Chirp Back Roller Wheel
DEAL
EPISODE SUMMARY
🕓 Air Date: October 30, 2020
Asking For:
$900,000 for 2%
Investor:
Lori Greiner
Deal:
$900,000 for 25%
PRODUCT SUMMARY
Chirp offers the Chirp Wheel, a back pain relief product designed to target hard-to-reach muscle knots in the back and neck, providing deep tissue relief.
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Background Story
Chirp’s founder, Tate Stock, pitched the Chirp Wheel on Shark Tank as a solution for back pain relief. The Chirp Wheel is designed to replace traditional foam rollers and effectively alleviate back pain by targeting muscle knots. Tate Stock emphasized the simplicity and effectiveness of the product.
Tate mentioned that Chirp primarily sells through its website, using social media channels like Instagram and Facebook for marketing. The company had a high customer acquisition cost of $20 to $30 per customer. When the COVID-19 pandemic hit, Chirp’s sales skyrocketed, but they ran into inventory shortages, missing out on approximately $4 million in monthly sales.
The Product
The Chirp Wheel is a back pain relief product that aims to target and alleviate hard-to-reach muscle knots in the back and neck. It comes in three different sizes, each applying varying amounts of pressure.
The product is designed to fit perfectly between the shoulder blades, featuring compression-sensitive padding and a patent-pending spinal canal to relieve pressure off the spine and provide a deep stretch in four directions.
Users simply roll on the Chirp Wheel to apply pressure to the knots in their back and neck, helping to pop them and provide deep tissue relief. The Chirp Wheel is positioned as a more effective alternative to traditional foam rollers for back pain relief.
How It Went
The company’s position before Shark Tank
Chirp has achieved substantial sales, with $12 million in sales and $4 million in profit in the current year. The company primarily sells through its website, utilizing social channels like Instagram and Facebook for marketing. Their customer acquisition cost is around $20 to $30, and they’ve spent approximately $3 million on marketing. Chirp has no debt and no partners.
The company faced a surge in demand during the COVID-19 pandemic, leading to rapid sales growth and the need for funding to fulfill purchase orders. Tate is seeking an investment of $900,000 to support the growth of the business.
The Negotiations:
Tate initially offered 2% of the company for $900,000. Kevin O’Leary, Mark Cuban, and Lori Greiner expressed interest. He ultimately received three separate offers from the sharks. Lori Greiner offered $900,000 for 2.5% equity, with the condition that her investment must be paid back in 18 months.
Kevin O’Leary offered $900,000 for 2.5% equity, with a $3 royalty until he’s recouped $2.7 million. Last but not least, Robert Herjavec offered $900,000 for 3% equity, with a $1.50 royalty until he’s recouped $1.2 million. After a brief pause, Tate ultimately decided to accept Lori’s offer!
