[Music] Foreign We live in Washington DC and we are the Creators of surprise ride We come from a family of six we escape War from Lebanon and immigrated to Canada growing up we really didn't have Much but our parents told us that Anything is possible I wanted to go to School at Harvard and I was able to go There many years later Rosie wanted to Travel the world she got to study abroad And even though we didn't have much we Made the best out of that situation Safety First too often we hear kids Complaining that they're bored and moms Struggle to keep their kids with short Attention spans busy our product helps Families spend fun quality time together And it helps parents and kids gain Knowledge along the way [Music] We've risked a lot to make this dream Come true I gave up a great career on Wall Street we've both refused great job Offers to make this dream come true we Validated that we have a great product People absolutely love the experience But we need capital from the Sharks to Share the ride with Amer Thank you [Music] Foreign [Music]
Calif I'm Rosie Calif we're the sisters Behind the company surprise ride today We're raising 110 000 in exchange for 10 Of our company surprise ride is a Monthly bundle of Adventure that gets Kids excited about learning with Surprise ride every month kids receive a Surprise box of interactive activities In all the supplies they need to explore A new topic we work with experts to Curate activities of the highest quality Families everywhere want to give their Kids a good reason to put away the video Games and explore the world through Hands-On play surprise ride makes it Easier than ever before sharks we Actually picked up some of your mail Today and your surprise rides have Arrived I love the boxes thank you beautiful Packaging oh wow oh Robert would you Stop look damn it it's car racing you Always act so amazed by everything you See Robert you're gonna get to design And model a race car vroom Lori we know That you love cooking and who doesn't Love chocolate right you're gonna get to Make chocolate from scratch and also Design your very own brand of chocolate It's great Kevin we know that you love Photography so you're going to get a Solar kit that has you taking pictures Using the power of the sun thank you Love it Damon we heard that you love to
Travel so you are going to be entering An adventure into the exciting city of Barcelona all right so you're going to Be designing a mosaic in the style of World-renowned architect Gowdy and Exploring the fashion in Barcelona I Like and you heard I like to get fat Yeah we heard that you love We we might have heard that you love Basketball so we designed a basketball Themed ride that has you creating a mini Basketball game for your desk and then Get fat what's a good game without some Popcorn I got that It's really cute I mean I have to say This is an extremely well constructed Quality surprise box well first of all Thank you very much very very cool how Much do they sell for it starts at 24.99 For a six month or a 12 month Subscription and that's per month per Month yep and it's 29.99 if you buy it On a monthly basis what are your sales Almost 800 800 boxes and we've got over 220 active members that's just in the Last four months yeah it's just started Ladies you know in an online business When someone comes into the shark tank With a model like this two questions That always get asked and hopefully You're gonna know this answer what is Your customer acquisition cost and what Is the value of that customer in profit Margin so our custom ERS acquisition
Costs What's the value of that customer first So for just the 12 month period it's 130 Customer value usually Mr O'Leary asked The client acquisition question there's A lot of uh deer in the headlight but What a great answer I got to know your Background my background is on Wall Street I actually worked um in emergency Acquisitions for a number of years then I left that I went back to get my MBA at Harvard fell in love with social Harvard MBA good for you what about your sister I have a degree in marketing um so I Have a business background I've worked With a number of Lifestyle Brands and Even some kid Brands so what does it Cost you to make each box and where are You making these we're at 50 margin and That 50 goes towards buying our Merchandise shipping and fulfillment we Have a fulfillment center in Florida That assembles all the boxes and ships Them out to our customers can they scale Absolutely so my business cool Background basically forced us from day One to create a business that's scalable One of the concerns and I say this often To new entrepreneurs is don't invest too Much before you have the sale absolutely How much have you invested in that is in That warehouse this business model Really allows us to anticipate the Demand very close to when we need to
Order that inventory which is terrific So we have very little interest because The multi-month orders right we can Actually estimate how many orders we're Having and We've raised 100 Uh Irwin Jacobs who's the founder of Qualcomm how much Equity did he get he's Actually an angel investor in the form Of a convertible note so you know darn Well that 100 from Irwin and 110 from us And squat for a subscription business The That we're raising now gets us through The Net are you sure Yes because in a subscription-based Business you know how many have gone out Of business yes and what's the Projection for next year Don for next Year we're anticipating about 500 000 in Sales and that's on the low end how many Subscribers is that that's 30 500 look You don't have enough money to get the 500 000 but they might because they have Access to this other investor so if you Have this I didn't get to answer your Question earlier but Damon effectively Is doing that because they have this Other investor why are you here Irwin Invested in us he's a big fan of this Mission which is to bring curiosity to Children all over the world there you Just hit the nail on the head there's a
