'That Was Ridiculous!' See What Left One Investor Exasperated on the New Episode of 'Elevator Pitch'

Entrepreneur

Learn the words that no investor wants to hear on the latest episode of "Entrepreneur Elevator Pitch."  This season on Entrepreneur Elevator Pitch, we've witnessed a steady stream of contestants who dream of making it to the top floor. All they need to do? Nail their 60-second pitch. We've seen countless entrepreneurs earn the chance to enter the boardroom with the chance to seal a life-changing deal or win cash prizes from Amazon to get their business to the next level. Some walk out victorious; some must pick themselves up to fight another day.  In this episode, a new group shows up to try their luck in the elevator. Will they succeed in reaching new heights at the press of a button? Or will they freeze up at the moment of truth? Watch and see what happens on an all-new episode!

Transcript

00:00 (dramatic music)

00:01 - Going up.

00:02 - This season, we've witnessed endless possibilities

00:07 to make it to the top floor.

00:09 - All you need is to nail the 60 seconds

00:11 to get through those doors.

00:13 - Countless entrepreneurs marching into the boardroom.

00:16 - I'm ready to make money, so let's get this thing going.

00:19 - Yes!

00:20 (screaming)

00:21 - Sealing life-changing deals with our investors.

00:24 - Absolutely, let's do it.

00:27 - All right.

00:28 - Oh!

00:30 (laughing)

00:31 - Receiving Amazon business cash prizes.

00:35 - Thank you guys so much.

00:36 Oh my God.

00:37 - Thank you so much.

00:38 I really appreciate it.

00:39 - Even returning once more for a chance at redemption.

00:43 - I love a good redemption story.

00:45 - Yes!

00:48 - Today, a new set of entrepreneurs step into the elevator.

00:53 - We're here 'cause we want to invest.

00:54 - Hoping to reach new heights at the press of a button.

00:59 - Again, it's called elevator pitch for a reason.

01:01 - Was that pitch good enough?

01:02 - This is Entrepreneur Elevator Pitch,

01:08 presented by Amazon Business with support from State Farm.

01:13 Meet our board of investors, Kim Perel,

01:20 serial entrepreneur and tech CEO of 100.co.

01:25 Mark Randall, co-founder and first CEO of Netflix.

01:30 Logan Stout, keynote speaker

01:33 and best-selling author of "Grit Factor."

01:35 First to step into the elevator,

01:41 an entrepreneur hopes to build financial portfolios for all

01:45 using a groundbreaking robo-advisor.

01:48 - Hi, my name's Kyle.

01:50 I'm the founder of Brave Wealth.

01:52 I was a financial advisor for over six years

01:55 and I was always discouraged

01:56 by the lack of investments in private equity.

01:59 To get an investment at elevator pitch would mean a lot.

02:02 I've got a daughter at home that I think about all the time.

02:04 And so the stakes are pretty high

02:06 to get an investment this year

02:08 and then continue growing the product and the team.

02:10 - Going up.

02:24 Hello, Kyle.

02:25 Welcome to the elevator.

02:28 Your pitch begins in three, two, one.

02:33 - Hi, my name's Kyle.

02:35 I'm a former financial advisor.

02:38 I've sold two companies

02:39 and I've raised over $25 million in venture funding.

02:43 Before Brave, only accredited investors would have access

02:47 to invest in private equity,

02:49 which is outperformed public stocks

02:51 by an average of 3.5% per year since 2001.

02:55 The Brave platform is the only way

02:58 that everyday investors will have access to exposure

03:02 to the $10 trillion alternative assets market,

03:07 which includes private equity,

03:09 venture capital, and real estate.

03:12 We are pre-revenue, but we've made meaningful traction

03:16 in development of our product for advisors and consumers,

03:19 both web and mobile.

03:20 We've signed LOIs with multiple private equity feeder funds

03:25 and engaged in private equity funds.

03:30 We are raising $100,000 at a-

03:33 - Hi. - Oh.

03:36 - So close. - So close.

03:39 - And I was interested in that,

03:41 but then it was like,

03:42 ah, it's like a fumble at the five yard line.

