Tower Paddle Boards
DEAL
EPISODE SUMMARY
🕓 Air Date: March 16, 2012
Asking For:
$150,000 for 10%
Investor:
Mark Cuban
Deal:
$150,000 for 30%
PRODUCT SUMMARY
Tower Paddle Boards offers stand-up paddle boards and accessories, catering to the fast-growing water sport trend, with an emphasis on direct-to-consumer sales through their website.
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Background Story
Stephan Aarstol, founder of Tower Paddle Boards, transitioned from a corporate job to pursue his passion for stand-up paddling. Recognizing the potential of the sport, he founded Tower Paddle Boards in San Diego, California. His background in internet marketing equipped him to build an online presence for the brand.
The Product
Tower Paddle Boards offers stand-up paddle boards designed for ease of use and affordability, with prices significantly lower than competitors. The boards, along with paddles and accessories, are sold directly to consumers through the company’s website. Stand-up paddle boarding is highlighted for its accessibility and health benefits, appealing to a wide range of customers seeking outdoor recreation.
How It Went
The company’s position before Shark Tank
Tower Paddle Boards has achieved $100,000 in sales within four months of operation, with a notable growth trajectory. The company’s direct-to-consumer model bypasses traditional retail channels, reducing costs and offering competitive pricing. Stephan’s expertise in internet marketing has facilitated customer acquisition, although precise customer acquisition costs are still being determined. The company is structured for scalability, with the potential for significant growth in the booming paddle board market.
The Negotiations:
Stephan initially sought $150,000 for 10% of the company, valuing it at $1.5 million. While facing skepticism from some sharks, Mark Cuban ultimately offered $150,000 for 30% of the company, with a contingency for first refusal on future ventures. After some negotiation, Stephan accepted Cuban’s offer, recognizing the value of partnering with a seasoned entrepreneur like Mark and the potential for future growth.
