Shark Tank US | Rebel Cheese's Cheesy Pitch Wins Two Sharks

Summary

Fred and Kirsten from Austin, Texas, pitch their artisan vegan cheese company, Rebel Cheese, seeking $750,000 for 5% equity on Shark Tank. They share their love story that led to creating premium plant-based cheeses using traditional techniques like culturing and cave aging. With a focus on e-commerce, wholesale, and restaurant sales, they've achieved profitability and are set to scale up. After a series of negotiations, they accept a joint offer from Mark and Lori for $750,000 in exchange for 10% equity, promising enhanced distribution and marketing support.

Takeaways

• 🧀 The pitch is for Rebel Cheese, an artisan vegan cheese company.
• 💑 The founders' love story and shared love for cheese inspired the creation of Rebel Cheese.
• 🌱 The company focuses on making premium vegan cheeses using traditional artisan techniques.
• 🛍️ Their products are sold through e-commerce, wholesale, and restaurant sales, with the restaurant channel being the largest.
• 🏭 The company has recently built a new production facility capable of making 8 million wheels of cheese annually.
• 💰 They are seeking $750,000 for 5% equity in their company, valuing it at $15 million.
• 🔍 The sharks are impressed with the quality of the cheese, particularly the Brie.
• 📈 Last year's sales were $2.5 million, with a projection of $3.5 million for the current year.
• 🤝 Mark and Lori make an offer of $750,000 for 10% equity, which the founders accept after some negotiation.
• ⚖️ The negotiation highlights the importance of distribution and marketing support, as well as the founders' valuation of their expertise.

Q & A

What is the name of the vegan cheese company featured in the script?

The name of the vegan cheese company is Rebel Cheese.

What is the unique selling proposition of Rebel Cheese?

Rebel Cheese's unique selling proposition is creating real cheese made only from plants, using artisan techniques such as culturing and cave aging to create premium vegan cheeses.

What is the couple's background and how did they come up with the idea for Rebel Cheese?

Fred and Kirsten from Austin, Texas, fell in love over a shared love for cheese and European-style picnics. When the girl in the story went vegan, they both followed suit, and seeing a gap in the market for gourmet vegan cheese, they started Rebel Cheese.

What are the main ingredients used in Rebel Cheese's products?

The main ingredients used in Rebel Cheese's products are cashews, water, salt, and culture.

How many different varieties of vegan cheese does Rebel Cheese offer?

Rebel Cheese offers over 20 different varieties of vegan cheese.

What are the three sales channels through which Rebel Cheese sells its products?

Rebel Cheese sells its products through e-commerce subscriptions, wholesale programs, and restaurants.

What was the company's sales figure for the previous year and what is the projection for the current year?

Rebel Cheese's sales for the previous year were $2.5 million, and they are projecting to make $3.5 million in the current year.

What is the cost structure for producing a wheel of Rebel Cheese's Brie, and how is it priced at retail?

It costs Rebel Cheese approximately $4.67 to make a wheel of Brie, which they then sell to retailers for about $9, with a manufacturer's suggested retail price (MSRP) of about $15 to $20 per wheel.

How does the valuation of Rebel Cheese compare to traditional cheese?

Rebel Cheese's valuation is comparable to that of traditional high-end Brie, with their vegan cheese priced similarly at retail, between $10 to $20 per wheel.

What was the initial investment offer from the sharks and what was the final deal?

The initial investment offer was $750,000 for 10% equity in the company. The final deal accepted was $750,000 for 10% equity, with the investment coming from two sharks, Mark and Lori.

What additional support did the sharks offer to Rebel Cheese beyond the financial investment?

The sharks offered enhanced distribution support and one shark, Mark, even committed to going to a grocery store in Austin to hand out samples.

