“That was my flexibility”- When Shark Tank star Mark Cuban made a $2M deal with NuMilk

NuMilk was on episode 8 of season 12 of Shark Tank which was released on December 11, 2020. Founders Ari Tolwin and Joe Savino showed up on the coveted stage, with their company seeking $1M for a 5% stake in their company. They came with a cupboard-sized machine, which they intended to sell to grocery stores. This machine would produce almond, oats, or any other plant based milk at the click of a button.

After Mark Cuban tried making the milk out of the machine himself, because he followed a plant-based diet, he offered Ari and Joe a deal. They wanted Mark to come overboard at 6% stake, but Mark said he would give them $2M for a 10%. The founder asked Mark to show some flexibility because they wanted to work with him. But Mark said:

"That was my flexibility."

Ari and Joe ended up taking the deal and were congratualted by the other sharks.

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How Mark Cuban made a $2M deal on Shark Tank season 12 episode 8

Barbara was the first one to give an opinion on Joe and Ari's Shark Tank presentation. She said she didn't understand anything that the two were trying to convey and that she felt like she was a 2nd grader who didn't understand what the teacher was saying.

She said she was out because Joe and Ari talked a lot.

Lori said she too was out because of the same reasons, that she wasn't getting much clarity on the type of business model they were serving. Daymond stated that he too was confused, so he was out.

Mark showed interest in the poratble version of the nutmilk maker, which they intended to sell to coffee shops. He saw potential in those selling as a home appliance, so he asked them about their price. Joe said they sold it for $699 per piece, and it cost them $300 to make.

This was where Kevin jumped into the Shark Tank deal. He told them that he didn't agree with his fellow sharks because he got what they were trying to do.

He offered them $1M for a 9.5% interest for 3 years and the 5% equity. He added that that would cost them $8K a month.

Then came Mark, who calculated that they had $3M in the bank for two products to launch. He stated that he liked the portable version of the nutmilk maker and added:

"I think that'll sell like hot cakes at home. I think you'll sell a million units easily."

He further calculated that they could price it at $899 instead of $699 and according to their margin, that would make them $500 per unit.

He added that with only $3M in the bank and marketing, inventory, and receivables costs to incur, they wouldn't have enough cash.

Mark stated that 5% equity wasn't enough, to this Ari and Joe requested him to come to 6%. Mark refused to do that, then put forth his offer. Mark said he was going to give them $1M extra.

He said that $1M would be for 7% equity, the other $1M would be a loan at 3% interest plus an additional 3% as stock as advisory or straight up equity. Mark further stated that if they didn't use the loan, they didn't have to pay him any interest or give him the additional 3% in equity.

All in all, he summed it up and said he was giving out $2M for a 10% equity. NuMilk's founders took the deal immediately and it went down as one of the biggest deals in Shark Tank history.

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The fans of Shark Tank can follow NuMilk on their official Instagram page for more updates- @numilk.