Season 5 | Episode 501 | EP506
In Season 5, Episode 6 of Shark Tank, Jason Reddish & Val Pinkshasov approached the Sharks seeking an investment of $200,000 in exchange for 20% equity in ‘Total Merchant Resources’. The company is currently based in Piscataway, New Jersey.
Total Merchant Resources is an alternative funding company. Their company will ‘purchase’ future credit card income at a discount from the business. They will then pay a lump sum to the business with a couple of days which they can use for whatever purpose they wish. Total Merchant Resources will then take their lending fee from the card processing. While the duo has some degree of success with getting their product ‘out there’ they state that they wish for their company to start tackling the larger accounts out there. For those accounts they will need the assistance of the Sharks.
Many of the Sharks are incredibly reluctant to invest in the financial arena. This is in part down to their lack of understanding about the way in which it works. They also believe that the alternative lending model may go through a little bit of a crisis in the near future. They believe that legislation will be introduced which will severely hamper the growth of the market as well as eradicate some companies altogether. These Sharks want to be sure that their investment is safe and thus they do not wish for their cash to be held in a company which is inherently risky.
Kevin is the only one whom is willing to make an offer to the duo. This is in part down to the fact that he believes that he has the contacts that could really help take the business to the next level. He actively encourages the duo to accept his offer as he states that if that they do not accept his offer then he could quite easily go out there and start a competing business. His offer is $200,000 in exchange for 50% of the business.
The $200,000 was the exact figure that the duo was after when they walked into the Shark Tank. 50% equity however was double what they intended to give away. They initially balked at the offer but after realizing that Kevin could bring a lot to the table in terms of contacts they were more than willing to accept it.
Kevin O’Leary is blunt, colorful outspoken and at times unpredictable. If you want to secure an investment from Mr. Wonderful you’re going to need to show him the money. Kevin loves royalty deals, patent holders and products with licensing potential.