@ PurseCase: The Perfect Medium

Jenn Deese and Kelley Coughlan entered the Shark Tank with their unique smartphone holder: the PurseCase. The product is made to solve the problem women have of having to dig through their handbags and purses to find their ringing cell phones. They asked the Sharks for a $55,000 investment in exchange for a 12% stake in their business. Although nothing too crazy went down in the Tank during this pitch, some of the Sharks' responses to the idea were a bit surprising. It all started with Robert Herjavec.

After taking a look at a sample PurseCase, Robert told Jenn and Kelley that he had just come back from a trip in Italy, and saw a very similar product all over he place. He saw it on the street, in the stores, and in all different colors. And even though they responded that their product has a pocket unlike their competitors' product, Robert was out because he didn't feel this was enough of a differentiating factor. The Sharks give many different reasons why they are not interested in investing in a product, and Robert's reason in this case was a pretty good one. He didn't see a point in investing in a product which is basically already being sold all over Europe. At this point many viewers thought that there would be a domino effect and all the other Sharks would drop out as well. However, this is not what happened. Yes, Mark Cuban went out because he doesn't like the technology accessory market in general because it is constantly changing and the products are just hits and misses. And Barbara went out simply because she didn't like the flap feature as she felt it wasn't enough of a streamlined experience. But Kevin and Lori were in fact interested.

Kevin made his classic royalty offer, asking for a $1 royalty on every unit sold until his investment is recouped, at which point the royalty decreases to 75 cents. The entrepreneurs didn't seem too interested in considering this offer, but then again they didn't have to because Queen Lori offered $55,000 for 15% of their business, after calling the product a "superhero". Like any semi-bright person would do, Jenn and Kelley accepted her offer and left the Tank ready to become millionaires.

The surprise here to many Shark Tank fans was that the Sharks were interested in investing even after Robert said that he just spent two weeks seeing a similar product all around Europe. It is probable that their interest was based on PurseCase's figures. In the first three months, PurseCase already had $30,000 in pre-orders, and had projections of raking in $240,000 in the first fiscal year. These numbers seemingly indicate not only a high demand and level of interest for the product, but also a market niche which has not yet been saturated. If these projections are correct, Lori and Kevin both felt that their investment would be recovered in a very short time frame, making their deal very worthwhile and financially astute.

The PurseCase inventors chose to partner up with Lori for this deal, and it was rather obvious why. As we've all heard countless times already, Lori has her own show on QVC. She has launched over 400 products and owns over 120 international patents. Almost every product she takes onto QVC is successful, and it's as easy as pie for her. She has the process down to the wire and has all the contacts she needs to take a product from concept to market as quickly as possible. As all the Sharks agreed on at the end of the pitch, QVC is the perfect medium for PurseCase, and will likely turn these young entrepreneurs into millionaires in no time.

Overall Performance: Presentation: 42/50. Strategy: 20/25. Product: 15/25.
Jeff Hopkins2 Comments