Grinds Before Shark Tank
Grinds are small pouches of flavored coffee that one would chew as an alternative to chewing tobacco. The idea was thought up by college students Matt Canepa and Pat Pezet from Cal Poly San Luis Obispo one night when they were doing a project for a class. Matt and Pat were seeking something to keep them awake and stumbled upon coffee grinds. They decided to chew on these to gain energy and although awkward at first, they could feel that it actually worked. Matt and Pat entered a contest after they saw a random flyer on campus with this idea and this led to a contest with a cash prize that they both won. Having played baseball, they knew there was a market for an alternative to chewing tobacco.
As Matt and Pat introduced the product to the market, many baseball players liked the idea including the San Francisco Giants manager the year they won the championship. The manager told Matt and Pat that he used Grinds during the season as an alternative to chewing tobacco. This motivated Matt and Pat to grow the idea into a business. With some help, they were able to find a manufacturer to start making their product and saw heavy promotion from media outlets such as Entrepreneur Magazine. They applied to be on Shark Tank hoping to grow the business and were invited for Season Four.
Grinds on Shark Tank
Pat and Matt entered the Tank seeking $75,000 for 10% of their company. They gave a brief background of their product Grinds, the benefits of the product with the energy kick it provides, and how it was an alternative to chewing tobacco. They also discussed how big the industry was for the product and how they had proven demand with 20 major baseball league teams using their product. Pat demonstrated how to use the product before handing out samples.
All the Sharks tried the product and Robert and Kevin immediately mentioned they could tell the product was working by getting the strong taste. Robert was also impressed when he heard one piece replaces a quarter cup of coffee. Mark was wondering how Matt and Pat came up with the idea and they gave their background story about the project night, competition, and the positive feedback from the San Francisco Giants manager. Robert was interested in the numbers and Matt mentioned last year they did $135,000 and were on track to do $300,000 by the end of this year. They also mentioned the product retails for $3.99, wholesales for $2.69, and it cost them about $1.25 to make.
Barbara was impressed with Matt and Pat, but couldn’t relate to the product so she went out. Kevin, like always, brought up the concern of bigger company’s “taking them out” if they became successful. Kevin felt they needed to grow the brand faster before bigger company’s do this so he made Matt and Pat an offer of $100,000 and he would receive $0.25 every time they sell a can. Daymond was wondering if they were looking for just capital or a strategic partner and they both mentioned they highly valued the partnership. Robert also saw merit in the product and made an offer $75,000 for 15% if Daymond would join because of his distribution connections and Daymond agreed to go in with Robert. Matt and Pat wanted to hear from Mark and he mentioned that he saw tobacco replacement product as a medium sized industry that was niche. Mark also felt this investment would take up too much of his time so he went out as well.
Matt and Pat countered Robert and Daymond with $100,000 for the 15%. Robert asked if they would give up more equity, but they declined. Robert declined their new offer because he felt the value he and Daymond brought would be worth much more in the long run than the additional $25,000. Kevin tried to sell the benefits of his deal of not giving up any equity. After a little hesitation, Matt and Pat accepted Daymond and Robert’s offer and left the Tank very happy.
What Happened To Grinds After Shark Tank – 2023 Update
Unfortunately, the deal with Daymond and Robert didn’t work out in the end but that didn’t stop the business from growing. For one thing, the “Shark Tank effect” caused their sales to explode. Not only that but the product sparked a lot of discussions online.
Over the next few years, the company continued to thrive. In fact, they grew so much that they eventually relocated all of their fulfillment, production, and distribution operations to Oak Ridge Road, Westfield—a $6.7 million investment. They also announced that they plan on creating 56 new jobs with an average salary of $40,0000, in the Westfield area by 2023. Based on these plans, the Indiana Economic Development Corp offered the company up to $50K in training grants and $250K in conditional tax credits.
That’s not all, they also announced that they’ll be leasing and equipping a 27,000-square-foot facility with operations, one that will be collaborating with a local Westfield labeling company. That same year, a personal property tax abatement for the company was approved by the City Council.
As of 2023, Grinds Coffee is still up and running. Currently, they offer 11 different flavors on their website including Red Eye Espresso, New Orleans Style, Cinnamon Whiskey, Spearmint, Mint Chocolate, Wintergreen, Cinnamon Roll-Doughboy, Orange Citrus, Double Shot Espresso, and Double Mocha.
Not only that but they also have coffee pouches with double the caffeine; they’re available in six flavors: New Orleans Style, Mint Chocolate, Orange Citrus, Cinnamon Whiskey, Double Shot Espresso, and Double Mocha. You can get them in groups of 3 ($17.95), 6 ($35.95), 10 ($49.95), and 20 ($98.95), and if you subscribe, you can get 10% off your order. Shipping is also free for all domestic orders above $49 (and all subscription orders above $29). There’s also the option of building your pack—that way, your can choose the flavours that you like.
Or if you want, you can get them from Amazon (do note that they’re not always available on the site). There aren’t as many flavors available compared to their website but you’ll be able to take advantage of Prime shipping. If anything, they’re highly rated by customers, with many praising the coffee pouches for their convenience and flavor. Those who used them as a tobacco alternative also found them helpful.
So yes, the company is a success. They might not have received an investment from the sharks but that hasn’t stopped them from growing and expanding (you can use their Find a Store feature to find a retailer near you).