The perils of being a startup founder and the emotional toll it can take is real. A gut-wrenching example of this is what’s happening with Haj Khalsa and his company, HANGTIME. You might recall that after putting in a ton of hard work in 2018, Haj’s invention, the KOALA Super-Grip™ Smartphone Harness, finally launched on Indiegogo last September. They blew past their goal and ended their 2-month campaign with $500K+ in sales and approximately 35K KOALAs sold globally. This was an incredible high for the HANGTIME team and we celebrated this high with Haj last December when he shared his story with us at Jean Cocteau Cinema.

Well, 2020 started on a great note and HANGTIME had some superb media exposure. Out of the blue, they were picked up by The NY Times as one of the 6 Items to Stuff in Your Ski Jacket Pockets. Shortly after that, they were featured on the CBS show Innovation Nation with Mo Rocca. Each of these press coups netted them $10K+ days! In addition to the revenue, their inboxes were filling up with interest in the KOALA and possible growth partnerships.

But 2020 had some nasty surprises in store as well. The same notoriety that attracted CBS and The NYT also attracted the attention of a competitor company in the form of a patent infringement lawsuit. Given that HANGTIME has a patent for the KOALA and several more pending, Haj assumed that the lawsuit could be easily resolved by way of a settlement or a licensing agreement. This did not turn out to be the case. $50K in legal expenses and many sleepless nights later, it seems that their competitor would rather try to put HANGTIME out of business than come to a fair resolution. Since HANGTIME would very likely prevail if the case went before a jury, it appears that the lawsuit was filed not on the merits of their case, but rather as a tactic to drive them from the market.

This strategy works because a full defense in a case like this can cost $500K-$2M, with no chance to recover legal fees should they prevail. On top of that, many of their potential growth channels are closed until the lawsuit is resolved. Channels like Amazon, as well as wholesale channels like REI or Cabellas, are all off-limits, along with many other reseller and partnership opportunities. Even Shark Tank invited them to apply to the show, but then tabled the invite when they learned of the suit.

So, what’s a startup team to do when faced with a seemingly immovable obstacle like this lawsuit? Tune in to find out. And in the meantime, check out PROJECT OLLO, because while the future of the KOALA is unclear, you can’t keep this entrepreneur down, as Haj has already hatched an idea for a solution that will connect brands and influencers, giving them the power to benefit the causes they support.

Zoom Meeting Link:
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