Sabri’s Shark Tank roundup: AI fails to wow and Catchy catches two sharks

Join Shark Tank Australia shark Sabri Suby for a weekly roundup of each week’s king or queen of the tank and the pitches that were eaten alive. This week, AI for teachers flops and Catchy catches more than a few sharks.

This week, we’ll break down the winners and wildcards that made a splash in the tank and those that sank without a trace. Dive in as we separate the chum from the champions.

Catchy

First on the menu is Catchy, a brilliant food-catching accessory for high chairs, pitched by Rachel and Brad Cohen. As a father to three girls, with my youngest just one-and-a-half years old, I could immediately see the use case for this product. Jane, a fellow parent, already owned the product. At a retail price of $54.95, with a cost of just $9 per unit, the margins made sense. 

But with a bid of $300,000 for 2% equity, the valuation was sky-high, especially after delving into the company’s financial details, revealing a $200,000 loss from the previous year and existing investors in the mix.

I extended an offer of $300,000 for a 9% share, but the founders chose to swim with Davie and Robert, who offered the same amount for a 5% share, plus royalties until the investment is paid back. 

You can’t win them all. While Catchy is clearly a great product with great founders behind it, that equity was still relatively small for an early-stage business. I’ll be watching closely to see how they get on. 

Kaasida

Kaasida founder Akanksha Sidha came into the tank asking $35,000 for 10% equity for her fashion brand, which sells handmade clothing decorated with chikankari embroidery. After a grilling from the sharks, Dr. Catriona Wallace made a deal for $35,000 for 30% equity. 

For me, though, it seemed too early for serious investment consideration with just 18 pieces sold. While I commend Akanksha for starting a business with the environmental aspect so front and centre, this was just too much of a risk to take on. Timing is everything in the tank, and Akanksha didn’t quite have the proof points needed for me to take a bite. If I’m sending out my money soldiers I expect them to come back with more. 

AI Toolkit

James King from AI Toolkit was asking for 250,000 for 10% — a $2.5 million valuation. Promising to ‘change the way teachers do business’, the tech was designed to help teachers build lesson plans in seconds. 

I have to agree with Robert: AI Toolkit was one of the worst presentations we’ve seen. The pitch was lacking in detail, the valuation was far too high, and every question we asked led us down a confusing rabbit hole. 

In the tank, pitches should distil a business down to its essential parts, and this one missed the mark. We were left with more questions than answers, which didn’t bode well for a business partnership. 

And let’s take this opportunity to make this a learning moment for all businesses: every pitch must contain a clear explanation of the problem, and how the product/service is positioned to uniquely solve that problem. A unique solution to a common problem means you have found a gap in the market, which provides the starting point to become the category king. 

The Beanies

Finally, we had The Beanies, an ARIA-nominated children’s music group made up of Sydney children’s entertainers Laura, Mim and Michael. Their podcast has been streamed 1.5 million times, and the group boasts 8 million streams of their AREA-nominated music on streaming. With six separate income streams, this business seemed promising at first. The Beanies were asking for $150,000 for 10% equity, valuing their business at $1.5 million.

However, once we dug further into the numbers, I started to realise that something was missing. With only 2,000 YouTube subscribers and no clear answer on YouTube revenue, their valuation was starting to look like a song and dance. In the end, Robert, Davie and Jane Lu teamed up for a 50% stake in the business at $150,000, with the option to buy back in the future.

Operating in a crowded market with no unique value proposition, The Beanies face steep competition. They were stuck in an overproducing trap, which was slowing down their journey to finding a viral formula they could repeat over and over again. The market doesn’t lie: and 2,000 YouTube subs just isn’t enough proof of product. For that reason, I was out. But what I will say is that this investment will either be the best or the worst of the season.

Read more about Shark Tank Australia here.