Last night’s episode of Shark Tank saw Queensland-based business Catch’n’Release face a deal that’s “never been offered”, when shark Glen Richards made a play to acquire its product, which could help save the Great Barrier Reef.
Husband and wife couple Margaret and Peter Powell entered the tank looking for an investment for their Catch’n’Release anchor retrieval system, which allows boat anchors that get stuck to be reclaimed without damaging coral reefs.
The pair were seeking a $200,000 investment for a 20% stake in the Catch’n’Release, putting the business’ valuation at a cool $1 million. Speaking to SmartCompany this morning, the Powell duo said they felt like “a lamb to the slaughter” entering the tank, but praised it as a fantastic learning experience.
“It was absolutely nerve-wracking. You see it on TV, and then you’re suddenly there, it was like some sort of Alice in Wonderland situation,” Margaret said.
“But it was a really good experience. It teaches you so much about yourself and your business, and what you can and can’t do.”
Margaret and Peter, an accountant and mechanical fitter respectively, said the idea for the Catch’n’Release system came about 20 years ago when the two were out on the water and their boat’s anchor got stuck.
“The rope went nearly taut, and when I tried to get the anchor up I nearly went overboard,” Margaret said.
It was nearly 10 years later that they developed the first prototype of the system, but they lacked the machinery to develop and test the system properly. Manufacturing companies routinely ignored the pair, leading to Peter constructing his own manufacturing shed to produce the device.
“We got no help when trying to prototype the device because back then there was no help out there,” Margaret said.
“Today entrepreneurial ventures are supported by just about everyone, but we were sitting in limbo, disheartened, for so long. There was no money, and manufacturing companies would take six months to just get the smallest piece of the prototype back to us.”
Acquisition deal floated
When they landed in the tank last November, the Powells were desperate for investment, revealing to the Sharks they had poured everything into the business, including their retirement funds. Unfortunately, after discovering the patent for the business had only three years left to run, four of the Sharks backed out, leaving only Richards.
In a deal fellow shark Steve Baxter claimed had “never been offered in the tank”, Richards offered the duo a 100% acquisition deal for $200,000, with an ongoing five percent royalty payout.
Although the entrepreneurs admitted going on Shark Tank was more for learning and exposure rather than cutting a killer deal, when Richards offered to buy the business, they felt “relieved”.
“In some ways we felt relief. Relief we could put the business in good hands, take a step back, and have our lives back,” Margaret said.
“People would tell us we would eat sleep and breathe the business, and looking back, that’s exactly what was happening.”
However, after the cameras stopped rolling and the deal went to due diligence, the Powells found leaving the business wouldn’t be viable, and decided to stay at the helm.
“We were already the face of Catch’n’Release in Australia, so we thought it was probably easier to keep going with the business with Glen’s support, rather than he take on the business and totally change the structure and how it operates,” Margaret said.
Since then the company has gone from strength to strength, landing two government grants along with getting local Brisbane manufacturer on board. Catch’n’Release is also developing a different version of its product for jet skis and kayaks, which it hopes to release soon.
In a statement to SmartCompany, Richards said it was “mutually agreed” to not continue with the deal, but he has continued to support and mentor the business as it grows.
“After the filming, Margaret and Peter found a quality manufacturer here in Australia. They were more rejuvenated again to continue on the journey,” Richards said.
“I had some serious concerns about the short-dated patent but have offered to help mentor and to continue supporting them on their journey. It is a great product which also has a great environmental impact on our Great Barrier Reef”.
The pair say the business has now come into its own, and they are currently in talks with overseas contacts who could help the product go global.
“We’re looking to get the product out there with the three years of patent time we have left, make some money, and then retire,” Margaret says.