The Ice Cream Canteen
DEAL
EPISODE SUMMARY
🕓 Air Date: March 31, 2023
Asking For:
$100,000 for 5%
Investor:
Lori Greiner, Mark Cuban (50/50)
Deal:
$300,000 for 20%
PRODUCT SUMMARY
The Ice Cream Canteen is a double-walled, vacuum-insulated container designed to keep pints of ice cream cold and frozen for hours, allowing people to enjoy ice cream on the go.
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Background Story
Jordan, the founder of The Ice Cream Canteen, introduced his product on Shark Tank to address the issue of ice cream melting too quickly when taken out. He was $15,000 in credit card debt when he started the business and has since seen substantial growth in sales. Jordan had a patent and three registered trademarks for his product, and he saw an opportunity to expand into the retail market, particularly within the ice cream industry.
The Product
The Ice Cream Canteen is a specially designed container for pint-sized ice cream containers. It is double-walled and vacuum-insulated, allowing users to keep their ice cream frozen for several hours without the need for a freezer. The product does not require pre-chilling but works even better when pre-chilled.
It can keep ice cream frozen for up to four hours on its own or up to eight hours when placed in a cooler with other food and drinks. The retail price for The Ice Cream Canteen is $44.99, and its production cost is $7.50.
The founder’s vision is to tap into the retail market, especially in collaboration with ice cream shops, where customers can purchase pint-sized ice cream and keep it frozen while on the go.
How It Went
The company’s position before Shark Tank
In 2021, The Ice Cream Canteen generated $98,000 in sales, and in the current year, it was on track to reach $185,000 in sales, with a net profit margin of over 50%. The founder aimed to do over $400,000 in revenue for the current year and was seeking investment to expand his inventory and scale up the business. The primary distribution channel at the time was direct-to-consumer, but the founder saw a significant opportunity in the retail sector, especially in partnership with ice cream shops.
The Negotiations:
Jordan initially asked for $100,000 in exchange for 5% equity in the company. Mark and Lori offered $100,000 cash and $100,000 as a line of credit for 20% equity, valuing the company at $400,000. Kevin O’Leary made an offer of $100,000 for 30% equity, which Jordan did not accept. Daniel made an offer that wasn’t heard.
Lori emphasized that Jordan should not let anyone bully him into making a hasty decision and that it’s essential to consider the best offer for his business. In the end, Jordan accepted Mark and Lori’s offer of $100,000 for 20% equity with an additional $200,000 as a line of credit in The Ice Cream Canteen, making a strategic partnership to help expand the product’s presence in the market.
