Modern Christmas Trees
DEAL
EPISODE SUMMARY
🕓 Air Date: December 3, 2017
Asking For:
$100,000 for 10%
Investor:
Barbara Corcoran
Deal:
$100,000 for 18% + $5/tree royalty until $100,000 is paid
PRODUCT SUMMARY
Modern Christmas Trees offers illuminated, artistic Christmas trees made of concentric, collapsible rings in various colors and styles, combining tradition with modern design.
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Background Story
Modern Christmas Trees, founded by Matt Bliss, traces its roots back to Matt’s grandfather, who designed the original tree out of cardboard with concentric rings. Matt’s motivation stems from a desire to create a legacy for his grandfather, who battled Alzheimer’s. The product is a fusion of family tradition and innovation, with Matt even having a tattoo of the tree’s patent drawing. The company, based in Denver, Colorado, has been a family tradition for over 50 years and aims to spread joy worldwide with unique holiday decor.
The Product
Modern Christmas Trees are both visually stunning and practical. Made of concentric, collapsible rings, the trees are easy to assemble, dismantle, and store flat in a zipper case.
They come in various colors, sizes, and styles, such as a full tree, a half tree for wall placement, and the Table Top Jubilee. The trees can either hang from the ceiling or rest against the wall, providing flexibility in decoration.
The design is inspired by Matt’s grandfather’s original cardboard tree and is a blend of art and convenience. Despite the higher price point ($799 for a fully decorated large tree), the product includes 96 crystal ornaments, glass-ball ornaments, LED lights, and a zipper case.
How It Went
The company’s position before Shark Tank
Modern Christmas Trees has demonstrated steady growth, projecting $380,800 in sales for the year. The company has experienced a 70% annual growth rate since Matt quit his job in 2014 to pursue the venture full-time. Sales primarily come from the website (80%) and retail (20%), with partnerships established with companies like Frontgate, Brookstone, and Hammacher Schlemmer.
The product’s premium pricing strategy yields substantial margins, with the fully decorated large tree costing $232 to produce and retailing for $799. The company’s niche position in the market allows for higher pricing, targeting a luxury market segment.
The Negotiations:
The negotiation phase witnessed a unique offer from Barbara Corcoran. Initially seeking $100,000 for 10%, Matt ultimately secured a deal with Barbara at $100,000 for 18%, after a series of adjustments in equity percentages. Barbara’s offer included a $5 royalty per tree until the initial investment was repaid. Kevin O’Leary, having initially made an offer, later drops out, citing the lack of love and Christmas spirit.
Despite other Sharks dropping out due to concerns about scalability and market reach, Barbara’s belief in the product’s uniqueness and Matt’s heartfelt pitch led to a successful deal. The negotiation also involved a playful banter between the Sharks, with Kevin O’Leary attempting to influence Matt’s decision. In the end, Matt agreed to Barbara’s offer, expressing gratitude for her belief in him and his product, making it a heartwarming success for Modern Christmas Trees.
