Alex dean, if you want to raise your voice, i can raise my voice dean go [bleep] yourself. Lemonis if i cant help them pump up the sales volume. Get the [bleep] place built. Overtone acoustics will fall silent forever. My name is marcus lemonis, and i risk my own money to save struggling businesses. Were not going to wake up every morning wondering if we have a job. Were gonna wake up every morning wondering how many jobs we have to do. Its not always pretty. Everythings going to change, everything. But i do it to save jobs, and i do it to make money. This. Lets go to work. Is the profit. Recording studios and home theaters are some of the typical places you would find a product called Acoustic Panels. They reduce echo. They improve sound quality. And usually, theyre very plain looking. Brad turpin thought he could do better. So after college in 2011, he founded overtone acoustics. His mission was to produce highquality Acoustic Panels that could double as artwork. Brad so this is going into a house. Well probably be doing a home theater, but were also probably gonna be doing a bowling alley. Were doing not only just the side walls, but were also doing the ceiling. Lemonis with some help from his childhood friend, alex, the company got off to a solid start and soon brought on several fulltime employees. Hussein that will show in the fabric. Brad no. I mean, youre going to be double wrapping it, and its the back of the panel. Lemonis but then a slowdown in sales forced brad to let everyone go. Brad summer just absolutely crushed us, because i had to turn off marketing. We just werent able to recatch our balance. Lemonis now hes relying on interns and volunteers, running low on cash, wondering how long he could survive. Brad not exactly what you were looking for . Ah, gotcha. Okay. Lemonis what i like about overtone is that they make products that are both functional and decorative, and i think a Recording Studio is only one of a number of places they can be used, so im headed to their office in orlando to learn more. Hi, guys. How are you . Brad doing well. Lemonis im marcus. Brad brad. Lemonis how are you . Nice to meet you. Brad doing well. Nice to meet you, as well. Hussein hi. Hussein. Lemonis hussein . Hussein yes. Nice to meet you. Lemonis nice to meet you. So this is it right here . This is all of overtone . Brad this is it. Lemonis how big is this place . Were small. Brad 1,250 square feet. Lemonis okay. So youre doing it simple. This is an Acoustic Panel. Brad yeah, and its actually a functioning piece of artwork. Lemonis oh, its like fabric. Brad right. Thats actually a recycled cottondenim blend applied to a wooden frame with acoustic foam inside. Lemonis and what does it actually do . Does the sound bounce off of it . Brad no. It passes through the canvas and is absorbed by the foam. Lemonis hello . [ laughter ] brad this is our sound diffuser. Lemonis this makes the room. Brad quieter. Lemonis and this makes the room brad this will help to kind of keep some liveliness in the space. Lemonis okay. What i thinks cool is how aesthetically pleasing it is. So you do custom stuff, as well. Brad yeah. The printing process is called sublimation. And so, unlike a tshirt, where it takes an image, and it places it on front of the fabric, this actually replaces the dyes in the fabric, which keeps it acoustically transparent. Lemonis one of brads best decisions was using the sublimation process in printing. This allows any image to be printed on the fabric. The fabric remains porous, allowing the sound to still be diffused. Youve now taken a functional product, and youve made it an artistic piece. What type of people do you sell to . Brad the audiophile, home theater, Recording Studio, but its not lemonis that sounds like individual use. Brad right. Lemonis what about commercial use . Brad commercial use, no. Lemonis brad doesnt realize that this artistic piece could now be used in any type of business restaurants, hotels, bars, office spaces, because now youve taken a really plainlooking product and turned it into a functional art piece. And where do you make everything . Brad in the shop side. Lemonis can you show me that . Brad absolutely. Lemonis okay. How you doing . Alex how you doing . Alex. Nice to meet you, marcus. Lemonis nice to meet you. Brad weve known each other since high school. Lemonis you guys are childhood friends. And what is your role in the business . Alex at times, i collaborate with brad. We talk about different Sales Strategies, different marketing strategies, or ill try to come here and manage. Lemonis are you fulltime . Alex not here. Im in the military. So i have, like lemonis thank you for your service. Alex im in the reserves now. So, you know, i get mobilized, and i go active duty for a stint. Also help pay the