Shark Tank Australia shows ideas are everywhere - it's how you execute them that matters

Close to $4 million in deals will be struck on Australia’s Shark Tank but what stands out at this point in the series is how diverse the ideas are.

The show, which debuted on Channel Ten last week, included pitches for investment in everything from cricket eskies to edible bug flour.

It demonstrates ideas really are a dime a dozen and how you execute them is the important part.

The founder of Edible Bug Shop, Skye Blackburn, pitched the judges for $170,000 in return for 20% equity in her company which breeds edible insects.

The proposed deal at a valuation of $850,000 was something judges Steve Baxter and Andrew Banks couldn’t jump.

“I’m tempted but I’m not tempted at this valuation,” Banks said. “The valuation is the challenge. I’m out.”

But the company’s margins were strong. Blackburn said it costs about $6 to produce a kilo of insect flour which is sold for about $80 a kilo. Last year turnover was $150,000 and profit was $90,000.

Four out of the five sharks tried the bug flour choc-chip cookies, a take-up rate which impressed Baxter.

But real estate entrepreneur John McGrath wasn’t having any of it: “I’m just not a bug-eating guy so for that reason, I’m out.”

Red Balloon founder Naomi Simson was concerned about competitors in the market – not that there were a bunch of bug breeders swarming but that anything that was a protein powder could be seen as a competitor.

But Blackburn wasn’t just after the cash. With her scientific background, she was after someone to help her expand the business.

Boost Juice founder Janine Allis was the only judge to make an offer and was a good fit for the company with her business experience in the food space.

The only shark to jump, Allis made an offer of $170,000 for half the business.

“The critical thing is the business needs people that’s been in this space,” Allis said.

Blackburn countered with a 30% stake.

“I do like that Janine has the expertise in the food area…but I think 50% is too much to give away given the work we’ve put in,” Blackburn said.

Allis said to drive the business forward she needs to “be an equal partner”.

“I do think that it’s high risk for me because it might be too early,” she said.

And with that Blackburn said “OK”.

Next to face the judges was a drone manufacturer by the name of James Palmer. He requested $150,000 for a 10% stake in his company Lambdatron which is developing a commercial drone which would ideally be capable of inflight charging, travelling up to 100km/h for up to six hours while carrying up to 10kg.

But when he was questioned on these details, which if they were possible would be a game-changer, he couldn’t commit to the claims. This concerned Baxter: “I don’t believe it at this point in time,” he said.

Palmer said it would cost him $5,000 to build a unit which he believed he could sell for between $10,000 and $15,000 each. But he hasn’t sold any yet.

“$1.5 (million) is a significant valuation for a business that doesn’t exist yet. For that reason I’m out,” Allis said.

It’s an example of pitching an idea without getting the numbers or proof of concept tied down firmly first and McGrath wasn’t letting him get away with it.

Next to face the sharks was Jennifer Holland who was pitching her illuminated tongue depressant device to the judges in a $76,000 deal for 10% equity.

Holland, a financial accountant, said the Throatscope costs $3.39 to make and she believes it can be sold for $29.99 in pharmacies and $9.99 in hospitals. Future product developments include a rechargeable docking station.

The heavily regulated health industry sent Banks packing.

Simson and McGrath were out because they felt the product was still in a very early stage. “It’s slightly premature but unfortunately I’m out,” McGrath said.

Allis was concerned that the product was 10 times the price of a paddle pop stick which doctors currently use to inspect throats. “It’s just a big barrier step,” she said.

Baxter, a longtime tech investor, prefers to invest in people with strong technical backgrounds. He said he’d be willing to waive that in this case because the product wasn’t highly technical.

“Kids will think this is a lightsaber,” he said. “This is amazingly over engineered. You could throw half of this away.”

With the realisation kids would love the device, Baxter said he was willing to make an offer of $76,000 for a 30% stake as well as a 5% royalty of sales up to the investment amount.

A done deal.

The next pitcher turned a few heads. Strutting in with her “fur kids” in a double pram, Shae Teo declared her love for her dogs Poko and Gigi who eat breakfast at the table.

They were the inspiration for her edible dog food company Bento. “Dogs are the children of tomorrow,” she said.

For a 10% stake in Bento, a dog food company which sells 100kg of product a week, Teo wanted $200,000 from the Sharks.

“I can see the product being distributed all over the world,” she said, adding she sold her shoes to invest about $500,000 in the company.

She managed to get Simson to eat dog food.

But lost the judges with her confusing pitch. She said net profit was $1,000 a month or $12,000 a year. She said she had four girls helping her and wanted to use the money for “customer acquisition” before going into one of the most confusing explanations of what sounded like a subscription model.

“None of it makes sense to me so I’m out,” Baxter said.

In what was a good warning for hopeful founders, McGrath said: “It seems to me that you don’t know your business numbers as well as you should.”

The last two hopefuls to pitch their life’s work to the judges were the very nervous Bruno and Paul who have created a conveyor tray for utility vehicles.

They were looking for $400,000 for 51% – a controlling stake in their company – and something that comes with a lot of responsibility for an investor.

“We can’t do it on our own,” the guys said.

The loading and unloading device was still in its prototype phase and the guys think they can retrofit the system in utes for $5,900.

“It’s way to early in terms of the lifecycle of a business that I want to be involved in,” Simson said.

Banks agreed: “To me it’s just too early stage.”

Allis was concerned about the commitment factor. “It would need so much of my time and that is the only reason I’m out,” she said.

It was an example of a company which was probably too early to pitch. But in what could be a hopeful lifeline, McGrath said he’d set up a meeting with Toyota. So maybe it wasn’t too early to pitch after all.

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