DoughP Cookie Dough
NO DEAL
EPISODE SUMMARY
đź•“ Air Date: May 5, 2019
Asking For:
$450,000 for 10%
Investor:
No Deal
Deal:
No Deal
PRODUCT SUMMARY
Doughp Cookie Dough offers a nostalgic experience, serving cookie dough in various flavors, targeting the inner child in all of us.
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Background Story
Doughp Cookie Dough, a Bay Area-based indulgence, finds its roots in the entrepreneurial spirit of Kelsey Witherow, its founder and fearless leader. Born in Dallas and raised in California, Kelsey’s journey took a significant turn after spending a decade in the tech industry, notably at Intel. The transition from processor chips to chocolate chips was not just a business move but a personal transformation. Kelsey’s motivation to enter the world of cookie dough was driven by a desire to create a nostalgic experience reminiscent of childhood.
The idea struck her after overcoming a 10-year battle with alcohol addiction, marking three years of sobriety. Seeking a change, she embarked on a journey to pursue her entrepreneurial dreams. In April of 2017, Doughp Cookie Dough was born, and Kelsey became the pioneer of San Francisco’s first-ever cookie dough bar. The concept was simple yet powerful—transporting people back to the carefree moments of sneaking bites of cookie dough in the kitchen. Doughp became more than just a business; it became a platform for Kelsey to share her story of recovery and resilience.
The location of Doughp’s flagship store on PIER 39 in San Francisco, one of the city’s major tourist attractions, strategically positions the brand to capture both local and visitor markets. Kelsey’s background in the tech industry, combined with her personal journey, laid the foundation for a brand that not only serves delicious treats but also resonates with a sense of nostalgia and triumph over adversity. Doughp Cookie Dough isn’t just about selling sweets; it’s a testament to the transformative power of entrepreneurship and personal growth.
The Product
Doughp Cookie Dough offers a delightful and nostalgic experience, serving up premium cookie dough in a variety of flavors to satisfy the inner child in all of us. With six enticing options, including the classic cookie chip, vegan alternatives like the Vegan O.G. made with vegan butter, and unique creations like Cinnamood and This S’more, Doughp caters to diverse tastes.
Available in three sizes—Self Control, Legit, or Fully Commit—the cookie dough is presented with playful names that reflect its indulgent nature. Whether customers are looking for a modest taste or a fully immersive experience, Doughp provides options to suit every craving.
The product is not only about taste but also about creating an experience. Each flavor is carefully crafted to evoke a sense of nostalgia, reminiscent of childhood moments spent sneaking bites of cookie dough. Beyond the storefront on PIER 39, Doughp Cookie Dough is exploring additional avenues for accessibility, including potential expansion into grocery stores.
The pricing strategy aligns with the premium nature of the product, with customers willing to pay a premium for the unique and high-quality cookie dough experience. Currently generating $1,100 per square foot at the flagship store, the product’s success lies not just in its taste but in its ability to tap into the emotional connection people have with this timeless treat.
How It Went
The company’s position before Shark Tank
Doughp Cookie Dough has demonstrated robust financial health and a strong market position since its inception in April 2017. The company, spearheaded by founder Kelsey Witherow, boasts impressive sales figures, surpassing $850,000 within just a year and a half. With a 35% net income ratio, the company has achieved a noteworthy $240,000 in net income for the current year, emphasizing its operational efficiency. The primary storefront, strategically located on PIER 39 in San Francisco, contributes significantly to the company’s success, generating an impressive $1,100 per square foot. Kelsey’s strategic approach, honed during her ten years at Intel, has undoubtedly played a crucial role in Doughp’s growth.
The company’s expansion plans include opening high-traffic storefronts, with negotiations underway for a spot on the Las Vegas Strip, anticipating exposure to 72,000 people daily. While the PIER 39 location remains the sole physical brick-and-mortar establishment, Doughp is exploring wholesale opportunities, entering San Francisco’s airport and potentially expanding into grocery stores. The company’s focus on cultivating an experience people are willing to pay for has proven successful, with a promising move into snack-size packaging to address portion control concerns.
In terms of funding, the company’s current financial structure positions it for growth, with no explicit information provided on external funding sources. The profitability of the business, coupled with Kelsey’s entrepreneurial acumen, forms the bedrock of Doughp’s financial stability. The company’s success lies not only in its delectable product but also in its adaptability to explore new avenues, ensuring continued growth and sustainability in the competitive market of premium cookie dough experiences.
The Negotiations:
Doughp Cookie Dough’s negotiation in the Shark Tank was a rollercoaster of interest, taste preferences, and valuation concerns. Kelsey Witherow entered seeking a $450,000 investment in exchange for a 10% equity stake in her business. Despite offering a tempting array of cookie dough flavors and showcasing impressive financials, securing a deal proved challenging. Mark Cuban and Kevin O’Leary both opted out early in the negotiation, citing personal taste preferences. While appreciating the business and its potential, they couldn’t overcome their distaste for cookie dough.
Lori Greiner followed suit, expressing concerns about the health aspect of promoting a product associated with overindulgence. However, she acknowledged the widespread appeal of cookie dough. Robert Herjavec praised Kelsey’s operation and story but struggled with the conflict of endorsing a product that encourages excess consumption, particularly given societal concerns about obesity. Ultimately, he also opted out, expressing admiration for the business but aligning with his values. The turning point came with Kevin O’Leary rejoining the discussion, offering insights into the financials. He acknowledged Kelsey’s strong operational skills and projected the company’s future valuation at around $1.8 million.
However, O’Leary couldn’t overcome his reservations about the valuation, emphasizing that the problem lay not with Kelsey but with the company’s worth. In the end, despite Kelsey’s compelling pitch and impressive sales figures, none of the Sharks extended an offer. The negotiation showcased the challenge of aligning valuation expectations with the Sharks’ perceived value of a business, especially in an industry where personal taste preferences played a significant role. Kelsey left the Tank without a deal but remained optimistic about the future growth and success of Doughp Cookie Dough.
