Mark Cuban, the Billionaire Shark Tank Investor, dumped his deal according to HyConn Founder, Jeff Stroope. Stroope’s Facebook page claimed, Mark Cuban’s “ego” got the best of him during negotiations and backed out when he realized what he had done. Stroope said when it was time to come up with the money, Stroope states, “Mark Cuban started changing the deal”.
Mark Cuban has not publicly commented on the deal. Stroope’s newness to deal making with investors proves he lacks understanding of the due diligence process. Entrepreneurs learn this lesson through hard knocks.
So what happened between Mark Cuban, and HyConn founder Jeff Stroope? Stroope hints, Mark Cuban concluded licensing the design to another company is the best strategy to bring the quick-disconnect hose fitting to market. It would reduce the cost and increase the profit margin. Apparently, Jeff Stroope disliked Cuban’s new strategy, forcing entrepreneur and investor to part ways.
Jeff Stroope would no longer be needed with a licensing deal, making the Mark Cuban deal less appealing.
The deal does not end with Mark Cuban. Another company, 101 Ventures, supposedly took an Equity position after the Mark Cuban deal fell apart. This company claimed that they were taking it to manufacturing according to a July 2011 press release from Innovate Arkansas, an economic development organization working with HyConn, but that is not happening, at least yet.
Shark Tank would be that better if Mark Cuban and other investors would come on and explain why they did not do the deal. It would make for fascinating reality TV, and it would help entrepreneurs have a better understanding of what investors are thinking when they change their mind.
I also think Mark Cuban found out that there was more competition than he originally anticipated. This was one of those pitches that were almost too good to be true…
But I love these updates Kirk, keep them coming. On a side note, I’ve got a feeling that EzVIP is a big shark tank hit. Daymond John certainly seems to connect with it.
All you have to say is ZipNut – http://www.zipnut.com. Worked on this technology 10 years ago. This is nothing new.
I am sad they split ways. I think the inventer was more worried about the connection for firefighting. I was happy after seeing the deal. I was also impressed Mark offered him a job for 3 years. Disappionted in Mark. I’m a big fan of his. Does he back out alot? Maybe “Mr. Wonderful” (gag) will invest.
Have a Fantastic Weekend
I just saw a rerun of this Hyconn product and couldn’t believe he was getting that type of deal.I;m in the business, as far as the garden hose quick disconnect, a very good quality one has been out for 20 years.You just don’t see it at your local home depot.As far as the Hydrant quick disconnect, good idea but a limited niche market and people that use hydrant adapters are paying less than $40.00 for this product in brass or aluminum.I love the show and was very impressed by Mark Cuban.I feel once he looked into it, he quickly realized he didn;t get to where he is on these types of deals
It only shows you that the investors are very out of touch with regular people. The sharks have not seen or touched a garden hose in 20 years, otherwise they would not go gaga over a garden hose quick connector that sells for $5 at home depot.
We need a “like” button for comments!
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Exactly.
TASK FORCE TIPS ALREADY LEADS THE MARKET SHARE WITH THIS!!
The firefighting industry already has an international standard quick connect. It’s called Storz, it can be purchased cheap and there are already companies that make adapters for the 20+ different thread specs in the U.S. firefighting industry. I can’t see how one would expect to make money offering essentially the same functionality but requiring new purchases in an industry obsessed with tradition. A little research would’ve revealed all the reasons needed to back down from that deal.
Mark Cuban, is a cheap scape. Don’t drop a penny he will step on your fingers if you go to pick up the penny.
the guy was a complete idiot to begin with to take marks deal, he should have taken kevins deal. 1.25 for 11 years worth of work? 100k pre tax salary, after taxes maybe take home 70k and 7.5%? the guy doesn’t deserve another deal for his stupidity. there have been guys who have been offered 5, 10, even 15 mill for their companies and products and they all walked away like they should have. this guy was an idiot. 1.25 is chump change for a guy who’s a BILLionaire, he would have turned it into 50-60 mill just like he said after he walked out of the tank.