Shark Tank US | Which Shark Will Invest In Toast-It Product?

Summary

Sisters MAF and Coko from Venezuela pitch their brand, Toasted, on Shark Tank, seeking $100,000 for 5% equity. They offer ready-to-eat, healthier Latin American staples like Aras—cornmeal breads with zero added sugars, gluten-free, and high in protein. Highlighting the growing Hispanic food market in the U.S., they showcase flavors filled with plantains, cheese, and guacamole. Despite impressive distribution in major retailers like Walmart, Whole Foods, and Publix, Sharks question low margins. After negotiating, they secure a deal with Daniel, who offers $150,000 for 20%, providing the sisters with both funding and a strategic partner to grow their business and promote their culture through authentic cuisine.

Takeaways

• 😀 Founders MAF and Coko are sisters from Caracas, Venezuela, who created Toasted, a brand of ready-to-eat Latin American staples.
• 😀 Toasted focuses on the traditional South American arepa, a cornmeal bread crispy on the outside and fluffy on the inside.
• 😀 The product line includes Original, Chia/Flax, and Yuca arepas, all gluten-free, with zero added sugars or trans fats, and 3–4g of protein per serving.
• 😀 Arepas are ready to eat in under 10 minutes, making them convenient while retaining authentic Latin American flavors.
• 😀 The Hispanic community is the fastest-growing minority in the U.S., and Hispanic cuisine has mainstream appeal across the country.
• 😀 Toasted has achieved distribution in about 900 stores, including major retailers like Publix, Walmart, Whole Foods, Winn-Dixie, and Central Market in Texas.
• 😀 Financially, the company made $200,000 last year, $190,000 in the first five months of this year, and projects $500,000 in revenue by year-end, with a selling price of $3.23 and gross margins of 30%.
• 😀 Sharks expressed concerns about thin margins (~20% after distribution costs) and the challenges of frozen/refrigerated logistics.
• 😀 Founders plan to improve margins by reducing packaging costs, optimizing production with new machinery, and lowering ingredient costs.
• 😀 Despite low margins, Daniel (Mr. Wonderful) invested $150,000 for 20% equity, valuing the company at $750,000 post-money, impressed by the founders’ passion, product quality, and growth potential.
• 😀 The deal highlights the importance of authenticity, founder commitment, and strategic alignment with an investor experienced in scaling food businesses.

Q & A

Who are the founders of Toasted and where are they from?

The founders of Toasted are sisters MAF and Coko, originally from Caracas, Venezuela.

What inspired the founders to create Toasted?

They were inspired by their craving for authentic South American food after moving to the U.S., where convenient and genuine options were not available.

What is the main product of Toasted and what are its key characteristics?

The main product is Arepas, a cornmeal bread that is crispy on the outside, fluffy on the inside, versatile for stuffing or topping, and ready to eat in under 10 minutes.

What flavors and health features do Toasted's Arepas offer?

Flavors include original corn, Chia, Flaxseed, and Yuca. They are gluten-free, have zero added sugars and trans fats, and contain 3–4 grams of protein per serving.

Which market segment is Toasted primarily targeting?

They are targeting the Hispanic community in the U.S., the fastest-growing minority, as well as mainstream consumers who enjoy authentic Hispanic food.

In which stores are Toasted products currently available?

Toasted is available in approximately 900 stores, including Publix, Walmart, Whole Foods, Winn Dixie, and Central Market in Texas.

What are the revenue and gross margin details for Toasted?

They sold $200,000 last year and $190,000 in the first five months of the current year, projecting $500,000 by year-end. The gross margin per unit is around 30%, and after distribution and selling expenses, it is approximately 20%.

What challenges did the sharks highlight about Toasted's business?

Sharks were concerned about low margins, costs associated with frozen distribution, and competition in the refrigerated food aisle.

What strategies are the founders using to improve profit margins?

They plan to optimize production with new machinery, reduce packaging costs by 50%, and explore cost reductions in ingredients.

What was the final deal made on Shark Tank?

The final deal was $150,000 for 20% equity with investor Daniel.

Why did the sharks appreciate the product despite concerns?

Sharks praised the product's taste, health benefits, and the founders' passion and cultural authenticity, although some were wary of the low margins and logistics challenges.

Have the founders been paying themselves from the business?

No, the founders have not been paying themselves yet as they are reinvesting earnings to grow the business.

What is unique about Toasted's product compared to competitors?

Toasted's Arepas are better-for-you Latin American staples that are ready to eat quickly, gluten-free, low in sugar, high in protein, and authentic in flavor, differentiating them from other refrigerated or frozen bread products.