Shark Tank guest investor Troy Carter wasted no time in making a deal on Friday night.
The talent agency owner and venture capitalist immediately accepted an offer from Mark Cuban to co-invest $US250,000 for a 20% ownership stake in sock subscription service Foot Cardigan.
Foot Cardigan delivers a new pair of socks right to your door for $US9 per month. Customers can choose from 1, 3, 6, and 9-month prepaid subscriptions.
Foot Cardigan co-founders Bryan DeLuca and Matt McClard entered the Shark Tank hoping to raise $US250,000 for a 10% share.
The company earned $US1.36 million in the past three years and currently services 6,000 monthly customers with seasonal increases to approximately 12,000 subscribers.
Foot Cardigan earned $US900,000 in the last 12 months with an estimate of $US1.5 million for 2015.
Daymond John liked the quality of the socks and asked the co-founders if they would consider domestic production.
John also questioned if buyers can pick their own socks. The company doesn’t currently allow users to pick their own footwear because of distribution concerns. The co-founders countered by telling the sharks that people tell them all the time, “I cannot wait to open my mailbox and the socks are just there.”
John offered $US250,000 for 22.5% under the contingency that his Bombas partners would work with the company.
O’Leary joined in on the feeding frenzy with a $US250,000 offer for 15% and quarterly distributions paid out to himself and the company’s co-founders.
Carter initially offered $US250,000 for 15% before agreeing to join Cuban’s funding plan for 20% at $US250,000.
During an interview with Business Insider, Carter explained that his investing style is largely based around “feel.”
“I’m a simple guy. I know a lot of investors use a lot of analytics in their diligence process and for me it’s about feel. It’s how do I feel about the idea, how do I feel about the entrepreneur.” Carter said. “It’s the same thing that gave me an advantage to being an artist manager. Because it’s all feel. You’re not operating with a lot of data, so you get to feel out people.”
Carter says “asking about the people” makes all the difference.
“I wanna know your background, I want to know your dynamic, I want to know how long you guys have known each other. If you’re partners on the show, I want to know how long you guys have known each other. I want to know how you guys make decisions together. so that tells me a lot about how the business is going to be run,” he adds.
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