SwimZip
DEAL
EPISODE SUMMARY
🕓 Air Date: January 24, 2014
Asking For:
$60,000 for 5%
Investor:
Lori Greiner
Deal:
$60,000 for 20%
PRODUCT SUMMARY
SwimZip offers sun-protective swimwear for children featuring a signature full-length zipper down the front, making it easy to put on and take off while blocking 98% of UVA and UVB rays.
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Background Story
SwimZip, founded by siblings Betsy Johnson and Berry Wanless, emerged from a deeply personal experience and a shared commitment to sun safety. Their journey is rooted in Betsy’s battle with skin cancer at the young age of 26. This diagnosis served as the catalyst for their mission to develop innovative solutions for sun protection, particularly for children. Betsy’s firsthand experience with the consequences of sun exposure propelled her to create a product that would not only protect her own children but also provide peace of mind to parents everywhere.
Drawing from her background in design, she set out to develop swimwear that seamlessly combined style with functionality, ensuring children could stay safe from harmful UV rays without sacrificing fun or comfort during water activities. Berry, standing alongside Betsy as a supportive sibling and business partner, played an integral role in SwimZip’s journey. Together, they collaborated to bring Betsy’s vision to life, leveraging their collective skills and determination to launch the brand. The siblings’ personal connection to the cause infused SwimZip with a sense of purpose and authenticity.
Their unwavering dedication to sun safety, coupled with Betsy’s design expertise and Berry’s support, laid the foundation for a company driven by a genuine commitment to protecting children and empowering parents. Through their shared experiences and passion for sun safety, Betsy and Berry transformed SwimZip into more than just a business venture; it became a platform for promoting awareness and providing practical solutions for families facing similar concerns about sun exposure.
The Product
SwimZip offers a range of sun-protective swimwear designed specifically for children, featuring a signature full-length zipper down the front for easy wearability. This innovative design makes it effortless for both parents and children to put on and take off the swimwear, eliminating the hassle often associated with traditional sun protection methods.
The swimwear is crafted from materials that block 98% of UVA and UVB rays, providing superior sun protection while children enjoy outdoor water activities. Parents can rest assured knowing that their children’s delicate skin is shielded from harmful sun exposure, reducing the risk of sunburns and long-term skin damage.
SwimZip’s products come as sets, including both a top and bottom, ensuring comprehensive coverage for children while they play in the sun. The swimwear is not only functional but also stylish, featuring designs created by Betsy Johnson herself, adding a touch of flair to sun-safe dressing.
Customers can purchase SwimZip products conveniently online through their website, Amazon, and Target’s website. With a wholesale price point of $15 for both the top and bottom, SwimZip offers affordable sun protection without compromising on quality or style.
How It Went
The company’s position before Shark Tank
SwimZip has demonstrated strong growth and resilience in its market positioning, with sales reaching $225,000 in its third year of operation, marking an impressive 1,100% increase from the previous year’s sales of $18,000. The company has strategically expanded its distribution channels, selling its products through online platforms such as Amazon and its own website, as well as through partnerships with retailers like Target. SwimZip has also established a presence in high-end hotels, catering to customers seeking sun-protective swimwear in various settings.
The founders, Betsy Johnson and Berry Wanless, have maintained a lean operational structure, designing products in-house and working directly with manufacturers to ensure cost efficiency. Despite generating profits of $100,000, the founders have not taken a salary, reinvesting earnings back into the business to support its growth trajectory. In terms of funding, SwimZip initially sought $60,000 for a 5% stake in the company on Shark Tank. However, they ultimately secured a deal with Lori Greiner, receiving $60,000 for a 20% equity stake.
This injection of capital will provide SwimZip with the necessary resources to expand its product line, invest in marketing initiatives, and explore new growth opportunities. With Lori Greiner onboard as a strategic partner, SwimZip is poised to capitalize on its momentum and further solidify its position in the sun-protective swimwear market. The company’s commitment to innovation, coupled with its focus on sun safety and customer satisfaction, positions it well for continued success and expansion in the future.
The Negotiations:
During the negotiations on Shark Tank, SwimZip founders Betsy Johnson and Berry Wanless initially sought $60,000 for a 5% equity stake in their company. However, Lori Greiner, recognizing the potential of the business and the importance of sun safety, made an offer of $60,000 for a 20% stake. Betsy and Berry, while appreciative of Lori’s offer, countered with a request for $120,000 for the same equity stake, aiming to secure additional capital for their business expansion plans.
The negotiation took an unexpected turn when Betsy and Berry surprised the sharks with their counteroffer, leading to some hesitation and deliberation among the sharks. Despite initial resistance, Lori stood firm on her original offer, emphasizing her belief in the founders and their product. Eventually, Betsy and Berry decided to accept Lori’s offer, recognizing the value of her experience and strategic guidance in scaling their business.
The negotiation process highlighted the founders’ determination to secure the best possible deal for their company while also showcasing Lori’s expertise and insight as an investor. By securing a partnership with Lori Greiner, SwimZip gained not only the necessary funding but also a valuable ally in navigating the challenges of business growth and expansion. The negotiation concluded with a sense of optimism and excitement as SwimZip prepared to embark on the next phase of its journey with Lori’s support.
