@ Coat Chex

I've heard of Corn Chex, but Coat Chex?

What's the difference? A box of Corn Chex is around $3.00. A box of Coat Chex, around $1,500.

That's right. Season 4 was ready to start off rain or shine with its first entrepreneur, Derek Pacque and his rather interesting invention, Coat Chex. Said to be a problem solver, the purpose of Coat Chex is to create hassle-free processes of checking coats no matter where you are. It is essentially a software and a neat package that eliminates the need for coat tickets, which supposedly get lost all the time. Now I'm not much of a bar guy or party animal, but I guess I'll have to take his word, for now, and trust that this is a legitimate problem. And even if I didn't want to trust Mr, Pacque, I'll trust his fellow "Who Who Who" (whatever the heck that is), Mr. Mark Cuban, who was willing to invest $200,000 for 33% of the company. That's right, $200,000 for a patented product which hasn't yet been tested in any market. Now, what went through the Mavericks owner's mind when he made this offer? Here's my conjecture:

Mark Cuban likes certain types of deals. He likes deals which he can make himself (with some exceptions of course) and which he visions becoming a global success. That being said, you can usually tell when Mark is interested in making a deal within the first 40 seconds of the presentation. Of course there are always additional factors, such as profit in past fiscal years and the ability of the entrepreneur to honestly answer questions, but from the product perspective, if you look closely you can see Mark's face light up when he hears a product or service he likes. I believe Coat Chex made this first impression, even though it dug itself into some holes over the course of that particular presentation. The idea of a franchised business which has so many opportunities, a new technology, and a neat package was an idea that Cuban liked. He figured that investing $200,000 for 33% of a product which can easily turn global was worth it. And who knows, maybe he had plans to take the idea and somehow install it in Mavs games!

Anyway, after speaking to his partner and entrepreneurship professor, Pacque turned down the deal which resulted in some hilarious facial expressions from all the sharks, especially Kevin O'Leary who looked as though he was going to throw his chair at him. Let me make something clear. If I was that professor's boss, I would fire him immediately for making a fool of himself and student on national television. I don't care how big he plans on making this business, the fact is it's a business model that hasn't been tested, it's a seasonal product, and he turned down a partnership with Forbes' #181 richest person in the US. Who does this?!

There is no doubt in my mind that both Pacque and his professor regret this tremendously and wish they can have another chance to correct this horrendous waste of a once-in-a-lifetime opportunity. Overall performance: 6

Jeff Hopkins1 Comment