Plunge Cold Water Immersion
DEAL
EPISODE SUMMARY
🕓 Air Date: May 2, 2022
Asking For:
$1,200,000 for 5%
Investor:
Robert Herjavec
Deal:
1 for 12%
PRODUCT SUMMARY
Plunge offers a revolutionary cold plunge system that provides various health benefits including reducing inflammation, increasing fat loss, strengthening the immune system, improving sleep, and reducing muscle soreness in just one minute.
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Background Story
Michael Garrett and Ryan Duey, the founders of Plunge, are based in Sacramento, California. Their entrepreneurial journey began with a shared passion for wellness and the potential health benefits of cold exposure. Prior to starting Plunge, Garrett and Duey had backgrounds that complemented their venture. Garrett had experience in product design and development, while Duey brought expertise in sales and marketing.
The idea for Plunge emerged as they observed the growing interest in cold exposure for its numerous health benefits, including reduced inflammation, increased fat loss, improved sleep, and enhanced immune function. Recognizing the inconvenience of using large quantities of ice for cold plunges, they aimed to create an accessible and hassle-free solution. Their vision was to design a sleek and efficient cold plunge system that would provide users with the benefits of cold exposure without the need for excessive preparation or maintenance.
Working from Garrett’s garage, they dedicated themselves to developing a product that would make the practice of cold plunging more accessible and convenient for a broader audience. Through extensive research and development, they created the innovative Plunge system, which combines powerful cooling and filtration mechanisms, allowing users to regulate the water temperature to their preference. With their combined expertise and dedication to wellness, they successfully transformed their concept into a thriving business, achieving significant sales milestones and capturing the attention of investors on the “Shark Tank” platform.
The Product
Plunge offers a revolutionary cold plunge system that provides a range of health benefits through its innovative design and functionality. The system is designed to allow users to experience the benefits of cold exposure conveniently and comfortably within their own homes or wellness spaces.
Utilizing powerful cooling and filtration mechanisms, the Plunge system enables users to adjust the water temperature according to their preference, with a range from 60 to 39 degrees Fahrenheit. This temperature flexibility caters to varying individual comfort levels and specific wellness goals. The system’s sleek and modern design not only enhances the overall aesthetics of the space but also ensures easy installation and maintenance.
The benefits of using the Plunge system include a reduction in inflammation, increased fat loss, strengthened immune function, improved sleep quality, and decreased muscle soreness. Its user-friendly interface allows for straightforward control and customization of the cold plunge experience.
Plunge systems can be purchased directly from their website, where customers can explore product details and make informed purchasing decisions. Priced at $4,800, the system offers an affordable option for individuals seeking to integrate the health benefits of cold exposure into their wellness routines without the inconvenience of traditional cold plunge methods.
How It Went
The company’s position before Shark Tank
Plunge has exhibited remarkable performance within a relatively short period, reflecting a strong market demand for their innovative cold plunge system. Their rapid growth trajectory is evident from the impressive sales figures they have achieved since their inception. With $4.9 million in sales within the first year, and an anticipated monthly sales figure of $1.1 million, Plunge has demonstrated a robust and sustainable market presence.
The company’s position within the wellness industry is further strengthened by its strategic partnerships with suppliers and distributors, enabling them to efficiently meet the demands of their growing customer base. Plunge has forged relationships with reputable manufacturers to ensure the quality and efficiency of their product. Additionally, their commitment to customer satisfaction is reflected in their streamlined distribution channels, ensuring timely and reliable delivery of their cold plunge systems to customers. Plunge’s target customer base includes individuals seeking to enhance their wellness routines and facilities, such as athletes, fitness enthusiasts, wellness centers, and residential clients interested in incorporating cold exposure into their daily wellness practices.
Regarding funding, the company initially relied on bootstrap financing, with the founders utilizing personal resources and early revenue to fuel the company’s growth. Plunge’s financial performance indicates a healthy balance between revenue generation and operational costs, resulting in a sustainable and profitable business model. With a clear focus on product quality, customer satisfaction, and market expansion, Plunge has solidified its position as a leading provider of innovative cold plunge solutions, poised for continued growth and success within the wellness industry.
The Negotiations:
During the negotiation phase on “Shark Tank,” the founders of Plunge, Michael Garrett and Ryan Duey, faced a flurry of offers from the Sharks, each vying for a stake in the promising business. The Sharks were captivated by the company’s impressive sales figures and the potential for significant market growth. The negotiation process kicked off with Robert showing interest in the product and offering $1.2 million for an 18% equity stake, emphasizing the need for a substantial return on his investment. Mark joined the discussion, offering the same amount for 20% but structured as a half-loan and half-equity deal, recognizing the company’s potential for accelerated growth with additional funding.
Barbara expressed her concerns about the high valuation and potential market competition, leading her to opt-out of the negotiations. Meanwhile, Kevin proposed a $2.4 million investment, with $1.2 million as a loan and the other half as equity, highlighting the importance of cash flow management for the company’s growth. Ultimately, a negotiation ensued between Robert and the founders, with Robert securing a deal of $1.2 million for a 12% stake in Plunge.
The negotiation also included a drop in equity stake from the founders’ initial ask, indicating a willingness to compromise to secure the necessary funding for the company’s expansion plans. The negotiation process highlighted the Sharks’ recognition of the company’s potential and the founders’ commitment to securing a deal that would not only provide the necessary capital but also support the company’s future growth and success.
