The mistake that cost this CEO a $1 million 'Shark Tank' deal with Kevin O'Leary

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First, Chet Beiler achieved something rare: He received a $1 million investment proposal from "Shark Tank" star Kevin O'Leary.

Then, the 58-year-old CEO did something rarer: He kept talking long enough for O'Leary to withdraw the offer.

On Friday's episode of ABC's "Shark Tank," Beiler pitched the show's panel of investors on his Lancaster, Pennsylvania-based DIY henhouse company, OverEZ Chicken Coops. The company had made $9 million in annual revenue at the time of filming, and $21 million in lifetime revenue since the company launched in 2016.

During his presentation, Beiler requested $1 million in exchange for 4% of his company's equity. Specifically, he said, he wanted to strike a deal with Robert Herjavec — noting that the money would be partially used to make new connections for international expansion into eastern Europe.

Herjavec, a Canadian businessman and investor, lived in Croatia until age 8.

But Beiler's presentation was disorganized and "wandering," according to O'Leary. Herjavec agreed, expressing concern about Beiler's fixation on Europe and inability to keep up with heightened Covid-era demand.

"The most valuable thing is my time," Herjavec said. "My fear of going into business with you is that it is going to take me longer than the lifespan of a chicken to find out the details of your business." 

Mark Cuban and Lori Greiner also declined to offer investment money, citing Beiler's European focus and inability to concisely pitch his company in a couple sentences.

"I think you're coming in talking overseas and Europe because you think that sounds good to us," Cuban said, noting that it would likely cost OverEZ millions of dollars to build factories in Europe. "I don't think you've really projected it out."

But two Sharks stayed with Beiler, drawn in by the OverEZ's revenue figures. Daymond John offered $1 million for 25% of the company's equity, while O'Leary offered $1 million for 4%, paid off over three years with 11.5% interest.

Instead of negotiating, Beiler circled back to Herjavec, saying he'd traveled to Prague to generate interest abroad for his henhouses, which currently start at $1,199. That's when John pulled his offer out of frustration, and O'Leary cut in with a piece of advice.

"I can actually speak chicken," O'Leary said, motioning to the live fowl that Beiler used in his presentation. "Those chickens are saying right now: 'Why don't you get focused on the two offers then talking to a guy who has been out for 15 minutes?'"

For a moment, Beiler took O'Leary's advice and negotiated. He said that in addition to the $1 million he requested, he'd eventually need more future finding to support the company's growth.

"If you actually come in with business that makes sense, and I can make more money with my 4%, I'm going to support you," O'Leary replied. "That's what I do with all of my entrepreneurs." 

Beiler accepted, but then turned to Herjavec, saying he "just wanted to talk a little more about eastern Europe" with "someone from Europe with a passion for getting jobs in Europe."

That was the last straw for O'Leary, who swiftly withdrew his offer. "I was the only Shark... who was going to fund your business," he told Beiler. "After everybody else dropped out."

Still, leaving the show, Beiler appeared to be in good spirits — telling the Sharks he hoped they'd each "enjoy backyard chickens someday."

"It looked like I had a Shark, but then he swam away," Beiler said. "I got distracted talking to Robert after [O'Leary] was going to step up, so that was a strategic error."

Update: This story has been updated to reflect Beiler's age and his company's founding year.

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