KaZam creator, Mary Beth Lugo, pitches her balance bike in Shark Tank Season 4. Kids learn how to balance first because the bike does not have pedals, they then transition to a regular bicycle once they learn balance. Her design includes a foot rest built into the fame.
KaZam costs $28.25 to build, wholesale is $45, and retail is $99.95. Kevin says they can buy training wheels for $19.95. Mary Beth claims that it is a faster and better way to teach the kids. The patented frame design is different than the competition.
They have $1.4 million on sales in the first three years. KaZam profit margins are at 36%. She needs to order 50,000 bikes to get the margin to 50%.
Mary Beth tells the Sharks that she would like to design a pedal bike for the next product. The Sharks do not like the idea of creating a pedal bike. Mark thinks KaZam will drown on opportunity if she builds the pedal bike.
KaZam Episode Data
- Company: KaZam
- Entrepreneur: Mary Beth Lugo
- Ask: $300,000 for 20% equity
- Episode Season 4 Episode 424
- Companies in this episode:
- Mark Cuban
- Daymond John
- Kevin O'Leary
- Barbara Corcoran
- Robert Herjavec
- First Aired: 05/09/2013
- Deal: Mark Cuban and Barbara Corcoran $300,000 for 32% equity
What do the Shark Tank Investors say about KaZam?
- Mark Cuban – gives her twenty-four seconds to convince Barbara to join him on an investment of $300,000 for 40% equity. Mary Beth feels 40% is too much and counters at 32%. Deal is done.
- Daymond John – thinks she has a great product, but if he gives her the money he will never get it back. He is out.
- Kevin O'Leary – believes she doesn't have a strong enough profit margin to recoup the investment due to needing a significant amount of capital. He is out. Kevin O'Leary asks if he is willing to pour boiling oil over your competitors?
- Barbara Corcoran – doesn't believe she has the killer instinct to crush the competition.
- Robert Herjavec – believes she will be distracted from focusing on her strengths. He is out.
KaZam after Shark Tank
You can find the KaZam bike in stores across the United States.