Baubles + Soles
DEAL
EPISODE SUMMARY
🕓 Air Date: November 10, 2019
Asking For:
$100,000 for 15%
Investor:
Daymond John
Deal:
$100,000 for 25%
PRODUCT SUMMARY
Baubles + Soles offers patent-pending, interchangeable shoes for kids, allowing customization with various accessories, and is machine-washable, slip-resistant, and recyclable.
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Background Story
Baubles + Soles was founded by Lisa Nguyen and Duc Nguyen, based in Huntington Beach, California. Lisa, originally from Vietnam, has a background in law and nonprofit work, having volunteered to do pro bono legal work for refugees. Duc, born in Montreal, Canada, pursued a film degree and later founded a wedding video production company.
The inspiration for Baubles + Soles came from their own parenting experiences, particularly the challenge of children outgrowing shoes quickly. The idea was born when Lisa wanted a way to extend the life of a pair of shoes her daughter had received. The couple embarked on a journey to create a single shoe that could be styled with various accessories, leading to the development of interchangeable shoes for children.
The Product
Baubles + Soles presents patent-pending shoes that are customizable with interchangeable accessories. The shoes are machine-washable, slip-resistant, recyclable, and made in the USA. The interchangeable accessories, called “baubles,” can be easily attached and detached from the shoes, offering endless style possibilities.
The founders demonstrated the product on the show, showing how the accessories could be twisted on and off. With about 20 different accessories currently available, including piggies and pompoms, the shoes aim to cater to various occasions and preferences. The base shoes cost $49.95 retail and $25 wholesale.
The accessories are priced individually at $12.95 to $16.95. Baubles + Soles targets a direct-to-consumer market through their website and has plans to implement a Build-A-Bear model to allow customers to customize shoes online.
How It Went
The company’s position before Shark Tank
In the last 12 months, Baubles + Soles reported sales of $150,000, with 80% of their business coming from wholesale overseas. They project $300,000 in sales for the current year, with a predicted profit of approximately $170,000.
The founders emphasized that 46% of their customers are returning, indicating high customer satisfaction and loyalty. The company has minimal inventory holding, producing 300 pairs per injection mold, allowing for quick turnaround times. Baubles + Soles aims to grow its direct-to-consumer market in the United States.
The Negotiations:
Lisa and Duc initially sought $100,000 for 15% equity. After hearing the concerns about inventory challenges, especially with various sizes and colors, John decided to offer $100,000 for 25%. Despite the emotional pitch and the founders’ compelling life stories, the other Sharks bowed out due to concerns about market saturation, sales volume, and the competitive landscape.
In a final effort to secure a deal, Lisa proposed a unique repayment plan, suggesting they pay back the investment in two years from revenue. Ultimately, John agreed to invest $100,000 for 25%, marking the turning point that secured a deal for Baubles + Soles.
