Knife Aid – Knife Sharpening Service
DEAL
EPISODE SUMMARY
🕓 Air Date: October 20, 2019
Asking For:
$400,000 for 15%
Investor:
Lori Greiner, Rohan Oza (50/50)
Deal:
$500,000 for 20%
PRODUCT SUMMARY
Knife Aid offers a mail-in knife-sharpening service, simplifying the ancient craft of knife-sharpening through an online platform.
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Background Story
Marc and Mikael, originally from Sweden, moved to the U.S. to start Knife Aid. Marc’s entrepreneurial background includes founding Happy Socks, and they decided to venture into the knife-sharpening business after observing a similar concept in their home country focused on commercial use. They identified the gap in the consumer market and aimed to simplify the process.
Their move to the U.S. was driven by a desire to avoid previous mistakes in launching a brand without American involvement and funds. They saw the potential to bring an ancient craft, knife-sharpening, into the digital age, making it accessible and convenient for everyday Americans.
The Product
Knife Aid’s process is simple. Customers order online, receive a secure postage-paid envelope, place their dull knives in the envelope, and mail it back. Expert knifesmiths then sharpen the knives, recreating a razor-sharp edge, and return them within about a week.
The service covers various types of knives, from kitchen knives to hunting knives, and even includes sharpening scissors. The pricing is straightforward, charging an average of $10 per knife, regardless of size. This simplicity contrasts with traditional knife shops that charge differently based on the knife’s size and type.
How It Went
The company’s position before Shark Tank
Knife Aid had experimental sales of $120,000 in the current year, with $37,000 in the last month alone. The founders experimented with different iterations of their website and utilized digital platforms like Facebook, Instagram, and Google for advertising. The pitch revealed that Marc and Mikael sought investment not just for capital but also for strategic guidance in messaging, packaging, and channel strategy.
The founders previously faced challenges in the U.S. market and acknowledged the importance of having American partners for growth. They presented two options: venture capital or partnering with the Sharks to leverage their expertise in the American market.
The Negotiations:
The Sharks were intrigued by the product, with Kevin expressing his interest as “Chef Wonderful.” Lori and Rohan offered $400,000 for 20%, emphasizing their expertise in scaling and understanding the U.S. market. Kevin and Barbara matched the offer but with an additional $100,000 for 20%. Lori and Barbara emphasized the value they bring beyond just capital, with Lori presenting herself as the “queen of retail,” proposing partnerships with retailers.
Kevin and Barbara eventually increased their offer to $500,000 for 20%, making it a competitive bid. Marc and Mikael expressed a preference for Lori and Rohan but wanted them to match the $500,000 offer. In the end, Lori and Rohan stuck to their initial offer, while Kevin and Barbara’s increased offer led to a swift decision, closing the deal at $500,000 for 20%.
