A trend has been developing on Shark Tank. The most successful products/presentations tend to be in the healthy food and beverage category.. Clothing, beauty products, household items, recreational products, and technology are secondary.
Best Deal of the Episode…………..Alex from Genius Juice began his presentation with a very entertaining song and dance (see below). His competitive advantage in the healthy beverage category is there is a full coconut in every bottle. His product can best be described as a coconut smoothie. The Sharks loved the taste of Genius Juice.
Alex sells his product for $5-$6 per bottle. His cost is $1.87 per bottle. He’s in 1100 stores and has estimated sales of $1 million this year. Interestingly, he was one of the few entrepreneurs that knew his Break-Even point (sales of $2.5 million per year when his company becomes profitable). This is a number that helps determine how much funding is required prior to reaching the B/E point.
Industry guru and Guest Shark Rohan Oza thought it would take longer to get to that point than Alex did. He also was concerned about the refrigeration requirements and the associated expenses. “That scares me”, he said.
In the end, Mark Cuban and Shark Barbara went in on the deal together. Each put in $250K for $500K total for 25% equity. This should be a great partnership.
Best of the rest……Chris and Geanie from Rapid Rope have developed an easy-to-use rope dispenser. Their product has had limited sales due to family issues ($172K sales in two years). They have 4 kids and recently adopted a boy from Africa who has needed a lot of medical attention. Chris and Geanie came across as high integrity people who believed in giving back to society.
Shark Barbara offered $200K for 30% equity and they accepted. Barbara is the Shark that relies the most on gut feel as a guide to doing a deal, and this was no exception. She said that her best decisions on Shark Tank have been “made from the heart”.
Daniel, Andy, and Dr. Katie from Ready Set Food hope to eliminate food allergies. Their product is mixed with baby’s milk to prevent allergies to peanuts, eggs, and milk. This represents 80% of all food allergies. Prior to Shark Tank, they had raised $2.4 million.
Although they had little proof that their product actually works, they got a deal from Mark Cuban for $350K for 10% equity. Mark has a particular interest in anything that can prevent food allergies as one of his children had food allergies.
Dustin from Ka Pop! has developed a popped chip made of ancient grains (sorghum) that tastes good and is good for you. The Sharks loved the product but the “valuation gap” was just too high and no deal could be reached.
OVERALL RATING OF THIS EPISODE………………………C+