03:44 - But guys, everyone makes mistakes

03:46 and I think he almost had it.

03:48 And up till then, I was intrigued.

03:51 I thought it was an interesting experience

03:53 having been a founder twice and sold his company

03:56 and raised 25 million.

03:57 That's just not easy.

03:58 - He wasn't terrible.

03:59 He just missed out on important information.

04:01 He knows he has 60 uninterrupted seconds to get it out

04:06 and to not have that practiced and perfect

04:09 and nailed, inexcusable.

04:12 - Well, it sounds to me like we're kind of on the fence.

04:15 Maybe yes, maybe no.

04:16 So are we ready to take it to a vote?

04:18 - Let's do it. - Let's do it.

04:19 (dramatic music)

04:22 - Attention, Kyle.

04:29 Your pitch has been denied.

04:34 - I'm disappointed.

04:39 I did my pitch a little slow.

04:42 I didn't get a chance to get into the boardroom.

04:44 I feel like I have a really great product.

04:45 I am a serial entrepreneur.

04:47 I've sold multiple companies.

04:48 I'm disappointed I wasn't able to pitch them today,

04:51 but I'm excited to continue building my business

04:53 and hopefully we finish our funding round somewhere else.

04:57 - We're here 'cause we want to invest

04:58 in a good business, an entrepreneur.

05:01 And today just wasn't their day.

05:04 It wasn't our day, but I have no doubt

05:06 that if they stick with it, they'll be successful.

05:08 - Well, I have doubts, but I'm genuinely pained

05:12 we didn't get a chance to see him.

05:14 It was the wrong pitch.

05:15 So we did the right thing in voting him down,

05:17 but it always hurts not to give someone a shot.

05:20 I don't disagree.

05:21 - Well, you got 60 seconds.

05:23 All you need is to nail the 60 seconds

05:25 to get through those doors.

05:27 He didn't nail it and we have to let it go.

05:29 Are you guys ready to see the next pitch?

05:31 - Bring it on. - Let's do it.

05:32 - And now for our entrepreneur elevator pitch

05:38 trivia question.

05:40 How many new small businesses are launched

05:43 every year in America?

05:45 A, 200,000, B, 1 million, or C, 5 million?

05:50 The answer is C, 5 million.

05:55 Next in the elevator, an entrepreneur introduces

06:06 sweet and savory condiments with no sugar.

06:11 (dramatic music)

06:14 Going up.

06:19 Hello, Abraham.

06:25 Welcome to the elevator.

06:28 Your pitch begins in three, two, one.

06:33 - True Made Foods is saving the American diet

06:36 by starting with the great American barbecue.

06:38 Did you know that ketchup and barbecue sauce

06:40 have more sugar per ounce in ice cream?

06:41 Probably two of the worst products

06:43 in the average American refrigerator.

06:45 True Made Foods products, we make True Made Foods

06:48 ketchup and barbecue sauce are no added sugar

06:51 with 100% fruits and veggies.

06:53 100% naturally sweetened from fruits and veggies.

06:55 I started True Made Foods because I was tired

06:58 of arguing with my kids at the dinner table over ketchup.

07:00 So I made a better one.

07:01 I then started partnered with the legendary pit master,

07:05 Ed Mitchell, and together we've made an entire lineup

07:08 of no sugar added condiments and barbecue sauces.

07:11 Our products are now in over 5,000 stores nationwide

07:15 and we're served in two major league ballparks.

07:18 We are now looking to raise $1.5 million

07:22 at a $15 million valuation to keep up this historic growth.

07:26 We all wanna make America a better place.

07:29 I just think we need to start with the ketchup.

07:31 - When someone starts off the pitch

07:37 with the metrics they have, I listen pretty carefully.

07:42 And what did he say?

07:43 5,000 stores?

07:45 - Yeah, it's impressive.

07:46 - My question is this, yes, sugar is awful

07:49 and people have no idea how much sugar

07:51 they consume every day.

07:53 I'm curious about the other ingredients though.

07:55 I get the healthy ketchup and all that, that makes sense,

07:58 but it's more than just sugar for it to be healthy.

08:00 - I love a story.

