Outer Shark Tank Update:- Terry Lin, CDO, and Jiake Liu, CEO, co-founded Outer Patio in 2017. Terry attended RISD. He has worked in marketing, retail sales, product design, and IT in different positions as a senior executive and consultant.
In exchange for 4% of the business, Terry and Jiake seek a Shark to invest $750,000. Only $800,000 of previous sales data is available to the Sharks since Outer is a young business. Although the Sharks are perplexed by the value, they soon discover that it is based on market size rather than real business forecasts. Aside from the expense of inventory, Terry and Jiake explain that they only pay for what they sell.
Two Sharks are intrigued by Outer’s product, but the other Sharks are worried about the value and risk-reward mismatch. Terry and Jiake accept Kevin O’Leary’s $750,000 for 20% equity. Lori Greiner also offers a royalty till she recovers her investment. Lori and I agree to a $750,000 loan for 5% equity. Up to $1 million, she’ll get $30 for each unit. That leaves her with her stock portion and no royalties. Their partnership with Lori is a natural fit.
In addition to his work as an angel investor, Jiake is a University of Alabama graduate. Both guys are still employed by the firm.
The company’s vision started with a reimagined attractive outdoor couch collection. A visit to an outdoor furniture factory in China inspired Jiake to think about an opportunity in the US.
To protect it from the elements (rain and UV radiation), he imagined an outdoor couch with a removable outer shell cover. It’s lightweight and includes handles for convenient storage.
Usually, we spend 90% of our time inside, leaving our back yards and patios to rust. Neither do wet couches after a downpour.
Following Terry’s lead, he and his family invested in the concept and business.
Instead of a showroom, they pay existing customers to show off outdoor furniture to prospective buyers.
They sold $800,000 in the first four months after going on the market. So they set out to find an investor.