Kevin O’Leary’s ‘royal’ gamble fails again, but let’s face it, there’s only one reason he’s on ‘Shark Tank’
LOS ANGELES, CALIFORNIA: On the Season 16 premiere of ABC’s “Shark Tank,” Matthew Hall and Victor Adamo unveiled TruFit Customs, a revolutionary custom-made mouthguard. The company’s thinner, better-fitting mouthguards enable improved performance without the communication drawbacks associated with industry commodity products, solving a problem plaguing professional sports.
The creators have won over many with their substantial development opportunities, seemingly identifying a lucrative niche in the sports industry. However, Mr. Wonderful lost the deal to a Guest Shark, who debuted on the October 18 episode, as Shark Kevin O’Leary hoped to take a bigger piece of the stake.
TruFit Customs asked for $750,000 for 5% of the company on ‘Shark Tank’ Season 16 (ABC/ChristopherWillard)
On Friday’s episode, Matthew entered the Tank with a 5% ask for $750,000 in TruFit Customs, which aims to use cutting-edge 3D technology to transform custom sports equipment, starting with guards. teeth and other dental items.
TruFit’s innovative use of 3D scanning technology, which simplifies the traditionally difficult process of creating custom sporting goods, makes them highly scalable. Given that they now have a significant customer base in professional sports, they provide the Sharks with the opportunity to invest in a lucrative business positioned for considerable development.
Their ability to serve both the consumer and business sectors adds to their scalability and makes them a desirable investment prospect. With its unique digital approach to custom sports equipment and existing partnerships with half of the NFL’s clubs, TruFit is positioning itself as a company with significant growth potential in terms of revenue and market reach.
No wonder Kevin wanted to make money on this, so he noted: “Customized mouthguards using 3D technology are a smart solution for athletes… The valuation is a little high, but I participate! $750,000 for 3% equity. , plus $2 per unit until I get back $2.25M. I think it’s a fair offer!”
Custom-made mouthguards using 3D technology are a smart solution for athletes… The valuation is a little high, but I’m in! $750,000 for 3% equity, plus $2 per unit until I get $2.25 million back. I think it’s a fair offer! #TRUFITCustoms #SharkTank #SportsTech
– Kevin O’Leary aka Mr. Wonderful (@kevinolearytv) October 19, 2024
While Mr. Wonderful refused to back down from his offer, Shark guest Rashaun Williams rushed over and met Matthew and his offer.
Rashaun Williams Lands His First ‘Shark Tank’ Deal By Investing In TruFit Customs (ABC/ChristopherWillard)
Kevin O’Leary and Royalty are two peas in a pod
It seems that entrepreneurs are more willing to give up some of their net worth (stock) than to reduce their gross margins, for fear it will destroy their business. After all these seasons, why doesn’t Mr. Wonderful understand?
It seems to us that companies that don’t generate money will almost never pay royalties. As much as we like Kevin, we don’t understand why he’s so stubborn about this.
Since they are on television, every company receives a huge influx of orders after the broadcast. If he receives a royalty on top of his future purchases, he can easily recoup his investment through that alone.
Compared to holding shares and waiting for an exit or profit distribution to be paid, this reduces risk and provides a more certain return. He doesn’t care about the long-term success of the company because he deducts it from revenue.
‘Shark Tank’ Investor Kevin O’Leary Loves Royalty Deals (ChristopherWillard/ABC)
Kevin O’Leary’s bluff is usually in favor of the founders
Sometimes we even think that he is doing it just to start negotiations. We’ve seen him obviously spout some bullshit to persuade someone to cut equity with another shark or make a deal.
One day he actually proposed something quite substantial, and when another shark undercut him, he immediately laughed. He likes to squeeze his other sharks. Plus, it gives business owners power over greedy and irrational sharks. Uncle Kevin is watching.
He often makes the initial offer. Others, like Lori Greiner, are simply waiting for the conclusion. Depending on the sale, he can earn thousands of dollars if he runs it 100 times and closes five deals.
‘Shark Tank’ Investor Kevin O’Leary Starts Negotiations With His Royalty Deals (ABC/ChristopherWillard)
Kevin O’Leary loves playing TV villain
We often forget that “Shark Tank” is a television program. Kevin’s “bad royalty deals” to help him create TV content are similar to how he played the “villain” character for several seasons.
For reasonable offers, many companies fail to attract the attention of the sharks. Instead of investing in average (but not bad) companies, “royalty deals” are a method of keeping things interesting without losing money.
Plus, Kevin usually isn’t really interested in these companies, and he’s well aware that the royalty deals are horrible. He constantly lets entrepreneurs hear other proposals, because he is generally not enthusiastic about the offers from competing sharks.
Kevin’s job is to make watching “Shark Tank” entertaining.
Kevin O’Leary is well known for his sneaky royalty acts on “Shark Tank” (ABC/ChristopherWillard)
“Shark Tank” Season 16 airs on ABC Fridays at 8 p.m. ET