'Shark Tank' offered a 5-figure deal to founders who sold potatoes online — but with a twist

Over the years, the American business reality show, "Shark Tank" has featured some of the most bizarre products and services. From machines that churn gold out of seawater to phones that do nothing, the Sharks have seen it all. While most startups with such products walk out of the tank empty-handed, one business bagged a pretty generous deal surprisingly from Kevin O'Leary. 'Potato Parcel' a company that mails potatoes with messages on them appealed to the creative side of the Shark while everyone else laughed at it. Down the line, it turned out to be a great move!

The co-founders of Potato Parcel, Alex Craig, and Riad Bekhit spotted a unique opportunity to market a humorous and standout gift. Thus, they created Potato Parcel, a service that lets people send personalized messages on a potato. That's it, as simple as that. 

The two appeared on Shark Tank season 8, dressed in potato suits, seeking $50,000 for a 10% equity in the business. They began to keep their pitch "rooted" and all they had to say was "Our company is Potato Parcel and we mail potatoes, that's it".

Naturally, the sharks wanted to hear more as Robert Hervajec said it was just too simple. The two then elaborated that their company offers a fun and unconventional way to send personalized messages or images of uncooked potatoes.

Customers just need to visit their website, write a message of up to 140 characters, upload a photo and address of the recipient, and place their order. The company then delivers the potato within 24 hours. They also offer an anonymous delivery option, and with every order, the company donates potatoes to those in need. The prices ranged from $9.99 to $14.99, with $4.99 for shipping.

The Sharks found the concept outrageously hilarious and Lori Greiner had a hard time believing that it could make money. However, the duo revealed that since 2015, they had already sent over 12,000 potatoes and generated $215,000 in sales. Riad also shared that he had bought the business from Alex for $42,000, in exchange for a $1 royalty per potato till 60 days after their "Shark Tank" appearance.

They added that their sales averaged $10,000 per month, which caught the sharks’ attention. However, Greiner and Daymond John bought the potatoes as a gag gift and didn't find enough value to invest. Mark Cuban, showed some pseudo-enthusiasm but ultimately decided to drop out as well.

The only two Sharks who saw potential were O'Leary and Herjavec. Mr Wonderful said that since he is creative, like Potato Parcel, he will make an offer. He put $50,000 on the table for 10% but there was something more. He wanted to cut Alex's royalty in half to take a $0.50 royalty for 60 days as well. The royalty would then go up to $1 until the Shark got $150,000 back. Meanwhile, Herjavec, who found the valuation too high, offered $50,000 for 25% equity.

"You better grab this before these two come back to earth," said Lori Greiner implying that the offers were too good to be true. After weighing their options, Alex and Riad accepted Kevin’s offer.

While most of the panel didn't believe in the business, it turned out to be one of the greatest investments O'Leary ever made. As per a 2018 update shared by CNBC, Potato Parcel sold over 70,000 potatoes, raking in a top six-figure revenue, since appearing on the show. 

The company also expanded beyond its original concept, introducing fun new products like birthday bundles, glitter bombs, and “big head” cutouts.

In the same year, O’Leary told The New York Times Magazine that Potato Parcel was among his top five favorite investments from “Shark Tank.”

According to Shark Tank Recap, the company's growth translated into a revenue of more than $700,000, earning Riad a six-figure salary. Their pitch was also featured in the "The Shark Tank Greatest of All Time Special" in 2020.