“Bunch bikes is sharing the joy of family biking across the county, so who wants to come along for the ride and make a bunch of money,” Bunch Bikes founder Aaron Powell asked as he walked onto the “Shark Tank” stage. And one investor answered.
The Denton-based e-cargo bike company landed a deal with Shark Barbara Corcoran. In exchange for a 15 precent stake in the company, Corcoran invested $100,000 in equity with an additional $150,000 as a loan.
Initially, Bunch Bikes was seeking $250,000 in exchange for a 10 percent equity stake. After filming, Powell wrote on Bunch Bikes’ website that Shark Robert Herjavec split the deal with Corcoran, after becoming a customer of the company.
“My goal, my vision is I want to make these bikes accessible to more people,” Powell said on the show.
Launched in 2017, Bunch Bikes makes electric cargo bikes, currently available in three models: the Original, the K9 and the Preschool — all of which feature a three-wheel bike with a large bucket-like attachment to help carry kids, pets or groceries and sell between $4,295 and $6,000 per bike.
That price point drove off a few of the investors, including Daymond John. Others dropped out of the investment opportunity due to the fact that Bunch Bikes doesn’t own the maker of its bikes, rather it owns the exclusive distribution rights in the U.S. and Canada for the product.
“You’ve done a great job, don’t get me wrong, but it’s hard for us to just say… what we’re going to do to scale your business and here’s how we can make it into $50 million business or whatever that may be,” Dallas serial investor Mark Cuban said to Powell on the show. “It’s very laudable, it’s great, but that’s a lot of uncertainty. It’s not necessarily the most capital efficient way for an investor to work, or at least not for me, so for those reasons I’m out.”
Bunch Bikes has been growing at a steady clip. On the show, Powell said the company has seen lifetime sales of about $2.7 million. Starting with $285,000 in 2018 – its first full year of operation – and is saw about $2.2 million in 2020.
Prior to Corcoran’s investment, Bunch Bikes had raised $95,000 from friends and family, as well as a couple of angel investors.
The Bunch Bikes concept was inspired while in Sweden, where Powell and his family spent days exploring the city on congestion-free, dedicated bike lanes. While the cargo-bike concept has been popular in Europe for decades, Powell decided having electric capabilities would help with adoption in the U.S. market.
When NTX Inno spoke to Powell last September, he said Bunch Bikes has moved from Phase One of its business, bringing the product to the U.S. market to Phase Two, where it can innovate more in the category. On the show, Powell said he hopes to eventually have his own design of e-cargo bikes and reach a point where Bunch Bikes can “roll out 5,000 bikes a year and reach more people, and maybe under a different brand.”
“What this is all about is setting an example for my kids. Yeah, I’m doing it for the families out there and I’m bringing these bikes to the world, but really it’s about showing my kids that you can do anything you want. You see a problem in the world; you can tackle it,” Powell said. “You know my legacy is not going to be Bunch Bikes. My legacy is going to be my children and the amazing things that they do, and that’s really what this is all about.”
On the same episode of “Shark Tank,” another DFW resident found funding. Selom Agbitor, co-founder and COO at e-commerce company Mad Rabbit Tattoo, who according to LinkedIn works at Fort Worth-based Bell, and his co-founder Oliver Zak landed a $500,000 investment in exchange for a 12 percent stake of the company from Cuban.
Mad Rabbit, which sells a balm to promises to keep tattoos looking vibrant and prevent color loss, was initially looking for $500,000 for a 5 percent stake. The company entered the tank with a $10 million valuation.
“Our balm lends itself well to the sports market,” Zak told Cincy Inno. On the show, he told Cuban the company wanted “an angel who’s going to be behind us and believes in our growth.”
It was a busy episode for Cuban, who also made a $2 million loan-equity deal with Numilk, a company that makes machines that can produce various types of dairy-free milks on-demand.
