Things Get Awkward In The Tank With Pashion Footwear | Shark Tank US | Shark Tank Global

[Music] First into the tank is a comfortable Version of a fashion staple [Music] Hi sharks my name is Haley pavoni and I'm from San Luis Obispo California Today I'm seeking a 500 000 investment In exchange for five percent of my Game-changing company passion Footwear It's a Tale As Old As Time a woman puts On her favorite pair of heels and heads Out to work out to a wedding or out for The night she is absolutely crushing her Commute tearing up that dance floor and Looking her absolute best for exactly 45 Minutes suddenly her feet are on fire And she is regretting everything about Her shoe choice so I invented the Ultimate solution to high heel pain and Inconvenience the world's first fully Convertible high heels now not that I'm Not totally crushing this outfit but let Me slip into something just a little More comfortable With a quick Twist of the wrist our Stylish high heels turn into comfortable And practical Flats just like that wow Wanna see me do it again yes that's Impressive That is so much more comfy here at Passion we are determined to make Traditional high heels and all their Ridiculous problems a thing of the past Now sharks who is ready to majorly

Disrupt the massive women's Footwear Market and take the next step of this Journey in some awesome convertible high Heels that's remarkable I actually do Have samples for each of you they're in Your size oh good you know I love a good Nude heel there we go Haley fantastic Part of our key Innovation is we use Completely different materials from any Other high heel in our midsole they're Totally flexible when you have no body Weight it looks like it has an arch but The second you step down goes completely Flat so I pop the hill off okay now am I Supposed to also remove something from Right here yes you're removing this sole Support portion just grab it turn and Then pull out there you go okay the Whole piece and that part that you took Out just there that's the removable sole Support that's really the essence of our IP there have been removable heels Before yes but no one's ever innovated I'm going to stand up on this oh wow It's like bouncy yeah so to put them Back on you just hook this bit here pop It back in give it a Twist it'll click And you're locked back into place gotcha So I am assuming that you have sold Quite a few of these we have yes so it's Been a year and some change and we've Done a little over eight hundred Thousand dollars in sales wow What are the returns like yep so our

Return and exchange percentage is 24 24. yes the Footwear average though is 20 just because the sizing for Footwear Is so difficult and your sales are net Sales after all right no uh net sales 500 000. 500 000 okay every woman I know Hates her high heels every one of them And can't walk in them for more than Three or four hours why was it you who Said let me do something about this so In my sophomore year of college I was Out at a sorority spring formal and I'd Worn six inch high heels as college Girls do but high heels when you're Trying to dance are not comfortable it's Really more of a wobble and I wanted the Bus to move so I ditched my high heels And took to the dance floor Barefoot Unfortunately tragedy and inspiration Quite literally struck one of the other Young women accidentally stomped her Stiletto through my foot and impaled me Through the time oh my God Like right through like clean and as I'm Sitting on the side of the Dance Floor It struck me as odd that there is this Societal expectation for women to wear High heels to formal or professional Events everyone knows they hurt and that They're inconvenient and yet there is no Solution so Haley how have you gotten Your 500 000 in net sales we are all Online and we've been able to sell Through digital marketing PR and then

Also Word of Mouth Haley you are super Impressive thank you I want to hear your Background a little bit yes absolutely So when I was in college I already was Very much in the headspace of when I Graduate I want to be working for myself And so after that impalement incident I Dove in head first started pitching at Different events and actually raised the First twenty six thousand five hundred Dollars and I actually got the first Working salesman samples the day before My college graduation Were you wearing your shoes in that Graduation picture yes absolutely and Luckily I'd actually built the company Up enough at this point that when I Graduated I was able to come on full Time I brought on a footwear development Team hired on a CEO brought on a lot of Student volunteers actually well it was Twenty six thousand dollars yes Initially we have raised more since then Who owns your company now what's your Cap table look I own my company right Now so we've raised a total of 2.5 Million today 2.5 million all on convertible notes so Right now I own 83 percent of the Company but after they convert it Depends obviously on valuation but for Instance if you were to take my deal Today I would be at 45 oh and you know That we're gonna have to negotiate and

So you you're gonna end up owning if you Get a deal less than 45 percent I'm gonna own a little less of a much Larger company with the help of which I'm always a fan of but how much cash do You have left in the bank right now we Have about 250 000 oh how much inventory Do you have right now I have 150 000 Worth of inventory at Cost what's your Monthly burn our monthly burn right now Is about 90 000 before marketing Ouch your burn is ninety thousand Dollars a month yes so you have three Months Of cash left yes but being said I've Been in this situation before and I did Get out of it something you should know About me is I'm one of the most Resilient people you'll ever meet back In 2019 we were in a situation where I Found us 80 000 in debt and I realized Okay I have just enough cash in the bank To make it 30 days or we're out of Business and so I hit the ground running I pitched every single person that would Listen and I closed a million dollar Deal on the 30th day and that's why We're still in business today so yes It's a scary situation but I believe in This too much to ever let it fail and I Will get out of it you don't really want To give up more than five percent here I Mean I appreciate the value that a shark Brings to the table all right look I

