BoomBoom Energy Nasal Inhalers
NO DEAL
EPISODE SUMMARY
🕓 Air Date: October 28, 2018
Asking For:
$300,000 for 10%
Investor:
No Deal
Deal:
No Deal
PRODUCT SUMMARY
BoomBoom is an all-natural nasal inhaler made of essential oils, menthol, and stimulating scents, providing intense refreshment and rejuvenation.
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Background Story
BoomBoom, a nasal inhaler company founded by John and Chelsea Pinto, emerged in the lively atmosphere of Southern California. John, a part-time dentist with a radiant smile that reflects his profession, joined forces with Chelsea, his better half, to introduce BoomBoom as a breath of fresh air for the nasal care market. The genesis of their product idea was rooted in the observation that, while eyes have eye drops, mouths have mouthwash, and lips have lip balm, there was a lack of everyday healthy and enjoyable products for the nose. This realization sparked the creation of BoomBoom, an all-natural nasal inhaler infused with essential oils, menthol, and stimulating scents.
The founders, both exuding passion and enthusiasm, positioned BoomBoom as more than just a remedy for congestion or allergies. Instead, it aimed to provide intense refreshment and rejuvenation, turning the act of breathing into a pleasurable experience. Their pitch highlighted the simplicity of usage—unscrew the cap, place the inhaler in each nostril, and inhale slowly for a minty-fresh, tingling sensation.
In their Shark Tank presentation, John and Chelsea revealed impressive sales figures, boasting $754,000 in the previous year and anticipating $1.1 million for the current year. This success underscored the market’s positive response to BoomBoom, positioning it as a promising player in the nasal care industry. The founders’ commitment to producing the inhalers in the U.S. further emphasized their dedication to quality, ensuring that customers experienced the best possible product for their nasal well-being.
The Product
BoomBoom, an innovative nasal inhaler, stands out as a unique and refreshing addition to the market. The product is designed for easy and enjoyable use, offering a convenient solution to nasal care. Made from a blend of essential oils, menthol, and stimulating scents, BoomBoom delivers an intense refreshment and rejuvenation experience.
To use BoomBoom, one simply unscrews the cap, places the inhaler in each nostril, and inhales slowly and deeply. This action triggers a cooling, tingling sensation that livens the senses, providing a feeling of vitality. The product distinguishes itself from traditional nasal inhalers, which are often associated with medicinal or earthy scents, by offering a fun and vibrant alternative.
BoomBoom caters to a variety of scenarios, making it a versatile product for different occasions. Whether in the car on the way to work, after a long flight, or simply to enhance breathing, BoomBoom promises a minty-fresh experience that invigorates users.
Customers can purchase BoomBoom directly through the company’s website or on Amazon. The inhalers are priced at $7.95 on the official website, with a wholesale price of $1.50. The founders emphasized their commitment to quality by manufacturing BoomBoom in Southern California, ensuring top-notch ingredients for a premium nasal care product. The pricing strategy, including a sweet spot of $3.99 for retail, aims to balance affordability with profitability, making BoomBoom an accessible and enjoyable nasal care option for consumers.
How It Went
The company’s position before Shark Tank
BoomBoom has demonstrated robust health and growth, positioning itself as a notable player in the nasal care industry. With $754,000 in sales the previous year and a projected $1.1 million for the current year, the company’s financial performance is impressive. The founders, John and Chelsea Pinto, emphasized their commitment to quality by manufacturing BoomBoom in Southern California, ensuring top-notch ingredients for their all-natural nasal inhaler. The company’s primary distribution channels include a 20% direct-to-consumer model through their website, 30% through Amazon, and a significant 45% through wholesale and other distributors.
BoomBoom’s wholesale partners contribute to its wide market reach, allowing the product to be available in various retail outlets. BoomBoom’s customer base is diverse, attracting individuals looking for a novel and enjoyable nasal care experience. The founders highlighted their product’s popularity, particularly with sales being driven by the refreshing and rejuvenating qualities of BoomBoom. In terms of funding, the founders mentioned their initial investment structure, with John and Chelsea each owning a little over 36% of the company. Additionally, three other investors who injected $200,000 into the business collectively own 25% of BoomBoom. The founders’ commitment to U.S. manufacturing and the quality of their product aligns with the company’s ethos. Profits and losses indicate a net profit of $120,000 the previous year, showcasing BoomBoom’s ability to generate positive returns.
The cost of producing an inhaler is 70 cents, with a retail price of $7.95, ensuring a healthy margin. The breakdown of sales channels includes a strategic mix of direct-to-consumer, Amazon, and wholesale, showcasing a well-rounded approach to market penetration. As for the company’s structure, BoomBoom operates as a partnership with John and Chelsea as the primary stakeholders. The founders presented a clear vision of their commitment to quality, U.S. manufacturing, and a diversified sales strategy, contributing to BoomBoom’s current strong market position and promising outlook.
The Negotiations:
The negotiations for BoomBoom in the Shark Tank were dynamic and revealing. The founders, John and Chelsea Pinto, sought a $300,000 investment in exchange for a 10% stake in their business. However, the Sharks were quick to express reservations about the valuation. While the product garnered positive reactions from the Sharks, concerns were raised about BoomBoom’s retail pricing strategy, particularly the decision to sell at a lower margin on their own website compared to the suggested retail price. Mark Cuban and other Sharks pointed out the challenges of sustaining such a model in the long term.
Ultimately, none of the Sharks were willing to meet the founders’ valuation. Mark Cuban and Kevin O’Leary bowed out early, citing concerns about the valuation and the sustainability of BoomBoom’s pricing strategy. Lori Greiner and Barbara Corcoran expressed interest but couldn’t reconcile the high valuation with the perceived risk. Robert Herjavec, however, saw potential in BoomBoom and offered $300,000 for a higher equity stake of 36%. He envisioned a flyer, acknowledging the risks but also the possibility of significant success.
The founders hesitated, expressing reluctance to give up such a substantial portion of their company. Attempts to negotiate the equity stake down to 20% were unsuccessful, leading to the rejection of Robert’s offer. Ultimately, BoomBoom left the Shark Tank without securing a deal but expressed gratitude for the experience. The negotiation revealed the balance the founders sought between valuation and the belief in the potential growth of their unique nasal inhaler product.
