Category: Shark Tank Pakistan

“Saraaf Commodity Trading Seeks Rs. 1.5B for 20% Equity on Shark Tank Pakistan”

Bilal, Ismail & Taha are the co-founders of Saraaf. Founder said that we and our partners in Central Asia and Afghanistan, which is a unique landlock mostly region, have been solving this problem for the last 10 years. We ensure that the goods reach the buyers and the sellers get their payments. Our hero products are Onyx and cotton.

Apart from this, in the last two years, we have also done exploration in the mineral industry, in which we have invested last year and we have also traded in lead. Moving forward we want to enter the tech market in trade industry. The world’s largest hotel does not have any of its own property, the world’s largest taxi service does not have any of its own car fleet, these two giants has disturbed its market by becoming trustee between customer and vendor. Founders said that we at Saraaf want to become trustee in commodity sourcing in this region.

Founder said that Sharks we have got soft approvals from the Pakistan’s biggest textile giants to work on our tech. Besides, the world’s largest cotton trading house is ready to buy Afghanistan’s cotton exclusively from us for the next year. That alone could be a contract worth to 10 to million dollars, we are here to dilute equity at 20 % for 1.5 billion PKR.

Equity Split

Sharks asked them how many co-founders are in your company? Founder said that we are actually five co-founders and the equity split is 35% Bilal, 35% Asfaan, 10% Ismail, 10% Saeed, 5% Taha and 5% for other one. Shark Junaid asked them is this a trading business or this market place which you will make in the future? Founder said that this is our business of sourcing, we basically source raw materials for buyers in Pakistan and rest of the world, we import Onyx here and then we export it to China.

Revenue

The cotton that we deal in is Afghani cotton, specifically its a best quality cotton out of that region, so its last years import numbers were Rs. 43 Billion, our sales in Pakistan were Rs. 2 Billion so which translates about the 4% of the Market share. Our Gross Margin in 2023 is 7%, 2022 is 11% and 2021 is 10% to 15%. Net Profit Rs. 21 Cr. last year. Till date, we have generated a revenue of Rs. 11B since 2019, Rs. 3.8B in 2023.

All 3 Sharks said that you guys are amazing entrepreneur, you guys are building a great business and know how it works and you have understood how make margins but for today we are out but we wish you all the best .

Episode 3

Update

At the end Shark Usman Offer PKR 80 Cr for 20% equity ( PKR 70 Cr Line of credit 3% Royalty). Founder said that this offer in which you are reducing our valuation a little bit but I understand that this would help us in the next few years to scale up in such a way , we accept your offer. The deal is closed.

They are trading business and they are trying to tell the investors that they are raising investment for the marketplace just to look cool Infront of investors. They should not waste their time on tech as Junaid mentioned.

The founders are amazing and know what they are doing and most importantly making huge profit. Amazing thing is they don’t work on credit in such business.

https://www.saraafglobal.com

https://www.instagram.com/saraafglobal/?hl=en

“Anusha Fatima and Rahul Rai, Founders of TrashIt, Pursue 4.5 Crore PKR Investment for Brand Expansion on Shark Tank Pakistan in Exchange for 7.5% Equity Stake”.

Anusha Fatima and Rahul Rai , founders of TrashIt are from Pakistan. They met at the startup weekend that happened in Nest Ayo, where Rahul share his idea with Anusha about Compost Fertilizer ,she agreed on it and they started working on it. Firstly, they invested their own money on this project ,created facilities and started their business in 2017. Rahul looks after legal ,finance and strategy. Anusha looks after business development, fund raising, growth and corporate communication.

Compost fertilizer is basically consist of compostable organic waste. Rahul said that total organic waste generated , yearly in Pakistan is 550 Million tons. Its recovery is estimated to be 25% then 100-13 Million ton is such waste which is compostable. Agri’s waste is standing at 18%. They have an urban facility in which 20 compartments have been made , in which they process the waste. They have to pay some charges for keeping that waste and the rest of the logistics is their own.

The total revenue in the last year they made is 1 Cr PKR and Rs. 4.5 Cr PKR projected in 2024. Shark Faisal Aftab asked them for the break up of the 45 Cr PKR where it will be used. Rahul said out of 45 Cr PKR 30% will be deployed at 3 new sites, 30% for pilot projects so that we can get data and can stand in the market, 22% in operations, 12% sales and marketing and 8% in there certifications and testing. Shark asked him how much net profit will be generated from that? Rahul said that they are expecting 10% net profit this year and in the next year it will grow to 20%.

Sharks asked them if they gave them the investment then they are going to experiment in the farm deployment and so on and for that we gave you the valuation? Anusha said that correct studies had been done through out the world on compost, valid data is available on how much benefit the land gets from the use of compost, no such study is available in Pakistan. Shark Junaid Iqbal asked them to take grant from World Bank, IDB or ADB or anyone. Shark Usama Bashir asked him that explain a little bit about how you reached 60 Cr PKR? Rahul said that they made the forecast for the next two years the base.

Sharks are a little bit confused that whether they are serious about their product or they are just here for promotion. Sharks said them are you serious about raising investment or are you just here to advertise you brand? Because the valuation they asked them are not that serious. Shark asked him if they gave them 4.5 Cr PKR on top of 7.5% then what will be its ROI? Then Rahul answered that its ROI will start coming from next year. And that moment shark said that it is just an imaginary plan that you will go there. Sharks are not impressed by their valuation and product marketing technique.

I think the main reason they were not able to raise funds is they were asking for funding for a business model that they have not tried yet. It’s a very risky for sharks and the other reason is they were not able to justify their valuation of the business.