Would make you an offer that looks like This I give you the five hundred Thousand dollars for five percent However I get paid a royalty till I Recoup A million bucks then that royalty goes Away and then the only negotiation we Have to have is how much that royalty Should be I would like it to be five Dollars a unit I'm not super interested in a royalty Only because I want every single dollar To go into growing this way you don't Know it's ridiculous we don't even know What they cost and we don't know what They cost to make Kevin right now the Product cost is 36 and then the land of Cost is 47 and we uh sell them for Between 150 and 190. you have plenty of Room for a five dollar royalty that's Not a problem I do but I'd rather have That five dollars go towards growing I Don't know yet Haley why don't you wait To see how many other offers you get Okay Haley let me get the ball going Here I think you're the type of person You don't know what you don't know The most important part of building a Business is keeping it in line and you Stretch every Buck nine different ways To see what you get out of it and I feel Like we are doing that I mean I know we Have a high burn but as I mentioned I Don't have excessive overhead you do

Have excessive overhead you're burning Ninety thousand dollars a month you Raise two and a half million dollars and You have three months left before you're Out of business I would say that's Important I can't take a chance on your Business climbing those mountains with You so I'm sorry Okay thank you yeah Haley Um you have a hundred fifty thousand Dollars worth of inventory that's about Five hundred thousand dollars worth of Revenue that's another five and a half Months of survival which then allows you To create more cash flow to bring in More inventory if you told me this is Where we're at I'm gonna sell these Shoes because I need to focus my Attention to these things to sell those Shoes it'd be a different story but That's not where you're at so for those Reasons I'm out okay thank you for your Time Haley you are a remarkable young Woman but the product is worrying me a Little bit it felt very strange to walk On so I don't know if I was walking Several blocks in New York City for Example in between meetings if that Really would be something that would be Comfortable for me I know you are going To be a success in life but this I'm not 100 sold on I wish you the best of luck But I'm out Thank you I appreciate that so Haley I

Um I think it's clever it's a good idea It's great for QVC I think you like Maybe I think it's good quality but five Hundred thousand for five percent It's just not enough for me and I don't Think 500 000 is going to be enough I Mean I'm open to negotiating but as an Investment it doesn't make sense for me Right now so I'm sorry I'm out Thank you Well All roads lead back to Mr Wonderful I bet you Haley if you could go back and If you could have done things Differently you would have and now you Are 90 days away from Oblivion your Problem is sales that's the only thing That's going to save you but the more You sell the more Capital you tie up in Inventory that's the curse of the shoe Industry you need money I have it but I'm going to put myself in a preference Position I really don't want to do a royalty as I Mentioned to me a royalty is just going To be very counterproductive to funding Growth it puts me in a preference Position so I don't get deluded into Oblivion I'd like to counter with 500 000 for Eight percent No If there's no royalty in here to reclaim My Capital royalty doesn't kill you if

You turn your inventory specifically Mark I don't see you writing a check I'm Encouraging her to consider her royalty This is the only deal out there right Now and I don't think what about it No no you know I would I would probably Be wearing these heels in heaven before I got my 500 000 back how about we do a Royalty at Two dollars and fifty cents until you Get your 500. Look I care about five hundred thousand That's not chunk change are you open to Any kind of counter though You can counter all you want but I'm not Encountered and come on you said that You have changed this year and all of a Sudden the heart transplanted into your Body I really appreciate you helping me With this deal Lori so to you I say no My offer is very simple it's five Dollars a unit till I recoup a million Dollars and I want the five percent Equity and I'm the only shark that's Making you an offer are you open to a Larger investment no 500 is plenty I'll Keep you going for about another six Months And you're not open to a different Royalty structure no if you had five Offers here Mine wouldn't be the one you choose but You don't Would you do the 500 000 at five percent

With a three dollar royalty paid back to The million No No With all due respect I don't think we're Gonna make a deal today Good job here I really appreciate all Your time and the feedback thank you Good luck Haley This is my baby I've put every single Bit of myself into this for the last Four years And I'll keep doing that every day until We get to where I know we can go any Investor she sees is going to look at This and say wait a second you're 90 Days away from Oblivion you know she Might surprise you I think what we'll See 50 off [Music] Before you go don't forget to subscribe To the Shark Tank Youtube channel and Ring the notification Bell to keep up With everything that's bubbling in the Tank

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