Tom & Chee Soup Shop
DEAL
EPISODE SUMMARY
🕓 Air Date: May 17, 2013
Asking For:
$600,000 for 10%
Investor:
Barbara Corcoran, Mark Cuban (50/50)
Deal:
$600,000 for 30%
PRODUCT SUMMARY
Tom & Chee is a grilled cheese and tomato soup shop offering creative and unique sandwiches, including their famous Grilled Cheese Donut, targeting the kid at heart.
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Background Story
Corey Ward and Trew Quackenbush founded Tom & Chee in Cincinnati, Ohio. The idea came about during a cookout at Trew’s house when Corey proposed opening a grilled cheese and tomato soup shop, to which Trew agreed. In the winter of 2009, they emptied their bank accounts, bought a tent and a griddle, and set up shop on Cincinnati’s Fountain Square. The response was overwhelming, leading them to open their first shop after just a year. Since then, they’ve grown, opened franchise stores, and are now seeking investment to further expand their franchise efforts.
The Product
Tom & Chee offers over 20 sandwiches, with their most popular being the Barbecue Bacon, alongside traditional grilled cheeses, soups, and their signature Grilled Cheese Donut. They use creative ingredients and homemade sauces, catering to a variety of tastes.
Prices are affordable, making it a family-friendly option. Their stores have seen massive success, with lines out the door and impressive sales figures.
Franchise opportunities are available, with initial fees of $35,000 and 7.5% royalties. Their first franchisee in Louisville, Kentucky, achieved $100,000 in sales in a month, indicating strong potential for growth.
How It Went
The company’s position before Shark Tank
Tom & Chee’s two corporate stores grossed $1.5 million in the last year, with peak sales of $1,400 per hour. They have over 70 employees and are experiencing high demand, often resulting in long lines. Franchising has begun with successful results, and the founders seek further investment to expand their franchising efforts and continue their growth trajectory. The company is structured to accommodate franchising, with affordable menu options and a proven track record of success.
The Negotiations:
Corey and Trew initially sought $600,000 for 10% equity but received an offer from Mark Cuban and Barbara Corcoran for the full amount in exchange for 30% equity, with each shark investing $300,000. They negotiated additional terms, including territorial rights and exclusivity for certain regions. Despite other sharks opting out, Corey and Trew accepted the offer, excited about the opportunity to scale their business with the support and expertise of Mark and Barbara.
