July 12, 2024

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A Charlotte startup on Shark Tank

A Charlotte startup on Shark Tank

Photo courtesy of TheMagic5

Over the summer, a Charlotte startup that uses robotics technology to make custom swimming goggles made a business pitch before a panel of high-powered potential investors for the hit show Shark Tank.

Driving the news: On Friday night, the program featuring the business — called TheMagic5 — aired on ABC. Two of the company’s founders, Bo Haaber and Rasmus Barfred, spoke with Axios last week about their experience.

Flashback: The idea for TheMagic5 was borne out of frustration.

On a vacation in early 2017, Haaber, a Danish recreational triathlete with a software development background, needed a new pair of goggles but couldn’t find a single option that fit properly.

  • So he called Barfred, a fellow swimmer with a business background, and a third business partner, Niklas Hedegaard, and they started working toward a solution. The team collected feedback from recreational and competitive swimmers, then established relationships with gear manufacturers.
  • They launched a Kickstarter later that year and started distributing their first custom goggles in 2018.

Last spring, TheMagic5 team was approached by Shark Tank researchers who asked them to apply to be on the show. Months of preparation followed, a process the team called highly stressful.

“All faces are different, but all goggles are the same. That doesn’t really make sense,” said Haaber, who picked Charlotte for the company’s HQ when his family moved here for a new job.

By the numbers: TheMagic5, which has taken on big-name investors like Olympian Matt Grevers, has generated $3.5 million in revenue since its inception.

  • The customer base for the goggles includes both recreational and competitive swimmers. Combined, that’s a potential customer base of roughly 70 million swimmers between the U.S. and Europe, according to Haaber and Barfred.
  • TheMagic5 goggles run between $55-$75 apiece.

Custom goggles solve important problems for swimmers, Barfred says.

  • For recreational athletes, the goggles make a workout more comfortable and enjoyable.
  • For competitive swimmers, well-fitting goggles make focusing on speed and technique easier — plus they’re one less thing to worry about before starting a race.

(Remember in 2008, when Michael Phelps’s goggles broke and filled with water? Phelps won the race and set a world record anyway, but that’s the kind of nightmare situation custom goggles aim to avoid. Not everyone is Phelps.)

“The mental state of a swimmer is super important when you’re at the starting block. You want to eliminate all risk and all the things that could go wrong in your race,” Barfred says.

Of note: Because they spoke with Axios before the show aired, Barfred and Haaber had to be guarded with specifics about what happened. But they offered one piece of advice for young entrepreneurs.

Look for niches, Haaber says. Swimming goggles are a niche industry. Finding a solution for a specific problem is the strategy he says his team followed.

“There are problems in all niches,” he says.

Editors note: When they appeared on Shark Tank, TheMagic5 asked for $500,000 for 2.5% equity in their startup. This valued the company at $20 million.

After guest Shark Nirav Tolia pointed out that TheMagic5 is more of a technology company whose tech could be applied elsewhere in sportswear and beyond, a bidding war followed among all judges, including Mark Cuban, Laurie Greiner, Kevin O’Leary, Robert Herjavec and Tolia.

Ultimately Herjavec offered the team $1 million for 6.5% equity in the company — valuing the company at $15.4 million valuation. They accepted.

This story was updated after the show aired.

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