The Mad Optimist Soap & Bath
DEAL
EPISODE SUMMARY
🕓 Air Date: May 15, 2020
Asking For:
$60,000 for 10%
Investor:
Mark Cuban
Deal:
$60,000 for 20%
PRODUCT SUMMARY
The Mad Optimist offers a unique, customizable soap and body-care experience that is vegan, halal, non-GMO, gluten-free, and cruelty-free.
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Background Story
The founders, Mohammed, Mohammed, and Anthony from Bloomington, Indiana, started The Mad Optimist out of their shared discomfort with traditional soaps containing animal fat, considering their vegan lifestyle. Their unique soap and body-care products allow customers to choose their scents, and add-ins, and even set their own price through a sliding scale, reflecting the founders’ commitment to transparency, integrity, and kindness.
Over the seven years of operation, they initially sold at farmers’ markets and shows before making a major pivot to focus on custom body care. Their journey has been supported by family contributions and personal savings.
The Product
The Mad Optimist’s products, particularly their soap, form the core of their offerings. Customers can visit their website and personalize their soap by selecting essential oil scents, add-ins like spirulina or coconut milk, and even choose packaging design.
Notably, the company introduces a sliding price scale, allowing customers to pay what they can afford, creating a unique approach to pricing. This system aims to make their premium-quality products accessible to a broader audience while maintaining a 50% profit margin. The founders emphasize their commitment to affordability and doing good in the world.
How It Went
The company’s position before Shark Tank
The Mad Optimist has experienced both challenges and successes. With $97,000 in sales year-to-date and a total of $21,000 from the last 11 months, they have faced questions about their growth and sustainability. The founders acknowledge the need for improvement but highlight that their business model includes wholesale and bulk custom orders, contributing to their overall revenue.
The company’s commitment to transparency is demonstrated by having live revenue numbers on their website. They operate with a sliding price scale for their products, showcasing their dedication to affordability and inclusivity. While facing skepticism from the Sharks about their sales figures, the founders emphasize their unique approach and mission-driven model.
The Negotiations:
The negotiation phase saw the Sharks expressing concerns about the company’s financials and growth. Despite facing criticism and several Sharks opting out, Mark Cuban saw potential in the founders’ mission and commitment to transparency. After a brief discussion, Mark Cuban offered $60,000 for a 25% stake in the company.
The founders negotiated, attempting to bring the equity down to 18%, but ultimately agreed to Mark Cuban’s terms of 20%. The founders, appreciative of the offer, accepted, securing a deal with Mark Cuban. The negotiation highlighted the Sharks’ skepticism about the company’s financials but also showcased Mark Cuban’s belief in the unique aspects of The Mad Optimist’s business model and mission.
