During the fifth episode of season 7 of Shark Tank, JD Claridge and Charles Manning presented their innovative drone company, xCraft. Aired nearly a decade ago on October 23, 2015, this was a pivotal moment in a burgeoning industry that had yet to fully realize the potential of drone technology.
The duo sought $500,000 in exchange for a 20% equity stake, valuing their business at $2.5 million. Their concept quickly garnered interest, as Kevin O’Leary saw great promise and countered with an offer of $750,000 for a 25% stake. Not to be outdone, Daymond John entered the fray with a $1 million offer for a similar percentage. Kevin then revised his bid to match Daymond’s. Lori Greiner also expressed interest, offering $1 million, which escalated the competition further. Faced with multiple offers, JD and Charles proposed a joint deal that would value their company at $10 million.
Daymond responded to their ambitious valuation with a tongue-in-cheek remark:
“Guys, how did you go from $2.5M to $10M? I smell greedy people now.”
After extensive negotiations, JD and Charles struck a deal for $1.5 million in exchange for a 25% stake, culminating in a $6 million valuation with all five sharks—Mark Cuban, Lori Greiner, Robert Herjavec, Kevin O’Leary, and Daymond John—jumping aboard.
Negotiation Dynamics: A Five-Shark Collaboration
During their pitch, JD and Charles showcased two distinct drone models. The first was a larger drone equipped with its own camera, capable of achieving the flight speed of a plane while maintaining the stability of a helicopter. The second model was smaller, designed to accommodate a smartphone for aerial photography.
When the founders mentioned plans to license their products to protect their designs, Daymond inquired about their connections in the licensing domain. Following their affirmative response, he pressed them on how they intended to allocate the requested $500,000. JD clarified that $250,000 was earmarked for scaling the production of the larger drone, while the remaining funds would focus on the smaller model’s development.
It was at this point that Kevin made his initial offer, igniting what Daymond anticipated to be a “nasty, nasty shark fight.”Daymond then escalated his bid to $1 million for a 25% stake, a move that prompted Kevin to quickly match him. Lori also proposed $1 million for a 20% equity share, leading Kevin to equal her offer as well.
As discussions continued, Charles suggested a joint offer, prompting Kevin to express his interest but demanding more equity in return. Daymond viewed this as overly greedy and playfully remarked:
“I used to tell my daughter a little story. Why didn’t the baby crab want to share his food? The answer is because he was just a little shellfish.”
Firm in their valuation, JD and Charles countered with a $6 million valuation for a $1.5 million investment for 25% equity. Despite Mark’s initial hesitation, he sought clarification regarding other potential investors and their offers. JD and Charles explained their reasons for favoring the sharks due to their extensive experience and resources. Satisfied with their justification, Mark agreed, facilitating one of the rare five-shark deals on the show.
For ongoing updates about xCraft, fans can follow their official Instagram account at @xcraftuav.