The ValPark Mobile app combines Uber’s convenience and ingenuity with parking. Currently only available for iPhones, the app provides users a map of participating parking lots where they can pay for parking through the app. If you valet parked, you can notify the attendant to get your car with the app as well. Users pay the given location’s regular parking rate plus a 10% convenience charge. The Android version is set to roll out this year along with upgrades to the vendor-facing version.
ValPark was tested at 33 locations in 2013 and released at more than 100 the following year. It’s available at 115 locations in the tri-state area of Washington D.C., Virginia and Maryland. Sales totaled $270,000 in 2014. They rocketed nearly fourfold to more than $1 million in 2015 with a profit of $281,000. Sales increased 30% immediately after co-founder Wayne Johnson’s Shark Tank appearance in October 2015.
The closest he came to getting an investment on the ABC hit business reality show was FUBU founder Daymond John offering to go in with another shark. John thought the service was valuable and was interested in investing if he could help from a tech-savvy shark Mark Cuban or guest shark Troy Carter. But both the Dallas Mavericks owner and the music mogul passed because they couldn’t see how it was scalable.
But why not? Although Uber experienced hockey-stick shaped growth, it started with equally humble beginnings. Uber’s timeline shows how the world’s largest ride-sharing company started out testing in New York with three cars in January 2010. It launched in one city, San Francisco, with 80 drivers in July 2010. It quickly expanded to New York City, Paris, London and the rest is history. It’s now available in more than 400 cities in 65 countries and boasts an eye-popping $68 billion valuation.
The sharks may regret passing on the Uber for parking. ValPark Mobile’s revenues climbed 15% so far this year from the year-ago period. Johnson is looking for venture capital tech investors to invest $750,000 for 20% equity in the company. His current valuation of $3.75 million is more than double when he appeared on Shark Tank. He offered the sharks 20% equity for $300,000. He has no other investors and has been completely self-funded.
Johnson and his partner Ben Tesfaye invested $120,000 to get ValPark off the ground. Johnson used money from his previous ventures including a development and graphic design firm called Johnson | Saia, which he used to own. Johnson is a front-end web developer specializing in user experience and user interface design.
ValPark is also searching for partners to fuel growth. It’s aiming to expand to seven other major markets with more than 100 parking locations each within five years.
Johnson explains how he came up with his business model, his regrets in the Shark Tank and much more.
Ky Trang Ho: How did you come up with the idea for your business? Ex. What problem were you seeking to solve? What is the market for your service or product?
Wayne Johnson: Parking in garages and with valet are mostly cash-based. In my own personal experience with not really carrying cash I found that finding an ATM negated any benefits that a valet initially offered. The main reason people use valet especially is to avoid the headache of driving around seeking a vacant spot.
So I thought, why not make this whole experience mobile ready? Why not allow users to find and pay for valet, garage and event parking from their phones as they do with Uber.
Ho: What made you think it could be a successful product and service?
Johnson: We think we stand out for two main reasons. Our hook in the market is focusing on valet and expanding out whereas our competitors are all fighting for the same customers within the event and garage space. Another differentiating feature about ValPark Mobile is our technologies. We use Bluetooth technologies that allow for a seamless transaction with the parking attendant, in most cases without the user taking out their smartphone.
Zooming Into the Shark Tank
Ho: When and where did you first audition and appear on Shark Tank? How long between when you taped the show and when it aired? What was that time in between like?
Johnson: I sent an email with my business plan and product and was later contacted to audition via Skype in early 2015.
We taped in July and the episode aired in October. I was anxious because I knew we didn’t “get the deal.” I was worried about how that would be viewed but was relieved to see the episode and see that I did a pretty good job presenting the business to the sharks.
Ho: Given that you didn’t get a deal, should you have done anything differently?
Johnson: The sharks went back and forth with curiosity and possibly getting involved. Daymond John actually made an offer contingent on Cuban going half. He ultimately decided it would be a good business for me (locally) but not nationally because of the competition in the market. He also did not know much our space, technology.
They were convinced companies like Zirx and Luxe were the future despite my explaining how these companies have a business model that is “cool” but not sustainable. This year both companies have gone in another direction and abandoned the on-demand valet model that I was against.
Ho: How did you prepare for your appearance? What made it a success?
Johnson: I stayed up learning about the sharks and their backgrounds. I wanted to learn who this idea would resonate with the most. One person, Troy Carter, who I thought was going to jump on this opportunity was more apprehensive than anyone.
Ho: What about being in the tank surprised you the most?
Johnson: What surprised me most was that the pitch is very traditional to what one would find at a VC firm. It also isn’t nearly as short as seen on TV. I was in the tank for about 45 minutes. They cut my segment to about 10 minutes.
Ho: If you could do the show over, what would you do differently?
Johnson: If I had another opportunity I would have asked for less and offered less. Lowering the point of entrance could have provided a viable strategic partner and more funding down the road.
Fueling Rapid Expansion
Ho: What are you doing now to move your business forward and expand?
Johnson: We are actively improving our app, building an Android counterpart and meeting with national vendors to expand our location list into multiple cities. But most of all, we are seeking funding. It’s crucial to expansion at this point.
Ho: What is your media and marketing strategy?
Johnson: We acquire customers organically and through branded valet kiosk and pylons. We also partner with large sporting and concert events to offer discounted parking if using our app.
Ho: What was the most effective thing you did to get more exposure for your business before going on Shark Tank?
Johnson: We ran a $1 weekend in Washington D.C. when using the app to park. We signed up over 700 users in 2 days.
Ho: What’s the worst mistake you’ve ever made in business and how can others learn from it?
Johnson: I’ve learned that most advice is not good, but everyone deserves a listen.
Ho: What is the best advice you’ve ever received?
Johnson: Love what you do.