'Shark Tank' contestants with millions in sales but zero profit fail to get a deal from judges

The sharks were baffled that the entrepreneurs did not even have a plan to become profitable.

PUBLISHED 2 HOURS AGO

Screenshots showing guest shark Emma Grede and the entrepreneurs on "Shark Tank" (Cover Image Source: YouTube | Shark Tank Global)

Entrepreneurs on "Shark Tank" usually come in with fascinating products and impressive pitches. But when it comes to numbers, it's very hard to survive the incisive scrutiny by ruthless sharks. Many of them are confident about the product and its popularity, but aren't good at making their businesses profitable. That was the case with a couple of entrepreneurs, who left empty-handed despite having a good product and decent sales figures.

via GIPHY

The entrepreneurs were Kristen and William Schumacher, who sought half a million dollars for just 3% of their company, valued at $16.6 million. But the numbers just weren’t adding up for the company that was selling healthy food products.

The problem was that half a loaf of their unsliced bread cost $12. That’s way too much money for that much bread. Guest shark Emma Grede said that she hoped to find a $5 bill inside the box. The company also had a high customer acquisition cost of close to $50.

Screenshot showing the product. (Image credit: YouTube | Shark Tank Global) — Screenshot showing the product. (Image source: YouTube | Shark Tank Global)

Not everything about the business was bad, as the entrepreneurs claimed to have hit sales worth close to a million dollars the year prior and more than $2 million year-to-date at the time of taping. They expected the company to generate $5 million during that year. Barbara Corcoran had trouble believing them and almost asked for proof. The biggest problem, however, was that the company was not profitable. It was actually nowhere close to making a profit just yet.

The Schumachers said that they had incurred losses of close to a million a year prior and said “absolutely not” when Kevin O’Leary asked if they were going to make any money on the projected $5 million in the year of taping. If one sets aside the ginormous valuation for a moment, this lack of profit alone is enough to dissuade any shark from investing. And that is exactly what happened.

Screenshot showing the sharks. (Image credit: YouTube | Shark Tank Global) — Screenshot showing the sharks. (Image source: YouTube | Shark Tank Global)

“I don’t think I’ve ever sat and spent this time in my seat and heard more fancy words in my entire life. I think if I were to put any money into your business, I would not sleep a wink tonight,” Corcoran said. She simply did not trust the entrepreneurs and did not offer a deal. Lori Greiner believed the product was in line with trends since healthy food was becoming a big deal, but this was not the right business for her.

Guest shark Grede also said no to making an offer as the entrepreneurs hadn’t laid out a path to becoming profitable. For Kevin O’Leary, the valuation was much too high to invest anyway. Finally, Mark Cuban said no as he did not believe the company was doing the right things to grow and gradually become profitable.