Eterneva – Memorial Diamonds
DEAL
EPISODE SUMMARY
🕓 Air Date: October 13, 2019
Asking For:
$600,000 for 5%
Investor:
Mark Cuban
Deal:
$600,000 for 9%
PRODUCT SUMMARY
Eterneva grows real diamonds from the carbon in someone's ashes, offering a soulful way to remember and celebrate remarkable individuals.
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Background Story
Adelle and Garrett, founders of Eterneva, based in Austin, Texas, were initially starting a lab-grown diamond company. However, a personal tragedy struck when Adelle lost her close friend to pancreatic cancer. This friend, Tracey Kaufman, had mentored Adelle and had expressed the wish for her ashes to be used in a meaningful and celebratory way.
Unhappy with the transactional and cold experience offered by existing services, Adelle and Garrett pivoted to create a more compassionate and customer-focused company. They founded Eterneva to eternalize remarkable people by transforming ashes into diamonds. The founders emphasize the importance of a positive customer experience and have successfully positioned themselves as a leading company in the industry.
The Product
Eterneva’s process involves extracting carbon from a small amount of ashes or hair provided by the customer. This carbon is then subjected to high pressure and high temperature to grow a raw diamond.
The customer receives a welcome kit to start the process, which includes selecting the diamond. The ashes or hair, about half a cup, are then placed in the kit and sent back to Eterneva. The company employs a high-heat process to purify the carbon before using specialized machines for diamond growth.
The machines, described as large refrigerators, come with a capital cost ranging from $50,000 to $180,000. The entire journey, from sending the ashes or hair to receiving the diamond, takes approximately 10 months.
How It Went
The company’s position before Shark Tank
In their first year, Eterneva achieved sales of $913,000, and they projected to reach $2.7 million in the current year. The founders raised $1.2 million in funding at a $10 million valuation. Their investors are experienced entrepreneurs with $200 million-plus exits. Eterneva is positioned as a celebration company, and their focus on customer experience has enabled them to outperform competitors, doing 3.5 times the volume in a year and a half. The founders acknowledge the potential in the pet market and highlight their strategic investors.
The Negotiations:
Adelle and Garrett entered the tank seeking $600,000 for 5%, valuing the company at $12 million. Mark Cuban, intrigued by the concept, offered $600,000 for 15%, valuing the company at $4 million. The negotiation involved discussions about valuation and competitiveness. Other sharks expressed concerns about the company’s need for an investment given their existing strong position.
Lori Greiner and Kevin O’Leary opted out, and Daymond John expressed skepticism about the need for a deal. Eventually, a deal was struck with Mark Cuban at $600,000 for 9%, bringing the valuation to $6.67 million. Adelle and Garrett agreed, excited about having Mark on board to help Eterneva become a well-known option for everyone.
