Offering dog treats disguised as cookies to the hosts of Shark Tank is a risky move, but it ultimately paid off on Sunday's episode of the ABC show.
Entrepreneurs Justin Miller and Tom Simon were pitching the Sharks their company Zookies Cookies, which sells a variety of bake-at-home cookie mixes for dog treats that are made entirely of human food ingredients. While none of the Sharks liked the taste of the cookies, Drybar founder and guest investor Alli Webb did agree to invest in the company.
"I think the pet space is on fire," Webb said, noting that she's an investor in the upscale pet boutique Healthy Spot. "People are obsessed with dogs, and they will buy something like this, 100 percent."
Miller and Simon launched the business in December of 2017 and generated $40,000 in sales in the nine months leading up to their Shark Tank appearance. The Raleigh, North Carolina-based startup sells its organic cookie mixes--which require customers to add water before baking--for $9.99 each, or $24.99 for a three-pack. The co-founders came to Shark Tank seeking $50,000 for 20 percent of their company.
While the founders were able to start a small bidding war, not every Shark saw promise in the bake-at-home pet food. Lori Greiner and Robert Herjavec backed out early, saying that they didn't believe customers would bake their own dog treats when healthy ready-made options were already available. Mark Cuban also declined to make an offer, noting that he knew nothing about baking. Webb offered $50,000 for 30 percent of the company, but on one condition: the founders let her redesign the label.
"If I told you I don't think it will sell as is, are you willing to make some changes?" she asked, adding that her work with Drybar's products taught her the importance of organizing label information according to a hierarchy. "As long as you guys are open to going back to the drawing board on a couple of things, I can bring value helping you get into certain retailers and gifting."
O'Leary matched Webb's capital offer but asked for 33.3 percent of the business. "I just like you guys," he said. "I think the idea is really dumb."
In the end, Miller and Simon accepted Webb's offer, agreeing that their packaging needed some work. "Having Alli as part of this now would be great because her products are already well-branded," Simon said. "We've been talking about new packaging and new styles and new things, so having her as a partner feels fantastic."