This IIT-IIM startup founder denies Shark Tank’s offer and sells his entire inventory over the weekend

• Ganesh Balakrishnanthe co-founder of Flat shoes received a bid that valued his company at ₹2.25 crore from two sharks Shark Tank India S2.
  
• Balakrishnan, who had previously invested personal money to keep the venture afloat, declined the offer.
  
• The shoe business that started just before the pandemic hit hard as people were forced to stay indoors by lockdowns.
  
• After the episode aired last Friday, the startup managed to sell its entire inventory over the weekend, Balakrishnan said on social media.

Last Friday, Shark Tank India S2 aired the most emotional episode of the season as Ganesh Balakrishnan made a pitch for his venture, Flatheads Shoes. The startup
creates ‘all-day casual shoes for the urban workforce’ priced between ₹1,000 – ₹5,000 per pair. It too
offers India’s first linen sneakers and the world’s first banana fiber sneakers.

At the time Balakrishnan’s episode was taped, his business was on the brink of closure. He said
on the performance that he has personally invested ₹ 35 lakh to keep the business running, in the past two months. His co-founder Utkarsh Biradar, who helped design the shoes, also invested the same amount. Biradar left the startup in 2022, but still has 30% equity.

Despite his increasing problems, Balakrishnan turned down the only deal he received on the show. Sharks Peyush Bansal (co-founder, Lenskart) and Vinita Singh (co-founder, Sugar Cosmetics), offered ₹75 lakh for 33.3% equity in the company. The offer values ​​the company at ₹2.25 crore.

Balakrishnan had asked for a valuation of ₹25 crore as the company generated revenue of ₹3.4 crore in FY22. The company had raised ₹5.2 crore by April 2021, at a pre-money valuation of ₹28 crore, from angel investors. Pre-money valuation refers to a startup’s value that doesn’t include outside funding — basically, a startup’s value before it raises funds.

Once in a generation of trouble

Balakrishnan started Flatheads Shoes in 2019, just before the pandemic hit. In less than a year, the company was out of customers – as India stayed indoors, people barely needed shoes, let alone work clothes in the city.

“It’s not that I can’t run a business. I am capable of it. The point is, when you enter the market and no one wears shoes for 4 months, because no one just steps out – such situations happen once in generations. And it happened to us,” Balakrishnan said on the show. He also said angel investors were unwilling to further invest in the company.

‘Need to evaluate my priorities in life’

Even as he declined the offer, Balakrishnan admitted that he needed to change his perspective, reevaluate his priorities and gain more experience before entering the D2C market.

“I now have to evaluate my priorities in life. I’ll go out and work with a D2C brand and understand how to do it before I come back and try again. I need a few years. But that perspective needs to be built. And the best way to build it is to work with someone who has done this before,” Balakrishnan said on the show.

Balakrishnan’s emotional confession left all the jurors teary-eyed, with Shaadi.com founder Anupam Mittal commenting, “Shark Tank is not just about getting funding, it’s about perspective.”

Every tear has a silver lining

When Balakrishnan pitched on the show, most of the Sharks asked him to shut down the business and instead earn a living through a regular job, using his educational qualifications and work experience. While the founder of boAt, Gupta, shared his personal experience of going down the same path, Mittal even offered him a job.

However, shortly after the episode aired, Flatheads Shoes was trending on social media and as a result got enough orders that it almost sold out its stock in India.

“We’ve almost sold out our stock in India, so please excuse us if you can’t find your size on www.flatheads.in,” shares
Balakrishnan on his LinkedIn account.

The product is on the
Shark Tank India website. The brand also has international ambitions. It launched its products in October 2021 in the US and plans to expand its international market in the US and UAE.

As Balakrishnan admitted on the show, Flatheads enjoy a “price advantage” in the US because people are willing to pay a higher price for a sustainable product.

The serial entrepreneur

After graduating as a mechanical engineer from IIT Bombay in 1999, Balakrishnan worked at an MNC for industrial technology Ingersoll-Rand International (India) for five years before earning an MBA degree from IIM, Bangalore.

He worked at Bain & Company and Honeywell, before beginning his entrepreneurial journey in 2013 at Windsleeve, a retail technology product company, and Momoe, a mobile payment product company.

While Windsleeve shut down in a year, Momoe ran for three years before being acquired by Shopclues in 2016 in a cash and stock deal. In 2019, Balakrishnan re-entered the startup space with Flathead Shoes, inspired by his personal experience of dealing with smelly and ill-fitting shoes.

Balakrishnan is married and has a 10-year-old daughter. Currently, his family income is managed by his wife, who works for a German company. His daughter is an artist who also wants to become an entrepreneur and is already taking orders for calendars made with her paintings.

“Did I mention that my 10-year-old daughter wants to become an entrepreneur? She says she’s a fan of Peyush’s no-nonsense mentality, and I know she admires Vineeta for her cheerfulness and positivity. She is very proud that I received an offer from both of them,” said Balakrishnan
on his LinkedIn post.

His persistence and honesty in the show left the
Shark Tank India panel and audience were so impressed that the admiration translated into sales.

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