bills, you know, while we build this here, so. Lemonis thats interesting you say, while we build this. Who has equity in the company, besides you . Brad im 100 . Lemonis but do you see what hes saying . While we build this. Brad right. Yeah, definitely. Lemonis you dont find that very often. Brad i mean, its, you know its, you know lemonis how much did you put in the business . Alex like 5 grand. Lemonis thats a lot, by the way. Alex im my brothers keeper. So when im slacking, i hope you pick me up, and you gonna get the same love. Brad yeah. I mean, without them, i probably wouldnt be here today, so. Lemonis can you show me the warehouse . Brad sure. Lemonis okay. Brad so, its definitely humble. Lemonis is there any ventilation in here . Brad it gets hot. No. Lemonis no ventilation. What about all this stuff flying through the air . Its not exactly a super safe working environment. Brad i would agree. Lemonis cant store the raw goods. You cant buy them the right way to get the margins right. Brad i cant have a good flow. Lemonis not in this space. I dont know how these guys are actually operating what they call a manufacturing facility in just over 1,000 square feet. Theres not even enough room for machinery, Raw Materials, an assembly line, a finishedgoods area, a shipping and receiving department. I mean, were in a shoe box. Its virtually a garage. How you doing, sir . Im marcus. Joel joel. Lemonis joel, how are you . Joel hows it going . Man this is my younger brother. Lemonis oh, youre his brother . Joel mmhmm. Lemonis okay. Are you fulltime . Joel i live down in port st. Lucie, so i drive up here to help out. Lemonis do any of you work here fulltime . Alex no. Lemonis and do you pay them when they come . Brad not right now, no. I had three fulltime employees. You know, our first 2 quarters of the year were pretty solid. Summer hit us. We had a really bad summer in sales. And then, like, you know, we had guys here for 40 hours a week and only 20 hours worth of work to do. Lemonis i understand that, in the moment, it made sense for brad to let everybody go. There was no money. But you cant run a business with volunteers because the predictability of their schedule doesnt really line up with your requirement to deliver to the customer. What does this panel cost to make . Break it down for me in pieces. What does the back panel of wood cost . Brad maybe 1. 50. Lemonis how much are the interior guts . Brad youre looking at maybe 2. Lemonis how about the frame itself . Brad probably another 1. 50. Lemonis how about the fabric . Brad 5 per yard, half a yard, 2. 50. Lemonis and how much time does it take to make this for one person . Brad it should be like 15 minutes max. Lemonis and if you paid 12 an hour, thats 3 bucks. 10. 50 to make this. What do you sell it for . Brad 55 on that. Lemonis so sick margins. Brad yeah. Lemonis what is special about this panel . Sell it to me. Im here to buy it. Brad i mean, its. Nothing too special. Lemonis but why buy yours and not somebody elses . I mean, other people make this. Why not buy theirs . Brad the brand, the story. Lemonis whats the brand . Brad i mean, quality, aesthetics. Lemonis what makes yours different in quality than your competitor . Brad performance. It outperforms studio foam. Lemonis how do you know . Brad nrc testing. Lemonis what does nrc even mean . Brad absorption rating, yeah. I mean, in not sure nrc exactly. Lemonis alex, please kill me now. [ laughter ] anybody who decides that they want to get in business has to accept the fact that theyre a salesman. You have to be able to sell your company, yourself, your product, your service. Its obvious to me that brad has a unique product. But he cant sell it. And if he cant sell it, what the heck am i investing in . This is the reason youre not selling, because i think its uncomfortable for you. Can i spend a minute with alex, if thats okay, guys . Brad yeah. Lemonis what does this mean to you . What do you want out of this . What do you hope for . Alex my dream is to work here. Regardless if you decide to come in and, you know, partner with us or not, the doors are still going to be open tomorrow. And we still got to figure this out. Im in the reserves because we need capital. When im not on orders, i sleep at a friends house. Lemonis here in orlando. Alex no, jacksonville. I drive here every day. Lemonis two hours . Alex mmhmm. Lemonis and youre only doing all of that to get a check to send back here to put money in a company that you do not own. Alex im in too deep, mark. Like, i cant go back now. Lemonis thanks for talking to me. Alex youre welcome. Lemonis i appreciate it. There is no question that alex brings a level of commitment that is rare. Its hard to find. He makes financial sacrifices, time sacrifices, investing in a