S15.E18: Murder Mystery Co., Overplay, Nourish and Bloom Market, Nowhere Bakery

[CrazyInAlabama]

Sharks-Guest Shark Jason Blum (Blumhouse Productions -scary movies), Mark, Barbara, Kevin, Lori.

Murder Mystery Co. - an immersive murder mystery experience.  $350,000 for 5%.  Nation’s leader in immersive experiences.   They do small parties, up to huge events.  They send you everything you need for the party.    They are in 23 cities, since 2017, almost 2,000 part time employees.   They should sell $10 million, and clear $2 million for 2023.  Sales are $50 million since 2017.   They do a private venue, not a huge commercial event space.  Prices range from $499 up to $10,000 per event.  Events take two hours and more with dinner.  Lori is out, Barbara is out, Mark is out.

 Jason Blum offers $350,000 for 10%.   Deal with Jason Blum.

Overplay- an app that turns videos into games. They want $500,000  for 2.5%.  Anyone can change a video into a game.    They have proprietary and patented software.   It’s very interactive.  Kevin and Mark create games.   150,000 downloads in two weeks, won’t make a profit until 2024, and have $3.7 million spent on this project from investors.   Patent covers turning any video into a game.   They earn money by interactive advertising,  They both worked at Sesame Street.  Barbara is out. Jason Blum is out, he lost on a similar idea.  

Mark is upset at the valuation, but offers 15% for $500,000.  Mark says they’ll need millions more to become profitable.  Counter is 3.25% at $500,000 and .75% advisory.  

Mark offers $500,000 for 4%, and Overplay pays him $500,000 to create content and promote the concept.    Mark makes the deal.

Nourish and Bloom Market-self-service grocery store, and bistro.   24/7 access to food in food deserts, college campuses and other sites.  $400,000   for 5%.   customers download the app, walk into the store, and leave with getting their receipt.  1.8% shrinkage.  They have the small stores, vending machines, and satellite stores in hotels, airports, etc. .   25% net profit on the mini-markets. Lori is out. Barbara is out.  Jason wants to know if they can do a non-profit version, and he’s out. Mark is out. Kevin says their deal is complicated with the three versions of the store, and he’s out.   Mark says their finances are a mess, and he’s out, but wants to help the sellers with contacts in Dallas.   I’m hoping Mark will help them after he helps them in Dallas. 

No Deal.

Nowhere Bakery-plant based cookies,  baked goods without any allergens.  $200,000 for 5%.   Better for you versions of popular desserts.   They make cookies and brownies, gluten free, sugar free.  Chocolate Chip, Candy Bar cookie, Tag, Blondies, and other treats. Started in March 2020, direct to consumer found through food blogging, and influencers.    Sales in 2020 $92,000, 2021 $524,000, 2022 $770,000, 2023 anticipate $1 million.  Profits aren’t great so far.   They sell in 6, 12 packs.   Mark is out, cookies are 300 calories each.   Lori hates the calorie count too, and she’s out.

They need a co-packer.  Barbara offers $100,000 cash, $100,000 in loans for 15%, but she doesn’t want a co-packer.   Kevin offers $200,000 for 20% to get a co-packer and he’ll give the co-packer 10%. 

Kevin and Jason want to go in together, with the same offer, $200,000 for 20%, with 10% going to the co-packer.  

Barbara makes the deal 12.5% for $100,000 cash, and $100,000 line of credit.

Iconic Moment:   Glace Cryotherapy, and Plunge with Robert freezing his entire body in cryotherapy.  

Update: Scholly, helps students qualify for scholarships. Deal with Lori and Daymond.  In 9 years they made over $30 million, and sold out to Sallie Mae.  Sallie Mae contributed $1,000,000 for scholarships via the Thurgood Marshall Fund.

Edited March 16 by CrazyInAlabama

[jcbrown]

I found this episode to be deadly dull. Actually had to come here to read the summary (thanks for that @CrazyInAlabama!) to remember what any of the pitches were.

[Tango64]

I guess if you charge enough for 300 calorie cookies it’s easier for me to lie to myself that they are natural, healthy etc.

I’ll bet the shrinkage is low on that DIY store because they’re in relatively affluent neighborhoods. If you put them in neighborhoods where most food deserts are located, the experience might be very different. They also seemed to stock products that looked high end and discretionary, not the essentials that people in food deserts need. (Maybe they would have both or could change for each market.)

[eel2178]

8 hours ago, Tango64 said:

I guess if you charge enough for 300 calorie cookies it’s easier for me to lie to myself that they are natural, healthy etc.

Just because they're sugar free and gluten free doesn't mean they're healthy. At that calorie count, they're obviously using a high calorie sweetener even if it isn't sugar or honey. That won't improve the glycemic index or decrease inflammation or do any of the other things a low sugar diet is supposed to do.

With $770,000 total income for 2022, they've sold 128,000 individual cookies. Only $32,000 of that income is profit, so their margin is all of 6%. Why were the snarks acting so impressed? Scaling is going to mean hiring more staff. With only a 6% margin, they really can't afford to pay anybody and still hope to make a profit.

Barbara cut their valuation from $4million to $800,000, and they were talking about what a great deal they got. Their margins are terrible, their sales are terrible, and they only got $100,000 out of Barbara that they don't have to pay back. Are they just bad a math or are they bad a business management altogether?

[eel2178]

8 hours ago, Tango64 said:

I’ll bet the shrinkage is low on that DIY store because they’re in relatively affluent neighborhoods. If you put them in neighborhoods where most food deserts are located, the experience might be very different. They also seemed to stock products that looked high end and discretionary, not the essentials that people in food deserts need. (Maybe they would have both or could change for each market.)

