ENTREPRENEURS: Peter & Yuen
PITCH: How Do You Roll?
ASKING FOR: $1 million for a 12% stake
BEST PART OF THE PITCH: Peter and Yuen took the same high quality you get at a sushi restaurant and paired it with the convenience at a grocery store. Barbara steps up to create her own custom-made sushi roll. The brothers dole out samples of their own sushi rolls for the other sharks. The brothers have sold 40 franchises with 15 of them now open. They get a 7% royalty from their franchisees' sales.
DO THE SHARKS BITE? Mark thinks the sushi business is brutal. He doesn't want to be part of it, so he's out. Daymond thinks the margin will be too low for him, so he's out. Robert likes the business and the sushi, but he can't invest. Barbara feels the presentation was a little too buttoned up for her tastes. She's out. That leaves Mr. Wonderful.
THE RESULT: Kevin offers the brothers $1 million for 22% equity. He also wants a monthly distribution prorated to the owners from the franchisees. The brothers counter at 15%, but Kevin will go down to 20%. The guys ask Kevin how he will help them with the real estate side of opening new locations. He says that's still up to them. At the end of the negotiation, Peter and Yuen take the offer because they believe a strategic partnership with Kevin will help get How Do You Roll? on a roll.