The Pizza Cupcake
DEAL
EPISODE SUMMARY
🕓 Air Date: February 12, 2021
Asking For:
$125,000 for 5%
Investor:
Lori Greiner
Deal:
$125,000 for 12.5% + 2.5% advisory shares
PRODUCT SUMMARY
The Pizza Cupcake is a gourmet frozen pizza snack with a unique cupcake shape and high-quality ingredients that can be enjoyed on the go.
WATCH HERE
IN A RUSH?
Click these to jump to the section you want to read.
Background Story
Michelle Jimenez and Andrea Meggiato, originally from New York City and Venice, Italy, respectively, introduced The Pizza Cupcake to the Shark Tank. Andrea, with a background as a chef in Italy and experience in fine dining, moved to New York City to work at a prestigious Italian restaurant.
Michelle, on the other hand, had a career in event production and social media influencers. Their paths crossed when Andrea asked Michelle on a pizza date, where he taught her how to make pizza. The idea for The Pizza Cupcake was born when they served their creation to a group of Italian friends, receiving rave reviews.
The Product
The Pizza Cupcake is a frozen gourmet pizza snack that stands out due to its cupcake shape. It’s made with a unique dough recipe that combines elements of brioche and sourdough, resulting in a fluffy and flaky texture.
The product comes in various flavors, including margherita and pepperoni, with a proprietary marinara sauce. The margherita variant contains 160 calories per cupcake, making it a relatively healthier frozen snack option.
How It Went
The company’s position before Shark Tank
The Pizza Cupcake started as a restaurant-based business but pivoted towards e-commerce due to seasonality and customer demand. They have achieved $344,000 in revenue in the previous year and projected $800,000 in sales for the current year. The company’s distribution channels included catering, participation in New York City’s popular Smorgasburg market, and partnerships with stadiums, including Citi Field.
They have secured a co-packer and are in discussions with a large distributor for retail placement. Michelle and Andrea were seeking $125,000 investment for 12.5% equity to scale up production with their co-packer and expand distribution. They also mentioned strategic investors on board and alliances with major distributors.
The Negotiations:
In the Shark Tank, the founders initially sought $125,000 for 5% equity but received an offer from Lori Greiner for $125,000 in exchange for 20% equity. After some negotiation, they countered with $125,000 for 12.5% equity and an additional 2.5% in advisory shares. Lori accepted this offer, and a deal was struck.
While other sharks, including Kevin O’Leary and Mark Cuban, were impressed with the product, they ultimately decided not to invest due to concerns about the challenges of selling a frozen product and the founders’ ability to handle the logistics. Lori’s offer, combined with her experience and connections, swayed the founders into making a deal that they believed would help them scale their business and navigate the challenges of distributing a frozen product nationwide.
