Thursday, July 7, 2022

Grace and Lace 2018 Update – Life After Shark Tank

The picture that started it all for Grace and Lace, just by appearing on the front page of Instagram. It goes to show that millionaires can be made overnight
The picture that started it all for Grace and Lace, just by appearing on the front page of Instagram. It goes to show that millionaires can be made overnight

Grace and Lace Before Shark Tank

As a guy, I don’t really understand the necessity, but the demand is there for women who want to have a little bit of style around their boots. I do sometimes see women wearing artificial/fake socks with their knee-high boots, so I do not fully understand why, but Grace and Lace is a quite popular “fake sock” maker. Grace and Lace adds a little twist to boring socks, and helps to give women’s boots a flair (maybe guy’s, too?) – read on more to find out about how Grace and Lace works.

Grace and Lace on Shark Tank

Rick and Melissa Hinannt have journeyed a long way from their home in Austin, Texas to the Shark Tank. Their company is Grace and Lace, and they are looking for a $175,000 investment for a 10% equity stake in their company.

Grace and Lace has taken the boring sock that women wear under their boots and turned them into a lacey, frilly fashion statement. Grace and Lace started when Melissa had the idea for a cute little lacey sock that stuck out of her boots, so after some time on the sewing machine, she finally made her first pair which got quite the reaction; people would ask where she got them and she would say that she made them, so strangers started giving her their phone numbers and asking for a pair. Melissa then looked it up online to see if the same sock would sell and they did; instantly. A business was born, and since then, Grace and Lace has existed.

Barb asks about sales, and their first fiscal year of 2012, $800,000 sales were done. To date of the filming of this Shark Tank episode, Grace and Lace has done 1.22 million dollars in sales – every single Shark sits up, including Kevin who says, “I was going to ignore you completely, but now…” Robert asks if they are all sold online, and Melissa replies that 90% of all sales are done through the online storefront. Since August of 2012, they entered into over 230 stores, thanks to the primary use of social networking. Melissa brings up that they have never paid a single dollar for marketing. Mark asks for more details, and Melissa says they have 34,000 followers on Facebook and through various blogs thanks to a #1 pinning on Pinterest in 2012 – literally striking lucky.

Some of Grace and Lace's designs
Some of Grace and Lace’s designs

Barb asks about the fabric, and Melissa says that Grace and Lace’s socks are made of cotton. Barb says that it feels soft and delicious, almost like cashmere, then asks about the price; each pair of socks sells for $34. It takes around $5 to $10 to make a pair of socks; Barb’s jaw drops in response. Kevin says that he is absolutely loving the Hinnants. Kevin then asks about total profit, which comes out to $35,000.

Lori is the first shark to exit the deal, which is surprising considering she has slipped on a pair of Grace and Lace socks; she says that she loves the product and is happy that Melissa has done all this and created an empire from nothing in no time, but she cannot relate to the product and just cannot find it worthy of an investment.

Robert asks what the two intend to do with the $175,000, and Rick says that they need a strategic partner. Melissa explains that two weeks after she sold her first ever pair, she received an email from Nordstrom saying that if Melissa could provide 30 to 50,000 pairs, and that they are looking primarily for a strategic partner out of their time in the Shark Tank – they are not exactly looking for the investment to save their business. Rick says that he believes the deal alone with Nordstrom should come out to 5 to 10 million, but are looking for the Shark Tanks to work out to 100 million and to come out even much bigger after that.

Barb says that every Shark is ignorant to not admit their interest and wants to make an offer to get things moving, however, she thinks that the Hinnants are greedy for their valuation for what their sales actually are. Barb offers $87,500 for a 5% stake if the Hinnants can find another Shark to go in on the same deal. Kevin then offers $175,000 for a 20% stake, which drops down to 10 as soon as the initial investment is paid back. Melissa and Rick look to Robert, who has been thinking most of the time; he agrees that the two need a partner and that their sales show that there is something to guide, and Robert offers a $175,000 in a 10% stake. Melissa and Rick ask if Barb would want to enter in on Barb’s deal, and Robert says that he does not want to enter in the deal with Barb. Robert brings up that the two of them entered into the Shark Tank looking for a $175,000 investment in exchange for a 10% stake, and that was what he offered – exactly what they are asking for. Robert insists that it isn’t fair when they ask to hear what Mark has to say since he offered exactly what the Hinnants asked for, and wants to hear a response from them to his offer before he allows Mark to speak. Rick tries to worm his way out of the deal, but Robert lays the pressure on and insists that he receive a binary ‘yes’ or ‘no’ answer from Rick.

Rick asks if he and Melissa can discuss it privately between them, and Robert states that he is now out of the deal and no longer interested.

Mark asks for more details – in exactly which area would Rick need the most help in? Rick explains that he would like a strategic partner that he could call up for advice when venturing into more unknown territories, such as expansion of production and entering into new research and development. Mark then repeats Robert’s offer of $175,000 for 10%, but must know right now if it is a yes or no. Mark and Melissa then ask if they can step back into the hallway once again to discuss the deal amongst themselves, and Mark explains that the two are coming to a point in their business management where they cannot afford to be indecisive, and at the moment they are being indecisive. Barb speaks up that she would like to change her offer, and revises it to the full $175,000 for a 10% stake, but half of that $175,000 will be a line of credit.

In the end, Melissa and Rick agree to Barbara’s deal of the $175,000 for a 10% stake in their business, with half of Barbara’s investment coming in as a line of credit.

SNL_1667_12_Shark_TankGrace and Lace Now in 2018- The After Shark Tank Update

Grace and Lace were really impacted by Shark Tank. Within 5 days they managed to make sales that grew to more than $1 million. They now have moved into a bigger facility and have hired 20 people.

In episode 9 of Season 6 (during the Update portion which airs so often), the Hinnnants said Barbara is a really good partner. Barbara introduced the Hinnants to the editor of Cosmopolitan, who featured them in the February 2014 edition. Since appearing on the show they’ve done $6.5 million in sales and have opened orphanages in India as well. They have also taken 100 orphans into their homes and used some profits to better the lives of these children. Grace and Lace is doing great things and making women look great.

Steven Kahn
King of the Bears, Shark Tank enthusiast, failed network engineer, sour cream enthusiast, Nanchaku instructor, Techman, Mega Man X fan, vaporizing know-how
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