Eggmazing – Easter Egg Decorator Kit
DEAL
EPISODE SUMMARY
🕓 Air Date: February 18, 2018
Asking For:
$350,000 for 7%
Investor:
Lori Greiner
Deal:
$350,000 for 10% + $2/unit royalty until $350,000 is repaid, with $1 going to charity
PRODUCT SUMMARY
The Eggmazing Egg Decorator is a no-mess solution to decorating Easter eggs, offering a creative alternative to traditional methods.
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Background Story
Scott Houdashell and Curtis McGill, founders of Eggmazing, came up with the idea during Easter 2015 while frustrated with the messy and smelly process of traditional egg decorating. Houdashell improvised a solution using a hot glue stick, an electric screwdriver, and a spoon. This led to the development of Eggmazing.
Two years of development later, with $150,000 in sales during the first year, they expanded their product line to include the TreeMendous Ornament Decorator, which had $680,000 in sales. With $1.2 million in purchase orders and successful sales, they entered the tank seeking an investment to scale their business.
The Product
The Eggmazing Egg Decorator simplifies egg decorating by allowing users to place a hard-boiled egg in the device, turn it on, and use colorful markers to create designs on the spinning egg. The product eliminates the mess associated with traditional methods, offering a fun and hassle-free alternative.
The TreeMendous Ornament Decorator is a sister product designed for Christmas ornaments, and while unproven in terms of sales, it generated $680,000 in orders. The Eggmazing is priced at $24.99, and the TreeMendous Ornament Decorator is priced at $30, including eight markers and three ornaments.
How It Went
The company’s position before Shark Tank
Eggmazing’s journey began with $150,000 in sales during its first year, selling units at $19.99. Facing the challenge of seasonality, the founders strategically joined the American Specialty Toy Retailer Association (ASTRA) and utilized an email blast to secure $1.2 million in purchase orders for the upcoming spring.
With a production cost of $8.28 per unit, they increased the retail price to $24.99, capitalizing on the product’s popularity on platforms like Amazon, where some units were sold for as much as $59. The introduction of the TreeMendous Ornament Decorator further diversified their product line, generating $680,000 in sales. Despite the success, uncertainties lingered about the sell-through of the Christmas product.
The Negotiations:
Entering the Shark Tank, Eggmazing faced a panel of potential investors who were captivated by the product’s success and potential for growth. Lori Greiner, Barbara Corcoran, and Kevin O’Leary expressed interest in partnering with the company. Ultimately, it was Lori Greiner who emerged as the chosen investor. Her offer of $350,000 at 10% equity, coupled with a $2 royalty until paid back (with $1 going to charity), resonated with the founders.
The negotiation delved into the seasonality of the product, the potential risks associated with the Christmas ornament line, and the intricate balance between profitability and charity contributions. In the end, Eggmazing expressed gratitude for the opportunity, accepting Lori Greiner’s offer as a stepping stone toward further growth and innovation in the egg decorating industry.
