Spooner Balance Boards
DEAL
EPISODE SUMMARY
🕓 Air Date: May 6, 2016
Asking For:
$400,000 for 16%
Investor:
Barbara Corcoran, Mark Cuban (50/50)
Deal:
$400,000 for 16%
PRODUCT SUMMARY
The Spooner is the ultimate board trainer for simulating surf, skate, and snowboard moves on any surface, designed for kids as young as three to develop balance and coordination.
WATCH HERE
IN A RUSH?
Click these to jump to the section you want to read.
Background Story
The founders of Spooner, Randy Putland, Bernie Miller, and Reuben Guymer, all from San Diego, came up with the idea when Randy, who owned a small surf shop, saw potential in a modified plastic dog igloo that resembled a skateboard deck. After creating prototypes and showcasing them at a kiosk, kids started playing with the boards, leading to high demand during the Christmas season. They sold 1,100 boards in six weeks, realizing the product’s appeal. The trio, who wear multiple hats in the business, demonstrated the boards at the New York Toy Fair, gaining traction and expanding to 15,000 elementary P.E. programs.
The Product
The Spooner is an innovative recreational board that allows users to simulate surf, skate, and snowboard moves on any surface. It’s designed for kids as young as three, promoting balance and coordination development.
The Yardboard, an all-terrain downhill slider, is also part of their product line. Priced at $45 for the small model and $55 for the large one, the boards have excellent margins, costing about $12 to $12.50 to produce. The company emphasizes its made-in-America status, with manufacturing taking place in San Diego.
How It Went
The company’s position before Shark Tank
Spooner achieved significant success, generating $1.73 million in the previous year and projected to hit $1.8 million. Their primary sales channel is specialty retail stores, constituting 65% of their business. They’ve penetrated 1,200 toy stores and have a strong presence in 15,000 elementary P.E. programs. The founders draw a $60,000 annual salary each, and the company is debt-free with no other shareholders.
The business originated in the physical education programs before expanding to major events like the New York Toy Fair. The founders manage all aspects, from manufacturing to distribution, maintaining a unique culture.
The Negotiations:
The founders initially sought $400,000 for 16%, valuing the company at $2.5 million. Mark Cuban and Barbara Corcoran collaborated, offering the requested amount but for a total of 16%, split equally between them. Kevin O’Leary expressed interest in partnering with Barbara but not at an 8% stake. Barbara, confident in the founders’ readiness for growth, presented her offer of $200,000 for 8%, with the condition that the other half should be secured from another Shark. Mark Cuban agreed to this offer, creating a complete deal that matched the founders’ initial ask.
Robert Herjavec proposed an alternative, suggesting a loan structure where he lends $400,000 in tranches, expecting a return of $2 per board sold. However, the founders opted for the joint offer from Mark Cuban and Barbara Corcoran, securing a deal for $400,000 at 16% total equity, split equally between the two Sharks. Lori Greiner attempted to make an offer, but the founders quickly accepted Mark and Barbara’s joint deal before considering Lori’s proposition. The negotiation showcased the founders’ hesitation to bring in an outside investor and their preference for a deal that aligned with their existing company culture.
