Must Love Non-Dairy Ice Cream
NO DEAL
EPISODE SUMMARY
🕓 Air Date: January 14, 2022
Asking For:
$600,000 for 7,50%
Investor:
No Deal
Deal:
No Deal
PRODUCT SUMMARY
Must Love offers a line of plant-based, dairy-free indulgent treats made with simple ingredients, including various flavors of ice cream, novelty bars, and plant-based sprinkles.
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Background Story
Must Love, a brainchild of the dynamic duo, Hannah and Mollie, thrives on the fusion of their individual strengths in the realms of operations and marketing, a synergy bolstered by their distinguished MBA degrees from reputable institutions such as MIT and Berkeley. The genesis of Must Love can be traced back to the founders’ shared disillusionment with the prevalence of detrimental ingredients pervasive in various ice cream offerings.
Fuelled by the desire to introduce a health-conscious alternative, they embarked on a journey to curate a product line centered on the simplicity of plant-based ingredients. Propelled by their familial exposure to the world of entrepreneurship and their hands-on experience, the duo officially unveiled Must Love in 2017, stepping into the fiercely competitive terrain of the frozen food industry.
Navigating this complex landscape was no mean feat, as the market brimmed with cut-throat competition and an ever-evolving consumer palette. Undeterred by the challenges, Hannah and Mollie’s unwavering commitment and unwavering determination propelled Must Love’s gradual expansion, cementing its position as a prominent contender in the health-conscious dessert segment. Their joint journey, infused with a blend of professional expertise, personal conviction, and entrepreneurial tenacity, underscores Must Love’s evolution into a promising player in the realm of health-driven indulgence.
The Product
Must Love’s product line revolves around a selection of dairy-free, plant-based ice creams, boasting enticing flavors such as Peanut Butter Swirl, Cashew Cookie, and Snickerdoodle Dough. A distinctive aspect of their approach lies in their commitment to using straightforward ingredients, incorporating a base of either bananas or oats, naturally sweetened with real fruits, and deliberately devoid of artificial additives.
In addition to their ice cream offerings, Must Love presents novelty bars like Dipped Crunchy Peanut Swirl and Dipped Banilla, catering to diverse consumer preferences. Positioned at a competitive price point of $5.99 per unit, their cost of goods is maintained at $1.80, reflecting a balance between quality and accessibility.
The accessibility of Must Love’s products is reinforced through their strategic placement in various prominent retail outlets, including Sprouts Farmers Market, Whole Foods, and the recent successful inclusion in Costco. This widespread availability not only enhances their market visibility but also facilitates the accessibility of their health-conscious indulgences to a broader customer base.
How It Went
The company’s position before Shark Tank
Since its inception, Must Love has charted a commendable trajectory of growth, commencing with an initial sales figure of $35,000 in its inaugural year and progressively expanding its revenue to achieve an impressive $1 million in sales to date. However, the company’s financial performance has been overshadowed by operational losses, primarily attributed to substantial marketing expenditures aimed at securing prime shelf space within fiercely competitive frozen food segments.
Notably, Must Love has successfully positioned its products in prominent national retail chains such as Sprouts Farmers Market and selected regions of Whole Foods, solidifying its market presence. The company recently marked a significant milestone with its successful foray into the reputable retail giant Costco, signaling a promising avenue for heightened brand exposure and increased market penetration. To fuel its ambitious growth plans, the founders have demonstrated their commitment by injecting a substantial sum of $200,000 of their personal capital into the venture.
Moreover, Must Love has secured a total investment of $1.4 million, sourced from a combination of contributions from friends, family, and institutional investors, demonstrating external confidence in the company’s potential. Currently in the midst of a seed round, Must Love has positioned itself at an ambitious $8 million valuation, reflecting the founders’ strong belief in the company’s future growth prospects and market potential.
The Negotiations:
During the negotiation, the Sharks expressed reservations regarding Must Love’s valuation and funding strategy, leading to a challenging interaction for the founders. Despite their impressive sales growth and innovative product offerings, the Sharks raised concerns about the company’s current financial losses, emphasizing the competitive nature of the frozen food industry and the challenges associated with securing prime shelf space. Kevin O’Leary and Mark Cuban drew on their previous experiences within the food industry, highlighting the potential risks and pitfalls of operating in a highly competitive market, ultimately leading them to opt out of the deal.
Lori Greiner acknowledged the quality of Must Love’s products but chose to decline the investment opportunity, citing the saturation of the market and her existing investment commitments in a similar domain. The negotiations took an unexpected turn when the founders’ proposed valuation of $8 million was met with skepticism from the Sharks, who viewed it as overly ambitious, given the company’s current financial performance.
Furthermore, the founders’ reluctance to engage in a flexible negotiation approach further dampened the Sharks’ interest, leading to a challenging environment for securing a viable deal. In the end, the negotiation concluded without an agreement, highlighting the importance of strategic valuation and flexible negotiation tactics in securing investment opportunities within the competitive business landscape of the food industry.
