No Deal


Urbanfloat is a company from Seattle, WA, that offers a spa in which people can come to and flat in two-hundred gallons and 1,200 pounds of epsom salt. The entrepreneurs claim that this will improve people's lives and help them with "faster recover" by submerging themselves into a "sensory controlled environment."

When Lori notes that these kinds of tanks have been around for a while (usually called "sensory deprivation chambers"), the entrepreneurs note that theirs are much more friendly looking and aren't so much about deprivation as they have lighting and music options.

To ward off germs from other people, the entire water contents are filtered "four times", heated, and then treated to make it very clean. The entrepreneurs claim to have spent five years perfecting the float tanks. Following that, a series of stores were opened and the entrepreneurs own four of them and have begun franchising. Supposedly, one franchisee opened four additional locations on the profits from the first.

The entrepreneurs opened the first location at the cost of $300,000. They claim that it costs between $500,000 and $600,000 to open a new location with six tanks.

How much does this cost a customer? A single float session is $45 however, the hope is that customers will enjoy it so much that they'll sign up for an unlimited membership at the cost of $150 per month.

Urbanfloat has made $2,500,000 in sales in the year in which this deal aired and $600,000 in profit. The business does have $1,000,000 in SBA financing and bank debt.

Making a Deal

Mark makes a comment that cryo-freezing was once popular with the players of his basketball team but that it's just not anymore, clearly questioning whether the float-tank idea could be just a passing fad. Daymond flat out says that he doesn't believe in the strategy and doesn't like the debt the company is carrying. Lori, likewise says that she doesn't like the debt and is also out.

Mr. Wonderful makes a typically Mr. Wonderful-style offer for $100,000 in capital and $400,000 more as a loan for 9.5% to be paid back over three years in exchange for 15%. Meanwhile, guest shark Matt Higgins offers a straight-up $500,000 for 15%.

The entrepreneurs state that they're not interested in debt and counter Kevin's offer 2.5% equity in exchange for $500,000.

Matt's response is that if he were an equity partner and not just a debt-holder, that Urbanfloat would have a ready source of additional capital. The entrepreneurs attempt to get Matt to drop his equity ask to 7.5% (a kind of cheap move considering that they came in offering 5% off the bat) but he refuses and stands his ground. Again, they ask if he'd be willing to make the deal at 10%.

Matt responds that if they'll accept the deal at 12.5% equity he'll take the business to a value of $100,000,000. If he's true to his word, then that would more than compensate the entrepreneurs for the $6,000,000 value he bit off their starting value. But then, everyone would be rich, so... who's going to quibble about a few percent here and there? Not these entrepreneurs and they made a deal with Matt Higgins.

Scroll chart to see it all!

Scroll chart to see it all!

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This page was last edited on 8 November 2019, at 16:00.