The founders are amazing and have been working on the startup since 2017. The idea is innovative and will surely help formers to grow their productions but again innovation needs initial funding for testing and trial and sharks seem to me interested in only revenue-generating trading businesses. At last the Deal is not excepted by the Sharks.

https://trashit.pk

https://www.instagram.com/trashitpk/?hl=en

https://www.facebook.com/trashIt.pk

“Entrepreneur Wahab Ahmad Muneeb, Founder of Pink Salts, Seeks $8 Million for 10% Equity on Shark Tank Pakistan”

Wahab Ahmad Muneeb the founder of Pink Salt products since three years and is from Chenab Nagar. His dad has been doing construction business in UAE for the last 20 Years, from the very beginning he decided to get in to business. In 19 Years he started his first medical business. This the product of Pakistan which was being exported all over the world from the India, to the name of Himalayan salt. He exported them to USA, Two companies are already registered in USA.

In pink salt, there is a market of Himalayan salt bricks, tiles, lamps and eatable salt. The brick style is used in spa, sauna and therapy rooms. He said that he was selling 15k quantity container in USA within two months. Revenue they generated is $70K in 2022, $86K in 2023 and $66K in six months 2024. There monthly sales of bricks is 44 Lacs PKR. There sales of bricks on Amazon is $10k, on website its $12k and on eBay its $1500. He asked for 8 Million PKR for 10% equity.

Product Price Range in their warehouse is $0.88 to $1.2. One container is sold out in $106k and the cost he used his own is $100k. Detox lamp made up cost in PKR is 5000 and its selling price in USA is $195 and he got a contract from a New York person who ordered 200 pieces in next 15 days. He has only two competitors in the market who are selling just bricks.

Shark Rabeel asked him to explain us what your vision is, what you want to make this company? Founder said that he would prefer online channels and should visit physically also. He hired two people there and gave them $300, they visit exhibition and made connections. In the exhibition, sales of 2 Lac $30k has been done on 10th September 2024.

Shark Usama Bashir said him that I would like to place an offer for you, which I will include two more sharks with me in it. Shark said that if they come together as a team and if they focus on this then they can scale it a lot. He more said that their issue will not be resolved with 10% equity because if they do not have enough skin in the game, then nobody’s interest will develop. Sharks who funded the startup are Faisal, Rabeel, Usman Bashir.

Sharks offered the founder 80 Lacs PKR for 20% equity, out of which 40 Lacs PKR will against his equity of 20% and the remaining 40 Lacs PKR will charged him as royalty at 10% till the 40 Lacs PKR returned. Founder said that its absolutely right and he made up with their deal.

The founder kept throwing ideas even after getting funding. I think founders should answer what they have been asked for and not try to become over-smart. Sometimes it backfired, founders should know how to maintain a balance.

 The good thing about the founder, he studied the sharks and target Usman Bashir during his pitch and told the potential of the business 50K Kg container by just making a partnership with him. Such a type of homework is really good while you are pitching to investors. That’s how Sharks are so impressed by his product and marketing techniques so the deal is done.

https://pinksalts.com.pk/

“Muhammad Zeeshan, Founder and CEO of Zee Sy Jewelry, Proposes 5 Crore Investment for 12.5% Equity on Shark Tank Pakistan”.

Muhammad Zeeshan is the Founder and CEO of Zee. Sy Jewelry. Since 2009 he started his journey from a small store in Nazimabad and then they introduced their designs of artificial jewelry to the customers across the world through e-commerce and the customers liked their designs very much. Today they have four retail outlets available and apart from this they are going to expand in the whole world of Pakistan and after Pakistan they are going to launch their stores in UK, Canada and UK.

Their revenue in 2023 is 13 Cr PKR and 15 Cr PKR in 2024. 60% split is from e-commerce, 40% from branches, 15% from Franchise and 25% comes from factory outlet. Gross margin revenue is 60% and CGS is 40%, breakdown Gross margin 7% admin expense, 9% marketing expense, 5% salary, 5% courier expense, 5% Franchise fee, 4% packaging cost, 3% GST and net profit is 22%.

Shark Romanna asked him that the 60% of your online customers are from Pakistan? Founder said that our overall sales are 80% from Pakistan, 10% from US, 4% from Canada, 3% from UK and 3% from other countries. Shark Usama asked him tell me the breakdown if you will get it, what you will do? Founder said that its breakdown will be that our future projection is that we will first built two stores in Punjab and the one cost for the making of store is 1.5 Cr PKR. The shops are minimum 500 square feet and maximum is 800 square feet.

The next location which they are going to open, where they have maximum client is Lahore and after that Islamabad. Founder said that they will expand 1Cr in marketing because when they are opening branches, they will focus on marketing and they will spend 1 Cr in team building.

Shark Faisal wants to place an offer he said that I will give you 5 Cr PKR but not on 12.5% but on 50% equity and I will change you trajectory. Founder said that 6 Cr PKR inventory is now available in the companies stock. Shark Rabeel said that if you build these two shops worth 1.5 Cr PKR per day, the return on those will not be that good, you will get a worse return than that if you focus on marketing and make the thing work, keep running it.

Shark Usama said that I want to make a deal, I will give you 2 Cr PKR for 30% equity and after that I will give a line of credit of 3 Cr PKR for your shops and you will return 80% of the net revenue of the company to me so that this 3 Cr PKR can be used as a cover up. If it happens and I get back my money of 3 Cr PKR, after that I will be a 30% shareholder in the company. At the end the founder is not satisfied by the deal which the Sharks offer him and the is closed!

He should mentioned the growth of the franchising model and explain the unit economics of each franchise, like monthly revenue, average monthly net profit and the capital required.

He rejected the offer and I am really happy for him because he already has product market fit and it makes no sense to give up such huge equity at this stage. I think he should grow his business through franchising and exit base can help him make the complete franchising models and bring the investors for the growth.

https://zeesy.pk