company that he essentially has zero financial stake in. How long have you worked with brad . Joel i mean, ive been around since he started in the garage. Lemonis oh, you have . Joel ive seen him go from, you know, nice apartment to eating ramen noodles, sleeping couch to couch, you know, just to keep this business afloat. Lemonis yeah. Hey, brad, where are you living . Brad here and there. Lemonis what do they call that, couch surfing . Joel yeah. Brad you know, i crash here sometimes, like lemonis here . Brad yeah, if needed. Lemonis i mean, you sound like youre putting every single thing brad allin. Lemonis youre allin. Brad like, ill do whatever it takes to keep the doors open, you know . Lemonis theres no lack of effort here, right . Can you grab your financials . Just want to see that together. Okay. 2012 is the first year of revenue. Brad right. Lemonis 80,000. 2013 . Brad roughly 160,000. Lemonis 2014 . Brad roughly 180,000. Last year was 280,000. And then this year, well do roughly 300,000. I think that the big thing to take away in the numbers is the growth. Lemonis holy [bleep] did you just sell me . That was actually that that was the first sales pitch i had all day. Margins are great, over 70 . And the net profits going to be 32,000 bucks. Brad yeah. Lemonis and how much cash is in the bank right now . Brad 7,000, and then we have another 5,900 coming. Lemonis receivable . Brad right. Lemonis what are your total payables . Brad probably about 30,000 in liabilities right now. Lemonis and anybody else you owe money in . Brad no. Lemonis alex . Brad no. Alex when we first started out, he was helping to buy table saws and stuff during the garage days. Lemonis did you give him money back or no . Brad no. I mean, he hasnt been recouped for that. Lemonis so you owe him something. Brad sure, absolutely. Lemonis and how much money have you put in the business since the beginning . Do you know . Brad i dont know. I mean, tens of thousands of dollars. Lemonis how much have you taken in paychecks . Brad i was getting paid 500 a week for a pretty short period of time. And then i havent been paid in 6 months. Lemonis yeah. When you sell everything you own to put it in the business, to try to make one idea work, i give you a lot of credit. I have a lot of admiration for you. Its emotional, isnt it . Brad yeah. I just dont like to show it, i guess. I pride myself on having the strength and willpower to keep something going that most people would have already folded on. You know, this has been, you know, the last 5 years of my life. Everything ive really done through my life has led up to this. Lemonis yeah. Its easy to go into any company, especially a smaller one, and find a ton of problems. But what you rarely find in a company like this is the level of commitment. It tells me a lot about the people. And as far as the product, i know theres potential. All right. I appreciate it. Well be in touch, okay . All right. Thank you, buddy. Brad enjoy the rest of your day. Lemonis thank you. [ thunder rumbling ] how you doing . Marcus lemonis. Brad how you doing, buddy . Lemonis how are you . Good to see you. Alex good to see you, also. Well . Brad well lemonis this place could definitely use some overtone, for sure. Brad yeah. Lemonis i wanted to get together with you to talk to you about what i was thinking about the business. And, you know, part of the reason, alex, that i wanted you here tonight is that i dont think the business can function without you. The two of you have sacrificed everything. Alex its hard. Im not scared to admit it. Yeah, i wake up thinking about security. You know, i know i should have a place to lay my head. Its embarrassing. Lemonis no. It shouldnt be embarrassing, because the reason that it exists is because of the sacrifice youve made to be an entrepreneur. I would say its the opposite of embarrassing. I would say im impressed. And thats why im sitting here today. Now, lets talk about business. You have a good idea. Theres a need for the product. This business could use it. So i know it fills a void. And the people around you are loyal. So im willing to make an investment in the business. Im willing to put up 200,000. Thatll go towards providing a wage of each of you making 1,000 a week, a reasonable amount of working capital to ensure that Raw Materials can exist and inventory can be made. And ill give you all the resources you would possibly need. But its a big risk for me. So id like to own 50 . And i want the two of you to share 50 . Brad so each of us would have 25 . Lemonis its not for me to decide. You guys work it out between the two of you. Brad to give up more than 50 , because really thats what youre asking me to do right now, thats a tough pill to swallow. Lemonis but youre asking me to throw a hail mary. And