'Shark Tank' contestants hide inside giant cake to surprise judges — the deal went as expected
"Shark Tank" contestants tend to be innovative, but some of them can also be eccentric during their pitch. Entrepreneurs try a lot of different things to stand out, but sometimes, no matter what they do, their vision simply does not align with that of the sharks. On one occasion, a couple of people walked in wearing cake masks over their heads, but they were not the founders.
The two guys wearing the cake masks just stood there for a few seconds and did not say a word. There was also a giant cake on the set, which suddenly popped open, and the real entrepreneurs showed themselves. It was the mother-son duo of Liz Charm and Jordan Long, who sought $200,000 for an 8% stake in their company, Surprise Cake.
The company did not exactly manufacture cakes, but cake stands that could be used to store gifts inside a cake. Charm claimed that she got the idea from a dream she had, and when she executed it for the first time, people around her loved it, so she decided to turn it into a business. The company had decent revenue as well, which was the reason why they asked for a valuation of more than $2 million.
It had earned sales of $10,000 in the first year of business, $280,000 in the second year, and year-to-date revenue at the time of taping was $550,000. The projection for that year was $900,000. However, they said that they’d only make $50,000 in net profit from the projected $900,000.
This was not appealing, but still something that could be worked around. What could not be worked around was the entrepreneurs’ vision for the business. They wanted to bake a cake themselves and put the Surprise Cake stand inside it, which Kevin O’Leary thought was an especially bad idea. “What you are selling is a product that has no spoilage, doesn’t have a shelf life issue,” he said.
“Cakes have all kinds of issues around their freshness when they’re shipped, how they’re shipped, why would you want to do that to yourselves?” The entrepreneurs revealed that it was what their customers asked for, and Mark Cuban advised that it’s not always the best idea to listen to customers. Charm and Long also wanted to sell gift pods, meaning that they’d be the ones curating the gifts inside the stand, which Barbara Corcoran thought was another bad idea.
Due to the lack of common ground between the entrepreneurs’ vision and what the sharks believed was the correct way to go for this business, Charm and Long were not able to get a deal. Lori Greiner seemed to be interested and was offered 12% instead of 8%, which was still not enough for her to invest.
Watch the negotiation here.
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