Shark Tank US | Will Toymail's Entrepreneur Convince The Sharks To Invest In Her Product?

Summary

In this Shark Tank pitch, Gory Nanda presents Toy Mill, a company that connects families through innovative toys called Takis, which allow children to send voice messages to loved ones without needing a phone. Despite impressive backing from Verizon and Amazon, and a strong background with Clocky, Gory faces challenges with valuation and the amount of equity offered. After two sharks back out, Chris Sacca and Lori Greiner offer a deal: $600,000 for 5%, with the option for Lori to join. In the end, Gory secures the deal, marking the start of an exciting partnership for Toy Mill.

Takeaways

• 😀 Gory Nanda and Ellie are co-founders of Toy Mill, seeking $250,000 for 2.5% of the company.
• 😀 Toy Mill focuses on connecting parents and children through voice messaging with toys, without the need for a phone.
• 😀 The Takis toys allow kids as young as three to send voice messages to approved contacts via a button on the toy.
• 😀 The toys are designed to be interchangeable, allowing kids to switch out skins as their interests change.
• 😀 Parents can unlock new features like educational content, games, and stories through the Toy Mill app.
• 😀 Toy Mill’s hardware is Wi-Fi-based, making it independent from phones or laptops.
• 😀 Verizon and Amazon are key investors, with Amazon interested in integrating its Echo voice technology into the toys.
• 😀 Toy Mill has raised $1.6 million at a $10 million valuation, which some investors consider high for a company still in early stages.
• 😀 The Takis toys will retail for $50, with a $20 manufacturing cost, providing strong margins for e-commerce sales.
• 😀 Gory Nanda previously created a viral product, Clocky, which helped him bootstrap $10 million in sales, giving him credibility in the toy industry.
• 😀 Two offers were made: Chris Sacca offered $400,000 for 5%, and Mark Cuban offered $500,000 for 5%, with additional content and distribution opportunities.
• 😀 Gory ultimately accepted a combined deal with Chris Sacca and Lori Greiner, where Sacca invested $300,000 for 2.5%, with Lori potentially contributing $300,000 as well.

Q & A

What is Toy Mill's mission and how does it aim to achieve it?

Toy Mill's mission is to bring families together, especially when they're apart. They aim to connect parents and kids without using phones by providing interactive toys called Takis. These toys allow kids as young as three to send voice messages to loved ones with just the press of a button, offering a simple, screen-free solution for communication.

How does the Takis toy work?

The Takis toy allows kids to send voice messages to approved contacts, such as parents. It works by pressing a button on the back of the toy, which sends the message via the Toy Mill app. Parents can listen to the messages and respond using the app, making the communication safe and easy.

What makes the Takis toy different from other toys?

Takis are unique because they are completely interchangeable. The hardware inside can be swapped out and placed into different animal skins to match a child's changing interests. Additionally, Takis respond to physical play and are expandable, allowing parents to unlock new features like educational content, games, stories, songs, etc.

What investors have backed Toy Mill and how much capital have they raised?

Toy Mill has secured investments from Verizon and Amazon, with Amazon interested in integrating their Echo voice control technology into Toy Mill's toys. The company has raised $1.6 million at a $10 million valuation, including a $500,000 investment from Amazon at the same valuation.

What is the retail price and manufacturing cost of the Takis toy?

The Takis toy is priced at $50 MSRP, and the cost of manufacturing each unit is $20. The company plans to reduce manufacturing costs to $10 per unit as they scale.

What is Gory Nanda's background?

Gory Nanda, the co-founder of Toy Mill, has a unique background in product development. He previously created Clocky, a disruptive alarm clock while studying at MIT. The product went viral and helped him achieve $10 million in sales, though Toy Mill is a separate venture from that project.

What is the sales projection for Toy Mill in the coming years?

Toy Mill projects sales of over $2.5 million in the next year, with plans to scale up to $12 million in sales within the next few years. They envision the company growing to a $1 million revenue business in the future.

Why did some sharks decline to invest in Toy Mill?

Some sharks, such as Mr. Wonderful, declined to invest because the equity stake being offered (2.5%) was too small. Others, like Lori and Mark Cuban, had concerns about the valuation, which they thought was too high given the company's early stage and lack of substantial sales.

What was the deal that Chris Sacca offered to Toy Mill?

Chris Sacca offered $400,000 for 5% of Toy Mill. He believed in the product but felt that the valuation of $10 million was too high for such an early-stage company.

What was the final deal that Gory Nanda accepted?

Gory Nanda ultimately accepted a deal from Chris Sacca and Lori Greiner, which was $300,000 for 2.5% of the company. This offer combined Chris's expertise in hardware and the internet with Lori's distribution experience, providing a strong partnership for Toy Mill.