It’s one thing to pitch your business on Shark Tank, but getting your company to succeed is another ballgame – one that Eco Flower’s founder, Meagan Bowman played well, but not for long.
Eco Flower: How it All Started
In November 2016, Meagan Bowman got the opportunity to pitch her business, Eco Flower, to Shark Tank’s investors. Eco Flower was a great execution of a novel idea; the company aims at producing fake flowers made of recyclable materials, mainly wood, that are presented in different manners and can be used for various occasions.
A Bold Request Was Made
Meagan entered Shark Tank looking for $400,000 in exchange for 10% of the equity. When she presented her idea, she only held 25% of the company’s shares, which is why some of the sharks raised a few concerns as to whom they are doing business with. Nevertheless, Meagan did an excellent pitch.
Numbers Can Make or Break Your Pitch
The sharks were skeptical when hearing the idea and learning about the details, as they found fake flowers to be less emotional than real ones, so they expressed their concern about whether there is good demand for such a product. To prove that the niche had potential, Meagan presented some numbers, which were impressive. Eco Flower did $2.8M in sales over the prior year and a half, out of which, $100k were made the day before the episode aired.
In doing so, Meagan proved that she can drive sales and that the investment money would be put to good use. After all, if Eco Flower could drive $100k in sales through a $4k investment, imagine what they could do with $400k.
Upon the pitch, Meagan got an appealing offer from one of the sharks. She struck a deal with Damien, who offered $400k for 20% of the business.
Eco Flower: The Fall
Soon after the episode aired, Eco Flower’s investors decided that putting a CEO in charge would make things more comfortable, and they chose John Allard for the position. Things didn’t work out between Meagan, as the original business owner, and the rest of the team, which is why she left the company along with her original partner, Alex Ledoux. JW Capital, which owned 50% of the Eco Flower, purchased the remaining part.
From Rags to Riches, and Back to Rags
Soon after, Eco Flower went downhill. The company started to fall behind on orders, take down negative reviews and comments, and mistreat its employees (according to them). As you must have guessed, it didn’t take long for Eco Flower to close doors, thus forcing all of the employees out without their last payroll. Even after emptying their HQ, Eco Flower kept getting online orders through their site, which was described as an act that “crosses a line that is beyond morally right” by one of the former employees.
What Can You Learn from the Eco Flower Shark Tank Experience?
There are several lessons to be learned from Eco Flower’s Shark Tank experience. For starters, as a new startup, you shouldn’t give out most of the company’s shares away as early as Meagan did, which is why she lost control over Eco Flower as quickly as she did. Even if you have a hard time with sales or conversions, keep the future implications in mind before taking such a leap. Also, keep the terms and lines clear when dealing with investors; otherwise you may end up on the street, just like Meagan did.
The Shark Tank experience wasn’t a total failure though. Among the good lessons that you can apply is backing up your claims with numbers. If Meagan didn’t get those impressive sales just before the episode, she wouldn’t have gotten a chance considering how skeptical the sharks were towards the niche and product.