Swimming goggles can be uncomfortable. They never fit, and they might leak or fall off while you’re swimming. Bo Haaber and Rasmus Barfred have created new technology: a scanning algorithm that allows them to create custom swimming goggles that fit your face perfectly. Will the sharks swim right into a deal with The Magic 5? Keep reading our Shark Tank Magic 5 update to find out.
Shark Tank Magic 5 Update
- Entrepreneur: Bo Haaber and Rasmus Barfred
- Business: Custom swim goggles
- Ask: $500,000 for 2.5% equity
- Result: $1 million for 6.5% equity
- Shark: Robert Herjavec
Bo Haaber and Rasmus Barfred are triathletes themselves, and they’ve struggled for years with goggles that don’t fit their faces. They decided to create The Magic 5, a custom scanning app that uses technology to create swimming goggles that perfectly fit your face. It’s a genius idea, and one that makes perfect sense: if you have prescription glasses, why not custom goggles?
- SCANNING: Download our Magic5 app to complete your goggle customization....
- PERFECT FEEL: You won’t feel you are wearing goggles. Not more raccoon...
The sharks are impressed with The Magic 5 as a company, but the valuation makes them laugh. It’s rare that people come onto Shark Tank with a $20 million valuation, and rarer that they offer so little equity for so much money.
However, Bo and Rasmus explain that since they opened in 2018, they have gained 40,000 customers, including some of the best athletes in the world. Their lifetime revenue is $3 million, with $1.5 million coming in in the first half of 2021. This company is going places.
When asked, they reveal that the goggles sell for $55 retail. They cost $14 to make, but customer acquisition is $24.
When the numbers are all said and done, the sharks begin a vicious bidding war over investing in the custom goggle company. It’s a proven model and the market for it is huge, as the entrepreneurs explain.
Mark Cuban makes the first offer, right out of the gate. He offers the $500,000 that the entrepreneurs asked for, but he wants 7.5% equity in the company.
Before they can react to his offer, Kevin O’Leary and guest shark Nirav Tolia make a combined offer. They will give $500,000 for 5% equity, plus a royalty of $3 a unit until they regain $1.5 million. They have the technology expertise and the marketing experience, so it seems like a good match.
Robert Herjavec, on the other hand, offers $500,000 for 5% with no royalty. He says that he simply knows the market, as his daughter was a swimmer for years.
On the other hand, Lori Greiner thinks they have most of it figured out. They just need to “blitz the market,” and that’s something she happens to be good at. She wants to go in with Robert or Mark for a combined offer. Mark refuses.
Robert is happy to go in with Lori, but they’re trying to figure out how they might split the 5% equity he offered. Kevin senses that the waters are getting choppy, so he reduces his deal with guest shark Nirav Tolia to only 4% equity, but keeps the royalty.
Lori and Robert decide to up their deal, asking for 6% equity for the $500,000. The entrepreneurs are clearly overwhelmed with offers, and they aren’t sure which of the sharky deals to choose. All are great choices for their company.
While they decide, Robert decides to drop a bombshell. He really wants to get the deal, so he offers a solo deal of $1 million for 6.5% equity. The entrepreneurs take this without hesitation. What a bidding war! Keep reading our Magic 5 update to find out if Robert regrets this huge investment.
It looks like The Magic 5 is doing well after Shark Tank. They’ve appeared in Men’s Health, Triathlete Magazine, The New York Times, Today, and Women’s Health, which is sure to help drive some sales.
Most companies see a spike in success after Shark Tank. Everything we’ve seen in our The Magic 5 update research suggests that their business is going to keep increasing steadily, especially as summer rolls around.
Before you go, be sure to check out more on Shark Tank Season 13 Episode 4:
For more on Shark Tank Season 13, be sure to check out our Season 13 products page.