Outlines

00:00

🧀 Vegan Cheese Entrepreneurs Seek Investment

Fred and Kirsten from Austin, Texas, pitch their artisan vegan cheese company, Rebel Cheese, to the sharks seeking $750,000 for 5% equity. They share their love story, which led to the creation of their business when Kirsten went vegan. They focus on producing high-quality vegan cheeses using traditional cheese-making techniques like culturing and cave aging. Their product line includes over 20 varieties, aiming to appeal to both vegans and cheese connoisseurs. The sharks taste their top-selling cheeses and are impressed by the quality and flavor, which are comparable to traditional dairy cheeses. The entrepreneurs discuss their business model, which includes e-commerce, wholesale, and a restaurant channel, with the latter being their primary source of sales. They also mention their recent expansion into retail and the potential for growth in the vegan cheese market.

05:00

💸 Sharks Show Interest in Rebel Cheese; Deal Struck

After tasting Rebel Cheese's products and discussing the business model, Mark makes an offer of $750,000 for 10% equity, which is initially met with hesitation due to the high valuation. Lori expresses interest and suggests partnering with Mark, which could provide additional support in distribution and marketing. However, another shark decides to exit the negotiation, citing a lack of understanding of the product's appeal. The entrepreneurs consider the offers and counter with a request to lower the equity share to 6%, which Mark and Lori decline. They emphasize the value of their expertise and the potential for enhanced distribution. After a brief discussion, they accept Mark and Lori's original offer, recognizing the significant opportunity for growth and support that the sharks can provide. The deal is celebrated, and the entrepreneurs express their excitement about working with their new partners.

Keywords

💡Artisan

Artisan refers to a worker in a skilled trade, especially one that involves making things by hand. In the context of the video, 'artisan' is used to describe the traditional, handcrafted methods used to make Rebel Cheese's vegan cheeses. It emphasizes the care and skill put into each product, which is a selling point for the brand. The script mentions 'artisan cheese making techniques' such as culturing and cave aging, highlighting the company's dedication to quality and tradition in their vegan products.

💡Vegan

Veganism is a lifestyle and dietary choice that excludes the use of animal products. In the video, the term 'vegan' is central to the product offering of Rebel Cheese, as they create cheeses made exclusively from plant-based ingredients. The script discusses how the founders went vegan and then created Rebel Cheese as a response to the lack of premium gourmet vegan cheeses on the market, aiming to 'invite vegans back to the picnic.'

💡Cheese Making Techniques

Cheese making techniques refer to the methods and processes used to create cheese. The script mentions specific techniques like 'culturing' and 'cave aging,' which are used to develop the flavors and textures of Rebel Cheese's products. These techniques are traditionally used in the cheese industry and are highlighted as a way to create vegan cheeses that can rival the taste and quality of traditional dairy cheeses.

💡Plant-Based

Plant-based describes products made from plants rather than animal products. In the video, Rebel Cheese's cheeses are described as 'made only from plants,' emphasizing their vegan nature. The script specifies that their cheese contains only four ingredients: cashews, water, salt, and culture, which underscores the brand's commitment to simplicity and natural ingredients.

💡Shark Tank

Shark Tank is a reality TV show where entrepreneurs pitch their business ideas to a panel of investors, known as 'sharks.' In the script, the setting is a pitch to the sharks for investment in Rebel Cheese. The term 'shark' is used to refer to the investors, and the script includes dialogue where the sharks express their interest, make offers, and discuss the business model, which is a central part of the show's format.

💡Investment

Investment in this context refers to the act of putting money into a business in exchange for equity or a return on investment. The script revolves around the founders seeking $750,000 in exchange for 5% of their company, which is a typical scenario on Shark Tank. The sharks' offers and negotiations are focused on the investment terms and the potential for growth and profitability of Rebel Cheese.

💡E-commerce

E-commerce stands for electronic commerce and refers to the buying and selling of goods or services using the internet. In the script, one of Rebel Cheese's sales channels is through their e-commerce platform, which involves a subscription model. This is mentioned as part of their business model, showing how they have adapted to online sales, especially during the COVID-19 pandemic.

💡Wholesale

Wholesale refers to the sale of goods or merchandise to retailers, or to businesses for use in their operations. In the video, the founders mention that a significant portion of their business, about 75%, comes from their wholesale program. This indicates that Rebel Cheese sells its products in bulk to retailers, which is a common distribution method for consumer goods.

