Ex-Amazon engineers lose 6-figure 'Shark Tank' deal off 1 blunder: 'That's the biggest mistake startups make'
After leaving engineering jobs at Amazon three years ago, Brett Skaloud and Jeff Feiereisen built a showerhead startup with social media virality, thousands of customers and $5 million in projected annual revenue.
They still couldn't land a deal on Friday's episode of ABC's "Shark Tank" due to making what billionaire investor Mark Cuban referred to as "the biggest mistake startups make": trying to grow their brand too quickly.
Skaloud and Feiereisen co-founded Boona, a Seattle-based company that makes a $249 showerhead called the "Tandem." It attaches to most standard extant showers, turning them into couples' showers by adding a new stream of water on the opposite wall.
On the show, they asked for $400,000 in exchange for 10% of their startup — saying they wanted to expand Boona past the Tandem, into additional product lines and revenue streams.
"We want to build a brand," Feiereisen said. "We have a lot of [intellectual property] around this product, but we're not banking the business on it. I mean, the next obvious opportunity for us is just the handhelds."
The statement raised a red flag for at least a couple of the show's investor judges.
"I don't buy it as a company yet, I see it as a very interesting innovation as a product," said Kevin O'Leary. "Some of the greatest deals in 'Shark Tank' history [are] when the entrepreneur focused on that one application and maxed it out."
"That's our focus right now," Skaloud responded.
"Well, I'm not sure. You were telling me about building a business, other SKUs, a brand strategy, which scares me," O'Leary said.
Cuban backed up O'Leary, adding that when startups make this mistake, "they want to be a brand, as opposed to just executing on selling their product. [But] what builds a brand