Jared Cannon left his 18-year career as a chef in 2017, and with a $1,000 loan, started Simply Good Jars, a company which sells jars of salad.
"At Simply Good Jars, we are revolutionizing the packaged salad to create simply delicious meals," Cannon said during Friday's episode of ABC's "Shark Tank."
Cannon was motivated to launch Simply Good Jars for a few reasons. Not only is salad his "favorite" meal to prepare, he says, but he wanted to create a healthy, convenient food option and hoped to reduce plastic waste with the reusable and recyclable jars.
"All our jars are returnable, so for every jar that we get back, we not only reuse it, but also donate one meal to feed someone in need," Cannon told the Sharks.
Simply Good Jars offers a variety of salad options, from cobb to smoked salmon to chicken quinoa. The jars sell for $8.99 to $10.99, depending on size, and it costs the company $2.50 to $3.60 to make each one, Cannon said.
And after trying his product, the Sharks loved it.
"This salad is excellent," Daymond John said.
Mark Cuban added, "This is really good."
But, they wanted to see if sales numbers backed Cannon's $7.1 million valuation, as he asked for a $500,000 investment in exchange for 7% equity in his company.
"Last year, we did just shy of $300,000. We're $475,000 year to date. We're on track to do $700,000, $750,000 this year," Cannon said. But, "we're not profitable. We won't be for about a year."
To continue growth, Cannon raised $2.5 million total from outside investors, he said, adding that he owns 51% of the company.
"Before Covid, the primary revenue driver for our business was really supported by this fleet of these smart coolers that we would put into places [like] hotels, airports, convention centers, office buildings, universities," Cannon said.
Of course, as stay-at-home orders went into effect across the country to curb the pandemic spread, "the places we had distribution [in were] 98% gone, almost overnight."
"So," Cannon said, "we had to figure out how we were going to follow that customer to where they are now, which was at home working, shopping at their local store, and we were able to very quickly make the pivot to retail."
As a result, Cannon got Simply Good Jars into 175 convenience stores and Walgreens locations across the U.S. He also partnered with multiple CloudKitchens, or facilities made to produce food for delivery, to shift and survive, which was especially impressive to Cuban.
"That's where you maximize your margin and where you make the most money," Cuban said.
Despite Cannon's lack of profitability at the time, Cuban was interested in making an offer.
"I would not be a billionaire if I just kept on raising money over and over again," Cuban told Cannon, and added that Shark Lori Greiner should join the deal so Cannon would not have to entertain any additional funding rounds.
Greiner said, "I like to get so many sales and do it so fast that you're not going to have to do a whole bunch of raising."
Cuban and Greiner offered Cannon a $500,000 investment for 10% equity — and he accepted.
Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank."
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