Stakt – Foldable Fitness Mat
DEAL
EPISODE SUMMARY
🕓 Air Date: October 7, 2022
Asking For:
$100,000 for 10%
Investor:
Lori Greiner
Deal:
$100,000 for 15% + $0.75/unit royalty until $100,000 is paid
PRODUCT SUMMARY
Stakt is a foldable yoga mat that offers extra support and versatility for various exercises.
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Background Story
Millie and Taylor, best friends living in New York City, created Stakt out of a need for a more versatile and supportive fitness mat. They met in college, maintained a close friendship, and both had full-time jobs to fund their business. Millie had sales experience, primarily in start-ups, while Taylor worked in fintech product development.
The pandemic motivated them to prioritize their mental and physical well-being, leading them to realize the limitations of traditional yoga mats for their workouts. They saw an opportunity to create a foldable mat that not only provided extra support but also doubled as exercise equipment, enhancing their workouts. This insight drove them to develop Stakt.
The Product
Stakt is a yoga mat with a unique foldable design that caters to a variety of exercises. When fully unfolded, it functions like a standard yoga mat but offers superior thickness and support.
Users can fold it once or twice to provide extra cushioning for joints, or fold it entirely to transform it into a block for tricep dips, planks, pushups, lunges, and more. Stakt mats are made from EVA foam, a non-toxic and non-porous material.
They are competitively priced at $86, falling in the premium segment of the market, which includes mats ranging from $70 to $130.
Customers can purchase Stakt mats directly from the company’s website. The product comes with a carrying strap for convenient portability. Stakt’s value lies in its versatility, allowing users to adapt it to different exercises and effectively replace additional workout equipment.
How It Went
The company’s position before Shark Tank
In the six and a half months since its launch, Stakt has achieved notable success. The company has generated over $110,000 in sales, a remarkable feat considering they have not invested in marketing yet. Stakt primarily sells its products directly to consumers through its website, focusing on the premium segment of the yoga mat industry.
Stakt’s profitability is promising, with a cost of $21.50 per mat and a selling price of $86. This pricing strategy places them in the low to mid-range of the premium segment, offering competitive value to customers. The company’s margins are healthy, contributing to its profitability. Currently, Millie and Taylor have invested over $25,000 each from their savings into the business. Both founders continue to hold full-time jobs to support the company financially.
Millie’s background in sales and experience working at startups has provided valuable skills in business development, while Taylor’s experience in fintech adds a unique perspective to the business. The company’s business model is primarily direct-to-consumer, with a focus on community-building and content creation to attract customers. Stakt’s success without substantial marketing expenditure indicates the potential for growth with the right strategic partners and investment.
The Negotiations:
During the pitch, the founders asked for $100,000 in exchange for 10% equity in their company, Stakt. Lori Greiner, recognizing the potential of the product, made the first offer, proposing $100,000 for 15% equity and a 35-cent royalty per unit sold, with the royalty aspect designed to recoup her initial investment. The founders expressed concern about the royalty affecting their growth.
After a brief discussion, Millie and Taylor countered Lori’s offer, suggesting $100,000 for 20% equity. Lori responded by offering $100,000 for 25% equity, making it a $400,000 valuation. They ultimately agreed on a deal with Lori for $100,000 in exchange for 15% equity without the royalty component, sealing the deal at the lower equity percentage.
Though other sharks expressed interest in the product, including Daymond John and Kevin O’Leary, the founders decided to go with Lori Greiner’s offer due to her experience in the fitness industry and the belief that she could help Stakt grow.
