Travis Osborne with a Mobile Tyre Shop van
Surreal is the word Travis Osborne uses to describe his experience on Channel 10’s reality show for entrepreneurs, Shark Tank.
Osborne was the second entrepreneur featured in last night’s Shark Tank episode and was lucky enough to secure an offer from not one but two of the sharks for an investment in his mobile tyre-changing company Mobile Tyre Shop.
Osborne, who founded Mobile Tyre Shop in July 2012, pitched for a 10% stake in the company for $250,000. With Mobile Tyre Shop turning over around $1 million in revenue, the pitch valued the business at $2.5 million.
“So sharks, who would like to join me in showing Australia the new way to buy tyres,” Osborne said in his pitch.
Osborne told the sharks he wants to reach “critical mass” of 10 mobile tyre-fitting vans and said “clearly this business is about franchising”.
While the sharks expressed some concern that one of the big retail tyre providers could swoop in the industry and crush Osborne’s company, four of the sharks liked Osborne’s pitch – Boost Juice founder Janine Allis, John McGrath of McGrath Estate Agents, Andrew Banks of Talent2 and “internet pioneer” Steve Baxter.
Allis—who recognised Osborne when he walked through the door as the former manager of Challenger’s property fund who years ago helped Allis open her first Boost Juice bar outside of Melbourne—ultimately decided not to put in an offer as she “can’t get passionate about tyres”, but Banks, McGrath and Baxter were keen.
Banks made the first offer but McGrath and Baxter decided to team up to make a joint offer of $150,000 for 10% of Mobile Tyre Shop and a loan to the business of $100,000.
“One of the rules of the Shark Tank is you have to get the dollar amount you requested,” Osborne told SmartCompany.
“You can negotiate on the equity.”
Osborne accepted the sharks’ offer but the deal is now subject to due diligence, potentially opening up the opportunity for offers from other investors.
“Steve [Baxter] has financial and online experience and John [McGrath] has franchising experience,” says Osborne, whose goal is to expand Mobile Tyre Shop into a national business.
“They saw the opportunity in the business and formed a two-headed shark.”
Osborne was also impressed by all of the sharks’ “appetite” and passion for business.
“You can see why they are so successful in their own business,” he says.
Osborne, who is the sole owner of Mobile Tyre Shop, said he spent two years ‘bootstrapping’ his business but had been looking for an external investor for some time. He came across an online ad for businesses looking for mentors on SmartCompany sister publication StartupSmart and his journey to appear on national television began.
“They wanted a paragraph about the business and I had to fill out a questionnaire,” Osborne says.
“I was invited to do a presentation out at Melbourne Airport and I had three minutes to explain why I wanted to be there. I then got invited to Sydney for the casting call.”
While Osborne admits he was somewhat apprehensive about watching last night’s episode – around one hour and 20 minutes of footage of him and the sharks was edited to just minutes of TV – he believes Shark Tank is a “a really good thing for Australia”.
“It shows what actually happens behind closed doors for many people,” he says.
But Osborne says there are elements of the show that make it challenging to secure a deal.
“What most people don’t realise is the sharks know nothing [about your business] until you come out the door,” he says.
“They are making a decision purely on gut feel and what they see in front of them.”
One of the other rules of the Shark Tank is that you are not allowed to bring in any written notes when pitching to the sharks.
“It’s difficult to go through your cash flow with the sharks,” Osborne says.
But while it may be some time for a deal to be done, Osborne believes being on Shark Tank has already helped his business, saying the process of “knowing your elevator pitch” is just one benefit.
“You have just one shot at it, so you have to sit down and prepare your presentation, really think about the key benefits of your business,” he says.
And of course, the publicity created by appearing on national advertising is beyond what a small business owner could ever afford.
“You can’t buy that type of advertising,” Osborne says.
“Irrespective of the investment, just to get out there is great for our business. A lot of people don’t know you can get your tyres fitted at home.”
And his advice for business owners looking for an investor? Practise your pitch.
“The first thing is to get your elevator pitch down right,” he says. “Practise it. It should be a 20-30 seconds pitch about what you do. It has to communicate your unique selling position.”
And Osborne says it is essential to be prepared enough to engage with any questions a potential investor throws your way and to “know how to follow-up”.
“Put yourself out there, go to events and meet people,” he says.