Jack’s Marketplace & Stands
DEAL
EPISODE SUMMARY
🕓 Air Date: November 11, 2016
Asking For:
$50,000 for 10%
Investor:
Chris Sacca
Deal:
$50,000 for 2%
PRODUCT SUMMARY
Jack's Stands & Marketplaces provides kids and their families opportunities to learn about entrepreneurship, business, and financial literacy through lemonade stands and marketplaces, aiming to inspire youth while making money.
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Background Story
Jack’s Stands & Marketplaces, founded by 10-year-old entrepreneur Jack Bonneau from Denver, Colorado, is a remarkable venture born out of a child’s desire for a LEGO set. At the age of 8, Jack aspired to own a LEGO Death Star, priced at $400. His supportive father, Steve Bonneau, allowed Jack to have it but on the condition that he earned the money himself. In response, Jack initiated his entrepreneurial journey by starting a lemonade stand. Over the course of 12 weeks, he not only earned the $400 needed for his LEGO set but also accumulated $900 in profits. This experience became the catalyst for the creation of Jack’s Stands & Marketplaces.
Recognizing the value of the lessons learned from his lemonade stand, Jack envisioned a platform that would provide kids and their families with opportunities to delve into the world of entrepreneurship, business, and financial literacy, all while having fun and making money. The venture is a unique blend of experiential learning and hands-on business operation for young minds. Based in Denver, Colorado, Jack’s Stands & Marketplaces operates in seven locations, including two stands in a mall and five others in farmers markets.
Jack and his team teach kids about customer service, sales, and entrepreneurship, offering them a chance to run their own stands and marketplaces. The company’s roots lie in a combination of a child’s entrepreneurial spirit, parental support, and a genuine desire to provide valuable learning experiences to young individuals. Jack’s Stands & Marketplaces stands out not only for its financial success but also for its commitment to inspiring the next generation of entrepreneurs.
The Product
Jack’s Stands & Marketplaces offers a unique and engaging platform for children to learn about entrepreneurship and business through practical experiences. The primary components of the product include lemonade stands and marketplaces, providing kids with a hands-on opportunity to develop essential skills while having fun.
The lemonade stands are not only a source of revenue but also serve as practical learning environments. Jack’s Stands equips young entrepreneurs with the tools to operate stands, teaching them valuable lessons in customer service, sales, and financial management. The stands operate in various locations, including malls and farmers markets, offering a diverse range of settings for learning and selling.
In addition to the lemonade stands, Jack’s Marketplaces take the concept to the next level by providing young entrepreneurs with the chance to sell various products in authentic market settings. This expands the scope of the learning experience, allowing kids to showcase their creativity and business acumen while telling inspirational stories about their products.
The benefits of Jack’s Stands & Marketplaces go beyond financial gains. Children gain practical insights into business operations, build confidence, and develop crucial life skills. The model encourages creativity, resourcefulness, and a sense of responsibility. As for purchasing, the products (lemonades and other goods) are sold directly to customers at the various locations where the stands and marketplaces are set up. The pricing structure and commission rates ensure a fair distribution of earnings among the young entrepreneurs, fostering a sense of achievement and financial literacy.
How It Went
The company’s position before Shark Tank
Jack’s Stands & Marketplaces has demonstrated a promising performance, positioning itself as a unique player in the educational entrepreneurship market. As of now, the company operates seven locations, including two stands in a mall and five in farmers markets, all based in Denver, Colorado. The company’s focus on providing practical learning experiences for children in the realms of business and financial literacy has contributed to its success. The financial health of Jack’s Stands & Marketplaces is evident in its revenue streams.
The two stands in the mall generate revenue through a rent model, with 15% of sales going towards rent. Over a span of nine months, these stands have collectively generated approximately $15,000. The company is strategically expanding, with plans to increase the number of locations to 12, projecting a significant jump in sales to $1 million next year. Jack’s Stands & Marketplaces has partnered with families who champion specific locations, allowing for the operation of stands and marketplaces beyond Denver. This unique partnership model ensures local support and involvement, emphasizing the community aspect of the venture.
Customers are primarily the general public visiting the mall and farmers markets, drawn to the entrepreneurial spirit and stories shared by young participants.Funding for the company has come from various sources. Initially, Jack received a $1,000 loan from his parents for the first stands and supplies. Subsequently, Jack secured a $5,000 loan from Young Americans Bank, a Denver-based institution solely dedicated to working with kids. The company is currently 60% paid off on this loan, with a monthly payment of approximately $250.
Profits and losses are closely monitored through mini profit-and-loss statements at the end of each day. Jack ensures the financial well-being of the young entrepreneurs by tracking revenue, expenses, profit, and tips. The company’s commitment to financial literacy extends to teaching children these essential aspects of business. As for the company’s structure, Jack’s Stands & Marketplaces operates as a family-centric venture, with Jack Bonneau as the visionary founder and CEO, supported by his father, Steve Bonneau. The father-son duo is deeply involved in the day-to-day operations, emphasizing a hands-on approach to learning and business management.
The Negotiations:
The negotiations for Jack’s Stands & Marketplaces unfolded with a captivating pitch by 10-year-old founder Jack Bonneau. After sharing his inspiring journey, Jack sought a $50,000 investment in exchange for a 10% stake in his company. The Sharks were immediately impressed with Jack’s entrepreneurial spirit and the positive impact of his venture on young minds. Chris Sacca, moved by Jack’s story, offered a unique proposition: a $50,000 loan at 2% interest. This offer came with specific conditions — Jack could draw down $10,000 at a time, and each drawdown would be contingent on the business’s performance.
Sacca also suggested that Jack start a video podcast, leveraging his story to share valuable lessons with other aspiring entrepreneurs. While Mark Cuban and Lori Greiner expressed concerns about Jack managing the business alongside his school commitments, they admired his dedication. Barbara Corcoran suggested focusing on the simpler and more manageable lemonade stand model. In a humorous moment, Kevin O’Leary pointed out that Jack would be the most in-debt 9-year-old if he took Sacca’s deal.
Ultimately, Jack enthusiastically accepted Chris Sacca’s offer, securing a $50,000 loan with conditions that align with responsible and gradual business growth. The negotiation concluded with a sense of accomplishment, applause, and congratulations for Jack, highlighting the Sharks’ recognition of the exceptional potential in this young entrepreneur’s journey. Jack’s willingness to take on the unique offer demonstrated his determination to pay off the debt and continue growing his business. The negotiation showcased the Sharks’ appreciation for the educational and inspirational aspects of Jack’s Stands & Marketplaces.
