For the second time in a month, “Shark Tank” is featuring Atlanta-based entrepreneurs with a product line targeting people of color.
A month ago, Range Beauty’s makeup line got “Shark Tank” love, with two Sharks willing to invest in them, although the actual deal is still pending. On the March 25 episode, Young King Hair Care, with hair products focused on young Black men, gets the spotlight.
The entrepreneurs in question are a married couple Stefan and Cora Miller. Both were successful corporate executives at Fortune 500 companies who threw caution to the wind and are now running their own company.
Cora, with degrees from UNC-Chapel Hill and Georgia State, was vice president of external affairs for United Health Group leading social responsibility initiatives through strategic investments addressing health disparities. She had previously worked at General Mills in Minneapolis. She left her executive job at UHG in September 2020.
Stefan, who is ironically bald, was senior brand manager for Sprite at Coca-Cola Company, then director of marketing for Red Bull until last fall. A Morehouse and Kellogg graduate, he is an expert in brand management and creative strategy.
As is often the case with many “Shark Tank” participants, their ideas came from a problem they faced while parenting. “Kids change your whole perspective,” Cora said.
They had a young son Kade in 2017 who had a full head of natural textured hair out of the womb. “I was trying to find clean, natural hair products for him,” Cora said. “There wasn’t really anything specifically tailored for boys of color. Everything was female oriented.”
If his hair got dry, it would break. Many families would just cut the hair to simplify things but they wanted Kade’s curls to shine. So they found a chemist to create the proper formula of plant-based natural ingredients that would nourish and maintain the hair’s moisture properly. Then they signed with a Black-owned female manufacturer.
Their best sellers are the bundles featuring shampoo, conditioner, curling cream, mousse and/or essential oils. Prices of the bundles range from $25 to $88.
“Our products create a simple regimen that is easy for parents and the young male to follow,” Cora said.
Credit: ABC
Credit: ABC
Young King products were a hit out of the box in 2019. They were quickly placed in Targets and Wal-Marts nationwide. (They were part of a special Target acceleration program that Range Beauty was in as well.)
Their original rollout was supposed to feature pop-up shows and road shows. “We wanted to take the products directly to the people,” Stephen said. “Then the pandemic shut everything down.” They opted for digital marketing and built a community online using Facebook and Instagram as well as an email list.
The 2020 George Floyd protests also benefited their business. “There was a lot of attention paid to Black-owned businesses,” Cora said. “We were put into that conversation. Our business foundation has always been around young men of color, how to uplift, celebrate and meet their needs.”
Sales grew from $4,100 in 2019 to $362,000, then $1.54 million at the point in 2021 when they presented at “Shark Tank,” with projections of $3 million.
“Shark Tank” has been an inspiration for the couple. They watched 10 seasons’ worth of “Shark Tank” ahead of appearing. “We’re fans of the show,” Stefan said. “While we were building Young King, we’d watch ‘Shark Tank’ in the middle of the night. They reached out to us last spring. We went through the whole process and made it.” Their episode was taped last fall.
Cora was eight months pregnant when they appeared in front of the Sharks. (They now have a healthy four-month old daughter.) Their episode featured regulars Daymond John, Mark Cuban, Lori Greiner, Robert Herjavec and Kevin “Mr. Wonderful” O’Leary.
“With pregnancy brain, I was really trying not to forget anything,” Cora said.
“I have newfound respect for everyone who has been on the show,” Stefan said. “We prepped like a 10-page packet of potential questions.”
The Millers asked the Sharks for $225,000 for just 2.5% of the company, valuing the company at $9 million.
The Sharks asked if they were profitable yet. Stefan said no. He said 70% of the costs go to marketing because it’s a new brand. Cora said they raised $1.6 million from investors in a round that closed in March 2021.
“You are on the right trend and put these gorgeous men like your son on the face of the product,” Greiner said. “This is a super competitive space and I have major concern to turn it into something enormous. I’m out.”
John said he can’t get behind this investment for such a small share of the company and said he is out.
Cuban said the company markets as a big company and is skeptical they would be a good fit since he likes it “lean and mean.”
Herjavec said the product line struck him as too narrow. Cora tried to argue that they want holistic solutions for a broad array of ages. He said the 2.5% was too low for him but did laud them for their impressive achievements so far before saying no.
O’Leary was the last one left. He likes sales and offered a royalty, his favorite structure. “I’d give you the $225,000 for a $1 a SKU til I get the $225,000, then drops to 50 cents per SKU for perpetuity,” he said. “I don’t have equity so I wouldn’t do it any other way.”
Herjavec came back and offered 50 cents per product until he got two times his return. The royalty stops, then he gets 5% equity that converts when the company gets sold.
Stefan said they have to consider cashflow and royalties are too difficult for them to take on so they walked away.
In a follow-up interview, Stefan said a 75-minute conversation was crunched down to 10 minutes but most of the positive statements survived. He said the royalty amount was too high for their appetites. He also said the company had grown so much in the span when they applied to the show to the point they presented to the Sharks that they could only offer a very small percentage of ownership.
He and his wife had hoped to get a line of credit and maybe some advisory shares from a Shark or two. He also thought Cuban would be a likely investor but was surprised how quickly the billionaire entrepreneur shot them down.
The Millers had hoped to use the Sharks’ ties and connections to build their business. But for now, they are fine doing it on their own, adding a skin care line for boys and young men.
ON TV
“Shark Tank,” 8 p.m. Friday, March 25, on ABC, available on Hulu the next day
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