What are the worst shark tank deals ever?
Starting a new business can be a daunting venture, with a long history of new companies crashing and burning before their owners have a chance to succeed.
Entrepreneurs looking for a cash injection can turn to the TV show Shark Tank, presenting their business ideas to potential investors along with a vast audience on national television in the hopes of getting a deal.
While some find success with their new company, others aren’t so lucky, so let’s explore some of the worst Shark Tank deals ever made and find out exactly what went wrong.
The 10 Worst Shark Tank Deals Ever
Our ranked lists are created by researching and rounding up information from the most reputable web sources.
Here’s our list of the 10 worst shark tank deals ever:
10. You Smell Soap
Investment: $55,000 + $50,000 Salary For 30% Equity
Megan Cummins appeared on Shark Tank season 3, episode 3, and pitched her luxury soap brand You Smell Soap to the sharks.
While some successful businesses started in garages, You Smell Soap began life as a college project based around custom packaging, transforming into a fully-fledged startup when she had two scents made into 1200 bars of soap to use for market testing.
Initially, things were looking good for Megan’s business, after she made a deal with Robert Herjavec for an initial outlay of $55,000 for the luxury soap company and a $50,000 salary for 30% equity.
Unfortunately, things didn’t work out quite as planned, and after unsuccessful attempts to chase Robert Herjavec up, six months later, he returned with an adjusted offer of $50,000 for 50% of the company.
Megan refused the offer, which was a frustrating experience for the young entrepreneur, who managed to continue running the company with the help of another investor.
Megan missed a big opportunity with another shark in the tank, Mark Cuban, who had initially expressed interest in investing with You Smell Soap, but she decided to go with Robert Herjavec instead.
9. Three65 Underwear
Investment: $60,000 For 25% Equity
Applying the subscription model to clothing and accessories can be incredibly lucrative, with companies such as Dollar Shave Club bringing in millions of dollars in revenue.
William Strange spotted an opportunity to apply this model to high-quality men’s underwear and visited the sharks to pitch his idea for the Three65 Underwear business.
After some negotiation with the shark tank angel investors, Strange managed to secure a deal with Naomi Simson and Janine Allis, each offering $60,000 for 25% equity of his company.
While they were concerned that Strange might not have the time and attention to give to the company, since he was already running a GPS business called Sports Performance Tracking, they had faith in the subscription model he proposed.
Since Strange was working two sharks at the same time, he was warned that eventually, he would have to make a decision.
In a surprise twist, William Strange ended up pulling out of the deal and going all-in with his own business, StartupSmart, since this company was growing in revenue and attracting much larger investment opportunities.
Investment: $70,000 For 35% Equity
Dating apps feature among the most successful apps released in 2021, with consumers spending $133 billion overall on apps for their mobile devices.
CATEapp, the brainchild of West Palm Beach police officer Phil Immler, can be viewed more as a cheating app than a dating app, allowing users to hide “secret” text messages and conversations from their spouses.
CATE is short for “call and text eraser,” and the smartphone app was picked up by entrepreneur Neal Desai, who took it to the shark tank investors hoping for a deal.
In spite of nearly 10,000 downloads in the aftermath of the show (70% of which was from women), the business deal fell through, even as Desai had begun marketing the app to government agencies and other businesses as a “privacy app.”
CATEapp is long since defunct, the last update on its Twitter business account from 2013, but the market for smartphone apps for cheaters hasn’t gone away, with apps like CheatMaster available for the unfaithful.
7. ShowNo Towels
Investment: $75,000 For 25% Equity
Shelly Ehler’s concept for her ShowNo towels proves that simplicity is often key, with these poncho-like bathing towels ideal for getting changed in public while keeping your decorum.
Ehler took the business idea to Shark Tank in episode 4 of season 3, looking for a $50,000 investment for a 25% stake in the company, bringing her two sons along to help pitch the idea.
After a few questions about production processes and some competition for the deal with other investors, Ehler accepted an offer from Lori Greiner for $75,000 for a 25% stake.
After the show, ShowNo Towels looked like it would thrive, with a deal struck to supply towels to Disneyland and Shelly and Lori appearing on the Today Show to drum up more support.
Unfortunately, after working together for a year and despite the initial popularity of the product, the business ended, with the website no longer selling the towels.
Investment: $90,000 For 51% Equity
In the first season of Shark Tank, Mark Burginger took his Qubits invention to the show, a puzzle-based toy that can be manipulated into different geometric shapes.
Burginger saw an opportunity to break into a potentially lucrative market, with the most valuable toys selling for tens of thousands of dollars.
Seeking an investment of $90,000, Mark Burginger was prepared to offer a stake of 51%, a deal which Daymond John eventually took.
A condition of the deal meant that Burginger had to look into pairing with one of the four top toy companies, which he agreed to.
Daymond John enlisted the help of Kevin O’Leary to help promote Qubits to larger investors, but despite their best efforts, by March of 2010, their deal ended with Mark Burginger.
Despite this initial lack of interest from the toy companies, following the break with Shark Tank, Burginger was able to strike a deal with Discovery Toys, LLC, with their wholesale order allowing Qubits Toy Company to erase all its debt.
Impressive sales saw the Qubits toys quickly selling out, with units shifted in the USA and Canada reaching up to six figures in retail sales.
5. The Body Jac
Investment: $180,000 For 50% Equity
The inventor of the Body Jac sought to revolutionize exercise equipment, and entrepreneur and infomercial star Jack Barringer took it to Shark Tank hoping for a $180,000 investment in the business.
