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00:00:00 – 00:11:28
Mike and Lauren Lamagna, co-founders of The Long Wharf Supply Company, presented their innovative apparel business seeking a $375,000 investment for 15% equity. Their enterprise focuses on sustainability by creating fisherman sweaters from recycled oyster shells, water bottles, and lambswool, addressing ocean pollution and supporting oyster reseeding. Financial details revealed an average gross margin just under 80%, production costs between $23.50 to $33.50, and recent annual sales of $495,000, though some investors deemed the $2.5 million valuation overestimated. Discussion highlighted the potential and scalability of businesses promoting environmental conservation through recycled products, with suggestions like an affordable, high-margin T-shirt. Eventually, an internal equity adjustment led to one team member receiving 10% equity. Despite attractive offers, including a significant one from Peter for a 45% stake, Mike and Lauren declined, maintaining strategic control over their company's future.
00:00:00
In this segment, Mike and Lauren Lamagna, co-founders of The Long Wharf Supply Company, present their apparel business to the sharks, seeking a $375,000 investment for 15% equity. They highlight the environmental challenge of ocean plastics and the disposal of oyster shells. Their innovative solution combines recycled oyster shells, water bottles, and lambswool to create fisherman sweaters. Each sweater sold supports the reseeding of up to 30 oysters, which helps filter seawater. They showcase a time-lapse experiment demonstrating oysters’ filtration capability. Mike shares his background working for Wayfair and his journey, which included stints in e-commerce and on lobster boats, leading to an awareness of ocean pollution.
00:03:00
In this part of the video, the speaker discusses the inception and development of their business, Longworth, which began in late 2016 with wax canvas and leather goods and expanded to include a sweater collection 12 months prior. The financials are detailed: the products have an average gross margin just under 80%, with production costs ranging from $23.50 to $33.50 and selling prices between $128 to $158. The customer acquisition cost is $41. Over the past year, sales totaled $495,000. The business is run by two people, with one currently holding a full-time job elsewhere. The speaker expresses ownership of 100% of the company. A proposed deal valuing the business at $2.5 million is discussed but is considered overvalued by the potential investors, leading to declined offers. One investor shares a personal anecdote reflecting a commitment to impactful businesses but ultimately decides against investing due to the high valuation.
00:06:00
In this part of the video, the discussion revolves around a business proposition centered on the circular economy and conservation efforts, specifically through products made from recycled materials. The key points include evaluating the market gap for such a business and considering its potential for growth and scalability. One suggestion was to create an affordable, high-margin product like a $29.95 T-shirt to promote conservation efforts while being accessible to a broader audience. A panelist expressed concern about the company’s valuation and the absence of equity for one of the passionate team members. Ultimately, the team member was offered and accepted 10% equity, leading to a successful deal. Another offer was proposed to help sell the product globally, showcasing the potential for broader market penetration.
00:09:00
In this segment, Peter offers $375,000 for a 45% stake in Lauren and Mike’s recycled oyster sweater company, Long Wharf. This is significantly more than the 15% they initially offered. Despite acknowledging the steep valuation and potential Peter brings with his experience in localizing global brands swiftly, Lauren and Mike ultimately decide to decline Peter’s offer as it requires giving up a larger portion of their business than they are comfortable with. The sharks commend their decision for its strategic wisdom.