Thursday, August 11, 2022

Gobie H2O 2022 Update- What Happened After Shark Tank

Gobie H2O Before Shark Tank

Rusty Allen, the founder of Gobie H2O, has stepped into the Shark Tank. Rusty is an industrial design entrepreneur as well, and he has come to seek an investment of $300,000 in exchange for 10% of his company. Four years ago when the recession hit, Rusty realized he was spending more money on single-use water bottles per gallon than he was on the gas that he was putting into his car. This pissed him off, and this is when he decided to develop Gobie. Gobie is the world’s most advanced filtering water bottle on the market, Rusty claims.

The flex flow technology allows you to have the durability of a hard shell with the accessibility of a soft shell. This allows for clean, purified water instantly. One thing that Rusty realized after developing the product was that they can filter out way more than just tap water, and he would love to show the Sharks what he means. With their upgraded filter, the filter can remove 99.99% of all contaminants found in water. To demonstrate, Rusty takes some dirt, which is fine potting soil, and shakes it up. This is disgusting, dirty water that nobody would ever drink. But with the upgraded filter, you can filter out clean, purified water instantly – Rusty squeezes out the water into a wine glass, which is completely clean.

Gobie H2O on Shark Tank

Rusty then passes out samples to each of the Sharks, starting with Lori of course. Rusty then asks which one of the Sharks wants to invest in clean, purified Gobie success. Kevin then asks if Rusty is looking to sell the product as a mainstream product in America that can compete with the other purifying water bottles, or is he attempting to sell the product in other countries where clean, purified water is not available upon demand? Right now, Rusty explains, the advanced filter is a prototype.

3This is a good thing, though, as it shows the power purely through a prototype. Rusty’s main focus, however, is competing with single use water bottles in America. Still, Kevin asks Rusty if he thinks that people are not just comfortable filling up water from the tap and not requiring a filter. Mark admits that Kevin is right, since we are not accepting only tap water, but there are also other filters available that can filter directly from the tap.

Robert explains that his children have a water bottle with a filter on the inside, and they have had that for nearly three years. Kevin guesses that it may not be the same type of water filter as the others, but Lori confirms it is. However, the hard exterior shell with the squeeze portion for creating pressure and shooting water out is something that she has never seen before. Still, she has seen multiple products that use a filter which takes out almost all the contaminants that the user can either put into different water bottles, or they already come built inside.

Rusty admits that Lori is right, but he wants to show the Sharks the beauty of the flex flow technology. What it allows them to do… and Rusty falls silent for a moment as he loses his train of thought. Rusty starts over; most squeeze bottles do not last the life of the filter because they are not very durable since they scratch up and breaking their own seal due to soft materials. The hard shell bottles are good, but if you have a filter in it, you have to suck the water through it, which really limits the type of filter you can built it. So when you combine a hard shell with a soft shell, it is the best of both words.

Still, Robert points out that Rusty is ultimately saying that other products cannot filter to the level that the Gobie can. Gobie is so good that it can filter dirt and nobody else can do that, but Rusty says that nobody else can filter dirt in the way that they do. Mark points out that this is a different answer to a different question. Rusty then explains that they have tested other filters with the Gobie H2O and realized that their technology, the flex flow technology, builds up a ton of pressure and allows for additional filtering.

Daymond then says that he finds the water bottle extremely sexy, then asks how much it costs in retail. Retail is $30, and each unit costs around $10 to make in the United States (based out of San Diego). Each unit includes a filter which lasts for 3 months or 100 gallons, and the consumer would buy one every quarter. So this means that the consumer keeps buying, which generates a reliable source of revenue over a dedicated customer’s lifetime.

Mark then asks if Rusty designed the filter himself, as an industrial engineer, or if he looked to license other work, like an entrepreneur. As far as the technology goes, it is a carbon block, which is a free market technology. Daymond then asks about sales for the Gobie H2O. Through purely online sales, Rusty has sold 10,000 bottles of Gobie H2O, and 15,000 filters. This comes out to $285,000 in revenue figures, all over the period of 17 months – not terrible. Rusty explains that he has only been selling the blue bottle.

However, Rusty has gone to retail, including Bed Bath and Beyond, Target, and J.C Penny’s. All three companies came back and said that they needed more colors, but Lori interrupts and explains that this does not make sense to her; if the companies thought that this was so original and so unique, they would have grabbed it and tested it. Lori’s feeling is that the companies did not look to Gobie because there are so many other similar products out there, all of which are less expensive. Lori likes the bottle, but she feels that there is too much competition out there, so she is out of the deal first.

2Kevin then explains that he has a different issue that they have not addressed yet; why is Gobie H2O worth $3 million dollars today, and how it will be worth more tomorrow? Unless they get past that, Kevin does not care about the colors of the bottles. Rusty explains that the richest man in Beverly Hills and the poorest man in Kenya both drink Kenya, which Mark calls a horrible sales pitch. It is obviously a broad market.

