Utility cable connector startup cashes in big on 'Shark Tank'
Mark Melni thinks he's built a better mousetrap. The Twin Falls, Idaho-based inventor says his new utilty cable connector can save utilities time and prevent lineman injuries in the field. And after last Friday, he's got a major new backer and national TV exposure behind his idea.
Melni appeared on Season 6, Episode 25 of the ABC primetime hit "Shark Tank" to pitch the Melni Connector, an alternative to traditional crimp connectors modeled on the Chinese finger trap. His company won a $500,000 investment from billionaire tech mogul and Dallas Mavericks owner Mark Cuban, with an option to invest $1 million at a later date.
Today, cable splicers use traditional compression (or crimp) connectors to hold long sections of power lines together. Linemen feed the lines into each side of the connector and then use a crimper — basically a giant pair of pliers — to crush or "crimp" the connector, holding the lines together.
Byron Dunn, a 30 year lineman veteran, appeared with Melni and the company's CFO Armand Eckert to demonstrate line repair process. He told the investors that the traditional crimping process takes about 10 minutes per connection, and that the thousands of pounds of force that it takes to crimp a connector can often mean health problems for utility workers.
"A lot of shoulder injuries," he told the "sharks."
In contrast, the plastic Melni connector can be tightened with the hands and two small wrenches, significantly reducing the time it takes to join power cables together and saving lineman from the exertion of using a crimper.
Dunn, who also edits the trade publication Powerlineman Magazine, told the investors that when Melni first sent him a product to review, he was so excited that he promptly invested $50,000 without even knowing the valuation of the company.
"I'm not a businessman. It took me ten minutes to figure out how to work it, and as a lineman, I wanted in," he said.
"Shark Tank" brings together five billionaire investors in one room to evaluate pitches and potentially invest in up-and-coming companies. The investors on this panel were clearly impressed by Dunn's testimony and the fact that he put his own money into the company. But they were less excited by what they saw as an unfocused pitch for an early-stage company. At the time of taping, Melni Connectors had less than $600,000 in sales, no orders from the power sector, and the trio's marketing pitch wandered from utilities to irrigation companies and direct consumer sales.
Melni and his partners originally asked for $500,000 for a 5% equity stake in the company. One investor called that $10 million valuation "crazy."
That didn't seem to trouble Cuban, who despite knowing little about the connector industry, offered $500,000 for a 12% equity stake in the company, with an option to invest another $1 million when the company's valuation reaches $15 million.
"Let's go make whatever that is," Cuban said as they shook hands on the deal.
The Twin Falls Times-News reports that the TV appearance has boosted interest in the Melni Connector. On Friday night, the site reportedly attracted 11,000 visitors, up from a daily average of 20-30, and the company's twitter account gained 290 followers that night, even though it had none before. Clint Eastwood, Michael Bloomberg and Popular Science all reportedly tweeted about the company as well.
You can view Season 6, Episode 25 of "Shark Tank" on the ABC website (cable sign-in required). Melni describes the history of his invention and a lineman compares it to traditional crimping below:
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