💡Retail

Retail in this context refers to the sale of goods to the end consumer. The script mentions that Rebel Cheese is in about 100 retailers, which is part of their distribution strategy. This is an important aspect of their business model, as it allows them to reach a wider audience and increase brand visibility.

💡Valuation

Valuation is the estimate of the value of a company or business. In the script, the founders are seeking an investment at a $15 million valuation for their company. This is a critical point of discussion among the sharks, as they consider whether the company's potential and current performance justify such a high valuation.

💡Distribution

Distribution refers to the process of getting a product from the manufacturer to the end consumer. In the video, the founders express a need for help with distribution as part of the investment deal. This is a key consideration for scaling their business, as it involves expanding their reach to more stores and potentially increasing sales.

Highlights

Introduction of Rebel Cheese, an artisan vegan cheese company.

The founders' romantic story inspired the creation of Rebel Cheese.

The company's mission to revolutionize the vegan cheese market.

Rebel Cheese's artisan techniques include culturing and cave aging.

The variety of Rebel Cheese's offerings, with over 20 different types.

Shark's positive reaction to tasting Rebel Cheese's products.

The simplicity of ingredients used in Rebel Cheese's products.

The unique selling proposition of Rebel Cheese's vegan brie.

The founders' explanation of their business model and sales channels.

Rebel Cheese's sales figures and projections.

The cost structure and pricing strategy of Rebel Cheese.

The valuation ask and the sharks' initial reactions.

Mark's offer of $750k for 10% equity in Rebel Cheese.

Lori's interest in partnering with Mark for the investment.

The founders' counter-offer and negotiation with the sharks.

The final deal acceptance with Mark and Lori for $750k for 10% equity.

The sharks' advice and excitement for the future of Rebel Cheese.

Transcripts

first in the tank is a modern product

made in traditional artisanal

[Music]

