Founder of Ormsby bespoke guitars offers sharks 10% of his business at $200 000. This leads to value the company at $2 million.
Perry Ombsy’s bespoke guitars
Perry Ormsby, a genius guitar maker, sold his house to finance his growing business in 2004.According to him, all his guitars are handmade and pre-sold.
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Pre-selling 20 guitars in 66 seconds!
During his pitch, Perry mentioned that his guitars are in very high demand. He pre-sold 20 guitars in 66 seconds while the prices range from four to twelve thousand dollars.He also mentions that to meet this demand, he teamed up with an offshore manufacturer.
Jake, his team member, makes a little demonstration with the guitar before the sharks ask him questions.In the 2014 financial year, Perry made a profit of $363 000 from $518 000 in sales after paying himself.
He also mentions that in the first three months of this financial year, they’ve turned over $465 000 which has Andrew impressed.
He also says that he expects to turn over $1.4 million by the end of this financial year with a predicted profit of $800 000.
If he’s doing so well, he probably doesn’t need the sharks
This must have been the question on Janine’s mind when she asked, ‘why do you need us if you have such fantastic income.’
Perry responded that he needs someone to be a guiding light, and together, they can build a massive brand.
Unfortunately, three sharks bow out as they can’t provide what he needs.
Andrew goes further to mention that as an investor calculating what he’d get in return, he doesn’t like a business dependent on one product and one person. For that reason, he’s out.
Janine, the only shark, makes Perry an offer, also staking 10% of his business. Still, she wants it returned at $220 000 in 24 months while she continues to get a 10% return on her money each year while still maintaining a 10% equity on his business during that period.
Steve thinks Janine is making a terrible deal. Steve and Janine enter into an argument, with Steve coming back to make a deal that matches Janine’s offer.
Perry hints out that the shark he wished when he walked into the tank was Andrew.
Unfortunately, Andrew admits to not having the time to help him as much as he’d like to but proceeds to make him an offer together with Janine.
Glen also thinks the deal he’s being offered from Andrew and Janine is pretty dodgy and urges him only to accept if he thinks they bring something to the table that would make his business grow faster.
Perry makes a counter offer which Andrew and Janine both reject.
Steve thinks he made the right decision, while Janine says he made a poor decision.
What happened to Ormsby guitars after shark tank?
Perry says he has no regrets as he’s confident about the future, and he’d get there anyway.
Company website: www.ormsbyguitars.com