08:01 So to be honest, for me, it's all about a story

08:03 and he explained really clearly that the story

08:06 was from his own need and his own children.

08:09 And I get it 'cause I have four children

08:10 and they like all the sugary stuff too.

08:12 So there is a need.

08:14 - Well, you know, I was in the supermarket yesterday

08:16 and I swear that condiment aisle,

08:19 it must be 200 feet of every single possible

08:24 kind of ketchup and salsa.

08:26 What an amazingly crowded market.

08:27 I don't even use ketchup, but my kids do, okay?

08:30 So I have an interest because a lot of times as parents,

08:33 we want what's best for our kids

08:34 and we'll violate ourselves sometimes

08:36 and make bad decisions, but I'm interested,

08:38 but I'm kind of on the fence about this.

08:40 Well, why don't we all find out what we think?

08:43 - Let's do it. - Ready to vote?

08:44 - Ready.

08:45 (dramatic music)

08:48 - Attention, Abraham.

08:53 Your pitch has been approved.

08:58 - Woo hoo!

09:02 (claps)

09:03 Let's go!

09:04 (bell dings)

09:05 Abraham, welcome to the boardroom.

09:07 Congratulations.

09:09 - Thank you so much.

09:09 Thanks for having me here.

09:11 - So the thing that kind of raised my eyebrows

09:13 was 5,000 stores, which is pretty good.

09:16 But tell us about sales.

09:17 Tell us about revenue.

09:19 - So we're on track to close about 4 million

09:21 in top line sales this year.

09:23 About 80% of that is from retail.

09:24 Most of our historical sales in this year

09:27 are from grocery stores.

09:29 That's our main primary driver of sales right now.

09:31 We do about 20% in food service right now

09:34 and we're looking to grow that.

09:35 We see food service really as a marketing channel

09:37 'cause we're a front of the house product.

09:39 It gets people trying our product.

09:40 It gets people familiar with the brand, right?

09:42 We do only about 1 or 2% direct to consumer,

09:45 Amazon, things like that right now.

09:47 We're looking to grow that as well,

09:48 but obviously we make more money

09:50 and we have better margins in the retail channel.

09:53 - Congratulations on a great company.

09:54 I think it's awesome what you're doing

09:56 to try to make America better.

09:58 You say you're using fruits and vegetables.

10:00 I'd like you to elaborate on that

10:01 and then I have a question to piggyback on that.

10:04 - We're using things like apple, carrots,

10:05 butternut squash, pureed, not juices,

10:08 full pureed fruits and vegetables

10:10 to add that natural sweetness.

10:11 This is how people used to cook.

10:13 - Tell me what the source is of the fruits and vegetables

10:16 because that's important to me.

10:17 - So the tomatoes all come from California,

10:19 like majority of the tomatoes in America,

10:21 tomato paste in America, things like that.

10:23 The apple we get from one supplier

10:26 in the Pacific Northwest in Oregon.

10:28 The carrots and butternut squash we get

10:29 from a farmer cooperative in North Carolina.

10:31 - Okay, what kind of third party testing are you doing?

10:33 So like I know for us at ID Life,

10:34 we get the raw materials sent in.

10:36 We do three different levels of third party quality control

10:38 'cause I'm not gonna trust a raw material manufacturer,

10:40 no disrespect to them, but a lot of things could happen.

10:43 I wanna make sure the product is exactly what we say it is.

10:45 - All our suppliers and our co-packers,

10:47 our co-mans are SQF certified, the highest level,

10:51 audited every year.

10:52 And then we have a bunch of certifications

10:54 like Whole30, Paleo, Keto certified, non-GMO,

10:58 all of our products are non-GMO.

10:58 - Okay, we can get to, I agree, like okay.

11:01 You guys can go down the rabbit hole

11:03 of how we're actually getting the ingredients.

11:05 I'm gonna go with trust that I believe

11:07 you're sourcing them from a very reliable place.

11:11 Besides that, four million in sales.

11:14 Is that last year or this year?

11:16 - This year we're tracking towards four million.

11:17 Last year we did 3.5.

