Mark Cuban Takes On Kevin Hard

my name is Jeff strou I'm the owner of hon LLC. I'm here today to ask for an investment of $500,000 for 40% equity in my business. ( Sponsored by www.bcbank.se )Now let's suppose for a moment that someone that you know or loved lived in a house that caught fire, and they could have been saved if only firemen could have gotten water to the structure. Just moment sooner now I've been a fireman for 15 years. I tried thinking of ways to save time in supplying water to the fire scene because there was too many homes, and American Dreams being destroyed by fire. Now I've come up with a solution hon hon is the world's fastest way to connect and disconnect from a hydrant.

Let me show you how that's done. I have two professional firemen going to help me demonstrate this now. Damon is on this side he's going to help me connect the hon with the standard hose to this side. And Kevin is on this side to connect just the standard hose which is the way it's done today.

Okay Gentlemen let's begin now as you can see the hon is already connected. It's ready to turn the water on the other side we're still trying to screw it on okay now he's got it tight okay. Now let's disconnect to show the speed on that. You can see the speed it takes to disconnect the hon versus your standard hose that's being used across the United States today.

At a fire scene every second matters. Your standard connection can sometimes take 30 seconds or more, hon will be done in less than 3 seconds and disconnected in a second. Now there's over 33,000 fire departments across the United States.

There's Millions to be made at this Market alone who's ready to make millions with me. Where you from Jeff I'm from Arkansas what about your base department where you worked what are they customers. They love it they they want to use them, the only reason we're not using them yet is because me working. There they can't buy them straight from me how are you going to sell this so let's say it was what 20 seconds difference it was an 8sec difference on my account can I go to a fire department and say you're going to save 8 seconds by this do you think that there's budget for this.

I do basically the last month is when I started making my sales calls and out of 11 departments that I visited I've had four that's give me hard POS. The other six are working on getting the paperwork together to give me the PO what did you sell them for this size here the smaller one is sold for $215, the larger that goes on the steamer valve is $385.

Jeff the only negative to your story is you're selling to the government your sector is under stress for budget cuts. They don't have any money assuming they liked it how much money would that particular Firehouse have to put out to buy enough of them to equip their typical equipment.

Most fire departments where I've got it figured out are going to average about 35 units. It's $7,000 roughly is your typical sale if you said you sold typically 35. That's a lot of money going along that line, nobody has bought isn't the real play here if you could get fire departments to mandate this product. If you could get municipalities to say you have to have this hose because it saves lives have you been able to get fire departments to approve it?

That way we're working toward that, we have not got that approval yet. Are there Distribution Systems that provide Direct products to fire stations like that jacket, is there a company that distributes that directly?

Yes there is have you talked to them about this product, yes I have. And what have they said to you?
I went into them trying to make a deal for them to buy the patent after they looked at it they said that at present time they wasn't ready to buy it. So they wanted to help me distribute them. They want to put it in their product line.

And how much Capital do you need to get it into distribution? 500,000
I can't get over the fact that the Distributors want you to take on the financial challenge of making the products. So they don't believe in it to that extent so I'm out.

I keep weighing that 8C savings pitching a municipality against spending $7,000 and, I don't think they're going to do it I'm out.

Jeff I love the design why can't you use it for oil pipelines or why can't you even use it for the the hose. I have at home because I can never screw in that stupid hose at home.

Like that one why'd you wait so long to show us that. Yeah no kidding now. That will be made out of plastic this is part of the same deal part of the same thing.

Do you have a patent on that?
That patent falls under the same thing. Have you tried to sell this? No I haven't the main reason why is because I've been focusing on the fire side.

Wait wait wait let's stop there's nothing wrong with the fire thing, but you're realizing how difficult it is to change the entire industry now. On the other hand there are two or three hose makers in the US that supply all the big boxes they're huge why wouldn't you go to them and say I have a better way to attach your garden hose to every home in America and you can pay me 20 cents. And you can manufacture this yourself that's only one call to them.

I haven't worked on like I said I haven't worked on the household side of it at all other than making a sample to see if that would function like that.

Let me just tell you don't listen to him 20 cents is way too low. Jeff do you have anything else in your pockets no sir. Now this is a big deal.

You know what Jeff I like this so much what if I offered you $1.25 million for your company, plus a three-year employment agreement at 100K per year to run the show. And and I'll pay you a percentage of the profits once we hit certain hurdles that we agree to.

Wait a second before you even consider that Madness Jeff I find this kind of thing distasteful. Watching a great entrepreneur be taken advantage of. Wait a second I think you're passionate about this fire element of your business. That's where you came from. I just want the garden hose piece all right, I'm going to pay you $500,000 for 100% of that and I'll pay you back a royalty of 3% in perpetuity.

If we become Partners which is what this would be you're selling out from underneath us an important part of the company, and so we don't want to give that away.

We what are you talking about we? my partner he's my partner I'm not taking everything his whole life from him like you are.

I'm not either I'm paying him a salary in excess of $100,000 is going to go a long way.
You're sucking the life out of him. Jeff what do you think about Mark's offer? I would want to know what the percentage is long-term percentage okay uh I would want at least 7 and a half% royalties long term. I was going to make an offer along the line of Mr Cuban but that's more generous than I was going to be at 1.25 million. I was not at 1.25 I'm out.

I'm going to leave my offer exactly the way it is because I don't have to change it, If you go to the dark side.

What is this with this dark side stuff? you're this is the enlightened side. It disturbs me immensely to watch you suck the life out of this man. He's worked hard to get to where he is and you're just taking it all away from him.