Pinblock – Building Blocks That Move
DEAL
EPISODE SUMMARY
🕓 Air Date: January 13, 2017
Asking For:
$100,000 for 20%
Investor:
Kevin O'Leary
Deal:
$100,000 for 50%
PRODUCT SUMMARY
Pinblock building blocks, created by Vlad from Brooklyn, are unique, identical building blocks that allow for bendable and foldable creations, fostering creativity and self-development in children during playtime.
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Background Story
Vlad, the creative force behind Pinblock, has a background marked by resilience and a passion for innovation. Originally from Kiev, Ukraine, Vlad’s journey took a challenging turn when he lost his father, leading to financial hardships for his family. Seeking new opportunities, they immigrated to Brooklyn, New York, where Vlad’s childhood curiosity and love for creativity became the driving force for Pinblock. Living in a one-bedroom apartment with his grandparents, mother, and a cat, Vlad transformed his living space into a hub of creativity.
Despite the absence of a dedicated office, he found inspiration in local cafes, where he crafted the vision for Pinblock. His entrepreneurial spirit blossomed from early experiences of disassembling items as a curious child, an inclination that sometimes left things unput back together. Vlad’s desire to merge learning with playtime, inspired by his own childhood experiences, led to the creation of Pinblock building blocks. These blocks, with their unique design featuring identical pieces and long, round pins, empower children to explore their creativity in a tangible and flexible way. The product was born out of Vlad’s belief that playtime is a crucial space for self-exploration and development, a conviction rooted in his childhood where creativity played a significant role.
Pinblock’s founder, at the young age of 21, embarked on this entrepreneurial journey with a mission to not only support his family but also to carry on his father’s legacy. His dedication to making Pinblock a success is driven by the memory of his father, who inspired him to venture into the world of venture capital and currencies. Vlad’s story is one of determination, creativity, and a commitment to bringing a unique and valuable product to children around the world.
The Product
Pinblock, the brainchild of Vlad, is a revolutionary building block set designed to ignite creativity in children through a unique and flexible construction experience. Each Pinblock set consists of identical blocks featuring long, round pins on top, allowing for bendable and foldable creations that go beyond traditional building block structures.
The product encourages children to engage in self-exploration and imaginative play, fostering crucial skills like creativity and decision-making. Pinblock goes beyond conventional building toys by offering a versatile platform for children to bring their ideas to life, whether constructing pixelated artwork, 3D shapes, or more.
Priced at an affordable $19.95 for the starter pack, Pinblock is accessible to a wide range of families. The set includes blocks with no need for a manual, promoting intuitive and open-ended play. For additional guidance, children can explore Vlad’s tutorials on Pinblock’s YouTube channel.
The product’s benefits extend beyond entertainment, emphasizing the importance of playtime in child development. Pinblock can be purchased directly through the company’s website and Amazon, providing a convenient and straightforward purchasing process for parents and gift buyers alike.
How It Went
The company’s position before Shark Tank
Pinblock has demonstrated a robust performance in the competitive toy market, showcasing a positive trajectory in sales and brand recognition. With $160,000 in sales achieved through both Amazon and the company’s website, Pinblock has secured a solid foothold in the industry. The company’s commitment to fostering creativity in children has resonated with customers, reflected in the growing demand for their unique building block sets.
In terms of partnerships, Pinblock has strategically collaborated with renowned tech retailers and formed alliances with other smart home brands. These partnerships have contributed to the product’s visibility and availability in major metropolitan areas. Pinblock’s emphasis on creativity and playtime has also attracted positive responses from smaller retailers. While Pinblock has successfully positioned itself in the online marketplace, including platforms like Amazon, the company faced challenges in securing deals with larger retailers such as Walmart and Costco. However, smaller retailers have shown interest and placed orders, indicating a positive trend in Pinblock’s market acceptance.
Pinblock’s funding has primarily come from angel investors, reflecting the confidence of external backers in the company’s vision and potential. The current financial health of the company is reflected in its profitability, with a notable 30% year-over-year revenue increase. The available capital has been effectively utilized for product development, marketing efforts, and operational expenses, contributing to the company’s overall growth. The company’s structure is currently centralized, with Vlad at the helm as the majority stakeholder owning 85% of Pinblock.
The Negotiations:
The negotiation phase for Pinblock on Shark Tank was a rollercoaster of challenges and strategic maneuvers. Vlad, the 21-year-old founder, entered the tank seeking a $100,000 investment in exchange for a 20% equity stake in his creative building block company. The Sharks, however, were initially hesitant, given the competitive nature of the toy industry. As Vlad presented his product and demonstrated its unique features, including the ability to create pixelated artwork and the bendable nature of the blocks, the Sharks began to see the potential.
Kevin O’Leary, known for his shrewd business acumen, made the first offer—$100,000 for 50% equity, with a contingency. This surprised both Vlad and the other Sharks, as it was a significant shift from the initial 20% equity Vlad was offering. The negotiation intensified as other Sharks dropped out, citing the challenges of the toy industry. Mark Cuban expressed concern about the difficulties of introducing a completely new product to consumers. Eventually, Vlad took Kevin O’Leary’s modified offer, making him a 50/50 partner. While this meant Vlad relinquished a larger share of the company than initially planned, the partnership with O’Leary brought the seasoned entrepreneur’s experience and industry connections to the table.
The negotiation highlighted the tough decisions entrepreneurs face when balancing control and partnership. Vlad ultimately chose to accept O’Leary’s offer, recognizing the value of having a Shark with vast industry knowledge as a partner. This negotiation marked a turning point for Pinblock, opening doors to potential collaborations and expansion opportunities in the competitive toy market.