11:19 - You have a 1.5 raise

11:20 and how much has been committed so far?

11:21 Or is any-- - This is a new raise,

11:23 we're just launching it.

11:24 - Okay, and how much have you raised already?

11:26 - Last year we raised $2 million.

11:29 - What was the valuation?

11:30 - Valuation was a $10 million pre-money.

11:32 - Okay. - Are you getting

11:34 the same thing I'm getting?

11:35 This is not coming racing out of the barn here.

11:38 I mean, this is reasonably slow growth.

11:41 - It's difficult.

11:42 We've only been able to raise a marginal amount of money

11:45 just to stay alive.

11:46 Like we are at an inflection point right now

11:48 where we need to start raising more money

11:50 and put it towards marketing and really growth.

11:53 Plus we were suffering from post-pandemic.

11:54 Most grocery stores didn't do new shelf placements.

11:57 They didn't even do category reviews.

11:59 It's very hard.

12:00 It's been very hard post-pandemic

12:01 to get new products on the shelf.

12:02 So we haven't been able to grow distribution

12:04 much in the last two years.

12:06 - What's the money gonna be used for?

12:09 - It's gonna be used to fund growth capital

12:11 'cause like every time we launch a new product on a shelf,

12:13 you know, you're paying slotting fees and free fills.

12:16 And we also wanna start pumping it into marketing.

12:19 We did a great marketing, digital marketing test

12:21 this past summer for 12 weeks.

12:23 We only spent 100K,

12:24 but we had 175% ROAS on it.

12:27 And we have the data where we could see the sales lift

12:29 by store with the digital marketing.

12:31 We just did 280 stores.

12:32 We wanna be able to do that

12:33 with a lot more than 280 stores.

12:35 - And how does it taste?

12:36 I mean, more importantly, right?

12:37 - That's the most important question.

12:38 - Honestly, it is the most important

12:39 because people only gonna repeat buy if they like the taste.

12:42 - One of the things I mentioned earlier

12:43 was that there is a thousand other products like this.

12:46 And so you've got to cut through somehow.

12:48 - We are the only product out there

12:50 that's using real vegetables and fruits

12:52 as a natural sweetener in any of these channels.

12:55 - Ava, I'm gonna, I'll let them taste it.

12:57 - Oh, he doesn't eat ketchup.

12:58 - I don't eat ketchup.

12:59 So I don't mean to be disrespectful at all.

13:01 - Wow, it's very good.

13:05 - Go ahead and give me some ketchup.

13:16 - Oh, look at you.

13:16 - I'm gonna do this.

13:17 I don't even eat ketchup,

13:18 but I'd be an absolute hypocrite

13:20 if I didn't at least try it.

13:21 If I wanna actually invest in this.

13:22 - First of all, I gotta point out,

13:23 this is surprisingly good for no sugar on it.

13:27 - Real food tastes better.

13:28 - As opposed to Logan, I am a ketchup aficionado.

13:32 For example, I consider a hamburger

13:34 basically a ketchup delivery system.

13:36 - Much like my kids.

13:37 - The formula you sold last year,

13:40 how much was sold in ketchup versus the barbecue sauce?

13:42 - So the ketchup is the oldest

13:43 and the most established product.

13:45 And that is the majority of our sales.

13:47 In retail, it's about 59% of our total sales.

13:49 So we think we have a lot of growth with the barbecues.

13:51 We've only recently launched the barbecues

13:53 and the mustards in the last couple of years.

13:55 There's very little competition in the barbecue sauce

13:57 for in the barbecue category for a better for you product,

14:01 and especially a better for you product

14:03 with a real Hall of Fame pit master on it, Ed Mitchell.

14:05 We just launched these brand new rubs

14:08 and the rubs are,

14:09 we think these are gonna be an absolute game changer.

14:12 There's nobody else who's doing it.

14:13 - May I see one of those please?

14:15 - Yeah, please.

14:15 Nobody else is doing rubs like this.

14:19 And again, they are historical recipes

14:23 from a Hall of Fame pit master from Wilson, North Carolina.

14:26 - So you've partnered with a legendary grill master

14:29 who I don't know of.

