This entrepreneur turned food waste into a $500K ‘Shark Tank’ deal — and proved snacks can save the planet
It appears that 'Shark Tank' investors are keen to invest in businesses that strike a personal chord. During an episode of 'Shark Tank' Season 13, which was released in May 2022, Kaitlin Mogentale presented her snack company, 'Pulp Pantry,' in front of the Sharks Mark Cuban, Kevin O'Leary, Lori Greiner, Barbara Corcoran, and Emma Grede. Mogentale's company makes gluten-free snacks with upcycled food waste. Right from the beginning, Cuban was captivated by Mogentale's innovative product. Eventually, Cuban ended up offering half a million dollars to the company.
In the episode, Mogentale was seeking $500,000 in exchange for 10% of her company, Pulp Pantry. She also stated that food waste is one of the biggest problems in the United States, and she hoped to resolve that issue through her snack business. Mogentale explained, "I know you like talking numbers, so let me throw some at you. In the United States, we waste 54 million tons of food every single year. The fiber left from juicing fruits and vegetables normally goes unloved. Talk about a missed opportunity. Well, Sharks, the madness stops with us because Pulp Pantry has found a new way to snack with impact."
Mogentale further added, "We take thousands of pounds of organic produce that would otherwise go unloved every single week and upcycle them into a line of real veggie chips that are made from, you guessed it, from real fresh vegetables, not corn, not potato starch, and certainly not grains for that matter. We're spreading the good fibers only with the delicious and nutritious snack that's packed with flavor and fiber."
However, there were some issues with Mogentale's valuation. Talking about the numbers, Mogentale said, "So one bag costs $1.70 to produce, we wholesale for $3.24, and we're on the shelf for $4.99 to $5.99." When O'Leary asked Mogentale to shed light on her sales, she quipped, "We actually finished last year with just under $250,000 in sales. This calendar year, we'll finish the year with just under $500,000." Shortly afterward, Mogentale revealed that she was once left with only $1,000 in her bank account. Cuban then told Mogentale, “We’ve all been negative."
Corcoran backed out first, saying that the space was too competitive for her. Then, O'Leary chimed in, "I don't think you're worth $5 million, but I'll tell you you're very impressive. I've made a lot of money investing in women's sustainability. Check the box; the product is right on trend. Because I'm lowering my gluten. I think your business is worth 2 million bucks, so I'll give you $500,000 for 25%." Soon after, Grede dropped out; meanwhile, Greiner wasn't too happy about the cost, but she still offered $500,000 as a loan at 6% interest for a 10% equity stake.
Cuban entered the chat and went on to say, "I'll make you an offer, and it's going to be $500k for 20%, and I can tell you that you know when you walk in the door, we all know every entrepreneur has that limit, that number that they don't want to go above, but you have to ask yourself where you can get to because that's really where the value comes from." Then, Grede advised Mogentale, "Take the offer." In the end, Mogentale accepted Cuban's offer after he lowered his equity to 17%.
