Terry Lin and Jiake Liu think that the outdoor furniture market needs an update. They created Outer, an outdoor furniture company, to combat common problems consumers have with their outdoor sofas and chairs. Will the sharks be able to get comfortable with this company during
Shark Tank Outer Update
- Entrepreneur: Terry Lin and Jiake Liu
- Business: Comfortable, eco-friendly outdoor furniture
- Ask: $750,000 for 4% equity
- Result: $750,000 loan at 3% interest for 5% equity and a $30/unit royaly until $1 million is paid back
- Shark: Lori Greiner
Ever wish your outdoor furniture was protected from the elements? Want more eco-friendly outdoor furniture options? Outer is the company for you. Terry Lin and Jaike Liu have perfected the outdoor sofa, creating an eco-friendly piece that is comfortable, durable, and includes a rainproof cover.
They have a patent pending on the ‘Outer Shell,’ a velcro-attached system for keeping the cushions dry and comfortable. Another part of their business includes the peer-to-peer showroom, where customers can invite people to their homes to test out their Outer furniture. Customers who do are paid about $20 to $40 per visit.
Right off the bat, the sharks are boggled by the valuation. With the value that they’re toting, their outdoor furniture company is worth more than $18 million dollars. The sales don’t seem to stack up. They have done $800,000 in sales in the last four months, with a projection of at least $1 million by the end of the year.
Daymond John is out first due to the insane valuation. Guest shark Anne Wojcicki isn’t upset by the valuation, but she doesn’t see that the product will change the world. Mark Cuban thinks there’s too much risk, so he’s out as well.
Kevin O’Leary like the product and makes an offer of $750,000 for 20% equity, a drastic increase from the asking price. Lori Greiner counters with a very sharky offer: a $750,000 loan as a line of credit for 10% equity and a $20 royalty per chair until she is paid $1 million.
Kevin says he’s going to revise his offer, and Lori tells Terry and Jiake that she will drop out if they listen to it. Kevin proposes to match her offer, but with a 5% stake instead.
They negotiate and eventually get Lori to go with the 5% equity, but with a $30 royalty on each unit until the million is paid back. The loan will have 3% interest. After some hesitation, they accept Lori’s offer.
It turns out that Outer’s ‘insane’ $18 million valuation wasn’t all that crazy. They raised $4.3 million in 2020 and another $10.5 million in early 2021 from investors. They are always looking to expand their online offerings to new furniture types, travel destinations, and commercial ventures.
During our Outer update research, we found that the company is doing extremely well for itself. Recent figures place its annual revenue at $45 million, and they now have 500 showrooms in the United States alone. Outer sure isn’t going under any time soon and it looks like Lori made a great deal.
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