The problem was that the conflict between the founders took place closely after the Shark Tank episode featuring the product was aired, which resulted in a big missed opportunity for the business. Things between the two partners went far enough for a restraining order to be issued. McDonald was suing his partner because he believed he was developing a competing product behind his back - Egger started operating the competing Cake Ballz brand.
James McDonald and Cole Egger got into a lawsuit shortly after the Shark Tank deal was struck. The story of Sweet Ballz is a classic story of two founders falling out. Investment: Raised $250k for 25% equity from Mark Cuban and Barbara Corcoran Sweet Ballz at Shark Tank: Season 5, Episode 1 Sweet Ballz’s founders: James McDonald and Cole Egger What was Sweet Ballz: Maker of cake balls retailing at convenience stores She restarted the website and is currently focusing on selling the towels mainly to people with disabilities - a market Lori Greiner didn’t deem large enough to pursue. Three years after shutting down ShowNo Towels, Shelly Ehler is back in business. The failure of both deals and the tension between the founder and investor lead to the dissolution of the business. Another deal that fell apart was a royalty deal with Franco Manufacturing. After not impressive-enough sales of the product online, and a profit margin insufficient to meet Disney’s expectations, the deal fell apart after many months of trying to move it forward. Moreover, the company had a lot resting on one big deal with Disney. She taught me so much more than she thought she did and none of it was about business," – a quote from Shelly’s blog post, which is currently taken offline. I once cursed my 'Shark Partner' for kicking me to the curb.
According to Shelly, Greiner warned her not to cash the check on the next day and later on tried to change the terms of the deal (asked for 70% of the company instead of 25%, and when Shelly Ehler refused, Greiner changed the deal to a loan that could be used only for sales rather than other expenses). Right from the start, the relationship between Shelly Ehler and Lori Greiner also took a hit.
Investment: Raised $75k for 25% equity from Lori Greiner (which didn’t materialize in this way) ShowNo Towels at Shark Tank: Season 3, Episode 4 What was ShowNo Towels: A towel shaped like a poncho (with an opening in the middle of the towel for the head)
#Visualize it shark tank free#
The free publicity could come at the wrong time when the business cannot make good use of it, and the relationship with the investors could turn sour. This, combined with the lack of consensus about the shipping issue, brought Phil to the opinion that the participation in Shark Tank was actually detrimental for the business.Īll in all, ToyGaroo is a great illustration that Shark Tank is not always a home-run for the participants. Which was not what we needed as a sudden influx into a business that depends on stock is not a good thing!”Īccording to Phil, the business would have been much better off growing slowly and organically, as this would have given them more time to deal with some of the sourcing and shipping problems we mentioned above.
“Like most SharkTank appearances, we got a spike when the show aired. They wanted to get out of it to deal with the problem, but their newfound investors were against it. This was a problem because they were running a “free shipping” model.
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