Investor: Kevin O'Leary
Shark Tank Appearance: November 15, 2013; Beyond the Tank, February 4, 2016
Offer: $50,000 for a 6% royalty until $150,000 recouped and 2½% equity
Results: Sales soared from $18,000 to $3 million.
Sisters Donna and Rosy Khalife faced a pivotal moment on February 4, 2016. More than two years after pitching their kids' activity kit subscription service, Surprise Ride, on ABC's Emmy-winning Shark Tank, they sought $110,000 for 10% equity. Robert Herjavec offered funding but demanded 25% ownership—terms he deemed non-negotiable. The sisters hesitated, polled the other Sharks, and found no takers. By the time they returned to Herjavec, he was out. Kevin O'Leary taunted, "You're going to be a legend. You had a deal and didn't close it."
After 1,000+ hours of preparation, the sisters were devastated yet resilient. Their family had fled war in Lebanon for the American dream. "It was a once-in-a-lifetime shot," Donna recalls. "We spent 90 minutes in the Tank, left without a deal, and weren't even sure our segment would air."
Related: 12 Reinforcing Lessons on Failure
The aired episode sparked massive exposure, propelling 2014 sales past their $500,000 goal and hitting $1 million in 2015. O'Leary, intrigued from the start, later invested. "The numbers don't lie," he says. "Shark Tank rejection built their resilience." He views failure as an entrepreneur's greatest asset: "Rejection forces you to own your business. Top performers turn it into fuel."
Related: 4 Tips to Grow Your Business
During the Beyond the Tank filming, O'Leary surprised them with a visit to their D.C. office and a firm offer they accepted. His guidance proved invaluable. With retail deals on the table, he urged starting small. "We expected Kevin to say 'go big,' but he advised focus," Rosy shares. They launched with Michaels stores—a perfect fit, as the sisters grew up shopping there, sharing a mission to get kids offline and hands-on.
"Failure and disappointment are two of the most useful resources for any entrepreneur."
Four years post-Shark Tank, their advice: Don't take investor nos personally. "Rejections shook our confidence," Donna says, "but they're often about fit, not your idea." O'Leary, who built his fortune in edtech, praises their model: "The Khalifes are powerhouses. Expect tens of millions in sales ahead."
Related: 5 Steps to Better Business Ideas
This article originally appeared in the February 2018 issue of SUCCESS magazine.
