ActionGlow – LED Lighting System
DEAL
EPISODE SUMMARY
🕓 Air Date: November 18, 2022
Asking For:
$200,000 for 15%
Investor:
Robert Herjavec
Deal:
$200,000 for 30%
PRODUCT SUMMARY
Action Glow is an aftermarket LED lighting system for sporting equipment that enhances personal style and safety during night activities.
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Background Story
ActionGlow was founded by Dakota and Garret Porter, two brothers from Traverse City, Michigan. They grew up as avid action sports enthusiasts, particularly snowboarding. Their passion for night snowboarding led them to develop ActionGlow, an innovative aftermarket LED lighting system for various sporting equipment. Despite their young age, the Porter brothers had been in business for over a decade, having filed for their LLC in 2012.
Their dedication paid off when they received a full utility patent in 2016 for decorative lighting systems for sporting equipment. Their journey to the Shark Tank was a long-held dream, and they finally achieved it in Season 14 of the show. The brothers showcased their entrepreneurial spirit from a young age and were excited to share their innovative product with the Sharks.
The Product
ActionGlow is an aftermarket LED lighting system designed to enhance the appearance and safety of sporting equipment used during nighttime activities.
The product is highly versatile, with applications ranging from snowboards to surfboards, and can be applied to any brand of sporting equipment in just five minutes.
While the original product offered static colors, the founders mentioned that they were developing a second-generation product, ActionGlow2, which would provide multi-LED color options to further enhance personalization.
How It Went
The company’s position before Shark Tank
ActionGlow has been in business for over a decade, with lifetime sales of $130,000. The founders noted that almost half of this revenue was generated in the last two years when they were able to focus more on selling their product. In 2021, the company achieved $32,000 in sales, and in the current year, they had reached $22,000, with expectations of substantial sales during the holiday season.
The company’s current sales model is primarily based on word-of-mouth referrals, with minimal marketing and no social media advertising. They explained that their challenge was keeping up with orders as they had to assemble and package each product individually. While ActionGlow had filed for a patent for their innovative product, they emphasized the need for capital to expand their marketing efforts, increase production capacity, and potentially develop multi-LED color options to meet market demands.
The Negotiations:
In the Shark Tank, Dakota and Garret Porter presented ActionGlow, seeking $200,000 in exchange for 15% equity. The Sharks were impressed by the young entrepreneurs but had concerns about their current sales and marketing strategy. Kevin O’Leary was the first to voice his concerns, citing the need for more substantial sales figures and the potential challenges of dealing with knockoff products. He decided to pass on the opportunity.
Lori Greiner also expressed concerns about the company’s small size and limited marketing efforts. She wished the brothers good luck but declined to make an offer. Mark Cuban acknowledged the Porter brothers’ dedication but considered the investment too risky and not a good fit for him. He also decided to pass on the opportunity. Barbara Corcoran appreciated the product but felt that something was amiss given the relatively low sales figures despite the potential appeal of the product. She also passed on the opportunity.
Robert Herjavec, however, saw potential in the product and made an offer of $200,000 for 30% equity. The Porter brothers countered by proposing a 20% equity share, but Robert held firm at 30%. Eventually, the founders accepted his offer, securing a deal with their dream Shark. The negotiation process emphasized the need for more significant marketing efforts and scaling up production capacity. The Porter brothers left the Shark Tank with Robert Herjavec as their partner, ready to take ActionGlow to the next level.
