Kevin O’Leary and Robert Herjavec Battle for the Online Marketing Dream Team Behind Saucemoto
Most people have guilty pleasures for fast-food, enjoying the occasional chicken nuggets and french fries from the comfort of their vehicle. However, have you ever struggled with the daunting task of positioning your dipping condiments in the front seat while driving? All of us, at one point, have tried to innocently place our small condiment packs on the dashboard or center console, only to have a small bump in the road knock your sweet and sour sauce all over your carpet, leaving you with not only a mess but a dry meal.
William Moujaes, Michael Koury, and Tony Lahood are three Cleveland-based entrepreneurs who marched in to the tank, pitching a solution for these sauce related catastrophes. Their product, Saucemoto, is a condiment holder for the vehicle. The product is an attachable clip that latches on to a vehicle’s air vent and it is shaped to hold condiments from just about all fast-food restaurants. The Saucemoto is also engineered to withstand hazardous road conditions. They were seeking a small (relative to most Shark Tank startups) $45k investment in exchange for a 15% equity stake.
The trio of entrepreneurs had the “Sharks” giddy throughout their pitch with witty wordplay like “It’s time to practice safe sauce,” as well as their dramatization of sauce dipping in rough conditions, which was characterized by Koury holding a steering wheel, rapidly bouncing behind the cardboard frame of a car, and Moujaes by his side perseveringly dipping his nugget. The three men were thoroughly enthusiastic (although Tony Lahood was more laid-back than his two partners) for their simple solution and captivated the Sharks with an entertaining and humorous presentation. Nonetheless the question still loomed in the Sharks’ heads, “Can we really take this business seriously?”
Soon after, the creators of Saucemoto began fielding questions about the business. Robert asked how they came up with the idea. Moujaes told the sharks about a road trip the three of them had taken ten years ago, and how the “inevitable” happened and Moujaes spilled a condiment all over Tony’s brand-new car. Barbara followed up their response by asking, “You really thought this was a big problem?” and Mark and Lori came to the rescue, claiming they see the product’s usefulness.
When asked for their sales, they said Saucemoto has sold 12,000 units for approximately $77k in sales. The Sharks didn’t seem to give much of a response to the numbers but became more intrigued with the entrepreneurs themselves, asking each partner’s role within the company. Koury heads design and Lahood heads marketing while Moujaes spans between both sides but designed the packaging. Barbra responded by giving high praise for the package design because of its efficient size and straightforward labeling. The Shark even said, “I want to have one, and I don’t even eat fast food.”
The Sharks then asked about their margins, which didn’t spur much applause. However, when the creators of Saucemoto began talking about their stout marketing strategy centered around viral videos, the Sharks’ eyes lit up. Moujaes said they’ve received 44 million views for their content on Facebook. The panel of investors recognized the potential demand and began asking their strategy to scale their customer base.
Lahood responded with their strategy to use Saucemoto as a promotional product for fast-food chains, rental car dealerships and other companies that share mutual customers. Therefore, these companies would push Saucemoto in promotional campaigns like say, “Buy two large drinks and get a free Saucemoto with your purchase.” These promotions would lead to more brand awareness and consequently, expand their customer base.
After hearing more about their marketing, offers began shooting from the Sharks, as Kevin O’ Leary broke the ice with a steep offer of $45k in exchange for 50%. It was their only offer so the trio responded with appreciation. Then, in what felt like an instant, Mark and Barbra dropped out due to the extensive work they would have to put in, for such a small company and product.
The entrepreneurs’ faces were starting to drip with unease until Robert asked, “Who created the videos that saw 44 million hits?” In return, the entrepreneurs said they had written the scripts themselves, hired a film crew and the 44 million views were achieved with an impressively low budget of $4k.
Robert exclaimed, “You are in the wrong business. Am I getting all of the products you guys create moving forward?” Lahood responded with an absolute yes and Robert offered $45k in exchange for 40%, undercutting Mr. Wonderful. O’Leary, then dropped his offer down to $45k for 25% to make the trio and himself all equal partners. The creators of Saucemoto took the deal almost immediately!
Saucemoto is a terrific example of a group of entrepreneurs who may not have had a jaw-dropping product, but came into the tank with an arsenal of skills that convinced the Sharks to invest in their team rather than just their business. The Sharks value entrepreneurs who can promote their product to the stratosphere with online marketing because they see an opportunity for future growth with new products due to a proven formula. Promotion is a rough bear to wrestle with when you first start your own company, but those who do it the best will thrive.