Wine isn’t a favorite beverage for millennials, as some find it too bland. BeatBox Beverages has launched a line of wine products with unique flavors and packaging. The company has appeared on Shark Tank and its founders have struck a deal with Mark Cuban. Beatbox Beverages is valued at $200 million by 2024.
Founder
Three entrepreneurs participated in the presentation, but there were five co-founders: Jason Schieck, Brad Schultz, Aimy Steadman, Daniel Singer and Justin Fenchel.
Justin Finchel, who started out as a financial analyst and became a serial entrepreneur, joined Amy, Jason, and Dan in the McCombs School of Business to pursue his MBA. Something different was Brad Schultz, who had a bachelor’s degree in marketing.
The birth of BeatBox beverages
BeatBox Beverages was launched in November 2011. It is a liquor product that tastes more like vodka and Gatorade. The flavors are uncommon and the drinks are packaged in creative three-dimensional boxes.
The co-founders started the business with $55,000 and borrowed an additional $100,000 to finance its growth. The drinks were a hit, generating $200,000 in sales within a year.
Shark Tank
Early success came from self-distribution, but in order to scale the business, they needed a strategic partner. In 2014, Justin, Brad, and Amy appeared on Season 6 of Shark Tank seeking $200,000 in funding in exchange for a 10% equity stake.
The team got off to a convincing start and handed out samples to the Sharks. Kevin O’Leary, a self-proclaimed wine connoisseur, said the wine tasted bad, but the others disagreed.
Barbara was the first to make an offer, followed by Mr. Wonderful. Then, Mark Cuban said he was the best fit and offered $600,000 for 33%. The founders offered the same stake but for $1 million, and Cuban agreed. It was one of the biggest deals on the show at the time. It is now the tenth largest deal of all time.
Sales after Shark Tank
Four months after the show aired, Beatbox Beverages had sales of $440,000. The publicity helped, and the company continued to grow exponentially. Their products are now sold in more than 65,000 retail stores, including 7-Eleven, Walmart, Kroger, Casey’s, and Circle K.
Beatbox has come a long way since Shark Tank. Revenue has grown from $1 million in 2017 to $18 million in 2021. Growth isn’t slowing down, and they expect to hit $20 million in revenue in 2022, with co-founder Justin Fenchel aiming for $100 million in revenue by the end of 2023.
Despite the incredible growth, the company lost money in the pursuit of growth rather than profits. The startup lost $4.2 million in 2019 and $3 million in 2020, but became profitable in 2021. They also raised $15 million through crowdfunding and investors such as Rob Dyrdek, Louis The Child, and Party Favor, with a valuation of $200 million.
As the company expanded its beverage offerings, it formed a new company called Future Proof LLC, under which the BeatBox brand will be based. Of the original five co-founders, three are still with the company. Daniel Sing left in 2013, and Jason Schieck left in 2021.
In an interview with Forbes, Mark Cuban ranked Beatbox as one of his best Shark Tank trades, along with Dude Wipes. Mark didn’t get a great return from a cash perspective, but his equity is worth much more.
Categories: Shark Tank
Source: svlsf.edu.vn