Glow Recipe
DEAL
EPISODE SUMMARY
🕓 Air Date: December 4, 2015
Asking For:
$425,000 for 10%
Investor:
Robert Herjavec
Deal:
$425,000 for 25%
PRODUCT SUMMARY
Glow Recipe brings the latest Korean beauty trends and products to the U.S., aiming to make every American woman's skin glow with curated skincare items.
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Background Story
Glow Recipe is the brainchild of co-founders Sarah Lee and Christine Chang, both hailing from New York City. With a combined 20-plus years of experience in the beauty industry, the founders drew inspiration from the innovation hub of skincare, Korea. Recognizing the growing influence of Korean beauty, the duo established Glow Recipe as an e-retailer with a mission to introduce the best of Korean skincare secrets and products to the American market.
Having previously worked at L’Oréal, the founders leveraged their expertise to curate natural beauty skincare products from Korea. Glow Recipe operates in two main verticals — an e-commerce site where they curate products based on their expertise and a brand incubator where they share revenue with the brands they work with. Their platform not only curates but also educates consumers, providing detailed information, instructions, and even videos on product usage.
The Product
Glow Recipe’s product lineup includes innovative skincare items sourced directly from Korea. They presented a waterless mist packed with botanical extracts, perfect for on-the-go skincare, a pressed serum combining the concentration of a serum with the hydration of a moisturizer, and a next-generation sea-kelp sheet mask, capitalizing on the popularity of sheet masks in the U.S.
The co-founders highlighted their commitment to bringing the latest and best products to American consumers. As an e-retailer, Glow Recipe carries 110 SKUs, carefully curated to avoid slow-moving goods and to keep up with the rapid pace of innovation in the Korean skincare market. The products showcase the founders’ dedication to quality and effectiveness, with a focus on natural ingredients and advanced skincare technology.
The founders emphasize their role as thought and trend leaders in K-beauty in the U.S., providing not only distribution but also education and translation services. Their digital presence includes a YouTube channel with 1,000 subscribers and 200,000 cumulative views, demonstrating their early efforts in digital content creation.
How It Went
The company’s position before Shark Tank
In terms of financial performance, Glow Recipe faced initial challenges with a revenue of $3,000 in the first two months after launching in November. However, they experienced rapid growth, reaching $550,000 in revenue year-to-date and projecting to hit $1 million by the end of the year. The company operates in two revenue streams, with half coming from their e-commerce site and the other from acting as a brand incubator, sharing revenue with the brands they feature.
The founders revealed their plans for robust growth, projecting over $3 million in revenue for the next year. Glow Recipe’s unique value proposition lies in being a thought leader and consultant for larger retailers like Sephora and Target, providing them with insights into Korean beauty trends and innovation.
The Negotiations:
The negotiation process saw offers from multiple Sharks. Mark expressed interest but opted out, citing uncertainty in his knowledge of the industry. During the negotiation, Barbara offered $425,000 for 40%, Robert offered $425,000 for 30%, and Kevin proposed $425,000 for 50%. Robert and Mark discussed the equity percentage, with Robert eventually coming down to 25%. The founders attempted to renegotiate for 18% but then countered at 22.5%. However, Robert stood firm at 25%, and the deal was sealed.
The co-founders ultimately accepted Robert’s offer of $425,000 for 25% equity. The negotiation highlighted Glow Recipe’s appeal, with the Sharks recognizing the founders’ intelligence, credibility, and potential for success in the competitive beauty industry. The co-founders expressed gratitude and excitement for the opportunity to work with Robert, marking a significant milestone for their business.