if i throw it, im only going to get 10 yards out of it. And im not willing to do that. I wont do a deal unless i have 50 . If your business is in trouble and you need my help, log on to. Brad to give up, you know, more than 50 , you say that customers make thelets talk data. Only Xfinity Mobile lets you switch up your wireless data whenever. I accept 5g, everybodys talking about it. How do i get it . Everyone gets 5g with our new data options at no extra cost. Thats good. Next item corner offices for everyone. Just have to make more corners in this building. Chad. Your wireless. Your rules. Only with Xfinity Mobile. Now thats simple, easy, awesome. Switch and save up to 400 a year on your wireless bill. Plus, get 400 off when you buy the new Samsung Galaxy note20 ultra 5g. Thats a tough pill to swallow. And i think that what i bring to the table, in terms of this brand, is pretty substantial. Lemonis i wont do a deal unless i have 50 . Do you think you should have more equity than alex . What i want to know is what the two of you are going to share with the other 50 . Brad you tell me what you think is fair, and ill rock with that. Alex to be honest with you, i wont be a part of overtone as just an employee and not a partner, and i told you that. Im not coming in saying we should be 25 25 . But i know my work ethic. Im willing to go 40 10 . Lemonis youre giving him 40 up front . And youre taking 10 , and youre saying youre going to work. Alex watch me work. Dont forget about the people who built the house with you. Deal . Aight. Lets do it. Brad deal . Lemonis i have to respect the deal that the two of you made, cause its none of my business, but i dont agree with it. Alex [ laughs ] lemonis i need you to have more skin in the game. Im going to lower my number to 40 , and youre going to start with 20 . Okay . Do we have a deal . Brad i got a deal. Lemonis okay. We have a deal . Alex thank you. Brad thank you, sir. Im ready to go to work. Alex im ready to get to work. Brad yeah. Alex so much man. This is what i always wanted, you know . Im happy. Lemonis as hard as you work, ill be there with you, okay . Alex thanks, man. Have a good one. Brad thank you. Lemonis i got the sense from brad when we were in orlando that he really struggled with his sales process. So i wanted to take him and alex to namm, the countrys largest music convention, and see how they do at a live event. It just so happens that a company i invested in years ago, sjc drums, is presenting at namm this year. Mike whats going on . Lemonis let me introduce you to these guys. This is brad. Mike nice to meet you, dude. Lemonis this is alex. I told brad and alex to pack up some of their products, bring out some samples, and sjc would make room for them. Alex grab the easels, set them up. Im grabbing a panel. Mike is this the product . Alex yeah. Thats one of our panels. Mike wow. Ive never seen a sound panel in a studio with artwork on it. Thats really cool. Lemonis they could put any image on it. Mike thats insane. Lemonis anything. Mike thats crazy. Lemonis when people go to a trade show, its important to give them a very concise message about who you are and what you do and why you do it. And when you look at their standup poster, you dont really know anything about them. I dont see any story here. I would think that you were selling equalizer. Brad a console . Lemonis then i see it again here. Then i see it again here. Brad right. Lemonis do you have brochures . Brad um, let me grab that. Lemonis thank you for your purchase. Brad well, yeah. This is what wed include with a purchase. Lemonis but where is the pamphlet that tells people, you should consider this for your home or your business . Brad we dont have that right now. Lemonis its not unreasonable that i expected them to have something to hand to people that gives them the ability to buy something and call them back. Im going to let you guys sell. And i want to see how that process works, okay . Brad all right, cool. Alex how you doing, sir . Im doing good, chris. Alex, alex. Nice to meet you. We can put any image that you like on it, you know . Lets talk about man caves, right . Whats your Favorite Football Team . Yeah, chicago, right . Chris no, no, no, no. [ laughter ] lemonis there are some real issues here. Alex wants to tell a story. Alex man cave all day, right . You sitting there, watching chicago running. Lemonis but candidly needs a lot of focus. Alex you send us your dimensions. You call in. We speak to everybody. Everything is custom. Lemonis and you have brad, whos preparing for his nap. How you doing . I need people like you to give me feedback. What did you ask when you walked up . Chris what it was, what the product was, what does it do. Pictures kind of say, im selling speakers and equalizers. Lemonis