Shark Tank investor Robert Herjavec hit a home run with Keen Home. The cyber-security king lauds the Smart Vent maker as one of the most successful investments he’s made on ABC’s Emmy-winning business reality show. In an April Forbes interview, Herjavec said Keen Home’s sales are projected to hit $5.8 million this year — a nearly sixfold increase from their $1 million in sales before Shark Tank.
Nayeem Hussain, co-founder and CEO, and Ryan Fant, co-founder and chief operating officer, scored a deal with Herjavec in a Feb. 20, 2015 Shark Tank episode despite having no proof concept for their Smart Vent. The wirelessly-connected air vent was still in the works when they taped. It came to market nine months after their episode aired. It took them two and half years to develop the hardware, firmware, software, smartphone apps and 30,000 units of finished product.
Herjavec made an on-air deal to buy 13% of their company for $750,000. They gave away slightly more equity than in their original offer of $750,000 for 10% equity, valuing it at $7.5 million. Herjavec beat out FUBU founder Daymond John’s offer of $750,000 for 20%. He talked Hussain and Fant out of taking O’Leary Ventures founder Kevin O’Leary and QVC queen Lori Greiner’s joint offer of $750,000 in debt at 8% interest and 10% equity.
Keen Home launched a pre-order sales campaign the night its Shark Tank episode aired and got more than $200,000 in pre-orders within 30 days. Heating, ventilation, and air conditioning, HVAC, installer and suppliers deluged it with requests to distribute the product.
Keen Home, based in New York City, rolled out the Smart Vent in 600 Lowe’s Home Centers in November 2015. It started selling directly to customers the following month through Amazon.com, Build.com, Newegg.com and keehome.io. Ryder Industries in Shenzhen, China manufactures the vents.
Hussain and Fant each invested $50,000 of their own savings to start the business. Within one year, they raised $1.6 million in a seed round of financing. They’ve raised $4.1 million in capital from venture capital and angel investors. They plan to raise another $8 million to hire more engineers, marketers and sales people in addition to developing more products and improving existing ones.