Qubits Toy
DEAL
EPISODE SUMMARY
🕓 Air Date: February 5, 2010
Asking For:
$90,000 for 51%
Investor:
Daymond John
Deal:
$90,000 for 51%
PRODUCT SUMMARY
Qubits is a construction toy designed to inspire creativity in children, allowing them to build structures with flexible pieces that can create curved shapes.
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Background Story
Mark Burginger, the founder of Qubits, hails from Bend, Oregon, where he works as an architect. Growing up, Mark developed a passion for construction toys, which ultimately influenced his career choice. As an architect, he found inspiration in the creative process of building and designing structures. However, with the economic downturn affecting architectural jobs, Mark faced financial challenges, accumulating $60,000 in debt.
Driven by his love for architecture and a desire to inspire future generations, Mark embarked on a journey to create Qubits, a construction toy for children. Drawing from his background in architecture and his fond memories of playing with construction toys as a child, Mark envisioned Qubits as a way to combine education with fun, allowing kids to explore design, engineering, and creativity. The idea for Qubits stemmed from Mark’s belief in the power of hands-on learning and the importance of fostering imagination in young minds.
Unlike traditional construction toys, Qubits offer a unique twist with their flexible pieces that enable the creation of curved shapes, providing children with endless possibilities for building and experimentation. With a garage full of Qubits prototypes and a determination to turn his passion into a viable business, Mark saw Qubits as more than just a toy – it was his last hope to secure funding and support his family. Despite facing skepticism from investors and the challenges of competing in a crowded market dominated by giants like LEGO, Mark remained steadfast in his vision to bring Qubits to life and inspire the architects and engineers of tomorrow.
The Product
Qubits is a revolutionary construction toy designed to unleash the creativity and imagination of children. Each Qubits set contains small, flexible pieces that can be easily connected together to construct a wide array of structures. What sets Qubits apart is its ability to create curved shapes, allowing kids to explore new dimensions in their designs.
The toy is incredibly versatile, offering endless possibilities for building everything from simple structures to intricate creations. Qubits pieces are designed to interlock securely, ensuring stability while also allowing for easy disassembly and reconstruction.
One of the key benefits of Qubits is its educational value. By engaging in hands-on play with Qubits, children develop essential skills such as spatial reasoning, problem-solving, and fine motor skills. Additionally, Qubits fosters creativity and encourages open-ended exploration, empowering kids to think outside the box and bring their ideas to life.
Qubits can be purchased online through the company’s website or through select retailers. Pricing varies depending on the size and complexity of the set, with options available to suit different budgets. With Qubits, children can embark on a journey of discovery and innovation, building, experimenting, and creating to their heart’s content.
How It Went
The company’s position before Shark Tank
Qubits, despite facing challenges in a competitive market dominated by established players like LEGO, has shown resilience and determination in its pursuit of success. The company’s financial health reflects a mixed picture, with modest sales and limited distribution channels. Partnerships with retailers and wholesalers are essential for expanding Qubits’ reach, but the company has yet to secure significant partnerships with major players in the toy industry. Currently, Qubits relies on online sales through its website and select retail outlets to reach customers.
The company’s target demographic includes parents, educators, and anyone interested in fostering creativity and learning through play. However, reaching a wider audience remains a priority for Qubits, necessitating strategic marketing and distribution efforts. In terms of funding, Qubits initially relied on founder Mark Burginger’s personal investment of $60,000, much of which was borrowed. While this initial investment provided the company with a runway to launch its product, securing additional funding is crucial for scaling operations and driving growth.
Qubits’ profitability is modest, with sales of approximately $8,000 since its launch in November 2007. Moving forward, Qubits faces the challenge of navigating a highly competitive market while capitalizing on its unique value proposition. Securing partnerships with major toy companies and expanding distribution channels will be critical for driving sales and establishing Qubits as a prominent player in the construction toy industry. Additionally, continued innovation and investment in product development will be essential for maintaining a competitive edge and meeting the evolving needs of its customers.
The Negotiations:
In the negotiations, Mark Burginger faced initial skepticism from the Sharks due to the competitive nature of the toy industry and Qubits’ modest sales figures. Mark’s offer of a controlling interest in his company for $90,000 intrigued Daymond John, who saw potential in Qubits’ branding and unique product offering. Daymond proposed a deal of $90,000 for a 51% stake in Qubits, contingent on securing deals with the top four toy companies.
Mark accepted Daymond’s offer, recognizing the opportunity to leverage Daymond’s expertise and network to propel Qubits to the next level. While some Sharks expressed concerns about the challenges Qubits faced in competing with industry giants like LEGO, Daymond’s strategic approach resonated with Mark, who saw it as a lifeline for his struggling business. By partnering with Daymond, Mark gained access to valuable resources and connections within the toy industry, increasing Qubits’ chances of success.
Ultimately, Mark’s willingness to relinquish control of his company in exchange for the support and expertise of a seasoned investor proved to be a pivotal moment for Qubits. With Daymond on board, Qubits now has the opportunity to pursue partnerships with major toy companies and expand its distribution channels, positioning the company for growth and success in the competitive toy market.
