NexerSys Before Shark Tank
Terry Jones is the CEO of NexerSys. Terry has just stepped into the Shark Tank, and he is seeking a $2 million investment in exchange for a 10% stake in his company. This immediately sets Terry and NexerSys apart from almost all other Shark Tank entrants – Terry has valued his company at 10 million. NexerSys is a next-generation exercise system, and is an interactive and intelligent fitness and gaming platform that delivers a fast, fun and effective workout for everyone, no matter an average Joe or olympic medalist. Terry has brought with him Marlen Esparza, an Olympic boxer. NexerSys combines the benefits of a personal trainer with the fun and excitement of today’s online games – select a personal profile, choose between circuit training, high-intensity interval rounds, or a one-on-one challenge against a NexerSys avatar.
NexerSys On Shark Tank
Marlen elaborates further, demonstrating the use of the NexerSys system. She begins to spar and throw punches against the system, which is an elaborate system of punching and kicking pads, all hooked up in an arrangement with an output display at the top. The touch display shows an avatar in the one-on-one challenge, which shows the avatar readying a punch and requires the user to respond by attacking the appropriate pad. The NexerSys also appears to be spring-loaded, as each punch is knocking back the appropriate arms of the machine but the machine isn’t moving from where Marlen is punching it. At the end, stats are displayed such as accuracy, ranking, times attacked, and another stat which was too small to make out.
All of the Sharks are impressed, and Terry continues – each time you train, the NexerSys gives a readout of how well you did that training session. With the NexerSys, you can live a happier, healthier, and sexier life using the same techniques as professional fighters and boxers. Terry invites up one of the Sharks to “draw first blood” against a special avatar that he has prepared specially for Shark Tank, which is Mr. Wonderful, Kevin! Mark steps up, almost ripping his jacket off – Steve Tisch, tonight’s guest Shark and also the owner of New York Giants and film producer, comments that Mark is “one-punch Mark.” Mark just begins to throw vicious hooks and gut punches, and the display of the NexerSys actually reads “Too Hard!” for any vigilant watchers. Terry points out that Mark was 36% accurate, so he was hitting hard but not accurately.
Lori asks if the workout was fun, and Mark comments that “it was a fun little workout – how long did we do?”
15 seconds. Mark worked out for 15 seconds, Terry says, and Mark is forced to admit that even just three or four minutes (Marlen worked for about 2 minutes) would be a great workout for the average person. Kevin brings up the valuation of the NexerSys of $20 million, and asks about sales – Terry reveals that sales, to date, are just over $4.2 million over 18 months. So far, NexerSys is not profitable, but is looking at profitability just two months off from the airing of this Shark Tank episode. Guest Shark Steve Tisch asks if the NexerSys is for the gym or the home, and Terry says behind him are actually two different models – the black model and the red model. The black model is smaller and less sturdy and is the personal model, while the red model is sturdier and is the gym model. Obviously, the red commercial model is more expensive but includes more features. Daymond asks for the mix of sales, and Terry says that about 70% of sales are commercial and 30% are home sales. Lori admits that she likes it, and Terry comments that she knows demonstration better than most people in the world, since Lori is the “Queen of QVC,” which is a home shopping network. Mark returns to the numbers, and asks for the cost of production; the commercial unit takes just under $2,000 to produce. Kevin comments that the Nexersys is just a digital punching bag, and asks about the price – the commercial model is $7,000, and the personal model is $2,995. So far, they have sold on television, direct-to-consumer models, general advertising (print, paper, digital, etc). So far, Terry have run one and two minute spots for NexerSys. NexerSys spent a million dollars in sales, which brought in about a million and a half in sales. Daymond and Mark stop for a second, look at each other, then continue on.
Daymond poses a question to Terry – how much in debt is NexerSys? Terry reveals that they are $7.5 million in debt to shareholders. All of the Sharks are surprised, and Daymond asks how much of that is Terry’s money – a very small portion of it is Terry’s money, and Daymond says he is afraid to ask how much Terry owns. Terry only owns 35% of the company.
Kevin says that if he weren’t a nice guy, but he is, he would just wait for that debt to come due for Terry and then he would own Terry’s company – that is what the debtors would do, is just wait Terry out to eventually own the equity. However, Terry insists that by the time the debt is due, NexerSys will have more than enough cash flow to pay the debt and continue on. But Kevin says, as as in life as is in business, “poopoo happens.” A savvy financial investor, which Kevin is going to prove himself as, he says, would not put a dime in that company due to the massive outstanding debt and the insane evaluation of the company. $20 million dollars and the debt guys aren’t happy means that Kevin is very, very liable to get screwed, but Terry says that he will pay the debt and is sure of it. Kevin asks what happens if the debt doesn’t get paid, but Terry says they will have to deal with the creditors at that time. Steve asks how many investors are currently interested in the NexerSys, which Terry reveals that they have about 60 investors currently. The investors have received no money so far. Steve Tisch says it best, this is the story of his life – great product, too much debt, but Steve is out first.
Kevin jokes that “I have gone to the future,” and says that the debt was never paid, so the shareholders proceeded to wipe out everything Terry did in the company and take everything Terry owned, then demoted Terry to be an employee of the company. The smartest guys in the balancing sheet are always the debt guys, Kevin says, but Terry says that the debt guys are his common stock and venture capitalist guys, but Mark insists that the investors don’t matter – the debtors are going to force Terry into bankruptcy, and everything Terry owns will be gone. The bank, and the creditors, are not Terry’s friend, then Kevin wishes Terry luck and exits the deal as well.
Terry says that his $20 million investment is not outrageous, and is actually a fraction of the companies like
BowFlex and TotalGym. The personal weight-lifting machine market is a billion dollar market, but Mark says that he disagrees since the devices Terry just named are simple, non-digital devices, and Mark is impressed that Terry managed to sink a $7.5 million investment into the development of the NexerSys. Mark says he can usually look past valuations since growth can come to any company, but it’s just crazy to tie up so much of his millions in a venture that might not succeed. Mark is also out.
Daymond gives the comparison of being in a third round against a young Mike Tyson – it’s best to just lie down and get it over worth. Daymond is also out, which leaves Lori as the last Shark standing. Lori says that she likes the idea, and that it looks like a lot of fun – it’s a great way to have a workout, and it’s a great product, but Terry is in serious debt. However, Lori believes that Terry can get out of debt, but Lori does not like to get into that type of situation and risk her own credit. Lori is out of the deal, leaving Terry without an investment in NexerSys.
NexerSys Now in 2018- The After Shark Tank Update
I have to say, I really, really want a NexerSys. I did martial arts as a kid, and find the idea of having a 24/7 sparring buddy appealing. But, NexerSys appears to be doing quite well in its own right. NexerSys is available on Amazon for a price of $1,299, which is way cheaper than what the price was 3 years ago during the filming of Shark Tank. NexerSys’s cost has fallen in line with other free hand martial arts stand, but with a more modern, digital appeal. In addition to a strongly-rated (3.8 stars) listing on Facebook, NexerSys has expanded its line to include a boxing trainer. More information can be found on NexerSys’s website pertaining to the development of additional models here, and NexerSys has a Facebook that appears to be doing quite well with 8,800 likes and continuous status updates.