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JD Claridge and Charles Manning came to season 7, episode 5 of Shark Tank with their drone company called xCraft. This episode aired almost 10 years go on 23 October 2015, a time when not many players were there in the drone making field. It was an age where this invention hadn't yet reached the pinnacle of its popularity.
JD and Charles came asking for $500K for a 20% stake at a 2.5M valuation. Kevin believed in the idea, so he offered them $750,000 for a 25% stake. Daymond offered them $1M for a 25% stake. Kevin raised his offer to $1M as well. Lori jumped in and offered them $1M as well. Seeing all the Sharks vying for them, JD and Charles asked them to do a joint deal for a $10M valuation.
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Hearing this, Daymond quipped:
"Guys, how did you go from $2.5M to $10M? I smell greedy people now."
After a lot of back-and-forth with negotiations, JD and Charles ended up making a deal for $1.5M for a 25% stake at a valuation of $6M with all five sharks— Mark Cuban, Lori Greiner, Robert Harjavec, Kevin O'Leary, and Daymond John.
How Daymond handled the five-shark deal on Shark Tank season 7 episode 5
JD and Charles showcased both their drones on Shark Tank, one of which was a bigger drone that used a camera of its own and boasted the speed mechanism of a plane and the stability mechanism of a helicopter. The other one was a smaller drone that could fit one's smart phone to use its camera to record shots from above.
When they said they were going to license the products so no one else would come up with those designs, Daymond asked if they had contacts that could help them with the licensing. After they said they did, Daymond asked them how they would be using the $500K they had asked for. JD explained that $250K would be used for scaling and the production of the bigger drone, while the rest would be used for developing the smaller drone.
This was when Kevin offered them $750K for a 25% stake in their company. Daymond commented that he was smelling a "nasty, nasty shark fight" that, according to him, was about to happen. He then offered them $1M for a 25% stake, to which Kevin said he would match his offer. Lori was ready to give them the same amount for a 20% stake, and Kevin matched her offer.
Then, when Charles asked for a joint Shark Tank deal, Kevin stated that he was interested but added that he needed enough equity. Daymond thought that was greedy and added:
"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."
He added that he didn't want to speak for everyone, but he personally didn't believe their company was worth more than $6M. So JD and Charles threw a counteroffer which was that of a $6M valuation. They asked for $1.5M for a 25% stake in their company. All the sharks readily accepted it, but Mark showed reluctance.
He asked if they were offered money from investors other than the ones on Shark Tank and why they didn't take those deals. JD and Charles said that they didn't like where those institutional people were taking their company and trusted the sharks, who had much more experience. Mark was satisfied with their answer and shook hands on one of the very few 5-shark deals.
Fans of Shark Tank can follow xCraft's official Instagram page for more updates at @xcraftuav.
