Vegan Mark Cuban offers a 6-figure deal to founder who pitched meat products on 'Shark Tank'
“Shark Tank” investors are known to have sharp business acumen, and they closely scrutinize every business model and the numbers on the table before making an investment decision. Rather than being sentimental, the likes of Kevin O'Leary and Mark Cuban are known to ruthlessly prioritize profits. When an entrepreneur named Phil Wong came to the show asking for $250,000 for 5% of his company, Misfit Foods, he was pitching sausages that are a mixture of chicken and veggies. This was aimed at consumers who want to reduce their meat intake but not cut it out entirely, and that was enough for Cuban, a vegan, to get on board.
Although he won't eat it himself, the celebrity investor was still impressed with what had been presented to him. He liked the entrepreneur, and he liked the sales figures. At the time of recording, Misfit Foods had been in the market for less than a year, and they were already on course to make more than a million.
This product, however, came with its own set of challenges. Firstly, it was a refrigerated food item and finding space for those in big stores is not easy. No company wants to give up shelf space, especially if that shelf is in a refrigerator. Kevin O’Leary said that he had tried multiple times to make it big in this industry but couldn't, and so he backed out. Robert Herjavec, who is also a vegetarian, backed out, stating that he did not share the entrepreneur’s vision for the product.
Daniel Lubetzky was the first to offer a deal to Wong. He said that he’d give the $250,000 but wanted 15% of the business. This brought down its valuation from $5 million to $1.5 million. He was not the only one. Lori Greiner liked the product as well and believed that it had a bright future. Therefore, she offered the same amount of money for 18% of the company. Cuban was the only one yet to make a decision.
“For me, if I was a flexitarian, this would be too much. I’m not a curry guy, and citrus kale, maybe I’ll try it, but if it was simpler…I just want a sausage that I can put on a bun and eat it in a cookout and know it's healthier and lower calorie,” he said as he held up the different flavors of the sausages. Lubetzky agreed with his counterpart, and Mr. Wonderful also chimed in with his opinion.
“I had no idea you’re a chef, Mark,” O’Leary said. “Are you gonna make an offer?” Cuban said that he would and asked Lubetzky if he would like to partner up. They agreed and together offered $250,000 for 15%. This still didn't change the fact that the company’s valuation would go down dramatically. The entrepreneur made a counteroffer and asked for $300,000.
Cuban looked at Lubetzky upon hearing this and said, “That’s not crazy. I would do that.” That was the deal they ultimately struck, and Wong walked away happy.
