'Shark Tank' contestants seek $1 million for just 3 percent of their business — judges line up for a deal
"Shark Tank" judges can shape a venture's future with their investments and insight, but they're hard to impress, especially when the entrepreneurs are seeking a million dollars. Things looked even more difficult for founders in an earlier episode of the show, as they sought such a massive amount for a mere 3% stake in the company. But, in a shocking turn of events, they got offers from every single shark thanks to their mind-blowing numbers.
The entrepreneurs were Jung Song and Dok Kwon, and their business was called Cupbop. It was a food company that sold Korean BBQ inside a cup. While the product was impressive, they valued the firm at a massive $33.3 million. As a result, the sharks were curious to learn about their sales figures, and they were not disappointed.
In the last 12 months leading up to the time of taping, Cupbop had made a whopping $18.7 million in sales. It had been in existence for eight years, but the last year alone saw a 90% increase in sales. Part of that was thanks to the COVID pandemic, as the business owners shut down their dining options, like everyone else, and shifted to takeout and delivery. That worked out well for Song and Kwon, which cannot be said for most other brands.
Both entrepreneurs had made their way to the States from Korea to pursue the American dream, and boy, did it ever pay off. The product was great, and the company was being run by two people who clearly were exceptional at their jobs. The 3% equity, however, was much too low for anyone. As a result, all of the offers asked for either more equity or a guarantee to make a chunk of money.
Kevin O’Leary was the first, as he offered the million as a loan at a 10% interest rate to be paid over 36 months, and he also wanted the 3% equity. Barbara Corcoran was next, and she was highly confident in her skills to make this business earn hundreds of millions. As a result, she offered $1 million for 30%. This was too high, but she insisted that the entrepreneurs should have faith in her.
Next up was Robert Herjavec, who valued the business at $18 million. So, he made an offer of $5 million for 28%. Lori Greiner then went in with Corcoran to offer the entrepreneurs $1 million as a loan at 8% interest for a 5% stake. Finally, it was Mark Cuban’s turn, and he understood that the entrepreneurs wanted someone who could make their brand famous.
He knew he had the contacts and the means to do that and offered the most reasonable deal of them all - a million for 7%. This was a bit high for Kwon and Song, and they negotiated it down to 5%. That was the deal both parties agreed upon.
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