What happened to FOAM Coolers on Shark Tank season 16 episode 6?

In season 16 episode 6 of Shark Tank, FOAM Coolers, a company that produces lightweight and durable coolers, appeared on the show to secure investment. The founders, Chad Lee and David Kittle, sought $150K for 10% equity in their business. The cooler was designed to be both strong and lightweight, setting it apart from traditional coolers.

The company faced challenges with its direct-to-consumer model and early sales, but the pitch also included a potential deal with Target. Ultimately, they received a deal from Daymond John on Shark Tank, who offered $150K for 30% equity in the business, reflecting his belief in the product's potential despite its early-stage challenges.

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Behind the scenes of FOAM Coolers' pitch on Shark Tank season 16

FOAM Coolers' sales and pre-Shark Tank success

Before their appearance on Shark Tank, FOAM Coolers had generated $114,000 in sales, with an additional $137,000 committed, bringing the total to $251,000 for the year. The company operated primarily through a direct-to-consumer model, with coolers priced at $99 retail and wholesale prices around $50, depending on the channel.

Manufacturing costs were approximately $25 per unit, which presented challenges regarding profit margins. However, the company had secured a deal with Target, which was set to launch one week after filming. The deal was initially limited to 97 Target locations, with plans to expand further if successful.

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The impact of the Target deal

The partnership with Target was a critical part of the FOAM Coolers pitch. While the deal had not yet been fully realized at the time of filming, the founders emphasized its potential impact on the company’s growth. The limited number of Target locations was considered a cautious approach to test the market before scaling further.

The founders indicated they did not want to risk the product being returned to them, as had happened with previous products in larger retailers. The Target deal was seen as a potential avenue for growth, although it was still in the early stages of implementation when the pitch aired.

Lori Greiner acknowledged that Target had likely recognized the product's potential, as they had experience with similar products and buyers. Kevin O'Leary raised concerns about the company's sales performance, questioning how the product had disrupted the market. Lori clarified that the deal with Target was based on the product’s concept and the retailer's confidence in its future potential.

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The battle between Kevin O'Leary and Daymond John

During the pitch on Shark Tank, Kevin O'Leary and Daymond John expressed interest in investing in FOAM Coolers, but with different approaches. Kevin offered $150K for a 33.3% equity stake, reflecting his belief that the business would either succeed or fail depending on the performance of the Target deal.

Daymond, in contrast, saw potential in branding and licensing opportunities and offered $150K for a 30% equity stake. Both Sharks faced a counteroffer from the founders requesting 17% equity, and the deal was finalized with Daymond John at 30% equity.

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What happened after the deal?

After the pitch aired, FOAM Coolers continued its plans to launch in Target stores. There have been no significant updates on the scale of the expansion within Target as of now.

The company’s success will depend on its ability to manage its direct-to-consumer and wholesale distribution models and its ongoing partnership with Target. The deal with Daymond John provided the company with additional resources to support branding and marketing, in which Daymond’s expertise could be valuable. FOAM Coolers remains focused on leveraging its product and partnerships to grow the business.

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