Kevin explains that Rusty should have said he was going to sell $3 million bottles in the next 12 months and make $500,000 in profit, then he would have remained engaged. Since Rusty did not do this, Kevin is out of the deal. Mark then says that he wants to clarify the problem; although he has really cool looking bottles, Rusty is also trying to be in the water filtration business. Rusty is not focusing on what sets his bottles apart, which is the design. If he had come in and explained that they have cool bottles and that the filtering was a secondary thought, Mark too would have been far more engaged.

Rusty admits that he was getting caught up in the other details, but at the end of the day, they can filter out more contaminants than anyone else. Mark rubs his eyes, then explains that he will make it simple; he is out of the deal since Rusty is selling the wrong thing. Robert explains that Rusty seems like a nice guy, but ultimately, it was a bad, convoluted presentation. Robert says that he does not think that Rusty understands the business he is in, and Rusty will be crushed. So, Robert is also out of the deal.

Daymond is the final Shark remaining, saying that he has been sitting here and silently rooting for him, but the other Sharks are bringing up valuable points. What will Rusty do with the money? Mainly inventory and a little bit of operating costs, since Rusty is working 24/7. Robert explains that since he is working hard, it does not mean that he will be successful. Rusty promises that he will work harder for Daymond than anyone else; he actually has a pad next to his office desk so he can wake up and go right to work.

Daymond then asks an interesting question; how much debt does the company have? None, Rusty answers. Daymond says that Rusty should take a swig of his water since he ultimately intends to make an offer, and the show dramatically cuts to a commercial break. Upon returning, Daymond extends an offer of $300,000 in exchange for 40% of the company, but contingent upon getting into one big box retailer immediately. Rusty answers back with 20%, but Daymond says that he is firm in his offer since he feels that is what it is worth.

Rusty wants to sum up what he is selling, but both Daymond and Mark do not allow for this. Rusty asks to step out and call his business advisor, who graduated from Cornell University. Daymond allows for this, and the four other Sharks ridicule Daymond for making an offer to such a convoluted offer.

In the hall, the business advisor explains that Daymond is valuing the company at $700,000, but Rusty explains that he will ask one more question and if they are good with that, he will accept the deal. Rusty steps back into the Shark Tank and asks how Daymond feels about bringing in Mark and Lori, for the demo purposes and licensing it through the Mavericks. Daymond explains that this is such a gamble that he wants the big reward, so he does not allow for the two Sharks to come in. His deal is firm at $300,000 for 40% equity.

Rusty accepts the offer with Daymond, finding himself a Shark partner. As Rusty steps out, Lori and Robert both admit they are absolutely speechless.

Gobie H2O Now In 2022 -The After Shark Tank Update

The deal with Daymond was eventually finalized. Shortly afterward, the shark tweeted that Rusty was “great 2 work with” and that “[he’s] a team player.”

Daymond tweeted about working with Rusty shortly after the segment aired on TV

And for a while, things seemed to be proceeding well. If anything, the show had given them a boost of publicity, which helped with the business. Not only did they sell the product on their website but they were also made available on Amazon and other online retailers.   

Reviews were mostly negative, however. While the Gobie itself looked cool, many customers agreed that it was way too expensive for what it is- that there are cheaper, more effective alternatives out there. That’s not all, many people also had an issue with air bubbles flowing through the mouthpiece. To make matters worse, the bottle had a tendency of leaking and could not be placed on its side without running into problems.

As of 2022, Gobie H2O is no longer in business. Their website has been shut down and their products have been pulled from all retailers including Amazon. Their social media accounts also haven’t been updated since 2015. Given the 2.3-star rating that they had on the site, however, it really isn’t all that surprising. At the end of the day, the product was simply too expensive; people weren’t willing to make the investment, and honestly, it’s hard to blame them seeing as how the bottle was far from perfect. Having said that, the business wasn’t a complete failure as they did manage to make over $300,000 in sales.

Interestingly enough, however, the company is still listed as ‘active’ on Rusty’s LinkedIn page. From the looks of it, however, he’s moved on to other endeavors.

Happi Canine offers full-spectrum CBD oil that comes with added omega-3s, EPA, DHA, and vitamin E

In 2018, he launched a new company called Happi Canine, which specializes in premium hemp and CBD wellness products for dogs. More specifically, they offer full spectrum CBD oils, with dosages ranging from 250mg to 1000mg. Depending on what you get, it can cost you anywhere from $40 to $130. All orders also come with free 2-3 day shipping across the U.S. For those who are interested, you can check them out here.

Aside from that, he’s also the Director of Industrial Design at RAD Product Development, which we’re guessing is probably his day job.

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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