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Does Shark Tank investing in a consumer product work for entrepreneurs?

Now that Appvance is along its way - with Kevin Surace as CEO and we just closed a VC round lead by Javelin - I turned my attention to an IoT company that will provide a direct connection from consumers to brand managers. The first step was to prove I could build a company that could design and manufacture a consumer product. I partnered with Disney Imagineer Terri Hardin and Maker Space founder Mary Keane. We sold 600 of the STARLINGwatch Steampunk art jewelry pocket watches. While they are no technical tour-de-force, each watch features 4 processors to produce 67 million color combinations. The experience taught me who to go for fabrication, development, and production of a hardware project and a successful business model. We will sell out of them next month. I really liked the experience and want to do it at the next level up. To do that I forecast $100,000 is needed. Margins are 65% gross, 25% net. It seems like a valuation of $400,000 is in line. My questions:

1) Do the SharkTank investors - former entrepreneurs still working in their fields of expertise - actually exist?
2) How do I find and pitch investors who have consumer goods experience?
3) Do the financial metrics make sense?

4 Replies

Jessica Alter
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Jessica Alter Entrepreneur • Advisor
Entrepreneur & Advisor
There are a couple good discussions on Shark Tank herehttp://members.founderdating.com/discuss/topic/Shark-Tank
Jonathon OBryan
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Jonathon OBryan Entrepreneur
Founder of The SmartSheet
not a good link... :(
Wayne Willis
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Wayne Willis Entrepreneur
CEO, Formula XO, Inc.
http://members.founderdating.com/discuss/topic/Shark-Tank

Joseph Wang
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Joseph Wang Entrepreneur
Chief Science Officer at Bitquant Research Laboratories
Yes they exist. There is a community of investors here in Hong Kong with consumer goods experience, who are putting money into IoT projects. If you are in Hong Kong (or willing to travel/move here), you can get in touch with them through the HK Business Angels Network, The Entrepreneurs Network, or TiE. If you have the budget to travel, I can put in pitches to HKBAN.

Alternatively, you might want to first contact a sourcing company like Global Sources or Berkeley Design Group. They provide the manufacturing know how and they are starting to get links with angel investors.

Having said that, HK investors are a really tough crowd. People have a lot of consumer goods experience so that they know how really painful it can be, but that's useful because you can often get feedback on why you idea won't work.

The trouble with watches is that a lot has to do with fashion and marketing niche. Most people that do watches here in HK, focus on the luxury market because the margins are higher and there are people that will pay extra for something that is both high quality and hand made.

Once you try to scale up, you run into problems because the cost of setting up manufacturing can be high, and once you've created a watch that is a commodity, the sales value of the watch goes to zero. So the issue is to come up with some sales angle that keeps the value of the watch high, and people have been trying to do this (and mostly failing) by doing smart watches or sports/fitness devices. Another angle is custom watches - seehttps://www.eoniq.co/


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