Difference between a mission and having A fully thought out fully funded Business that is going to accomplish a Specific goal So let me tell you a little bit about How we plan to spend that money that Might give you some comfort Because we're doing driving traffic And then monetize Okay that's easier to stay explained so Uh the first thing is we've partnered With a marketing agency the leading Expert on reaching moms what does that Cost you monthly it's going to cost us Forty thousand dollars total for the Next 12 months to reach 5 to 10 million Moms Donna Rose I want to make sure I Heard the facts correct I think you said You did 800 boxes and you have 220 Members would that come to around twenty Five thousand yeah about 20 it's a Startup It's a Brand New Start I got it But the startup question here is you Were like a hundred and ten thousand Dollars for ten percent yep the value is A company of 1.1 million dollars yeah You're an investment banker at least you Were one do you think there's a little Extreme ask in terms the classic Valuation question this is literally What I spent yes it is the class Minute of my hours We know there are two things that Primarily go into evaluation the team
And the future puts earning potential of This company this team has been working Together for over 20 years we worked so Well together when you say you've been Working together for 20 years can you Explain that by that I mean we've been Sisters I don't know if that's a good Thing I have two daughters they're ready To kill each other if they spend too Much time with them we hear that a lot But we we came from Lebanon actually as War refugees and we lived in a One-bedroom We didn't have a lot of video games and Toys and things to entertain ourselves But fortunately our dad always Encouraged us to experiment try a lot of Different things we sort of had a craft Store in a chemistry lab in our living Room yeah um I'm a really simple and Basic guy when I started approval I sold 800 shirts you know what I was worth I was worth 800 shirts The value in the company at 1.1 million Dollars I'm out You know I'm stuck on the capital Requirements I don't quite agree with You and we can debate this till the cows Come home my guess is you're going to Need somewhere between three and five Million dollars to scale this to where You have a sustainable business I went To school with the girls who founded
Birchbox which is one of the most Successful subscription Services they've Hit 300 000 subscribers but you know You're at a proof of concept right now In my opinion I'm tempted but I'm going to pass I'm Out Donna let me tell you where I'm at yeah Yeah great idea but there's a lot of Executional risk here You know your idea of spending forty Thousand to get that traffic is a little Unrealistic I think you're Underestimating the hustle that this Business is going to take to get off the Ground But I think you'll figure it out So here's my offer to you So my offer Is the offer that I feel comfortable With that reflects the executional risk In the business I'll give you the 110 000 for 25 percent With the hundred thousand dollars you Said forty thousand dollars to a Marketing company what was the rest of Optimizing monetizing that traffic so That we could actually generate the Sales I think that this is one of the Finest and best made gift box for kids That I've ever seen I love it I know what it's like to be a woman in
Business And I know that sometimes it can be Harder but I also know that you can make Anything happen if you put your mind to It I had to start from the ground up by Myself and I had to figure out a lot of Things but it was the best learning Lessons I could have ever had And when I look at the two of you you Make me think of myself and I think that You can do this you're telling your Shoes out in like 9 000 words seven Paragraphs don't be rude Lori you know How to reach women you know how to reach Moms you know how to reach aunts doing It on your own that's how you're really Going to learn so for that reason I'm Out I'm giving you my very best advice Because that's what I think is important Here Donna she's out to address your Theory you're gonna have to address Anything okay I made you an offer Mark Either say yes or no let me let me ask Some questions what's your core Competency our core competency is Execution that's what I was going to Tell you Robert let me talk with you Possible The fact that you need to go out and get This marketing company you need to go Out and get this optimization company You need to go out in these other
Companies means you don't have that road To success directly in your mind when You're an entrepreneur you've got to be Able to control your own destiny on A number of things I asked you the Question what's your core competency I Thought you were asking me personally so Come on now come on that's a Harvard Answer that's not a real answer okay That's fair but let me tell you Something I'm out This was why my offer was so high you Don't live in the real world you live in The world of theory ladies this is in Kansas anymore I made you a generous Offer for you and for me because I can Help you I disagree with her you need Guidance along the way Whoa whoa Robert whoa Gave me time to change my mind Guys you said you're all about sales you Had a sale You didn't close the sale Ladies I think we're all out Robert if you come Back in we'll do it 25 we'll do it right now interesting you Know what I'm not gonna immigrant to Immigrants no you know what I I heard The dynamite when somebody makes you an Offer a bird in the hand Right I made you a pharaoh you know you're Willing to take isn't it
Decide that's what a smart business Person would do not always Ladies Shark Tank you are going to become Legend because you had a deal and you Didn't close it you came into the Shark Tank poo poo happened and you got a Surprise ride gotta turn around walk Into the sunset good luck you guys thank You thank you [Music] Robert pulling away at the end is almost A blessing in disguise it showed how Serious or not serious he was about our Business that's hilarious they talk Themselves out of the deal you know what It happened
