Sharks Are Astonished By Costly Business Model | Shark Tank AUS

next into the tank a Chris and Patrick a larger-than-life business team with big plans for the future there you go mom Chris a 28 year old builder from Sydney I better build it for 10 years and the same problem I see on every single job you happen to change things after we've already built it if you look at the entry walls here we had the ready we've developed a way to solve that problem the neighborhood visualize your house properly would save you a lot of money because you won't be changing your mom [Music] I'm feeling good about going out there and letting them know what's what's on offer [Music] I left my flaws on them let's go hi I'm Patrick this is Chris we're from life-size plans we're up to 2 million dollars for drinks and equity in our business at life-size plans we head you're architects plans and we project it onto the ground of our 850 square meter warehouse we adding furniture walls and you get a chance to walk through your house before it's built now us we've got a video just and so you can get it I feel for it after they give us the planes we project them from the ceiling onto the floor to one-to-one scale when you're walking through our warehouse you're basically walking on a lot of size scale of your home so we give people the opportunity to say what they're where they're throwing their money for a small investment I get to sort of chop before you boy so you can change your plans before you start building in the video there's there's furniture now it's not augmented its actual furniture get we're rolling some pieces bears what walls yeah I cry so it throws it onto the floor which is awesome right it's as big as the IMAX theater was yep thank you gentlemen so about two million dollars for 20% of your business yeah so it's just a very modest valuation around 10 million bucks so why don't you kick us off Chris I've got the feeling you're the engineer and he's the sales guy yeah I'm the Builder he's a technician sir yeah so basically came up with the idea yeah building sites or a home builder yeah residential how long you been doing there 2news 10 years and every time I build someone's house without exception that I always say I wish I'd done this or wish I'd done that yeah in in most cases they get me to change things meet construction which causes their money costs me money I think we can relate to that yeah yeah Chris what why did you go to Patrick what's he got that you couldn't do yourself oh it was time after some skills but what it was what he got sorry you got a lot Patrick I just can't think of it right I think at the time he needed someone that will actually go and run it and get it to the next level my background is in OIT I started building the website for Chris one thing led to another I'm not real good with the computer and all that and Patrick has a Facebook and Instagram and all that stuff so emails tick or not always been doing my email so I guess the thing there were nothing Chris I'm Steve I can make a mist of anything if you've got traction so you've put a ten million dollar number on your business that means you must have a lot of people out there paying you to do executives we turn it out about twenty three sessions a week at about eleven hundred a session of average check about 1100 so he's us about 1.3 million a year Wow but a great cash flow business expenses wise plus sixty sixty thousand in rent the only staff member whose name unless twenty to cover twenty three sessions so if we had let's take me out of the kitchen if we had an operator at sixty thousand a year or something like that then put some incidental or just put some other expenses we'd still end up with one point one profit Wow how long's a session take ah typically now on hours are you working this thing for 23 hours a week in probably a moment probably a 60 hour week yeah bad utilization oh yeah for a empty warehouse within you know it's pretty good that's damn good that's damn good it's a Patrick with your ten million dollar valuation I understand the technology get me excited about how you scale it so just off the back we don't Benny Brisbane Melbourne initial plan uses her license we're thinking $100,000 for a one-off license fee then some amount per years for service sir so Patrick I'm in Brisbane I want to buy a license of you I need a space which I could rent how much do I have to pay for all this projecting of I mean it's not just the equipment but we can set up the warehouse for about seven hundred and twenty grand 700 so in order to buy a license I need $700,000 to be in business with you no more need the last no I know no exactly that's a big number at the front you could probably make that into Syria it's it's almost a million dollars to be in this business but I could have bought a system that cost me three three four hundred grand list but what's what's 700 grand get you days any these days anyway a chicken shop just swapped you just walk me through the seven hundred twenty thousand you're asking me to cough up as a franchisee or a licensee or something yeah like that what are you where are you spending that it looks say the floors have to pay a hundred percent level then you gotta you can't just go to any building because the building expands and contracts especially big metal structures so you you got a we got a rig furlings up and structural members up so when we sit the projectors there they don't sit there and be on sequence if a projector moves one millimeter up the top look you can't show the client we know that the value for the customer is a hundred percent there every customers come through has made a change that align for us is what's got me excited [Music] you realize if they only get to you know 55 people a week that one location makes him 3 million a year there's a question that the single biggest investment most people have is their home and there's also no question that the biggest fear people have is understanding plans so to be out a war crew for this is actually you're incredible so it's it's well darling yeah you you're a bit of an enigma you guys because you clearly created a service that is some great value to the customer at a very reasonable price [Music] what's worrying me Chris is haven't done enough work on how could I scale back the cost so that I could have 20 of these around Australia at a much lower cost so you know that's the bit that's holding me back [Music] so one of the things about the price tag in terms of the $700,000 for set up it does create a barrier for entry so it does make it harder for somebody to just pop into the same game and that's great what you haven't managed to convince me of today is the pipeline so it's too early so for that reason I'm out Thanks [Music] for where you are right now it's it's no great the the issue is you know I don't think it's scalable so I'm not sure that I'm the right investor few today you are on the verge of breaking through our business that could be making a very good living and if you can somehow get that barrier of entry lower then I think you can scale but this is sort of valuation you leave me no choice so three sharks are out we've got the two Queenslanders on the end still if you could just stand one of these things up to like return of grand or something that's a lot less risky and important you know you've put them close to a brick on the line I'm sorry guys I wish you all the best and I mean you're out Thanks you're asking a licensee or a franchisee to take a big risk and it's a space that I'm a little nervous about and because of my nervousness I can't invest thank you I'm happy for this cause but thank you thanks guys I really would like to work yeah back to work investment displays I'm gonna get to yeah Chris was good he knew didn't he he was good either have a go he's actually put real coin and citizens can do this he's an entrepreneur that's actually prepared to back his thoughts with with some activity you

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Keywords: best shark tank ideas, business, coatchex, deal, entrepreneurs, mark cuban, millionaire, money, most successful shark tank pitches, proof eyewear, rejected shark tank pitches that became successful, rejected shark tank, shark tank episode, shark tank pitches, top trending, shark tank show, shark tank success, shark tank, worst shark tank pitches, most successful shark tank businesses, best shark tank pitches, Full episode, Shark Tank, Shark Tank Full Episode, life size plans

Id: BFH-IfTB47E

Length: 10min 41sec (641 seconds)

Published: Tue Aug 06 2019