'Shark Tank' contestants bring a pizza cupcake as their product and it went as expected
Innovation that makes everyday life easier or more interesting is at the heart of ventures that often bag an investment from “Shark Tank.” This could be things that solve issues in daily life, or just an idea as simple as baking a pizza into a cupcake form. Andrea Meggiato and Michelle Jimenez came to an earlier episode of the show and completely changed every preconceived notion about pizzas. The couple asked for $125,000 for 5% of their company, called The Pizza Cupcake.
Their inspiration came from the concept of frozen pizzas, which are hard to carry around and consume on the go. The pizza cupcake serves as an alternative to this, and the entrepreneurs claimed that its quality is also better. It was now time for the sharks to taste the product, and not only did all of them love the taste, but they liked the texture of the dough as well. Andrea revealed that the dough was a hybrid between a sourdough and a brioche. That’s how it's fluffy and crispy at the same time.
There was no doubt about the taste of the product, and the entrepreneurs even had decent sales figures to sweeten the deal. At the time of recording, Michelle claimed that they were on course to make $800,000 from sales that year. They had even managed to find a co-packer to help them with packaging the product. The issue, however, lay in the fact that it was a frozen food product. You may ask yourself how a food item being frozen or not affects the sharks’ decision to invest in it or not. Turns out that it indeed is a big deal. Frozen products are hard to ship from one place to another, and it also costs more. There is also the matter of shelf space, since it’s not easy to find space in a freezer in supermarkets, as they’re already usually stacked up.
The entrepreneurs’ mistake was that they did not think about this aspect of their business when they made their pitch. Kevin O’Leary and Mark Cuban backed out exactly for this reason. Daymond John didn’t believe he could bring much to the table, and Robert Herjavec also backed out for similar reasons. Lori Greiner was the only one who made them an offer.
However, she wanted 20% of the business. That came down to 15% after a bit of negotiating. The entrepreneurs still seemed unsure, so Mr. Wonderful had to step in. “When you only have one offer, you’re skating on really thin ice, and now you have to make a decision,” he said. The entrepreneurs asked if Greiner would be okay with 12.5% equity and 2.5% advisory shares, to which she agreed, and a deal was struck.
