In November 2013, an entrepreneur named Jamie Siminoff pitched his idea for a “smart doorbell” on the reality show Shark Tank. The show’s judges turned him down. Siminoff forged ahead with the concept, and news broke yesterday (Feb. 27) that Amazon is buying his company, Ring, for over $1 billion.
In his Shark Tank pitch, Siminoff said he was seeking a $700,000 investment for a 10% stake in his then-struggling startup—called DoorBot at the time—which he thought was worth $7 million.
A year ago, ABC News ran a two-hour special in which 20/20 anchors David Muir and Elizabeth Vargas asked Shark Tank judges which ideas they regretted rejecting. Siminoff’s pitch was the first one mentioned. The broadcaster noted that Ring had reached a valuation of $460 million (at the time), “the most of any company to appear on Shark Tank.”
Ring had already become the company that popularized the idea of the video doorbell, letting customers, via their smartphone, check who was at the door from both inside the house and outside of it. The wifi-enabled doorbell uses motion detectors to sense when someone approaches a door and then delivers video and sound to the owner’s smartphone app. Being able to see who stopped at the door is a key selling point and a deterrent to would-be thieves.
The judges had their reasons.
“It’s really not an internet play,” said Robert Herjavec, CEO of IT security provider Herjavec Group. “It’s a consumer device.”
“I just don’t think it’s for me,” said Daymond John, founder of hip-hop apparel company FUBU.
“I just don’t see the progression, and for that reason, I’m out,” said Mark Cuban, owner of the NBA’s Dallas Mavericks.
Amazon, for its part, wants to become a bigger player in home security, which explains its interest in Ring. The service could play nicely with efforts like Amazon Key, a program to allow deliveries inside your home while you’re out. The acquisition will also improve Amazon’s already strong position in internet-connected home devices, epitomized by its Echo line of smart speakers.
The Shark Tank judges were philosophical about rejecting ideas that, like DoorBot, became big winners.
“Why cry over spilled milk when you know there’s another great idea coming through the Shark Tank,” mused investor Kevin O’Leary.
That’s a massive amount of milk in the case of Ring.