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Not all of the business partnerships on “The Profit” have a happy ending. In season 5, Marcus Lemonis attempted to invest in cell phone accessory company, The Casery, however, Marcus and owner Matt Harlow could not find a way forward. In Marcus’ opinion, Matt was not a true leader and made bad business decisions. He also treated his team very badly. Marcus could not partner with Matt and made the decision to walk away from The Casery.

Following the show, two key members of The Casery contacted Marcus in hopes of partnering with him to create a competitive cell phone accessory company. Lead designer, Charlotte Hennington, and operations and finance manager, Skyler Milligan-LeCroy, met with Marcus to discuss the possibility of Marcus investing with them to create a brand new company. Charlotte and Skyler would put their hard work and core competencies into the company and Marcus could help with financial support and leadership guidance. There are several other designers from The Casery that would also follow them to the new company.

In order to launch their business, they need someone to finance their inventory which is an estimated $2 million investment. Marcus is unable to simply invest through equity because it will look like the gave them a gift of approximately $1 million that they will need to pay taxes on. It will need to be structured as a preferred investment. Marcus offers a deal so that he will have a 49% ownership in the company and Charlotte and Skyler will own 51% (which will be split between the two of them). Marcus is clear that he does not expect to have any operational or design control over the company, but he does want to have financial control. They agree and officially go into business together. Marcus prefers that Charlotte is the CEO because she has better higher level thinking and is friendlier and more approachable to customers. Skyler will be the COO and in charge of the operational portion of the company.

When Marcus was working with The Casery, he had set up a meeting with T-Mobile. Since that partnership possibility fell through, he decided to keep the appointment and give their new business an opportunity to pitch to T-Mobile. In order to be prepared for that pitch, which was in 10 days, they had a lot of start-up work to get done in a short amount of time. Before the T-Mobile meeting, they need to decide on a company name, set up their LLC, create all new designs that are unique to their company, define clear roles of each member of the company, create a brand identity and make design boards for the pitch.

They decide on a new company name, Everkin. The name represents that there is something for everyone at their company. The Casery had strongly skewed toward female designs and they want to be clear that their company will be inclusive for everyone. When they show their initial designs to Marcus, however, he feels that they still skew very much to a female market and align too closely with The Casery designs. He wants to avoid anyone questioning their integrity or their brand and asks the design team to come back with new designs that will be further from the Casery designs for the T-Mobile pitch.

On the day of the T-Mobile meeting, it is clear that Everkin isn’t quite prepared and find themselves in conflict with Marcus before the meeting begins. Although Marcus is upset with their lack of preparation, he likes that Charlotte is standing up for herself and her team. As the meeting progresses T-Mobile appears to be impressed with their design and strategy. They are very happy that Everkin included their signature magenta into the designs so that they could tie the T-Mobile brand into the cases. Charlotte also added a clever touch by having the Everkin team sport T-Mobile shirts during their sales pitch. T-Mobile agrees to sell Everkin cases throughout each of their stores across the US. The designs passed the meeting, but barely. T-Mobile echoed Marcus’ assessment that they need a better balance of male and female designs. T-Mobile placed an order for 38,000 cases in 18 designs.

Now that they have their first major client, Everkin will face their biggest obstacle which will be to fulfill the order. The team heads to Hong Kong to one of the largest tradeshows in the world. They are looking to find the latest trends, accessories and the newest technology in the market. Because they are a new team, it is also important that they work on their teamwork while they are on their trip.

When the team returns from their trip they dive into creating all new designs so that they can be printed in Hong Kong. Skyler is working with a third party logistics company that will receive the product after it gets air shipped to Californi. Once received, the inventory will get packaged and sent out to the T-Mobile stores across the country.

The official launch with T-Mobile happened at one of their New York City locations and unfortunately for Everkin, they came off as unprepared for their launch, just as they did with their initial meeting with T-Mobile. They had trouble getting the displays together and the customers provided feedback that they also felt that their line appears to be more feminine than masculine. This angers Marcus because he feels that the design team has consistently ignored this feedback. Unfortunately, that’s not where the bad news ended with their T-Mobile launch.

T-Mobile reached out to Charlotte because they have SKUs that are not selling well. T-Mobile is requesting help with markdown support. In retail, when a product doesn’t sell, the customer asks the supplier to help supply them with markdown money to offset the cost of them lowering their price to move inventory. They are asking for $300,000 to offset these costs. Marcus is frustrated because he feels that this could have been avoided if Charlotte would have followed up with T-Mobile to switch out the slow movers right away like he had coached her to do. They agree to simply take the product back rather than pay for the markdowns. This makes Marcus nervous since this is their one and only customer.

It is clear that there is some friction among the team. Skyler feels like no one is truly running the business. Charlotte feels like she doesn’t know what she is doing. Marcus is frustrated that they aren’t getting anything done from a sales perspective, they didn’t listen to feedback on the design side, they didn’t perform like he wanted with TMobile and there are personality conflicts throughout the company.

To turn low morale around, Marcus asks them to focus on what they feel is going right in the company instead of what’s going wrong. They are very proud of their product development because they have a lot of good ideas. They are going to be adding different types of cases as well as matching wireless chargers. They also are excited because they have set up a meeting with Marvel in an attempt to create more masculine designs. Because he is impressed with their initiative and idea to contact Marvel, Marcus gives them a contact with Major League Baseball to set up an additional sales pitch.

During their meeting with the MLB’s commissioner’s office, Everkin presents a line of cases and wireless chargers that compliment each other. MLB is looking for more stadium and iconic images on the product and not just logos. The meeting was already going well, and then Charlotte secured the deal by unveiling a line of products that are aimed at female baseball fans. Because the fanbase is nearing a 50/50 ratio of men to women, the commissioner’s office was very interested in that line. Major League Baseball agrees to give licensing rights to Everkin to create a line of products for all of their teams.

Marcus is very proud of the growth that he saw with Everkin. This is the first time that he had started from scratch with an investment company and he was very proud of how quickly they developed products and sought out major clients. There are still additional sales pitches setup with companies such as Striker and Marvel that he is excited about. With the success they are already seeing, the sky is the limit for Everkin.

What are your thoughts on Everkin’s journey and success? What are your favorite startup tips? Sound off in the comments below!

“The Profit” airs Tuesday at 10 p.m. on CNBC.

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