Element Bars
DEAL
EPISODE SUMMARY
🕓 Air Date: September 13, 2009
Asking For:
$150,000 for 15%
Investor:
Kevin Harrington
Deal:
$150,000 for 30% equity + 4% royalty in perpetuity
PRODUCT SUMMARY
Custom energy bars made with wholesome, natural ingredients, tailored to individual tastes and nutritional needs.
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Background Story
Jonathan Miller, a 29-year-old entrepreneur based in Chicago, Illinois, is the founder of Element Bars, a company dedicated to revolutionizing the energy bar industry. Jonathan’s journey began out of personal dissatisfaction with conventional energy bars that left him feeling sluggish due to their artificial ingredients. Determined to find a healthier alternative, Jonathan started experimenting in his own kitchen, meticulously crafting energy bars using natural, wholesome ingredients. His quest for a better energy bar stemmed from his background in health and fitness, combined with his entrepreneurial spirit.
With a keen eye for business opportunities, Jonathan saw the potential to fill a gap in the market for customizable, nutritious snacks. Drawing from his experience in venture capital, he recognized the importance of execution in transforming a novel idea into a successful business. After refining his recipes and conducting market research, Jonathan officially launched Element Bars in August 2008. His initial investment of $50,000, coupled with unwavering dedication, fueled the company’s growth from a kitchen experiment to a thriving business capable of producing thousands of bars per day.
Element Bars’ mission resonates with health-conscious consumers seeking personalized nutrition solutions tailored to their tastes and dietary preferences. Jonathan’s background in both entrepreneurship and health and wellness positions him as a visionary leader committed to providing customers with a superior alternative to traditional energy bars. His journey from kitchen experiments to securing a deal on Shark Tank showcases his resilience, determination, and passion for creating positive change in the health food industry.
The Product
Element Bars offers a unique and customizable approach to energy bars, allowing customers to design their own bars tailored to their specific tastes and nutritional needs. Through Element Bars’ user-friendly website, customers can navigate the “Build a Bar” interface, selecting from four core options (chewy, oaty, crispy, or datey) and adding a variety of fruits, nuts, sweets, and nutritional boosts.
Each ingredient choice updates the nutrition label in real-time, ensuring customers are aware of the caloric content and nutritional value of their creations. Once the desired combination is selected, Element Bars freshly prepares the custom energy bars and delivers them to the customer’s doorstep within seven to ten days.
Element Bars’ innovative approach provides numerous benefits to consumers. Firstly, customers have full control over the ingredients, enabling them to avoid artificial additives and allergens commonly found in pre-packaged energy bars. Additionally, the personalized aspect enhances the overall experience, allowing customers to enjoy bars uniquely tailored to their taste preferences and dietary requirements.
Purchasing Element Bars is convenient through their online platform, where customers can customize and order their bars with ease. Pricing varies depending on the ingredients selected, providing flexibility to accommodate different budgets and preferences. With Element Bars, customers can enjoy nutritious, flavorful energy bars customized to meet their individual needs.
How It Went
The company’s position before Shark Tank
Element Bars has demonstrated steady growth and a strong market position since its inception in August 2008. Initially founded by Jonathan Miller in Chicago, Illinois, the company has expanded its operational capabilities over the years, currently capable of producing thousands of bars per day. While the company started small, it has steadily increased its sales volume, shipping approximately a thousand bars per week. Element Bars has built strategic partnerships with suppliers to ensure the availability of high-quality, natural ingredients for its customizable energy bars. These partnerships contribute to the company’s commitment to providing wholesome, nutritious products to its customers.
The company’s customer base consists of health-conscious individuals seeking personalized nutrition solutions. By offering customizable energy bars tailored to individual tastes and dietary preferences, Element Bars has attracted a loyal customer following. In terms of funding, Jonathan Miller initially invested $50,000 of his own money into the business. Additionally, the company has sought external investment to support its growth trajectory. On Shark Tank, Jonathan secured a deal with Kevin Harrington, who invested $150,000 for 30% equity in the company, along with a 4% royalty on sales.
Element Bars’ financial performance has shown promise, with sales doubling in the past six months and a consistent 15% annual growth rate. While the company initially grossed $12,000 in its partial first year and approximately $50,000 year-to-date, its expansion efforts are expected to drive further revenue growth. The company is structured to support scalability and expansion, with a focus on efficient production processes and customer-centric operations. Element Bars’ commitment to providing customizable, nutritious energy bars positions it for continued success in the health food industry.
The Negotiations:
The negotiations on Shark Tank for Element Bars were intense and pivotal for Jonathan Miller, the founder. Jonathan initially sought $150,000 for 15% equity in his company. However, the sharks raised concerns about the $1 million valuation, given the company’s current sales figures. Daymond John offered $150,000 for 75% equity, which Jonathan declined, countering with 20%, but Daymond ultimately withdrew his offer. Kevin Harrington proposed $150,000 for 100% ownership with a 4% royalty, which Jonathan also declined, expressing concerns about losing control and motivation.
After further negotiations, Kevin Harrington made a final offer of $150,000 for 30% equity and a 4% royalty on sales, which Jonathan accepted. This deal ensured investment to fuel Element Bars’ growth while allowing Jonathan to retain a significant stake in the company. Throughout the negotiations, Jonathan demonstrated his passion for the business and willingness to stand firm on his valuation, ultimately securing a partnership that aligned with his vision for Element Bars’ future.
