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If you ask Saphira and Maurizio Rasti, the way to a “Shark Tank” star’s heart is through their stomach.
The Costa Mesa, California-based husband-and-wife duo brought investors treats from their business, Nowhere Bakery, on Friday’s episode of the ABC television show. The pair launched their bakery with $400 in March 2020, two weeks before the Covid-19 pandemic began — and left the TV show with an offer valuing the company at $1.6 million.
It might not have happened if the cookies and brownies didn’t taste so good, much to the investors’ surprise. “They’re free from dairy, eggs, gluten, soy, refined sugar, sugar alcohols and are paleo-friendly,” Saphira said on the show, noting that the idea originated as a solution for her own dietary restrictions.
“This tastes like a real cookie,” Barbara Corcoran responded, expressing surprise. “This tastes absolutely delicious.” Kevin O’Leary added. “I congratulate you. We’ve had so many plant-based cookie deals and they all taste like s---.”
The Rastis asked investors for $200,000 for 5% of Nowhere, which got its name from its lack of a pandemic-era location: Without enough money for a brick-and-mortar store, Saphira baked treats in her friend’s kitchen and hand-delivered them to her customers, many of whom found her on social media.
By the time of filming, Nowhere operated out of a commercial kitchen. It brought in $770,000 in 2022 revenue — including a $32,000 profit — and was projected to finish 2023 with $1 million, Saphira said.
At first, investors O’Leary expressed concern over the company’s profit margins. The couple could pocket more money by switching from a commercial kitchen to finding a co-packer, he suggested.
“That’s a possibility, but right now we can control everything ourselves,” Maurizio responded, with Saphira adding that they value controlling the quality of their treats.
O’Leary pushed them to consider it, making an investment offer that came with a contingency. “I want to put it in major grocers around the brand,” he said. “I’ll give you $200,000 for 20% ... I’m going to bring the co-packer I want in mind that I think you’re going to like, and I’m going to give him half of my equity.”
“Otherwise, I’m sorry, I’m not interested,” he added.
Corcoran disagreed with O’Leary, and encouraged the Rastis to stick to their plan — offering them $100,000 cash and $100,000 as a line of credit for 15% of Nowhere.
“Every food product [founder] I ever had that went into a co-kitchen came out of the kitchen and did it themselves again,” she said. “Co-packers never work for them.”
Two of the other investors, Mark Cuban and Lori Greiner, declined to extend offers. “It tasted amazing until I looked at the back,” Cuban said. “Now I’m going to be in the gym for 17 hours tonight. One cookie is 300 calories.”
But guest judge Jason Blum, the CEO of Blumhouse Productions, offered to join O’Leary’s deal, splitting the money and equity down the middle. O’Leary accepted, saying “two Sharks [are] better than one.”
In response, Corcoran told the Rastis about a company from her investment portfolio called Kate’s Kookies.
″[The founder] got out of the kitchen [and] they went out of business,” Corcoran said. “She told me she would never leave her kitchen again, or leave it in anyone’s hands. She thought the most important part of running a bakery business is being a baker ... It’s too early [for you] to get out of the kitchen.”
The couple asked Corcoran if she’d accept $200,000 in exchange for 12.5% of Nowhere. The investor agreed to the deal — valuing the company at $1.6 million, according to a CNBC Make It estimate.
“We are so excited we got a deal with Barbara,” Saphira said. “It’s time to take Nowhere everywhere,” Maurizio added.
Source: CNBC
