Sharks Think This Music Entrepreneur Should Ask For More Money |Shark Tank AUS

[Applause] next into the tank a master guitar maker who sold his house to finance his growing business 10 years later Willy convince a shark to help him take his products onto the world damage [Music] hi my name is Perry Osby and my business is almost be guitars we've been running this business in 2004 when I started with a dream and just $1,800 myself and my team produced 50 guitars a year they're all handmade and pre-salt pricing ranges from four thousand to twelve thousand dollars with an average price of six thousand in comparison to the bigger brands and their high-end models they would generally be priced around two and a half to four and a half thousand due to our constant output of eye catching designs and models we're under massive demand the last 20 handmade guitars that we sold pre-sold in 66 seconds due to this demand we've teamed with an offshore manufacturer to produce guitars to our specifications these guitars range from 1500 to 1800 dollars which is more accessible to the wider market so what was the offer the offer is 10 percent equity for $200,000 thank you we're going to hear a little demonstration of the handmade guitars from Jake and welcome any questions you may have [Applause] [Music] excellent my hat my husband collects guitars okay so yeah we've got them all over their house sure why are your KTAR so special okay with our handmade guitars we use a lot of very difficult to find and rare Timbers we use a lot of innovative designs like the multi scale layout which is the found fret arrangement that you see yep okay and we pride ourselves on having the absolute best quality so you your market is the absolute high-end people that just really love love the specialty of equality yes artwork yes you've got this high-end grooves now introduced mass production yes in terms of dollars and numbers of guitars in the next 12 months how many you gonna sell and how much money you're gonna generate in revenue okay 2014 financial year yeah the overall sales five hundred and eighteen thousand the profit was three hundred and sixty three thousand after paying yourself yes in the first three months of this financial year we've turned over four hundred and sixty-five thousand wells Wow your annual sales are going from five hundred eighteen thousand to close to two million in one year I mean you know we expect to be 1.4 million disability all right okay what do you predict a profit eight hundred thousand why do you need us I mean you've got a fantastic income what I do need is just just someone there to be a guiding light for me and I think together we can we can build into a massive brand $200,000 ten percent that that's a two million dollar valuation yes I hate to say it's not a bad valuation actually it's pretty cheap you should ask for more I thought that was a bit too much no I might you have a really good business and you know obviously I'm in awe of your business we've done exceptionally well but I'm not going to invest this I'm out thinking my I don't know I don't know guitars I'm usually from anything but you have gone in with an exceptionally cheap offer you might not be asking for more alright so Steve's out where are we going yeah I love your business my concern ease of employed plenty of specialists in my time they are high maintenance and quite simply I have no doubt you are an artist and you're going to be high maintenance too Whibley he doesn't maintenance it's it's a it's a positive thing but I just know you're going to be high maintenance and for this one I'm going to bow out but what you have is a fabulous business do not ever compromise and well done I'm getting where you are thank you Perry you seem to have it all together and I'm trying to work out really what you want and I'm beginning to think what you want is a business partner a business manager if somebody to really work with you hold your hand you know there's all sorts of things you can do but I'm not that person so for that reason I'm out thank you for your time the downside on your business it's kind of a double-edged sword as an investor just sitting back objective is a lot of its are ret dependent on you yep and of course if you're a calculating investor who is purely concerned with getting a return you don't really like businesses that are too dependent on one product for one person so dependency on you is why I know thank you for your time as an investor quite often you think what's the exit so I'm looking at this deal and I want to do one but I'm trying to work out how can I make a deal with you that actually allows for some of my concerns that I've got okay so the deal I'm going to put to you is this I'm going to give you the 200,000 the 10% but I do want it returned at 220,000 in 24 months so I basically get a 10% return on my money each year I then will still maintain a 10% equity in your business after that period she it's free agreed baby she doing a shakedown here yeah I think she's actually alright how is he gonna get Nixon yeah he's telling me selling guitars my banjos Mike well they might then write a check do it to you basically apart from the little arguments going on you basically got to put a price on the on your value of Janine's expertise look I believe in your vision I believe what you've done don't believe enough to actually leave your money in here though do you I mean that's not a real belief anyway so that's actually a free bullet it's always interesting people aren't prepared to write a check what they say that if I do make it off it was I think yours is that bottom three needs no you gotta come back in Steve I'm thinking about that cuz I love that deal I'm making like an equal deal I think the deal is that good I'll give I'll give two sharks to choose from but you think it's such a bit of you think it's due by highlighting how bad the deal is you're saying you're gonna make it you will do the same offer if that deals on the table I'll take a chunk of that [Music] that's a terrible deal then write a check and do a deal Perry Ormsby is weighing up an offer from Junaid for a stake in a successful guitar making business I'm making identical deal I think the deal was that good you're saying you're gonna make a deal do the same offer if that deals on the title I'll take a chunk of that so when you walk through that door who did you want you I don't have the time to help you as much as I'd like to I'm very tempted but I'll go in with another shaft I'll go in with Andrew on the same deal but I'm doing because it's a good deal yeah and especially if you get two sharks you're gonna get a lot of F at both sides and all you got to do is use your cash flow to pay us back Perry you don't need their money if you think they bring something to the table that's gonna help your journey go faster take them but you don't need their money in the deal is pretty dodgy the deal is not to G it's a normal part of business what is it is the only way that an investor can get a return so you actually want you and double return you want your equity repaid and you wanna continue through royalty which is different it takes a risk on stuff you're saying here regardless for sales I want the money back after 24 months and I'm gonna keep my equity Perry is Janine and I to decide the value of our time and our equity it's not for them to decide and that's the price we're putting on our value announcer we have other options to invest in as well we like you we like your product so I think it's time to for you to make the hurry up the hunt means nothing do that because if the middle is not the Chairman right seriously this is a $200,000 loan okay ten percent I'm limit if you're welcome to take stays offer if you like I made you work with that imagine getting badges getting honest advices hey [Music] it's up it's up to you I don't feel comfortable with 24 months - okay so what do you feel comfortable with I'd like to make a counteroffer sure five percent each dropping down to five percent total once the two hundred thousand is repaid with the goal to repay that as fast as possible I like you and I like your product well 2.5% snot a lot of skin in the game for me I wish you well you know it's a nice business but I'm out I don't agree to be leader thanks anyway iris thank you very much I assume you did smile for two is that correct well good luck to you good luck well done might you be the moment we made the right decision oh for God's sake you made a poor decision I don't have any regrets I'm confident about the future we'll get there in the end anyway definitely was a bit of a shark bite and you know it was interesting just sort of standing back while they're arguing with each other yeah well done Steve you totally blew that one out of the water that was a bad deal no you're wrong you're actually wrong [Applause] [Music] you [Music]

Channel: Shark Tank Australia

Views: 3,001,488

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, watchmojo, worst shark tank pitches, most successful shark tank businesses, best shark tank pitches, full episode, shark tank full episode, 2019 new

Id: LRLGVq9OGHs

Length: 11min 1sec (661 seconds)

Published: Fri Oct 11 2019