ABC's "Shark Tank" is known for boosting the businesses of founders who pitch their company on the show — such was the case for recent businesses like Locker Board and Bottlekeeper. But on Sunday night's episode, two entrepreneurs found themselves instantly rich, when Daymond John bought their company outright for $3 million.
Alyssa and Zach Brown from Connecticut walked into the Tank seeking $150,000 in exchange for 5 percent of their business, Moki Door Step. Zach, a firefighter and Alyssa, an emergency room nurse, always enjoyed outdoor activities, like kayaking. There was just one problem: When they'd transport their kayaks (or bikes or snowboards) on the roof of their car, 5-foot-tall Alyssa would struggle to reach the roof to help take the gear down.
It inspired the couple to create the Moki Door Step, essentially a small step that attaches to the u-shaped latch in your vehicle's open door so you can reach the roof. It currently sells for $44.95.
The sharks were impressed by the ingenuity of the product and by Zach and Alyssa's 30-day Kickstarter campaign, which had $110,000 in sales. Still, Kevin O'Leary thought their $3 million valuation seemed a little rich.
Zach, though, explained they were in talks for a licensing agreement with a car roof rack company. The deal would span seven years for a minimum of $3 million, and it would be for Moki Door Steps sold in North America.
Zach also mentions that his uncle gets $1 for every Moki Door Step sold for the next 18 years, since he was the one to initially file the step's patent.
"Do you have an uncle like Kevin?" Daymond John says, poking fun at O'Leary's notorious ruthlessness when it comes to cutting deals.
O'Leary is out; he doesn't like the price of the step and fears knock-offs. Meanwhile, Robert Herjavec encourages Zach and Alyssa to just take the licensing, distribution deal — they would make good money off of it, after all. Zach points out, though, that since the terms of the deal are only for North America, they want to take the product global.
Daymond John is interested and offers them a deal of $450,000 for a 20 percent stake. But they don't want to give up that much equity.
"For that amount of equity, I think we're better off just selling [the company] outright," Zach says. "If the offer was right, I would sell it."
Mark Cuban then asks how much they would be willing to sell the company for. Since they came into the tank with a $3 million valuation, Zach says that's what it would cost.
"We enjoy our jobs," Alyssa says, and Zach adds that she's pregnant with their second child.
"If you have that [licensing agreement] in place, I will offer you right now, $3 million for the entire company," John says.
The sharks look stunned, and Alyssa and Zach look floored, but accept the offer.
"We've enjoyed running the business, but we really enjoy our jobs and being with our family, so we can make money off of it and go back to our normal lives," Alyssa says.
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Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank."
