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In Shark Tank season 12, investor Robert Herjavec attempted to acquire XTorch, a solar-powered flashlight company, for $400,000. Gene and Keidy Palusky pitched their multi-functional device, seeking $150,000 for 10% equity at a $1.5 million valuation.
When examining the $53,000 annual sales and $18.50 manufacturing cost against the $55.95 retail price, Herjavec identified fundamental market positioning issues. The Shark Tank investor described how the absence of patent protection and unclear market positioning made the partnership risky, then stated:
"Katie, the sales are awful. There's just a lack of understanding of how to get this to the market…I love the product but I don't want to be your partner. I want to buy the entire company. I'll give you 400,000 for 100% of the business."
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The negotiation continued with Herjavec raising to $500,000 before talks ended without a deal.
XTorch founders declined Shark Tank investor Robert Herjavec’s full buyout offer
Shark Tank product XTorch entered the market with significant personal investment from Gene Palusky, who put in $300,000 from his real estate ventures. The manufacturing costs stood at $18.50 per unit, with retail pricing at $55.95.
Their financial records showed annual sales of $53,000, projecting growth to $90,000 in the current year.
Mark Cuban analyzed XTorch's market strategy and sales figures before stepping back from investment consideration. Kevin O'Leary pointed out pricing concerns, suggesting a direct-to-consumer model at $29.95.
Daniel Lubetzky examined the manufacturing costs and retail margins before declining involvement. Lori Greiner reviewed the product specs but chose not to invest.
Robert Herjavec's interest took a different direction. Shark Tank investor stated:
“You either have to be the world's toughest torch and go higher end or be the world's best low-end flashlight with some features. You're kind of in the middle. You can't be in the middle. You're going to get crushed.”
After evaluating the business model, he proposed a complete acquisition for $400,000. Gene Palusky countered with a $1 million valuation, prompting Herjavec to raise his offer to $500,000.
The negotiation continued with Gene suggesting $750,000, but the gap remained too wide. Herjavec emphasized his plans to restructure the direct-to-consumer sales approach. The discussions ended without reaching an agreement.
Product background
XTorch, a solar-powered torch, combined a flashlight, lantern, and phone charger features with 48-hour battery life and water resistance.
The product gained traction through multiple sales channels. Their website served as the primary direct-to-consumer platform, complemented by Amazon marketplace presence. The dual charging capability through solar and electrical power attracted outdoor enthusiasts and emergency preparedness customers.
Sales data indicated stronger performance in regions with frequent power outages or active camping communities. The company maintained a steady production cycle, managing inventory between commercial sales and nonprofit distributions.
The company split its inventory between retail and charitable initiatives, selling 200 units at full price while providing 1,200 units at cost to nonprofits. They also donated 1,500 torches to communities without stable electricity access.
Post-Shark Tank performance
As per Shark Tank Blog, their appearance triggered an immediate market response. XTorch received over 2,000 orders following the episode broadcast, depleting their inventory of 1,400 units. The surge led to supply chain adjustments and manufacturing schedule revisions.
The company implemented a pre-order system with a 20% price reduction, dropping the retail price to $39.95.
Their Amazon presence strengthened, maintaining a 4.5-star rating across 200 verified customer reviews. The business continued operations independently, focusing on both retail sales and humanitarian distribution.
Their annual revenue reached $1.5 million, marking substantial growth from their Shark Tank appearance figures.
The company maintains its original mission of combining commercial success with social impact through continued nonprofit partnerships.
New episodes of Shark Tank are airing on ABC network.
