Entrepreneurs who appear in front of the investors on hit reality television show "Shark Tank" have to be prepared. They are expected to have an entertaining story, a solid business model and some amount of traction to show the Sharks that there is real demand for their product.
That's why it's especially surprising that Tyler Peoples from Colorado Springs, Colorado, landed a deal on the "Shark Tank" episode that aired Friday. When he pitched the sharks, he had only sold 200 of his scooping bowl.
That's not many, and many of the sharks were skeptical of the limited sales.
Peoples himself was aware his sales traction was minimal. "I know that is not a great number," he said. The scooping bowl has a built-in semi-circular, moving spatula that scrapes the bottom of the bowl like a windshield wiper.
Also, a small hole makes it possible to drain items in the bowl without moving them to a separate strainer. Most of his sales came at trade shows and gadget expos, where buyers could see the bowl in action.
The bowl sells for $24.95 and costs $5.80 to make. Peoples has a U.S. utility patent for the invention, he said.
Peoples is a chef who worked his way up the culinary ladder to be the head chef running a high-end kitchen at a fancy restaurant. He quit to run a kitchen at a homeless shelter that serves meals free of charge. He runs a catering business that employs men who have graduated from an addiction recovery programs to fund the homeless shelter. He spends a lot of time in kitchens.
"I am thinking, there has got to be a better way. And I waited for somebody else to make this dream real and I was tired of waiting. I knew that if it was going to happen, I was going to make it happen," he says. That's why he launched Peoples Designs, the company that manufactures the bowl.
Investor Lori Greiner, known as the "Queen of QVC" makes Peoples an offer to invest $75,000 for 33.3 percent of the company.
"I am going to take a flier on you. I like you. I think this is smart. It's a better mouse trap. Folks will respond to it. It's a great gadget to have in the kitchen," she said. "I will help you get this out there into Bed Bath, QVC and all of that. I think I can help you get this everywhere. But you need to say yes, now."
Peoples pushes back. He tried to lure Greiner to accept royalty fees, presumably for a lower equity stake, but she wouldn't budge.
"Here's what scares me. As you know, I have done over 500 products. I know when I first started, I would go into JCPenny, they gave me a chance, and I would demonstrate my earring organizer and I would sell a hundred a day," she said. "You have sold only 200 in all the trade shows you have done so far so I am taking a risk."
Greiner says she wants the higher stake in the company because it's going to take a lot of hustle to get the bowl to sell.
"The reason why I want the third is because I know the work and the effort that I put in. I am going to get it on QVC. I have a built in audience that trusts me and knows me. But this is going to take a lot of work by my team and myself to get this out there into kitchen stores, Bed, Bath and Beyond, all the places that it can be," she said.
"I am just asking for 8 percent more than what you offered but here's the thing. You should answer me right now. I know my value," Greiner stressed. "Just as a reminder, I make millionaires. That's what I do. My offer was $75,000 for 33.33 percent."
Peoples ultimately took the deal.
"Striking a deal with Lori means I can make an impact. If you follow your dreams, it is possible to achieve them," he says.
See also:
Why billionaire Mark Cuban invested in an Afghan saffron start-up run by veterans on 'Shark Tank'
Why 'Shark Tank' investors Daymond John and Kevin O'Leary got in a bidding war over wine for cats
Mark Cuban, Daymond John and other 'Shark Tank' investors share 10 things you have to do to be successful
False 'Flag': Here's why billionaire Chris Sacca eviscerated a pitch on 'Shark Tank'
Disclaimer: CNBC owns the exclusive off-network cable rights to "Shark Tank."
