"Can we de-risk this deal for you?" Lisa asked the reality show's panel of investors. "I know this company is going to work and I'm here for a shark."
The Nguyens were seeking $100,000 in exchange for 15 percent equity in Baubles + Soles, a Huntington Beach, California-based business that sells customizable shoes for children and women. Customers can purchase a pair of kids' shoes for $49.95--and a larger "mommy" version for $55.95--then decorate them with baubles like hearts, ice cream cones, or pompoms that snap onto the toe. The baubles range between $12.95 and $16.95, while the shoes are recyclable and machine washable.
The co-founders got the idea for the company after their daughter Kaia quickly outgrew a pair of beloved shoes with hearts on them. They sought to create an affordable solution to that problem with one shoe that could serve many different occasions. In the 12 months before appearing on Shark Tank, the Nguyens booked $150,000 in sales through the startup's website and expected to end 2019 with $300,000 in sales, they said on the show.
Duc, who's from Montreal, came to the U.S. when he was 20 years old to pursue a film degree. He now runs a wedding video production company, he told the sharks. Lisa and her mother left their native Vietnam on a fishing boat, then lived in a refugee camp for three years before settling in Australia.
"We were one of the lucky few," Lisa said, adding that before Baubles + Soles, she worked as a lawyer for an NGO that provides pro bono legal services for refugees. "Twenty-five percent of people who did this died at sea."
Daymond John was the first to applaud Lisa's story, noting that he didn't recall another refugee appearing on Shark Tank before. "So you know that she's going to be a hard worker," he added.
The Sharks were impressed with the Nguyens and their presentation--even the notoriously grumpy Kevin O'Leary lauded their modest valuation--but declined to make an offer, citing factors like the difficult shoe market and possible inventory challenges. As each shark dropped out, Lisa pleaded that they needed a strategic partner to help them.
The sharks closed their notebooks and prepared for the founders to leave the tank, but that's when Lisa offered to take the risk out of a potential deal. She proposed paying back the $100,000 investment in two years from the company's profits, which got the attention of John.
"Listen, you're not going to fail," John said, offering $100,000 for 25 percent equity. "I've got to be in business with you."