I would like to start this post by precisely repeating what Mark Cuban said:
When you are climbing up the ladder, everybody just roots for you and holds the ladder for you. When you get to the top, people you’ve never seen before in your entire life will take pot shots and try to pull the ladder off from underneath you.
Mark Cuban
I am a big fan of Mark, and as you can see i have dedicated the first entrepreneur profile post to him. However i have no choice but to be among the pot shooters.
Tania Speaks, a 19 year old young girl, was able to sell in 2 years $2.4 million worth of cosmetic product she made.
That is a huge accomplishment, and not just that, she was netting around 70% in pure profits. What a genius entrepreneur, and what an amazing entrepreneurship skills. The girl, was hustling in school selling the cream from the school bathroom, it can’t get more entrepreneurship spirit than that. Her brow gel costs her 1.10$ a jar and sells 29$ (after shark tank, it is selling $49.99).
She came to Shark tank, asked for $400k in exchange of 10% equity. Instead she got $400k for 15% equity (after counter-offering the 20% from Mark).
None of the entrepreneurs wanted to make a deal with her, because her product have a major flow, It is just a made up cream with absolutely no tests. She thinks it works, and you need to take her word for it. It is like saying, my poop heals depression, if i don’t do a clinical study, then it would be a snake oil scam.
Are Organic Cosmetics A Scam?
She came up with the formula herself, mixing aloe vera plant and vitamin E. Influenced maybe by Dexter lab, and pretending to be a chemist.
The idea of selling an organic product, may maybe help her avoid much scrutiny.
Without going into details why in general organic cosmetics are often labeled as scam.
Cosmetic companies have thousands of highly paid chemists working on products, that are tested through clinical study which involves thousands of paid volunteers. All this to detect side effects and knows the efficacy of the product.
But Tania Speaks, a 19 year old, bypassed all this and made the claim that her eyebrow gel … wait for it … stimulates hair growth for thin brows and tames thick brows. Yes you read it correctly (contradiction much?), i even screenshot the website for future reference in case it is changed.
A gel that helps you minimize your eyebrow if you use it once a day but help you grow your eyebrow if you use it twice a day, what a big load of nonsense is this?
When such a company making $2.4 million in sales, make the claim that the product they sell, help thin brows, they should present 3rd party accredit lab testing (as Lori Greiner suggested).
Aloe vera plant and vitamin E both have some benefits to the skin, but anyone can buy a bottle of aloe vera on amazon for half the price of a single gel jar.
Investment Goal
To understand how risky for a shark to do a deal with such a product. None of the sharks wanted a hand in this! Mark decided to come back and made a deal of $400k for 15% , but for Mark it wasn’t about the deal, his intentions was maybe to inspire his 2 daughters to be hustlers and entrepreneurs. He made to Tania the contingency that she meet with his 2 daughters, 14 and 17 years old, so that maybe they can learn from her.
Later Mark confirmed his decision by saying that every father has aspiration for his kids, if he can get her to connect to his kids that’s more important than the money involved.
