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5 Shark Tank Sales Pitches That Struck Out
Copa Di Vino
Copa Di Vino
Copa Di Vino is essentially "wine for dummies." It is a an easy-open glass sof wine you can easily open and enjoy anytime and anywhere. It requires no bottles, corkscrews or glasses. It is simple as open and enjoy.
Now, James Martin did not invent the idea of serving wine by the glass. He discovered it while travelling through the south of France. He then brought the technology to the United States and sold it under the label Copa Di Vino.
Copa sell ten varieties of wine - cabernet sauvignon, chardonnay, merlot, moscato, pinot grigio, pinot noir, red blend, riesling , white blend and white zinfandel. These are sold in 6.03 ounce plastic cups that come in packs of a dozen. Aside from selling wine by the glass, the company also sells the traditional by the bottle for those who prefer it that way.
The company has transformed itself from a struggling winery in Oregon to a powerful brand with 13,000 retail locations. It has also grown in revenue from $500,000 in its maiden Shark Tank appearance to $25,000,000 shortly after its second appearance. It now employs 150 employees and harvests 400 acres worth of fruit in the Oregon area.
While the idea of wine by the glass makes perfect sense, it was not this idea that the sharks rejected but rather the arrogant owner - James Martin.Through the presentation James was smug and arrogant. He did not listen to any of the shark's suggestions. He even botched the chance to partner up with Kevin "Mr Wonderful" O' Leary, a wine connoisseur with his own wine brand - Kevin O' Leary Fine Wines.
The sharks absolutely despised this man. Barbara Corcoran calle him "arrogant" because he never listened to any of their suggestions. Daymond John called him "obnoxious and stubborn" Mark Cuban called him a "gold digger."The sharks felt that James just was in it for the free publicity and never wanted to do a deal. They felt he just wasted their time.
Round 2 with the sharks fared no better. The sharks were trying to get a deal on the equity James was offering but he wouldn't budge. James felt that the sharks were low-balling him. The sharks felt James did not consider the value they bring to the table - their expertise, connections and their resources.
When interviewed by ABC regarding James Martin and the deal that "got away", you could clearly see the disdain from the sharks. Sure the sharks missed out on a very profitable venture. Any amount they would have invested during the first go around with Martin would have returned twenty fold but the sharks did not want to deal with Martin everyday. They are successful after all and could choose the people that they work with.
Copa Di Vino
Aidan Chopra and his friend Scott Lininger are co-founders of Bitsbox - a monthly subscription box similar to Loot Crate where a subscriber would get random items which are usually theme related. In this case, Bitsbox contains toys,stickers, tattoos, puzzles, books and activity cards that will help teach kids how to code. The product is meant for boys and girls ages 6 to 12.
Bitsbox comes in 3 packages - Basic for $24.95, Deluxe for $32.95 and Digital for $19.95. The basic just contains books about coding. The deluxe contains more toys and goodies. The digital contains just PDF files that you can print yourself.
Aidan and Scott met at Google. Scott proposed to Aidan that they resign in order to pursue the Bitsbox venture full time. They amusingly reenact this scene much to the amusement of the sharks.
The two bring along Grace, a 10-year old girl who started coding at a young age. She was there to help demonstrate the benefits of Bitsbox. She did so through a Shark Tank themed application. The sharks are impressed by the smart young girl.
Kevin recognizes the value of Bitsbox as China has outpaced the United States in producing engineers. He acknowledges that kids need to learn coding skills at a young age. The two were targeting Chris Sacca as he was former Google employee. They heaped praises upon Chris.The initial offer by the do was $250,000 for 3% equity but Chris wanted 5%. The two kept nickel and diming Chris until they came at 4.75%. Kevin got frustrated and encouraged the two to just do the 5% to close the deal.
Chris was not pleased by the indecisiveness of the two and dropped out. He felt the two were not valuing him enough as a business partner. Whatever premium he was asking for was well worth it since he brings a lot to the table.
The two were too busy over-analyzing the deal and were to concerned about decimal places that they did not notice Chris dropping out for a second and final time. They try to salvage the situation but Chris did not give them another shot. They came up empty handed because they were simply too greedy and indecisive.
The two were .25% away from closing a deal with Chris Sacca.
The Cookie Kahuna
The Cookie Kahuna
Cookie Kahuna is the latest venture of Famous Amos founder Wally Amos. Wally was a pioneer in the cookie industry as he was the first person in the United States to develop a large distribution chain for his cookies. Using a $25,000 loan he got from his friends Marvin Gaye and Helen Reddy, Amos was the king of the cookie world.
Famous Amos was a success right from the get-go. The company sold $300,000 in its first year of operation and proceeded to more than triple that by the next year. The company seemed to be reaching new heights each and every year. Sales even reached $12 million in 1982.
What goes up must come down eventually.In 1984, sales plateaued and started to tank. In order to fix the problem and get a new infusion of cash, Amos part of his company. The process continued until Amos sold himself out of the company he founded.
The company ownership changed hands multiple times. From Wally Amos, it went to such owners as the Bass Brothers, the Shansby Group, Keebler and Kellogg's.