14:30 - I've never heard of him either, to be honest with you.

14:33 - So he's not fully legendary.

14:35 - I love what you've created and I love your passion.

14:40 However, I am an investor

14:42 and I invest in high growth companies.

14:45 And looking at your growth from 3.5 million to 4 million

14:47 at a $15 million valuation,

14:49 just doesn't work for me.

14:52 I'm gonna have to pass.

14:55 - I've gotta say that on one hand,

14:59 I am really impressed by how this tastes.

15:01 I mean, seriously, for ketchup aficionado,

15:04 I'm ready to switch.

15:05 I'm ready to short my Heinz stock.

15:08 So I think this is really impressive.

15:10 But on the other hand,

15:11 packaged goods to begin with scares me to death,

15:16 especially a category as competitive as this,

15:19 especially with the fact that this isn't leaping

15:21 off the shelves in terms of growing.

15:23 I mean, for any brand, you've gotta be at the beginning,

15:26 multiplying much more than just a small percentage each year.

15:29 I'd love to hear from you in a couple of years,

15:33 but I think unfortunately for today, I'm gonna pass.

15:37 - I have no doubt you're gonna succeed

15:40 because one's purpose in life is a combination

15:43 of their passions and their talents.

15:45 And you're clearly passionate about this

15:46 and you're obviously extremely talented as is your team.

15:49 For me, I look for individuals that are laser focused

15:52 on dominating one main thing

15:55 before they scatter shoot into other things.

15:57 And so before I put my money into something,

16:01 A, I have to know they're laser focused.

16:03 You lost me with all the skews.

16:05 B, I don't even eat ketchup.

16:08 And for those reasons, I pass.

16:10 - Abraham, I'm sorry.

16:14 All three of us, unfortunately,

16:16 aren't gonna write you a check today.

16:18 So I'm afraid we're gonna have to send you home empty handed.

16:21 - Well, consumers, you're switching, right?

16:22 I'm switching.

16:23 - I'm switching too, actually.

16:24 - I'm definitely switching.

16:25 - I'm buying it for my kids.

16:26 - Thank you.

16:26 I mean, that's-- - Three new customers.

16:28 - Brand awareness.

16:28 - Many thanks. - Thank you.

16:29 - Good luck, Abraham. - I appreciate it.

16:30 - Good luck.

16:31 - The investor has definitely missed out

16:34 on an awesome opportunity,

16:35 but I'm excited that I got out of the elevator

16:38 and that we did well and that everybody loved the product.

16:40 That's really the most important thing

16:41 at the end of the day.

16:42 We got a great product.

16:43 It just needs to get out there.

16:44 We might have struck out with the investors this time,

16:46 but we're gonna hit a home run with these products.

16:48 These products are a home run, hands down.

16:51 - That's too bad, isn't it?

16:53 - I mean, honestly, he has all of the ingredients,

16:57 kind of like this ketchup, to be great.

16:59 It's just the velocity and the sales just don't show it.

17:02 - I was in where he lost me was when he said,

17:04 and then we have this next thing coming out.

17:06 I'm like, you're not exploding with what you already have.

17:08 And now you're gonna go spend all this money

17:10 on inventory on another thing?

17:12 I just think his focus was off.

17:14 And for me, I'm not gonna invest

17:15 if somebody doesn't have a laser-beam focus

17:17 on what they're looking to do.

17:18 - I said the same thing.

17:19 I mean, I was looking at the size of that display

17:21 on that table and thinking with the growth rates,

17:23 he's trying to make up for it

17:25 by throwing more skews at the problem.

17:27 - It was a great opportunity,

17:28 but we just couldn't get it over the line.

17:30 - So how about we move on to the next pitch?

17:32 Are you ready?

17:33 - Let's do it.

17:34 - I'm ready to see.

17:34 - Entrepreneur Elevator Pitch

17:39 is presented by Amazon Business

17:42 for every organization at every stage of growth.

17:45 Last in the elevator,

17:52 an entrepreneur introduces a plant-based formula

17:56 to improve men's health.

17:57 - Going up.

18:07 (dramatic music)

18:10 - Hello, Steve.

