ABC Shark Tank Results for Spikeball

Mr. Wonderful Kevin O’Leary

He was consistent as always; a loan of $500K at 9% which converts to a warrant with 10% equity. He liked the “viral thing going on”. He also believes with this offer, the company is worth roughly $5 million.

I was surprised he was so generous.

Mark Cuban, Lori Greiner, and Nick Woodman all gave Chris and his team credit, but they were out pretty early. Then the drama really began.

Damon John

He thought Spikeball’s $5million valuation was “a ball with spikes”. But he offered $500K for a 25% stake to own the licensing AND the manufacturing.

Translation? Damon’s saying to Chris Spikeball is worth $2 million.

You gotta love this guy. He makes money two ways; on cost of goods through manufacturing and revenues through licensing.

  1. Chris counter offers Damon John with $500K for 15% for a $3 million valuation.

  2. Damon John counter offers $500K for 22% for a $2.27 million valuation.

  3. Chris volleys one more time $500K for 20% for a $2.5 million valuation.

Damon John bites and seals the deal. Whew. That was a real nail biter.

BRILLIANT and gutsy negotiating on Chris’s part.

Spikeball Final Score

Damon starts with a $2 million valuation, Chris counters with $3 million and they settle on a $2.5 million valuation. Beautiful.

And Chris got exactly what he needed for his business; a branding genius in Damon John, reduced cost of goods because DJ’s motivated to drive that cost down now that he’s a part owner.

This now gives Chris gross margin flexibility to go mass market.

And Spikeball also has an advocate to blow distribution on this item wide open so Damon can make money through the licensing deal.

Everybody wins.

If any of these numbers made your eyes glaze over, then you really should read my book, Accounting for the Numberphobic; A Survival Guide for Small Business Owners AMACOM Books.

Oh right. Stay off Chris’s lawn.


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