'Shark Tank' offers a life-changing deal to founder who called her product 'the Netflix of toys'
There are certain simple ideas that went on to become big after getting a deal from "Shark Tank," and there are also those who were rejected by sharks but still grew into behemoths. But ToyGaroo was one of those firms that started with a great idea and even got a deal from not one but two sharks, and still didn't deliver on the expectations. Its founder, Nikki Pope, even left a Shark, Robert Herjavec, high and dry to get the multi-investor deal from Kevin O'Leary and Mark Cuban.
In the episode from season 2, Pope sought $100,000 in exchange for a 10% equity stake in ToyGaroo. She began her pitch by sharing her experience of observing her 13 nieces and nephews who had tons of toys lying around their homes. She highlighted that it had become a problem for parents, as most kids had more toys than they could play with. This was because the kids always want more toys, but they soon get bored with nearly all of them. This is particularly problematic with higher-end toys like Drive Suits, driveable cars, and more.
Thus, to solve this problem, Pope came up with the idea of ToyGaroo, a toy subscription platform. She called it "the Netflix of toys," through which parents could rent toys online and return them when their children got tired of them. "Just throw them in the box use the return label that we provided send them back to us and we send them their next box of toys," Pope said.
She emphasized that sanitization of toys was the first priority of the company before re-shipping the toys. She further shared that they had a catalog of about 300 types of toys, and their subscription started at $35 and went up to $89. Looking at the high price, O'Leary speculated that there won't be many members. However, Pope explained that they already had 500 paying members who paid $42 a month to get toy boxes worth $200. "It costs them about $500 a year, which is great because the average family spends anywhere between $1,200 and $1,400 on new toys," she claimed.
However, when she revealed that she owned just 10% of the company and her husband owned the majority 50% stake, the Sharks started to drop out. Daymond John was the first to exit, citing problems with the ownership structure. On the other hand, O'Leary made an offer of $100,000 for 35% equity. This got Robert Herjavec and Mark Cuban interested as well, and they partnered up to offer $200,000 for 40%. Looking at the offers, Barbara Corcoran dropped out as she couldn't match the other sharks.
In a bid to sway Pope, O'Leary highlighted his experience in the toy business, "I want you to know something about me. I am Mr. Toy. I sold my company to Mattel. I lived in Fisher-Price for a year, and those toys are my friends. I speak toy. I just think you need more capital," he said.
At the same time, Cuban also highlighted his social media acumen in trying to get Pope to make a deal with him and Herjavec. Then came a twist when Pope revealed that she was interested in signing O'Leary as a partner. The cunning shark quickly teamed up with Cuba to offer $200,000 for 40%, and Pope accepted the deal.
Unfortunately, while things went great for ToyGaroo in the Tank, a few years down the line, it shut its doors. The company's website is long defunct, and its developer shared an update with the blog Failory claiming that ToyGaroo had faltered due to pressure from toy manufacturers and a lack of support from the sharks.
