His business was once described as the biggest success story in the history of the US version of Shark Tank. Scrub Daddy founder Aaron Krause speaks to My Business about how his business and his spot on the TV show came about.
Mr Krause is the inventor of Scrub Daddy, a popular cleaning sponge that made waves in the US market and has now launched in Australian stores. Its idea was simple: a sponge shaped like a smiley face, where the mouth and eye holes could be used to better scrub cutlery and utensils, that is made from non-toxic and non-scratching foam.
He gambled everything on his Shark Tank appearance, having ordered a stockpile of the product and relocated his website server to handle a dramatic increase in traffic volumes.
Clearly, it paid off, with between 30,000 and 40,000 hits in the first hour of the episode going to air.
My Business asked Mr Krause about his experience pitching his business for investment on national television, what public scrutiny has done for the business and the role of having a mentor.
What made you go on Shark Tank in the first place?
Shortly after I started working with [US television network] QVC, I felt as if I was born to do live TV. I honestly got a rush each time the camera turned on. I felt as if this was my calling and was bragging to my wife one Friday night after dinner as we sat down to watch our new favourite show, Shark Tank.
This show embodies everything I hold dear. Inventors are pitching their ideas to self-made entrepreneurs who either vindicate the prepared or villainise those foolish enough not to be.
After watching Mr Wonderful kill another person’s dreams, I turned to my wife and said I could go on that show and crush the sharks.
How much did you gamble on changing servers and buying inventory before the show went to air?
I did a numbers game thinking there would be about 7 million viewers on Shark Tank and only 5 per cent would visit our site and only 3 per cent would buy. So we brought in inventory to cover that with backup for reorders.
So many entrepreneurs go on the show with big ideas but are quickly shot down. What preparations did you do going into the pitch that was different from these?
Believe it or not, I watched every episode twice! Watching others’ success and failures helped me refine my pitch. I knew I had to get to the point quickly and, of course, know my numbers.
My previous years spent working trade shows definitely contributed to me to feel at home in front of the crowd, despite being under immense pressure.
What pressure and, conversely, motivation did you get from your pitch being made so publicly?
It’s really been an honour to be recognised as having an exemplary pitch. The only real pressure it caused was keeping up with the demand that the exposure caused!
TV aside, pitching to investors is a very daunting challenge for many entrepreneurs. What advice would you give to others trying to secure investment?
When you’re first starting out, it’s daunting figuring out who to trust. Make sure to do your due diligence and ensure that you’re working with people who have your and your product’s best interest at heart.
What would you say are the three best pieces of advice you have learnt from working with Lori Greiner (the shark with whom he reached an accord on the show)?
Lori’s given me so much great advice over the years that it’s difficult to limit to just three! But Lori has been invaluable with providing advice on packaging, strategy and growing our brand with QVC.
When (and where) can Australian shoppers expect to see Scrub Daddy on the shelves?
We’re already on the shelves! You can find us at Howards’ Storage World, IGA, Ritchies Supa IGA, FoodWorks Supermarket, House, Kitchen Warehouse, Robins Kitchen, TVSN, King of Knives, and online at QVC and KitnCaboodle.
How have you resisted the urge to sell the company given its success to date?
Honestly, I’m too much of a workaholic to sell the company and retire right now. I think I take after my Uncle Ted who didn’t retire until he was in his 100s!
What are your plans for the company going forward?
Our goal is to have this in every supermarket, drug store chain and major retailer in the country and in the world.
Opinion: Why do so many claim to represent small businesses?
By Adam Zuchetti
Opinion: House prices not all doom and gloom
By Adam Zuchetti
Analysis: How can SMEs realistically stay competitive?
By Adam Zuchetti