Loliware: Before The Shark Tank
In Season 7 Episode 2 of the hit tv show Shark Tank, entrepreneurs Chelsea Briganti and Leigh Ann Tucker introduced the sharks to Loliware, edible cups made from jello that you can actually eat after finishing your drink. The idea for Loliware came together when the two entrepreneurs entered a Jell-O contest back in 2010.
Chelsea Briganti and Leigh Ann Tucker saw an opportunity to create a new category of sustainable materials you can eat. Loliware products, which are made from gelatin, are not only edible but they are also biodegradeable and thus spawned the term “biodegredible”. The cups, as highlighted on the Shark Tank episode, are 100% vegan, gluten-free, and made only with organic ingredients. The cups can hold a liquid drink for up to 24 hours and have a shelf-life of three months.
Loliware: Early Investments & Shark Tank Success Stories
From the very beginning the duo knew they were on to something big. The buzz was building and so were orders. The company landed an order for 60,000 cups from Absolut Vodka for a concert, a sure sign that they were on the right track. Early success prompted the team to seek strategic investors. Going straight to the people, Loliware initially raised $10,000 from a Kickstarter campaign in 2011, followed by a $60,000 angel investment from from the Hot Bread Kitchen incubator in Harlem. At the time of the taping Loliware was in the middle of a $1 million capital raise with $600,000 remaining.
One lesson that can be learned from the Loliware story in the early stage was in how they strategically went about obtaining capital only when they needed it. The Kickstarter campaign proved that consumers were interested in the Loliware concept and were willing to pay money for the products. The sizable order from Absolut Vodka indicated that more capital would be needed in order to scale this new brand to meet increasing demand.
Prior to entering the Shark Tank, the duo also appeared with Marcus Lemonsis on CNBC’s The Biz Fix where they were advised to introduce a variety of flavors in their product offering and to focus on the environmentally friendly, biodegradable aspect of the product. With all signs pointing upwards Loliware earned their spot in Tank.
Loliware: Shark Tank Episodes Recap
Briganti and Tucker entered the Shark Tank seeking $150,000 for a 10% stake in Loliware, which equates to a $1.5 million valuation. The sharks got right down to business after the brief introduction of the company and pressed them on the financials. The duo shared that each cup costs around $0.97 to make and they wholesale it for $1.50. They mentioned they feel they can get that cost number down to $0.50 as they scale, yielding a hefty gross margin.
Robert Herjavec quickly dismissed the idea of investing on the $150,000 amount the duo presented but instead suggested investing on the remaining $600,000 portion of the current capital raise. Through several back and forth negotiations the Loliware team secured a deal with sharks Mark Cuban and Barbara Corcoran for 25% of the company for $600,000 implying a total company valuation of $2.4 million.
Loliware: After The Shark Tank – 2017 Update
In late 2016 Loliware teamed up with global nutrition company DSM to introduce a new product prototype called Lolivita. Lolivita, which debuted at the IFT show in Chicago, combines a daily servings worth of multivitamins in each of its cups. The move opens up a whole new category, supplements, to the company, one they hope will continue to pay dividends for the upstart. Briganti imagined what it would be like “if your actual container had a functional benefit”.
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