Atlanta’s Southern Culture Artisan Foods got a deal with Barbara Corcoran on ABC’s “Shark Tank,” which aired on Friday night.
She initially asked for $100,000 for a 25 percent equity share of her company.
Corcoran offered $100,000 for a 40 percent equity stake in Erica Barrett’s gourmet breakfast brand, which focuses mostly on pancake and waffle mixes with interesting flavors and organic ingredients. They negotiated it down to 38 percent.
This was actually a counter offer to Kevin O’Leary (nicknamed ironically as “Mr. Wonderful”) who offered $100,000 but wanted $1 for every sale on top of that until the $100,000 is paid off and 50 cents per product after that.
The show was taped last fall. Barrett’s business has been growing rapidly , generating $250,000 in sales last year in its first full year in operation. In an interview this morning, she said thousands of new orders have rushed in over the weekend, something she anticipated. She also recently received a re-order from QVC. (She also sells per products at T.J. Maxx, Marshalls and Nordstrom and a few Whole Foods markets.)
Although these deals appear to be made on the spot on the TV show, they don’t always work out. The sharks have to go through a due diligence period to ensure the deal works for them.
She and Corcoran are still negotiating a deal that may or may not transpire. Barrett said 38 percent is a large equity stake. Either way, Barrett enjoyed the experience and said her product and persona came out well on TV.
On the show, Barrett fed the sharks samples of her most popular flavor pancake mix: banana pudding. They were impressed. Her presentation went smoothly. She looked and sounded confident and was not flummoxed by any of the judges’ comments.
Corcroan warned Barrett about the difficulties of the food business, which has notoriously low margins and often kills entrepreneurs.
Robert Herjavec, one of the sharks, said he considers her product, given its price points, is too niche for his taste. Mark Cuban said this wasn’t his field of expertise given that he prefers eating cheap hotdogs.
Earlier on the show, former pro wrestler and current Smyrna resident Diamond Dave Page showed off his impressive DDPYoga fitness system, which he said generated an impressive $2.6 million in its first year with a fat $890,000 in profits. In 2013, he was trending even better.
He himself, at age 57, showed off his flexibility and brought in a client, an overweight veteran who had messed up his back and could barely move. Now, a year later, that veteran can run and even do a split. His presentation was very convincing.
Page has generated most of his sales from DVDs and books, which concerned the sharks because people are going more to apps, where profits aren’t as big. He is also going to invest in infomercials (or as he calls it a documercial) but that didn’t thrill the sharks either.
Daymond John noted he had invested in Billy Blanks Jr.’s exercise regimen and while it was successful, he found it a major drain in time and resources for him. Corcoran said these things tend to be trendy and not worthy of a long-term investment.
In the end, the sharks passed. But Page had said even before the show aired that he was thrilled to get the airtime on prime-time television before more than six million viewers.