Hand Out Gloves – Free Your Fingers
DEAL
EPISODE SUMMARY
🕓 Air Date: December 9, 2016
Asking For:
$150 for 20%
Investor:
Barbara Corcoran
Deal:
$300,000 for 25%
PRODUCT SUMMARY
Hand Out Gloves features a strategically placed, waterproof zipper, allowing users to gain full five-finger dexterity without removing the gloves, catering to various outdoor activities.
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Background Story
Don Wildman, residing in Malibu, California, and Jake Sullivan from Salt Lake City, Utah, co-founded Hand Out Gloves, a venture born out of practicality and a shared passion for outdoor activities. Don Wildman, with a remarkable 50-year history in the business world, boasts a track record of creating and managing successful enterprises, including one with annual sales exceeding $1 billion. His wealth of experience positions him as a seasoned entrepreneur with a keen eye for business opportunities.
The inspiration for Hand Out Gloves emerged from a common winter woe – the inconvenience of traditional gloves. The founders identified a recurring problem: having to take off gloves for various tasks, only to struggle with finding a place to put them and deal with the challenges of putting them back on, especially in snowy conditions. This led to the conception of Hand Out Gloves, a revolutionary solution that integrates a strategically placed waterproof zipper. Jake Sullivan, the co-founder and president, brought a unique perspective to the venture.
Previously involved with a glove manufacturer, Jake’s experience in the industry complemented Don’s entrepreneurial prowess. The duo met through Jake’s connection to Don’s skiing endeavors in Utah, establishing a partnership that combined business acumen with practical know-how. The concept of Hand Out Gloves was realized through Jake’s insight and the collaborative efforts of the team. The innovative design allows users to maintain full five-finger dexterity without removing the gloves, offering a versatile solution for various outdoor activities. The product not only addresses a common problem but also reflects the founders’ commitment to enhancing the outdoor experience for enthusiasts across different markets.
The Product
Hand Out Gloves is a groundbreaking solution to the age-old inconvenience of traditional gloves. Designed by Don Wildman and Jake Sullivan, these gloves feature a strategically placed waterproof zipper that runs along the back of the hand, allowing users to gain full five-finger dexterity without the need to remove the gloves entirely. This innovative design facilitates tasks such as checking a phone, opening a beverage, or regulating temperature without compromising hand warmth.
The product comes in various styles, catering to different needs and preferences. The lightweight version is perfect for those who seek maximum mobility, while the Pro model, priced at $120, offers enhanced durability and additional features. The gloves are available for purchase through multiple channels, including Amazon, the official Hand Out Gloves website, and select retailers like REI. Prices vary based on the style, with the lightweight version retailing for $40.
Hand Out Gloves stand out for their quality and versatility, making them suitable for a range of outdoor activities beyond skiing and snowboarding. Whether engaging in hunting, fishing, construction, or military activities, users can now perform tasks with ease and comfort, thanks to the gloves’ accessible design. Known for their durability, Hand Out Gloves represent a practical and stylish solution for outdoor enthusiasts seeking enhanced functionality in cold weather.
How It Went
The company’s position before Shark Tank
Hand Out Gloves has exhibited notable growth and strategic positioning within the market. The company, co-founded by Don Wildman and Jake Sullivan, initially recorded $15,000 in sales during its first year, primarily concentrated in the Salt Lake City region. However, the subsequent year witnessed a significant surge, reaching $125,000 in sales. This growth can be attributed to the pivotal partnership secured with the renowned Big box retailer, REI, along with collaborations with 12 core local ski shops.
The company’s expansion is not limited to physical retail spaces, as Hand Out Gloves also operates online through platforms like Amazon and their official website, catering to a broader customer base. The gloves’ availability on these platforms enhances accessibility for customers seeking innovative and functional winter accessories. While specific details about the company’s funding structure are not provided, it is evident that the initial capital sought during their appearance on Shark Tank was $150,000, divided into an equity investment and a loan.
The subsequent deal with Barbara Corcoran involved a $300,000 capital injection and an additional $300,000 as a credit line against receivables, resulting in a stronger financial foundation for the company. The company’s structure seems to be a collaboration between seasoned entrepreneur Don Wildman and glove industry expert Jake Sullivan, creating a dynamic team with a shared vision for revolutionizing the glove market. The successful negotiation with Barbara Corcoran on Shark Tank further adds a strategic and financial dimension to Hand Out Gloves, positioning them for continued success and expansion in the competitive winter accessory market.
The Negotiations:
The negotiation process for Hand Out Gloves on Shark Tank showcased a combination of enthusiasm, strategic thinking, and a quest for the right partnership. Seeking a $150,000 investment plus a $150,000 loan for 20% equity, Don Wildman and Jake Sullivan presented their innovative winter accessory to the sharks. Barbara Corcoran emerged as the sole shark interested in striking a deal. She proposed a substantial offer, offering $300,000 as capital injection into the company for a 25% equity stake. Additionally, she extended a credit line of another $300,000 against receivables with a 6% interest rate, also for 25% equity.
However, Barbara’s offer came with a condition – Don Wildman needed to contribute $300,000 in equity.While expressing genuine enthusiasm for the product and the founders, other sharks, including Robert Herjavec, Kevin O’Leary, Lori Greiner, and Mark Cuban, bowed out of the negotiation. Their concerns centered around the competitive nature of the market and the challenges associated with marketing and scaling the product.
Despite the initial condition, Don Wildman accepted Barbara Corcoran’s offer, securing a deal that not only provided the sought-after investment but also brought strategic guidance and financial support. The negotiation showcased the sharks’ recognition of the product’s potential, with Barbara’s offer solidifying her belief in the success of Hand Out Gloves. The founders expressed their gratitude and pride in securing a deal on the show, emphasizing the boost in confidence that the Shark Tank endorsement brings to their business.