How do these places get restocked and how often does that happen? I just don't see how they can serve a neighborhood any better than a convenience store that is getting daily shipments of produce. Is only one customer allowed in at a time? How else would they know who to charge for what?

I also don't think having to travel 5miles to get to the grocery store is that big a deal, especially with all the delivery options and ride share companies that are available in this day and age. Do people who can't afford a trip to the grocery store have cell phones to download the ap? What are they going to do when people don't pay their bills?

I just don't think this has been well thought through.

[CrazyInAlabama]

For the cookies, I bet Barbara's first step was to get a co-packer, and tweaking the recipes to lower the calorie count.    The calorie count is almost as much as the huge Crumbl cookies, and the cookies aren't lower calorie, just free of allergens. 

I don't see the cookie company succeeding. 

For the grocery mini-markets there are places where there is nothing, and people either have to decide between paying for transportation or using the corner convenience store, which is full of unhealthy, high calorie/low nutrition food.   Almost everyone has a cell phone, and the array of foods offered can be tailored to fit the needs of the users.   The boutique stores in hotels and airports are usually rather expensive, and that should make those locations, and vending machines profitable.   If the stores in food deserts offer good selections on basics, then I think they can offer better prices, and have necessities only.    They could work, because there simply aren't decent alternatives except fast food, and corner markets full of junk food.   I think the stores need to be bigger, but still far short of a regular grocery. 

[30 Helens]

On 3/16/2024 at 10:23 PM, eel2178 said:

How do these places get restocked and how often does that happen? I just don't see how they can serve a neighborhood any better than a convenience store that is getting daily shipments of produce. Is only one customer allowed in at a time? How else would they know who to charge for what?

This isn't really a new idea. I went to an unattended Amazon store in an airport a couple of years ago that operated like this. You scan your credit card to gain entry, walk in, pick up your stuff, and leave. Whatever you take is charged to your card. There was some kind of surveillance equipment to track your movements and monitor what you took. A little creepy, but convenient. 

So it can be done, but it takes technology. And if it were that profitable, I'm sure Amazon would have those all over the place. (I've never seen another.) They certainly have the ability to crush an upstart like this one, if they want to.

[CrazyInAlabama]

Amazon still has a few Amazon Fresh and Amazon Go stores.  They're mostly for Prime members, but they have cut down from the original 22 stores and smaller Go marts.     A friend says she was in Montgomery, AL recently, and went to a drug store, and it was all self-checkout and no  personnel were around.   

If the size of the Bloom Markets is like the Amazon Go stores, and they could work depending on location.     Where I live the convenience stores are in gas stations, may have a few frozen items, mostly ice cream, and some food they heat up for you, but it's mostly junk food, and soft drinks.   

The only small grocery here is the  section at our local Target, and it's pretty big now, including some fruit and produce.    So, either you go to Dollar General, or convenience stores in gas stations, or you go to one of the supermarkets.   Many towns have literal food deserts with nothing but fast food, or convenience stores without fresh or healty options.    Supermarkets have been leaving inner cities, because they need room for parking, and stores that can handle more items, and that's very hard to find in urban areas.    The stores need volume and space, and that's not an option in a lot of areas.   

[seacliffsal]

I have put some murder mystery parties together (they used to sell themed murder mysteries in a box/game-don't know if they still do) and they were fun although a lot of work.  I think the murder mystery company could do well, but I don't know how often customers would repeat.  And a lot of companies offer variants on this idea-murder mystery trains, dinners, etc.

So many, many 'healthy' alternative bakeries/snack companies have been on this show.  I wonder how they are all doing at this point.  Barbara does have experience in this sector.  Hard to tell how successful they will be.

The 'anything can be a video game' idea was unique-but will its uniqueness wear off?  Basically, Mark got 4% for free (all he has to do is make content).  I am obviously not a shark as I don't understand how that benefits the company.  Especially as it seemed like they needed money.  Oh well, he's a billionaire and I'm lucky to be a hundredaire.

I like the idea of the stores-but in the video it seemed like it was set up for only one person at a time.  What happens if a crowd comes in when the door swings open?  What happens if people 'sneak' in and just grab and run?  It seems risky to me.  I think Jason Blum was on to something when he talked about them going 'not for profit.'

Oh, and I liked Jason Blum (saw his other appearance).  He seems nice, willing to work with others, and made reasonable offers.  More of him...less of Gwyneth...

[SoMuchTV]

On 3/17/2024 at 9:25 AM, CrazyInAlabama said:

For the cookies, I bet Barbara's first step was to get a co-packer, and tweaking the recipes to lower the calorie count.    The calorie count is almost as much as the huge Crumbl cookies, and the cookies aren't lower calorie, just free of allergens. 

Haha, my first thought was, make the cookies smaller!  No, leave them alone, but say that they’re two servings. Voila! Half the calories!

[eel2178]

18 hours ago, seacliffsal said:

The 'anything can be a video game' idea was unique-but will its uniqueness wear off?  Basically, Mark got 4% for free (all he has to do is make content).

They're going to pay him to make content. He got 4% of the business for whatever the word is for "beyond free."

[eel2178]

On 3/19/2024 at 5:35 PM, SoMuchTV said:

Haha, my first thought was, make the cookies smaller!  No, leave them alone, but say that they’re two servings. Voila! Half the calories!

On the radio program I listen to a woman said she gave her 3 year old nephew a chocolate chip cookie that he wanted to share with the dog. She told him that Jasper couldn't have the cookie because chocolate was like poison to dogs. After a prolonged temper tantrum, he calmed down then told her sternly "take the poison out of the cookie!"

Maybe Lori should have just demanded "take the calories out of the cookie!" She likes bullying her inventors anyway.