Felt – Digital Handwritten Cards
DEAL
EPISODE SUMMARY
🕓 Air Date: May 20, 2016
Asking For:
$200,000 for 6%
Investor:
Kevin O'Leary
Deal:
$225,000 for 10%
PRODUCT SUMMARY
Felt allows users to send authentic, handwritten cards from their phone or tablet, simplifying the card-sending process.
WATCH HERE
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Background Story
Felt, founded by Tomer Alpert, originates from Telluride, Colorado. The idea sprouted from the founders’ realization that while receiving handwritten cards is a heartwarming experience, sending them is often cumbersome. Tomer, along with his wife Gracie and two other partners, launched Felt to revolutionize the greeting card industry. They envisioned a platform that enables users to send personalized, handwritten cards directly from their smartphones or tablets.
The team identified two major markets with significant challenges – brides who need to send numerous thank-you cards and professionals looking for a convenient way to express gratitude. Felt aims to simplify and enhance the card-sending experience, making it not only easier but also more meaningful. Since its inception in May 2013, Felt has garnered over 60,000 downloads and maintains a 4.5-star rating on both app stores.
The Product
Felt’s app, available since May 2013, allows users to send authentic handwritten cards directly from their mobile devices. The process is simple: users download the Felt app, choose a card for the occasion, and handwrite their message on the screen using a finger or stylus.
The app offers the unique feature of adding up to three photos to the card, along with short handwritten messages for each. Felt takes care of the rest by printing, sealing, stamping, and mailing the card on behalf of the user. The platform acts as a marketplace for designers to sell their cards, contributing to Felt’s strategic plan.
While Felt currently focuses on individual consumers with an $8 cost per card, the founders envision expanding their services to brides and professionals. The platform’s ability to save addresses provides a valuable tool for future use, such as sending invitations or holiday cards. Tomer Alpert highlighted the potential integration with wedding registries to tap into the lucrative wedding market.
How It Went
The company’s position before Shark Tank
Felt started with a scrappy approach, with the founders investing $100,000 of their own cash into the business. The company’s current position includes over 60,000 downloads and a 4.5-star rating, indicating positive customer reception. However, Tomer acknowledges the need for additional funding to scale the business. Felt’s primary focus is on brides and professionals, identified as key markets with substantial card-sending needs.
Tomer emphasized the strategic plan to integrate with wedding registries, presenting an opportunity for future growth. The company’s current revenue model involves selling cards at $4, with a net profit of $125 for each $210 spent by brides. The founders, Tomer and his wife Gracie, along with two other partners, have invested significant personal funds in the venture.
The Negotiations:
The negotiation process on Shark Tank started with Tomer Alpert seeking $200,000 for 6% equity in Felt. As the pitch progressed, Kevin O’Leary made a compelling offer of $225,000 for 10%, coupled with access to his existing customer base in the wedding space through his ownership of Honeyfund. Barbara Corcoran and Lori Greiner expressed interest but did not make offers. Mark Cuban was the first to bow out, citing the lack of proprietary technology as his reason.
Barbara Corcoran advised Tomer to consider Kevin’s offer, stating that Kevin’s deal was a good one. Lori Greiner, though not making an offer, echoed Barbara’s sentiment, emphasizing the potential benefits of Kevin’s proposal for reaching brides. Despite Barbara and Lori’s encouragement, Tomer chose to accept Kevin O’Leary’s offer of $225,000 for 10%, bringing a successful end to the negotiation. The deal was finalized, marking a significant milestone for Felt, and Tomer expressed his excitement and gratitude for the opportunity.
