Kitty Kasas Cat Houses
DEAL
EPISODE SUMMARY
🕓 Air Date: January 20, 2019
Asking For:
$200,000 for 20%
Investor:
Lori Greiner
Deal:
$200,000 for 30%
PRODUCT SUMMARY
Kitty Kasas are modular, stackable cube systems for cats, offering a cleanable, durable, and cute solution for cat owners.
WATCH HERE
IN A RUSH?
Click these to jump to the section you want to read.
Background Story
Nikki Linn and Rusty Niedwick, the founders of Kitty Kasas, hail from Basalt, Colorado, and their journey is as unique as their product. Both are self-described tattooed bikers with an unexpected passion for feline companionship. The genesis of Kitty Kasas lies in their frustration with the lack of quality pet products. Having run a no-kill animal shelter for two decades, they found themselves in dire need of a solution to maintain clean cat rooms. Their background in managing an animal shelter equipped them with a deep understanding of the challenges associated with conventional pet products.
The lack of cleanliness, durability, and modern design in existing options spurred them to create something better. The idea for Kitty Kasas was born out of a genuine need for a stackable, cleanable, and durable solution for cat rooms. The founders, being cat lovers themselves, initially developed the product for their shelter. The positive response from visitors, who expressed a desire to purchase these innovative cat cubes, ignited the idea of turning it into a business.
Their journey took a challenging turn when a major plastics company attempted to take advantage of their product. Despite facing adversity and having their intellectual property stolen, Nikki and Rusty persevered. They rebuilt their molds, redesigned their product, and secured a patent. Their resilience in the face of setbacks showcases their dedication to providing a quality solution for cats and their owners. Today, Kitty Kasas stands as a testament to their passion for feline welfare and innovative, functional design.
The Product
Kitty Kasas revolutionizes the world of cat furniture with its modular, stackable cube system designed for feline comfort and owner convenience. The product offers a cleanable, durable, and stylish solution for cat owners seeking a modern and functional addition to their homes.
Each Kitty Kasas cube is made to be virtually indestructible, addressing common issues with traditional cat furniture. The cubes are modular and can be used individually or stacked in countless configurations, allowing cat owners to create personalized environments for their furry friends. The cubes come in a variety of colors, adding a touch of modern aesthetics to any space.
The product line includes three distinct models: the bedroom, equipped with a cozy space for rest; the scratching post, satisfying a cat’s natural instincts; and the top bed, offering an elevated spot for observation. The cubes are designed to be easily cleanable, overcoming challenges associated with traditional materials like carpet and cardboard.
Kitty Kasas are available for purchase directly from the company’s website, with prices ranging from $22.99 for the top bed to $49 for the scratching post model. The affordability combined with the product’s durability and versatility makes it an attractive choice for cat owners looking to enhance their pets’ living spaces. With a focus on online sales and a direct-to-consumer approach, Kitty Kasas provides a convenient and accessible solution for cat enthusiasts.
How It Went
The company’s position before Shark Tank
Kitty Kasas has exhibited a resilient performance, overcoming challenges and achieving notable success in the pet product market. With total sales reaching $600,000 over a span of two years, the company has demonstrated consistent growth, particularly noteworthy given a setback in the second year due to a failed partnership with a plastics company. The recent surge in sales, totaling $200,000 in the last three months, indicates a positive trajectory and a strong market response to their innovative cat furniture solutions.
The founders, Nikki Linn and Rusty Niedwick, have structured the company to primarily focus on direct sales. Their commitment to online sales is driven by a desire for better profit margins and the challenges associated with big-box retail, as mentioned during their Shark Tank pitch. The choice to sell directly aligns with their vision of providing affordable and functional cat furniture directly to consumers. In terms of funding, the founders secured a deal with Shark Tank investor Lori Greiner, who offered $200,000 for a 30% stake in the company. This infusion of capital is earmarked for expansion, additional support, and hiring employees to facilitate the company’s growth. The founders emphasized that their biggest hurdle at the moment is the need for additional support and resources to meet increasing demand.
While the company currently operates with a small team consisting of Nikki, Rusty, and one IT professional, the founders have expressed intentions to use the investment to address logistical challenges and enhance their online presence. The focus on direct-to-consumer sales aligns with their strategy of maximizing profits and maintaining control over the distribution of their innovative product. Kitty Kasas’ current structure, bolstered by Lori Greiner’s investment, positions the company for further expansion and success in the pet product market. The founders’ dedication to the well-being of cats, combined with their innovative approach to cat furniture design, forms a solid foundation for sustained growth and market presence.
The Negotiations:
The negotiation process for Kitty Kasas on Shark Tank unfolded with a mix of enthusiasm and strategic considerations. The founders, Nikki Linn and Rusty Niedwick, entered the tank seeking $200,000 for a 20% equity stake in their company, which offers modular, stackable cube systems for cats. The Sharks were intrigued by the unique product, and after a brief discussion on sales figures and the founders’ background, Lori Greiner made the first offer. Lori offered the full amount requested, $200,000, but in exchange for a slightly higher equity stake of 30%. This offer reflected Lori’s belief in the product and her interest in fostering its growth.
Kevin O’Leary, known for his direct-to-consumer expertise, also expressed interest and made a competing offer. He offered the same amount, $200,000, but for a 33.3% stake, positioning himself as a potential third partner for the founders. The negotiation took an unexpected turn when Lori emphasized her commitment to the founders and the product. In a surprising move, she matched Kevin O’Leary’s proposed equity stake of 33.3%, securing her place as a strategic partner.
The founders eagerly accepted Lori’s offer, valuing her experience and the equal partnership she proposed. Ultimately, the negotiation showcased the Sharks’ recognition of the product’s potential and their willingness to compete for a stake in Kitty Kasas. The founders secured a deal with Lori Greiner, who brought not just financial backing but also her expertise and passion for the product, marking a successful outcome for both parties involved.
