When 26-year-old PolarPro founder and CEO Jeff Overall walked into the pitch room in the latest episode of “Shark Tank” Season 7, he played up his heavy Southern California accent and surfer slang for the investors’ amusement.
But not long into his pitch, it became clear that he was one of the more successful and astute entrepreneurs they have had on the show.
And after a bidding fight among the Sharks, Overall walked away with a $US1 million deal with Mark Cuban and Robert Herjavec for a 20% stake in his high-end camera accessories company.
Overall founded PolarPro in 2011 as a student at the University of California, Santa Barbara. He was a member of the school’s ski team and was frustrated by the low quality of the GoPro videos of his ski runs. After doing some research, he bought a DSLR polarised lens, which cuts glare from the sun, and taped it over his GoPro.
Satisfied with the difference and figuring other GoPro users would be, too, he bought some polarised film and started selling Ziploc bags of amateur lenses for $US10 each, he told the Orange County Register this month. Eight months in, he decided to turn his hobby into a business and hired his best friend Austen Butler to help him.
Overall took out $US2,000 of his student loan money and got to work building his business. Though GoPro was once interested in making a deal with him, he told the Register, they ended up producing their own line of filters. Overall found that offering a cheaper but high-quality alternative maintained a customer base for PolarPro. He decided to start producing new camera accessories primarily for the extreme sports crowd to stay ahead of the competition. Today, PolarPro has more than 30 products.
After the first year of business, the company brought in $US8,000 in revenue, Overall said. In 2014, that number was $US2.8 million. For 2015, that number is projected to hit $US5.6 million.
Back in the Tank, for a segment that was filmed in June, the investors were very impressed with the numbers. Overall explained that across much of the explosive growth has come from owning the drone camera filter market.
The Sharks were impressed with Overall’s demo. Kevin O’Leary, however, was concerned that of the projected $US5.6 million in revenue for 2015, only $US300,000 is projected to be profit. Overall explained that it is only because so much money, over $US1 million annually at this point, is being put into research and development to keep PolarPro inventive and ahead of the pack. O’Leary understood but decided the sector wasn’t for him and pulled out of a deal.
After Overall explained that PolarPro is only in 1,200 independent retailers and that he expects to get up to $US40 million to $US50 million in revenue within the next few years after landing deals with major retailers like Best Buy and REI. He wanted $US500,000 for 10% equity in order to get to that next stage.
A bidding war ensued:
- Mark Cuban: Will give you the $US500,000 for the 10%.
- Daymond John: Will give $US500,000 for 15%, but will handle licensing and distribution deals. Interested in splitting deal with Cuban.
- Cuban: Wants to do deal alone.
- Lori Greiner: Will give $US500,000 for 10%, and will be a valuable strategic partner for getting mass distribution.
- Robert Herjavec: You need more money. Will give $US500,000 for 10%, if I split the deal with either Cuban or Greiner, for a total of $US1 million for 20%.
- John: Will give $US1 million of my own for $US17.5%.
- Cuban: Prefer to do deal alone, but will do Herjavec’s deal if necessary.
After Cuban’s concession, Overall decides to close the deal with Cuban and Herjavec, giving each 10% equity in exchange for $US500,000 from each of them.
As the two investors walked up to Overall, he told them, “This is how we shake hands at PolarPro!” giving them fist bumps with his pinky and thumb outstretched. “Hang loose!”
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