BRUW Cold Brew Coffee Filtering – Acquired by Snarky Tea
DEAL
EPISODE SUMMARY
🕓 Air Date: January 6, 2019
Asking For:
$50,000 for 25%
Investor:
Mark Cuban
Deal:
$50,000 for 30%
PRODUCT SUMMARY
BRUW offers a simple and cost-effective way to make cold-brew coffee at home using a specially designed filter for mason jars.
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Background Story
BRUW, a cold-brew coffee solution hailing from Detroit, Michigan, was born from the inventive mind of Max Feber. At the tender age of 15, Max, fueled by a passion for coffee, embarked on a journey to explore the nuances of this beloved beverage. His fascination led him to the realm of cold-brew, a method known for its smoother and sweeter flavor profile. The inception of BRUW emerged from Max’s frustration with the messy and impractical methods of crafting cold-brew at home. After experimenting with mason jars and encountering a chaotic countertop covered in coffee grounds, Max took matters into his own hands.
A trip to his garage resulted in the creation of the first BRUW prototype, fashioned from a screen door, mason jar lids, and a hot-glue gun. Since those early days, BRUW has evolved into a sophisticated yet simple solution for coffee enthusiasts seeking an affordable way to make cold-brew at home. Max’s entrepreneurial spirit led him to Babson College, where he pursued a business major while tirelessly developing and refining his product.
What sets Max apart is not just his innovative product but also his unwavering commitment to the business. Watching “Shark Tank” since the age of 8, Max absorbed the lessons of entrepreneurship imparted by the show. The culmination of these lessons and Max’s determination led to the recent grant of a patent, a testament to the viability and uniqueness of the BRUW solution. Now, at 18, Max stands at the intersection of youthful enthusiasm, business acumen, and a dream realized, ready to take BRUW to new heights.
The Product
BRUW introduces a game-changing approach to crafting cold-brew coffee at home, providing a simple yet effective solution for coffee enthusiasts. The process begins by combining ground coffee and cold water in a standard mason jar, allowing it to steep in the refrigerator for 24 hours. The innovation lies in BRUW’s specially designed double-sided filter.
To transform the cold-brew, users insert the BRUW filter, straw-side down, into the coffee-filled mason jar and secure an empty jar on top. This configuration allows the coffee to drip from the top jar through the filter into the bottom jar, resulting in a delicious and smooth cold-brew coffee.
The brilliance of BRUW lies in its simplicity and versatility. Users can customize their cold-brew by adjusting the amount of coffee used, offering a tailored experience. The product’s main component, the filter, is the best-selling item, priced between $15 and $20, and is designed to fit any wide-mouth mason jar, readily available in most grocery stores.
This user-friendly solution not only simplifies the cold-brew process but also eliminates the need for expensive and complicated equipment. As BRUW plans to expand into big-box retail, it opens the door for more consumers to enjoy the benefits of making quality cold-brew coffee at home, all with the convenience of a straightforward and cost-effective solution.
How It Went
The company’s position before Shark Tank
As of the latest available information, BRUW demonstrates promising growth and a solid foundation. In the past year, the company generated $50,000 in revenue, showcasing a robust start in the competitive coffee accessory market. Projections for the current year estimate a substantial increase, with an expected revenue of $100,000. BRUW’s current primary revenue stream is derived from the sales of its best-selling product, the double-sided filter priced between $15 and $20. This product has garnered attention online, positioning BRUW as a viable player in the market. The strategic plan involves expanding into big-box retail, targeting stores like Bed Bath & Beyond and potentially reaching a broader customer base.
At present, the company’s funding primarily comes from its sales revenue. The cost to produce the filter stands at $4, providing a healthy profit margin. As the company scales up, the cost is expected to decrease further with the implementation of a new two-cavity mold, bringing production costs down to $1.50. While details about specific partnerships and wholesalers are not explicitly mentioned in the provided transcript, the focus on entering big-box retail suggests a future network expansion. BRUW’s growth trajectory is further emphasized by the recent grant of a patent, a testament to the uniqueness and protectability of its innovative solution.
The company is currently structured with Max Feber at the helm, balancing his role as the founder and CEO with his ongoing commitment to education at Babson College. Max’s dedication to the business, combined with his business major background, indicates a strong leadership foundation. As BRUW secures a deal with Mark Cuban on “Shark Tank,” this strategic partnership is likely to inject additional capital and expertise, fostering further growth and market penetration for the innovative cold-brew coffee solution.
The Negotiations:
The negotiations for BRUW on “Shark Tank” unfolded with an energetic pitch from 18-year-old founder Max Feber. Seeking $50,000 for 25% equity, Max presented his innovative cold-brew coffee solution. The Sharks were intrigued by the simplicity and effectiveness of BRUW, sparking a dynamic negotiation. Mark Cuban, expressing interest in the higher margin strategy, offered $50,000 for a slightly larger equity stake, proposing a 30% ownership. Other Sharks, including Lori Greiner and Kevin O’Leary, voiced concerns about Max’s ability to manage the business full-time while balancing his college education. Robert Herjavec suggested a licensing deal, indicating a different path for BRUW.
Despite initial hesitation, Max eventually accepted Mark Cuban’s offer of $50,000 for 30%, solidifying a deal with the high-profile Shark. The negotiation highlighted Max’s enthusiasm, adaptability, and the Sharks’ willingness to recognize the potential of the BRUW product. The decision to accept Mark Cuban’s offer aligned with the strategic vision of focusing on higher margins rather than pushing down the price, a choice aimed at maximizing profits and market appeal.
This successful negotiation marked a significant milestone for BRUW, as it not only secured vital investment but also gained a strategic partner in Mark Cuban, known for his business acumen and successful ventures. The deal on “Shark Tank” is poised to propel BRUW into a new phase of growth and market expansion, further solidifying its position in the cold-brew coffee accessory industry.