18:12 Welcome to the elevator.

18:15 Your pitch begins in three, two, one.

18:20 - Hi, I'm here to talk about a topic

18:24 that many men are embarrassed to talk about

18:26 with their physicians, urinary health.

18:28 My name is Steve Nemiroff,

18:29 and I am the founder and CEO of Dr. Steve's.

18:33 We've created a novel formulation for prostate health

18:36 that is different than anything else on the market.

18:38 Flosam is a unique,

18:41 has unique ingredients that are natural and evidence-based.

18:46 We've studied Flosam over the last year

18:48 with urologists across the country

18:50 and have had phenomenal results.

18:52 And now we're here to share them with the world.

18:55 We're hoping that one of these investors

18:57 will help us with some cashflow

18:59 so we could help continuing to help these men

19:02 with their urine flow.

19:04 My partners and I have created other products as well

19:07 that are in our pipeline and we're ready to launch.

19:10 We're looking for $150,000 for a 15% stake in our company

19:14 to grow the Dr. Steve's brand of products.

19:17 Thank you.

19:18 - Wow, that was interesting.

19:24 When someone in their pitch

19:27 says I'm just looking for cashflow,

19:29 that is ridiculous.

19:30 I don't even understand what you're saying

19:32 and I'm not being rude,

19:33 but that, I just need money for something.

19:35 - It sounded to me like he wants us

19:37 to fund his salary every month

19:39 is what it basically sounded like.

19:40 And I don't know if you meant it that way,

19:41 but we're not investing for cashflow.

19:43 - Well, it wasn't clear where they are in the process.

19:46 I mean, is this already for sale?

19:48 If so, how many have they sold?

19:50 How far away are they from selling it?

19:52 So there's a lot of questions here

19:54 that are kind of unanswered for me.

19:56 - This is called elevator pitch.

19:58 And the question I ask you guys is,

19:59 was that pitch good enough to let him in the boardroom?

20:03 - Well, that is the big question.

20:04 And you're right.

20:05 You really do have to make it a good pitch.

20:08 So will the size of this market, I guess,

20:10 outweigh my hesitancies?

20:13 I'm not sure.

20:13 - Let's put it to a vote.

20:15 You guys ready?

20:16 - Ready.

20:17 - Attention, Steve.

20:26 Your pitch has been

20:30 denied.

20:33 - Well, the 60 seconds was a lot of pressure

20:38 and I didn't get everything out.

20:39 I would have loved to have more time

20:40 to explain to the investors where we're at

20:43 and where we'd like to go with FlowSome

20:44 and the rest of our products.

20:46 - This is called elevator pitch.

20:48 You have 60 seconds to convince us

20:50 that you truly have what it takes,

20:52 not just passion, but also a viable business

20:55 that we want to invest in.

20:56 - Well, you can tell us all kinds of things,

20:58 what it does, what it is, which you didn't,

21:01 but you have to say why we as investors should care.

21:04 - If you're passionate, that'll get you through adversity.

21:07 And I didn't sense the passion.

21:09 Again, it's called elevator pitch for a reason

21:11 and no disrespect to the company.

21:13 I hope they succeed, but that was not a very good pitch.

21:16 - I have to agree.

21:17 - Well, the good news is there's a lot more entrepreneurs

21:20 and a lot more founders for us to invest in.

21:23 - I love that about this show.

21:25 - Absolutely.

21:26 - While two entrepreneurs couldn't get past the elevator,

21:33 one made their way to the boardroom.

21:36 In the end, no one was able to secure a high-flying deal

21:40 and were sent back down with nothing to show.

21:43 Whether it's a new innovation or a new way of living life,

21:50 anyone could be 60 seconds away from rising to greatness.

21:55 Or fall from glory.

21:56 Tune in next week as Entrepreneur Elevator Pitch continues.

22:02 - You're coming in hot.

22:03 - You are coming in really hot.

22:05 - And to apply for the next season,

22:07 go to entrepreneur.com/elevatorpitch.

22:11 Investors personally styled by celebrity stylist,

22:14 Kim Bollefe.

22:16 (upbeat music)

22:18 (door slams)

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