The One Shark Tank Deal Daymond John Regrets Turning Down
In February 2023, entrepreneur Daymond John appeared as a guest on "The Drew Barrymore Show," where he talked about his humble beginnings and starting his apparel company, FUBU, while still working as a waiter at Red Lobster. However, it wasn't long before the conversation turned to any regrets John may have had over the years, over missed opportunities on the hit ABC show "Shark Tank." Not surprisingly, John jumped right to Scrub Daddy, an innovative cleaning sponge that's the second-most successful "Shark Tank" product ever, with lifetime sales of more than $900 million.
For the few that might not know, Scrub Daddy is an odor- and stain-resistant sponge that changes firmness depending on water temperature. Under cold water, the sponge is firm for aggressive scrubbing, but becomes soft when exposed to hot water. And of course, there's Scrub Daddy's perennially smiling face, which is as functional as it is whimsical. The eye holes act as a grip to hold the sponge and its mouth cleans both sides of utensils simultaneously.
Speaking with Barrymore, John recollected that "the company that I have to regret is one I lost the bid on ... against Lori (Greiner), and it is a stupid-looking little sponge. And every time I go in the store, there's a Scrub Mommy, Scrub Baby, Scrub Daddy. And they're smiling at me." But after giving the iconic "Shark Tank" episode (Season 4, Episode 7) a second look, it seems like John has nobody but himself to blame for giving up on the opportunity.
John folded at the negotiating table for Scrub Daddy
Scrub Daddy's inventor — Aaron Krause from Philadelphia, Pennsylvania — came on "Shark Tank" in 2012, seeking a $100,000 investment in exchange for a 10% stake in the company. Krause explained that although the product was selling well, he wanted the investment in order to produce the sponges in-house rather than being hostage to the timeframes of third-party manufacturers.
Mark Cuban, Robert Herjavec, and Kevin O'Leary each bowed out at different points of Krause's segment, leaving only two interested Sharks left: Draymond John and Lori Greiner. John expressed interest in investing in Scrub Daddy but wanted to partner with Lori Greiner for her expertise. Greiner is known as the "Queen of QVC," which is the shopping channel where Scrub Daddy had already enjoyed success. But Greiner didn't feel like she needed to dilute her profit potential by partnering with John, so she shot him down. The two investors then proceeded to get into something of a bidding war, culminating in Greiner offering $200,000 for 25% of Scrub Daddy.
At that point, John voluntarily dropped out of the bidding war altogether, saying that he only wanted to "stick it to" Greiner by making her pay a premium. Eventually, Krause and Greiner settled at $200,000 for a 20% ownership stake in the company. Besides financial support and advice, Greiner also promised she could get the product on grocery store shelves within weeks and make Krause a millionaire within one year.
He later redeemed himself with Bombas
Daymond John might have thought he was being clever by driving up the price of investing in Scrub Daddy, but it was Lori Greiner who got the last laugh. The day after the sponge was featured on "Shark Tank," more than 42,000 sold in under seven minutes. Making good on her promise, Greiner also got Scrub Daddy onto shelves at Costco, Walmart, Target, and other retailers in record time. Nowadays, the brand sells over 20 different products, including cleaning solutions, organizers, and pet and seasonal-shaped sponges.
Don't feel too bad for Daymond John and his regrets over not making a deal with Scrub Daddy, though. A few years after Scrub Daddy smiled its face on "Shark Tank," the serial entrepreneur invested $200,000 for a 17.5% stake in Bombas, a sock company that is said to be the most successful company ever to come out of the ABC show.
As of October 2023, lifetime sales for Bombas are a whopping $1.3 billion. What's so exciting about a sock company, you might wonder? Besides having a reputation for extreme comfort, Bombas also donates a pair of socks to a person in need, like the homeless, for every order it receives. The company has since expanded to selling other undergarments, as well.