Wally decided to throw his hat back in the cookie arena with his new venture, Cookie Kahuna. Unlike other Shark Tank entrepreneurs, Wally Amos was not a relative unknown but rather a legend. Not only was Wally one of the pioneers of the cookie industry but he was also a known motivational speaker and author.
Mark Cuban was especially fond of Wally Amos as he knew of Wally's story.
Wally was very upbeat and entertaining through his presentation. The sharks simply loved the charismatic Amos. The sharks praised Amos for still willing to open up a new business even as a senior citizen.
However, there were a lot of things that prevented the sharks from making an investment. First of all, the margins were low. It would take a long time for the sharks to get a return on their investment with such paper thin margins.Second is that Wally's name and likeness is owned by Kellogg's - who owns the Famous Amos brand. This negates whatever brand equity Amos may have.
Despite not getting a deal, Wally was very gracious and happy to at least get the word out about Cookie Kahuna.
Cookie Kahuna is mostly sold in brick and mortar stores in Hawaii and through their online stores. They sell three variants in 6 oz. bags - original chocolate chip, butterscotch macadamia and chocolate chip pecan. The bags sell for $5.99 plus shipping on their website and $9.99 with free shipping for Amazon Prime members in Amazon.
The Cookie Kahuna
Move over pet rock, here comes the NoPhone. The NoPhone is a plastic object that is supposed to resemble a smartphone and was intended as a play on cellphone addiction. The company was founded by Chris Sheldon, Van Gould, Ingmar Larsen and Ben Langeveld.
The NoPhone comes in three versions. The original NoPhone has no screen and is sold for $15. The NoPhone selfie comes with a mirror that acts as a screen and is sold at $20. The NoPhone Air is an empty smartphone package with virtually nothing inside and is sold at $6.
The NoPhone looked more like a gag than an actual viable product.It serves as a placebo to people who are addicted to their smartphones. It can also serve as a nice gag gift. They asked for $25,000 for 25 percent of the company giving it a valuation of $100,000. The sharks found the idea to be funny and did not take it seriously at all. Throughout the presentation, you can clearly see the sharks laughing at the absurdity of the NoPhone.
One by one the sharks dropped out as they did not see NoPhone as a viable investment. It was a nice novelty item to them and nothing more.
Not everyone thought the same though as the NoPhone was able to raise $18,316 in Kickstarter in 2014. The campaign raise more than thrice the goal amount. Now this is no laughing matter.
Diamond Dallas Page is one of the greatest wrestlers World Championship Wrestling (WCW) has ever produced. If you mention WCW, you would think of wrestlers such as Sting, Ric Flair, Bill Goldberg, Booker T and Diamond Dallas Page.
DDP or Page Joseph Falkinburg in real life, had a successful 14 year professional wrestling career where he was both a wrestler and manager. He started wrestling at the age of 35 and became the world champion three times. He also feuded with many of the legends of the sport such as Hulk Hogan, Randy Savage, Bill Goldberg and Bret Hart.
DDP had a very memorable career and had many accolades. In WCW he had 3 World Heavyweight Championships, 1 World Television Championship, 2 United States Heavyweight Championships and 4 World Tag Team Championships. In WWE he had 1 European Championship and 1 Tag Team Championship. Page is also in the WWE Hall of Fame.
DDP's career took off at the age of 39 and three years later, he suffered a potentially career-ending injury. He tried everything but to no avail. Then his wife Kimberly suggests he should try yoga. DDP initially refuses the idea as he also viewed it as a lot of nonsense.Page was desperate and eventually gave it a shot.
Surprisingly, Page was healed. It took only three months and he was back in the ring. The results encouraged Page to help other people through the benefits of yoga. DDP's program used to be called Yoga for Regular Guys or YRG. With this, he wants to promote yoga to the average Joe. DDP developed YRG in collaboration with Dr. Craig Aaron. DDP's favorite yoga is "power yoga" which is a variation of the Ashtanga style of yoga.
DDP Yoga was doing quite well and DDP decided to bring it to the next level by offering a mobile application. He was seeking $200,000 for a 5% stake in the company. DDP showed the sharks that despite him being age 57 at the time, he showed the sharks how flexible he was.
He also showed footage of Arthur Boorman, a disabled war veteran who lost weight and gained his mobility back using DDP yoga. Despite DDP being able to give a good presentation, solid answers to the sharks' questions and posting a hefty $800,000 profit, the sharks did not bite as they thought that it would not be sustainable. Kevin jokingly offered 200,000 for 50% but DDP declined. Also, the sharks do not often take single digit ownership stakes as they want "more skin in the game."
Despite not being able to secure the investment he needed, Dallas Page was able to sell more than $1 million worth of product in less than a week after appearing in the show. He was also able to cobble up the money needed for the DDP Yoga Now app and subscription to it goes for $29.99 for a monthly subscription, $39.99 for a quarterly subscription and $107.88 for a yearly subscription.
Shark Tank Pitches
Which deal should the sharks have taken?
© 2018 Jan Michael Ong