The garage door lock that appeared on Shark Tank in season 9, episode 3 was called Garadget. It was pitched by inventor Dennis Shmigelsky from California as a smart garage door opener that could be controlled via a smartphone app. The product secured a deal on the show, but later ran into issues that caused controversy and negative publicity.
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What is Garadget?
Garadget is a Wi-Fi enabled garage door opener that can be controlled through a mobile app. It allows users to open and close their garage door remotely using their smartphone, as well as set schedules, receive notifications and track activity.
Some key features of Garadget include:
- Remote access – Open, close and monitor garage door from anywhere
- Activity tracking – Records time and date every time the garage is opened or closed
- Notifications – Get alerts whenever the garage is opened or closed
- Scheduling – Set times for the garage to automatically open or close
- Security – Encrypted app with password protection
The device attaches to existing manual garage door openers and integrates with home automation platforms like SmartThings, Amazon Alexa and Google Assistant. It aimed to provide convenience and security for homeowners.
Garadget’s Shark Tank Pitch
In 2017, inventor Dennis Shmigelsky pitched Garadget to the Shark Tank investors, seeking $100,000 for 10% equity in the company. He demonstrated how the device worked and emphasized the convenience and security it provided.
Kevin O’Leary made an offer of $100,000 for 15% equity, which Shmigelsky accepted. O’Leary was impressed with the recurring revenue potential of Garadget’s $4.99 monthly subscription fee.
Shark Tank Deal Details
- Entrepreneur: Dennis Shmigelsky
- Product: Garadget
- Deal: $100,000 for 15% equity
- Shark: Kevin O’Leary
After securing the deal with O’Leary, Garadget saw a boost in sales and publicity. However, the success was short-lived.
What Went Wrong for Garadget
Despite the promising start after Shark Tank, Garadget ran into multiple issues that derailed the business.
Negative Customer Reviews
Not long after the episode aired, Garadget began receiving negative reviews and complaints from customers. Many users were unsatisfied with the product’s performance and cited issues like:
- Connectivity/app problems
- Hardware malfunctions
- Poor customer service
These negatives reviews damaged Garadget’s reputation.
Controversial Decision to Brick Devices
In response to a negative review, Garadget’s founder pushed out an update that bricked customers’ devices, rendering them unusable. This controversial decision to essentially disable devices angered many customers.
While the company said this was to protect intellectual property, the move brought on further backlash and criticism. Customer trust was lost.
Severed Relationship with Shark Tank Investor
The brand’s self-destructive actions led Shark Tank investor Kevin O’Leary to end his partnership with Garadget.
In an interview, O’Leary explained he found the company’s actions unacceptable and cut ties with the founder. This dissolved the deal made on Shark Tank.
Outcome for Garadget
The string of negative events sunk Garadget as a business. Sales declined, the founder stepped away, and the company ultimately shut down in 2018.
While Garadget found brief success after Shark Tank, poor customer service and controversial business practices ultimately led to its demise. The founder’s disastrous decision to brick devices was the nail in the coffin.
Key Takeaways
Garadget serves as a cautionary tale in how not to handle a surge in sales and publicity from Shark Tank.
Some key takeaways for entrepreneurs include:
- Deliver high quality products and customer service
- Manage online reviews and feedback carefully
- Do not punish customers with tactics like bricking devices
- Maintain positive relationships with investors
The Garadget incident demonstrates the importance of building a sustainable business, even when faced with product issues and negative reviews. Rather than engaging in retaliatory actions that alienate customers, the founder could have worked to address concerns and rebuild trust in the brand.
While Shark Tank can deliver big opportunities, companies must focus on executing well beyond the pitch.
Conclusion
Garadget’s time in the spotlight was short-lived. What started as a promising smart home device that secured a Shark Tank deal quickly unraveled into dissatisfied customers, controversial business practices, severed investor relations, and ultimately, the end of the company.
After initial success from publicity through Shark Tank, Garadget was unable to deliver on product performance and service. The founder’s decision to brick customers’ devices in response to negative reviews crossed ethical lines and cost Garadget its future. This serves as a lesson that appearing on Shark Tank is just the first step—the real work begins after the pitch.