Alice’s Table – Flower Arranging Events
DEAL
EPISODE SUMMARY
🕓 Air Date: January 14, 2018
Asking For:
$250,000 for 6,25%
Investor:
Mark Cuban, Sara Blakely (50/50)
Deal:
$250,000 for 10%
PRODUCT SUMMARY
Alice's Table is a platform that empowers women to start their own businesses by offering flower-arranging classes and provides a business-in-a-box kit for entrepreneurs.
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Background Story
Alice Rossiter, the founder and CEO of Alice’s Table, presented her business on Shark Tank, aiming to help women become entrepreneurs by hosting flower-arranging classes. Alice’s inspiration came from the idea of creating a business platform that could be a stepping stone for women looking for flexible and creative ways to make money.
The concept was to sell a business-in-a-box for $699, which included materials like aprons, clippers, and buckets. Alice believed that by providing training and a ready-made kit, women could easily launch their own flower-arranging classes. The long-term vision was to expand the platform into an event-management system for various businesses.
The Product
Alice’s Table is not just about flower arrangements; it’s a business platform designed to empower entrepreneurs. The $699 business-in-a-box includes all the necessary materials for hosting flower-arranging classes, such as aprons, clippers, and rose strippers.
Entrepreneurs, called “Execs,” purchase this kit and receive training to start their own businesses teaching flower arrangements. The model encourages flexibility, allowing classes to be held in various locations, from homes to bars and country clubs.
The flower-arranging classes involve hands-on activities where participants learn to create beautiful arrangements while enjoying cocktails. The $65 ticket price includes the materials and the experience. Alice’s Table takes a 30% commission on all ticket sales.
The platform’s uniqueness lies in its scalability beyond flowers. The initial flower arrangement classes serve as a proof of concept for a broader vision of turning Alice’s Table into an event-management platform for different businesses.
How It Went
The company’s position before Shark Tank
At the time of the Shark Tank pitch, Alice’s Table had 53 Execs who had invested $699 each to join the platform. The company’s total revenue was about $600,000, with a 30% net revenue after taking a commission on ticket sales. The average Exec sold approximately 17.5 tickets per month, generating revenue for both the Exec and Alice’s Table. Alice’s Table justified its $4 million valuation by considering its 7x valuation from the top-line revenue.
The goal was to position the company as a business platform rather than just a flower company, envisioning a future where various business-in-a-box options would be available. The company’s success was evident from the $100,000 in ticket sales that Alice herself had achieved in eight months, demonstrating the potential of the platform. However, concerns were raised about the need to continually attract new entrepreneurs and the scalability of the model.
The Negotiations:
The negotiations centered around the high valuation of $4 million, which Kevin O’Leary found excessive. Mark Cuban and Sara Blakely were interested in the concept but were hesitant about the equity offered (6.25%). Mark made an offer of $250,000 for 25%, valuing the company at $1 million. However, Mark and Sara collaborated to make a joint offer of $250,000 for 10%, with an option to buy more in the next round at the same valuation.
They emphasized their commitment to help grow the business and increase its value, positioning themselves as valuable partners for Alice’s Table. Despite Daymond John expressing concerns about the valuation, Alice accepted Mark and Sara’s offer, appreciating the expertise and support they brought to the table. The negotiation highlighted the balance between valuation, equity, and the strategic value of the Sharks as partners in the business’s future growth.
