Jon Hayes, a Princeton graduate and former Wall Street investor, came to the Shark Tank seeking $200,000 for 5% of his company. Jon’s company, RewardStock was founded after Jon and his wife returned from their honeymoon.

Key Takeaways: RewardStock on Shark Tank

  • Investment: Secured $320,000 for 10% equity plus 1% advisory shares from Mark Cuban.
  • Product: An automated travel advisor that helps users maximize and trade reward points for vacations.
  • Sales and Fundraising: Earned $50,000 on 10,000 users with a primary revenue source from referral fees.
  • Shark Interest: Cuban was drawn by the potential to grow the platform and believed it could integrate well with his other investments.
  • Entrepreneur: Jon Hayes, a former Wall Street investor, taught himself to code and created the platform after planning his own honeymoon using reward points.

The Story Behind RewardStock

They were able to take a great trip but spend very little by being strategic with how they used their airline and hotel reward points.

They soon realized that they could make a business out of planning vacations for others by maximizing and trading their reward points. Jon quit his job and taught himself how to write code so that he could start RewardStock.

RewardStock is a fully automated travel advisor that strategically helps users to redeem and trade their reward points, that would otherwise go unused, to claim great deals on travel. The service determines the best way to utilize the points so that they can get the maximum value for them. RewardStock accepts input from the user via a profile that assists in driving the algorithm to make travel decisions based on the user’s travel preferences.

The site launched two years ago and has made $50,000 on 10,000 users. This equates to $5 per user for referral revenue which is one of their primary sources of revenue. Aside from referrals, RewardStock also makes a profit on user membership fees and on excess profit that is gained during the exchange of points. The Sharks are admittedly very concerned about how small the companies revenue is in comparison with it’s $4 million valuation. Jon shares that RewardStock is in need of additional programmers so that the platform can continue to grow.

As the Sharks begin to evaluate RewardStock, guest shark Sara Blakely immediately declines to make a deal citing that this business is not a particular passion of hers and so she does not feel strongly about investing in this company.

Lori Greiner is afraid that the company is too young and under-developed. She doesn’t feel confident in her investment also passes. Barbara Corcoran does not like the revenue of the company so far and also declines to offer.

Mr. Wonderful, Kevin O’Leary is interested in RewardStock because its business model fits in with the other companies that he is a part of. He offers $200,000 for 10% of the company citing that he does not believe the company is worth its current valuation right now. He tries to sell Jon on the fact that none of RewardStock’s current investors have as strong of a platform as he does which could make this a very popular service. Unsure, Jon asks Mark if he has an offer. Mark Cuban offers $320,000 plus 1% in advisory shares for 10% of the company. Jon quickly accepted Mark’s offer and declined Kevin O’Leary’s original deal.

Wrapping Up

What do you think about RewardStock’s business model and Mark’s offer? Would you utilize this service? Sound off in the comments below!

For a full summary of this episode, check out this article. Shark Tank airs on Sundays at 9:00 PM EST on ABC.

Latest Update: RewardStock

Since appearing on Shark Tank, RewardStock has expanded its reach, offering more tools for users to track and trade their reward points effectively. Mark Cuban’s investment has helped them grow technologically and scale their user base. Their platform has partnered with several travel services, making vacation planning easier and more rewarding for users.