Why Mark Cuban made a 6-figure deal with this family 'manscaping' business on 'Shark Tank'
ABC's "Shark Tank" has seen its fair share of creative companies, ranging from ones that tackle breast sweat to men's padded underwear. On Sunday, a 'manscaping' kit business snagged a half-a-million-dollar deal from two Sharks.
Steve and Josh King, a father-and-son duo from San Diego, California, walked into the Tank seeking $500,000 for a 7 percent stake in Manscaped, which sells tools and products for below-the-waist grooming and hygiene for men. Manscaped sells electric trimmers, razors and skincare products, both individually and in kits. During their pitch, the Kings demo-ed the tools on a shrub.
The presentation drew laughs from the Sharks, with Mark Cuban even asking guest judge and NBA legend Charles Barkley, "All of America, and the world, wants to know: Charles, do you manscape?"
"Not a day in my life," Barkley responded.
Another Shark, however, admitted he is a fan of the process: "I do manscape," Robert Herjavec said. "I was on 'Dancing with the Stars' and I'd get a wax and I just kind of went crazy.
"I manscape everywhere, and I think a lot of people do."
The idea for Manscaped came during a conversation Josh King was having with his friends; they were swapping horror stories about manscaping gone wrong after using the wrong tools. (One such example? A friend who used a beard trimmer for a quick clean-up before a date cut himself so badly he had to cancel.)
Josh — whose background includes working at start-ups at digital agencies— brought his idea of targeted tools to his dad, and the pair teamed up to launch the company.
When Manscaped launched in January of 2017, the Kings originally had a hard time finding a way to effectively market the products to target customers and were on the brink of closing the business. Then they switched gears and started marketing with humor, including live videos of the horror stories that had originally sparked the idea for Manscaped.
The kings relaunched with this marketing plan in April 2017 and sold out 3,000 products in 13 days. By the end of 2017, the Kings said, they had done $1.5 million in sales, though they netted a loss.
"Year to date, we've done $2.1 million," said Steve. "We would have made about $60,000 to $80,000 per month," he added "but we put all that money back into inventory and paid media [advertising]. On our paid media, we spend anywhere between $120,000 to $150,000."
Still, the Sharks thought the King's roughly $7.1 million valuation of the business was high. "That's a lot of hair down there," joked Kevin O'Leary.
O'leary also didn't like the low margins ($7 per kit) and high customer acquisition cost ($16). He was out.
Barkley also said no.
With Herjavec's penchant for male grooming, he offered $500,000 for 35 percent of the business (a roughly $1.4 million valuation).
Lori Greiner was interested too, asking if women actually buy the kits as gifts for men.
"No, I think it's the other way," Cuban said. "Because it's a present for the woman."
But the Kings respond that they've noticed a spike in women buying the kits for men during the holiday season.
"This is perfect for QVC," Cuban said to Greiner, who is the host of her own popular show on the shopping network. "Lori, I'll put up the money just to see you sell it on QVC."
Greiner liked that idea. Cuban and Greiner offer $500,000 in exchange for 25 percent of the company (a $2 million valuation).
Herjavec acknowledged that Cuban and Greiner's offer was better and rescinded his.
The Kings countered Cuban and Greiner with a 20 percent stake, instead. But the Sharks didn't budge. With a little prodding, the Kings accepted.
"Most of us thought that when you stepped out here with this presentation, that the chance of you walking out of 'Shark Tank' with half a million dollars was zero," said O'Leary.
[Editor's note: After the episode, Manscaped's "Shark Tank" deal did not come to fruition, according to Cuban and Paul Tran, the company's CEO.]
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Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank." This story has been updated to include additional info from CEO Paul Tran.