ways hi sharks I'm Fred Zar and I'm

Kirsten maand and we're from Austin

Texas we're seeking

$750,000 in exchange for 5% of our

company wow sharks who doesn't love a

cheesy love story boy falls in love

because Girl Is Awesome but also the

boy's romantic who loves to create these

impressive European style picnics which

girl loves however that meant the

foundation of a relationship relied on

one very important thing

cheese but then uhoh the girl goes vegan

uh- oh again boy goes vegan and with no

truly premium Gourmet shakuri style

cheeses on the market boy and girl go

into business together and create Rebel

cheese The Artisan vegan cheese company

that is inviting vegans back to the

picnic again we create real cheese but

made only from plants and just like with

love there is no shortcuts we spent

years mastering the artisan cheese

making techniques such as culturing and

Cave aging to create the most perfect

textures and flavors that will fool even

the most committed cheese lover imagine

a creamy rinded bre with a true rind a

Tangy sharp cheddar smoked with real

mosquite chips and with over 20

different varieties of cheese we're here

to revolutionize the vegan cheese game

so sharks who's ready to write their own

cheesy love story and take a bite out of

the vegan cheese market with redel

cheese got to try it I am yeah I'm

hungry and ready to try it and sharks in

front of you you have our five top

selling SKS we have our Brie we have our

honey pistachio Chev sundried tomato

forage sharp cheddar and also our

pimento oh my God that's so good the

pimento do it primarily cashew or have

you used multiple plant-based Solutions

we do multiple um what sets us apart is

our techniques so we actually have caves

that we cave age debris in WoW debris is

incredible thank you and it's just four

ingredients it's cashews water salt and

culture so it's super clean oh my God

that sundried tomato fromage is fabulous

I've tried them all and and I'm a huge

cheese guy I'm a huge wine guy so I'm

very sensitive

the one you nailed it on is the breed

there is no way to tell the difference

thank you I mean these are interesting

but the texture is like pretty similar

on all of them right it's kind of very

mushy and pasty the texture is throwing

me a little bit CHR are you the only one

that makes a vegan cheese no no to this

to this level standard there aren't many

people that are making Artisan vegan

cheese at scale there's no one making

vegan bre at scale we just just um built

our new production facility we can make

8 million Wheels a year though so guys

you came in with a pretty Punchy ask so

explain to us the business model today

yes so we have three different channels

that we're selling in currently we have

our e-commerce which is through

subscription that entails about 16% of

our business we also have our wholesale

program which is about 177% of our

business and then our restaurant that is

65% of our business well that's

interesting a single location yes a

single location and what's the

restaurant uh Rebel cheese so during Co

we had a pivot like every other uh

restaurant in America we pivoted to an

e-commerce to start with and that

started taking off and now we're in

about a 100 retailers any of the large

Majors like Foods or they they reached

out to us in the beginning but we

weren't ready for them um those 100 for

you for recognizing that what's the

price of this versus a traditional wheel

of high-end Brie so it cost us about

$467 to make that and that's after

overhead and labor we then landed at the

retailer for about $9 and then we have

an MSRP of about $15 to $20 per wheel

how does that compare with real cheese

our real cheese is anywhere from between

10 to $20 so we're right there with them

Fred what are the sales today so our

last year's sales were 2.5 million this

year we're projecting to make 3.5

million what will this whole thing make

if you hit the 3.5 million pre-tax this

year after you pay yourselves so we've

been profitable for 4 years that's what

also sets us what are you going to make

this year this year we're hoping to

break even to be honest with you because

scaling next year we want to be in 500

stores which will put us about $7

million just in our distribution Revenue

I'm trying to get my head around the

deal because the differentiation for

Rebel cheese is this extraordinary Leap

Forward in Brie and yet you're asking uh

$15 million valuation I think you asked

for too much money if anybody here

should invest in this it's me but I'm

out all right I'll offer you 750k for

10%

wait what do you think wait

wait wait wait wait one shark is out

Fred and Kristen have an offer on the

table from Mark for their vegan cheese

company Rebel cheese but Lori also seems

interested wait wait

wait wait wait

wait I

just I have to jump in and say something

I did a deal with border we are

surpassing by Christmas 30 million in

retail sales within one year we make the

most fabulous cheese and shakery boards

that you can imagine and we have no

vegan cheese I'm happy to go in with

Mark if Mark wants to go in with me we

can do that I'm not your customer I'm

not a big cheese guy so I'm going to be

out really appreciate thank you so guys

I'll make this really nice and easy for

you I'm going out it's to me I don't

really understand their product I don't

think it's as amazing as everybody's

talking about I don't get it apparently

Mark and Lori do 750k 10% you get two of

us would you guys be willing to drop

down to 6%

no you're getting two of us you get two

of us a million for

10% you get two of us you get two of us

you can't hire it cost more than that to

hire us yeah so another thing that we'd

be looking for is help with our

distribution we'd be also looking for a

spokes person we'd be looking for

somebody to help us with marketing yeah

look I'll even commit I'll I'll go to a

grocery store in Austin and hand out

samples and I already have I already

have border where boom we sell the

millions of people in this go right into

our line like that what do you would you

guys be willing to do 7 and a half%

no don't let it go let it go well you

know for 3% you could lose this 2 and 1

12% you could lose

this do you want to talk about yeah can

we have us second to talk about it yeah

sure okay guys guys before you leave let

me just say something in sharp tank lore

I've been around here so long I'm the

vampire on the set okay 200 plus years

here on Shark Tank there are only a few

moments in your life you get like this

you made it on Shark Tank that's

impossible to do you have an offer from

two sharks who are passionate about your

business and give you enhanced

distribution and you're worried about 2

or 3% you don't need to walk anywhere

you'd be out of your you know what Minds

not to take that

deal and this isn't even my deal I'm

just saying this is your moment AB what

the are you

doing I almost never agree with him but

what he said for

[Music]

else thank you we'll accept the deal

y you can thank me now Mark thanks so

much thank you

so good well done

congratulations very excited so work

with Mark and Lori the part that really

got me I don't know about ciron per se

is where Mark even said he'll come down

to Austin to hand out samples yeah we

were like done after I think Mark one

day will learn you don't have to buy the

company you can just buy customer buy

the chase it's more fun when I get to

say but it's

mine for