With everybody on the start-up wave right now, it can be difficult to stand out amongst the crowd.
Lucky for you, we’ve connected with Rasmus Barfred and Bo Haaber, co-founders of the mold-breaking tech company, THEMAGIC5.
Marking one of the biggest deals in Shark Tank history, THEMAGIC5 harnesses proprietary AI technology and robotic manufacturing to make the world's first and only custom-fitted swimming goggles, a true game-changer in an industry that has seen little to no innovation over the years.
Rasmus and Bo entered the Shark Tank studio asking for $500,000 for 2.5% equity in their startup, valuing the company at $20 million (one of the highest valuations in the show's history).
Initially, the Sharks scoffed. (Robert Herjavec actually laughed.) But then, guest Shark Nirav Tolia pointed out that THEMAGIC5 is not a swimming goggles brand, but a tech company—with custom-fitting technology that could be applied throughout sportswear and far beyond the realm of sports into other industries.
At that moment, a bidding war ensued, with all Sharks including Mark Cuban, Laurie Greiner, Kevin O'Leary ("Mr. Wonderful"), Robert Herjavec, and Nirav Tolia ultimately making not one but two rounds of offers and several Sharks joining forces on combined offers.
After much tribulation, Herjavec stopped the duo in their tracks and offered $1 million for 6.5% equity in the company (a $15.4 million valuation).
Rasmus and Bo accepted on the spot.
Simply put, this power-duo knows a thing or two about surviving in the start-up world.
Keep reading for their expert tips on creating and maintaining a successful business.
Don't start a business to start a business. Start a business because you have a clear and focused problem to solve. Test whether the problem is a real problem or just a “good idea in your head” – don’t just rely on feedback from friends and family ask potential customers.
When you have a clear problem to solve it's easier to prioritize and focus your time and effort. It's a messy process starting a business and you need a clear guiding start to keep you on the right track.
Be able to articulate why you are in business within 5 seconds. For THEMAGIC5, our why is “giving everyone a better swimming experience.”
Having a niche means less competition.
Both physically and mentally. Make sure you truly understand the needs of your customers.
How will your setup handle 10x? Asking those questions helps you understand where your weaknesses and risks are.
Having co-founders makes the journey easier and much more fun. It makes the good times better as you share your successes with your team, but most importantly, it makes difficult times shorter as someone else can help you get out of it.
You need to trust your co-founders - it sounds like a basic thing but down the line when you need to make bigger decisions and you can't be involved in everything yourself, you need to trust that your co-founder is doing the right thing.
Find someone who is different from yourself. In our case, we are relatively similar but we also differ in some important ways; level of experience, area of interest, and the way we work.
This mainly applies to the team we've built. We've been fortunate to attract athletes as employees. They have been raised in a competitive environment and despite the relatively young age (avg. age of the company is 27) they really understand the process of improvement and that it needs to happen in small incremental steps.
Building a startup most of your time is spent on fixing small challenges of things that don't work. You try 10 things and only 1 works - you need to see that as a win that you found 1 thing that worked and not 9 defeats.
Photography by: Courtesy THEMAGIC5