The Body Jac device was designed to make push-ups easier, so potential investors Kevin Harrington and Barbara Corcoran instructed him to lose 30 pounds to prove his exercise equipment was up to the task.
After losing the required weight, Barringer received the $180,000 funds for 50% equity from Corcoran and Kevin Harrington.
According to Showbiz Cheat Sheet, it’s not clear why the business was a failure, but the company discontinued its production of the Body Jac push-ups machine, shutting down their website in 2012.
Corcoran described Barringer as a “fast-talking cowboy,” with his invention best remembered as “the worst business deal ever made” in the show’s history.
4. Night Runner
Investment: $250,000 For 15% Equity
The creation of Doug and Renata Storer, the Night Runner posed a solution to the problem of running in the dark by fixing rechargeable LED lights to running shoes.
The two partners took their idea to Shark Tank, looking for $250,000 in exchange for a 15% equity stake in the company, and secured an offer from Robert Herjavec.
However, once the show ended, the Storers decided it was in their best interest to take their company in a different direction, retaining their equity and taking on more risk themselves.
In an interview with Forbes, Doug Storer explained, “After it aired, we didn’t need the investment anymore, and we started to think, why should we give up equity if we don’t need it.”
After reneging on their deal with Herjavec, the Night Runner company found investors from elsewhere and were able to transform their product into a consistent seller, making $1.5 million in revenue in the first year.
It’s a reminder that not every Shark Tank deal which goes south works out badly for the entrepreneur; they can sometimes present missed opportunities for the five sharks on the panel.
3. Sweet Ballz
Investment: $250,000 For 25% Equity
James McDonald and Cole Egger set up their cake ball company, Sweet Ballz, and took the food innovation concept to Shark Tank in the hopes of acquiring $250,000 in exchange for 25% of the company.
Their business model involved producing Sweet Ballz for sale at a variety of retail outlets including 7-11, with Mark Cuban the most likely candidate to invest in their new business.
After Mark agreed to the deal, and Barbara Corocan also came on board, the relationship between James McDonald and Cole Egger began to sour as their Sweet Ballz cake ball company ran into trouble.
With one believing the other was operating behind his back, a competing Cake Ballz brand set up by Egger further inflamed tensions and eventually led to a restraining order being issued.
A lawsuit between James McDonald and Cole Egger soon followed, and things became more fraught when the Sweet Ballz website began redirecting traffic to CakeBallz.com.
Once the dust had settled, and the feud ended, ownership of the Sweet Ballz cake ball company went back to McDonald, its original creator.
While James McDonald and Cole Egger couldn’t repair their relationship, Mark Cuban and Barbara Corcoran made the right decision.
The company went on to thrive, striking deals with some of America’s top food service providers, its founders proving to be successful businessmen.
Investment: $250,000 For 35% Equity
With children well known for quickly getting bored with their toys, the idea that parents could rent toys from a subscription service sounds great — or at least, it does on paper.
The company ToyGaroo set out to do just that, allowing parents to rent toys on a monthly basis, saving them money while giving their kids more variety with their playthings.
Mark Cuban and Kevin O’Leary both agreed that this was a great idea, and over the course of two funding rounds, they put up the $250,000 required to get the business off the ground in exchange for 35% equity in the business.
Unfortunately, ToyGaroo failed, unable to meet the high demand caused by the spike in interest when the show was aired, leading to the company being a victim of its success.
Lacking the stock to meet this demand was a death blow to the company, and founder Phil Smy believed they would have been a success had they been able to grow organically.
Slower growth would have given them the time needed to refine the “free shipping” model they wanted to use but were hampered by the different dimensions each toy came in.
Additionally, they struggled to source their toys at affordable prices, and hopes that Mark Cuban and Kevin O’Leary would help them secure a deal with Mattel came to nothing.
On April 6, 2012, the company filed Chapter 7, officially closing its doors for good in 2016.
When interviewed by Forbes, Kevin O’Leary and Mark Cuban described the ToyGaroo company as a “great concept, but they were unable to execute.”
Investment: $1 Million For 30% Equity
Another idea that sounded great on paper is the Breathometer, a portable breathalyzer device connected via a smartphone app, allowing users to check their blood alcohol level before driving.
Created by entrepreneur Charles Michael Yim, the Breathometer required $1 million in exchange for 30% equity in the company, and all five sharks enthusiastically took up the deal.
If the device worked as intended, this might have been a great deal.
However, problems with it giving the wrong blood alcohol levels led to the involvement of the Federal Trade Commission, which ordered the company to issue full refunds to all of its customers.
In addition to the faulty product, the company failed to fulfill its orders and was seriously mismanaging funds.
Mark Cuban described the venture as “the worst execution in the history of Shark Tank,” ultimately blaming Yim for misspending the capital which had been put into his company.
Nevertheless, Breathometer is still in business and has pivoted toward measuring biomarkers that indicate bad breath and gum disease, where it hopes to acquire new customers.
We’ve covered some of Shark Tank’s biggest failures, from morally questionable apps designed to help people cheat on their partners to a portable breathalyzer that failed to work as intended.
These failed investment opportunities have left both the shark tank hosts and aspiring entrepreneurs out of pocket, despite exposure to over five million viewers throughout the country.
Still, with only 12 companies of the 210 companies featured on the show between seasons five to nine actually failing, budding startup owners would do well to try and book a slot on Shark Tank if they want to increase their odds of success.
Here’s a quick recap of the 10 worst shark tank deals ever:
- Sweet Ballz
- Night Runner
- The Body Jac
- ShowNo Towels
- Three65 Underwear
- You Smell Soap