- The three founders of Sand Cloud had taken a big risk for their towel business. And that risk paid off.
Back in 2016, the three Sand Cloud founders Brandon Leibel, Bruno Aschidamini, and Steven Ford did a pitch on the reality business reality TV show Shark Tank. Sand Cloud is a beach towel company.
Originally, the founders of the company created a beach towel with a pillow attached to it. But they decided to pivot from this idea after attempting to sell it on the beach only to find out that no one was interested in the product. Eventually, they decided to create a thin towel made from Turkish cotton that could be easily rolled up and placed in a bag.
After they realized that the thin towel had potential, they sold their furniture in order to make more space in their apartment / office. Aschidamini and Ford sold their cars, but Liebel kept his car so he could drive for Uber and use those earnings to help fund the business. And Liebel also cashed in his 401(k). It was a huge gamble for the founders, but it paid off. Sand Cloud hit $30,000 in sales in its first year of business and $430,000 the following year.
That is when they decided it might be a good idea to apply to be on Shark Tank. During the time of their appearance on Shark Tank, the three co-founders were still living in a two-bedroom apartment that they also used as their office.
When they appeared in front of the investors on Shark Tank, they had asked for $200,000 for 8% of the company. Shark Tank’s Mark Cuban had offered $400,000 for 25% of the company since he wanted to be more involved as an equal partner in the company.
The founders believed that giving away 25% equity would be too much so they decided to hear what the other “sharks” had to say. That is when Cuban said “I’m out.” Fortunately, the Sand Cloud team was able to make a deal with Robert Herjavec — who had offered $200,000 for a 15% equity stake in the company.
Since appearing on Sand Cloud, Sand Cloud saw $6.8 million in revenue last year and got ranked as number 308 on the Inc 5000 list of the fastest-growing private companies in the U.S.
One of the strategies that worked well for Sand Cloud was producing small batches of product to see how it resonates with their customers before mass-producing the designs. This method also ensures that the co-founders also stay connected with their customers and empowers them to contribute to future products.
“We’re never going to commit too quickly to something before knowing it’s a winner,” said Leibel via Inc. “We will either double down or we will try something new.”
Some of the products that Sand Cloud now sells include water bottles, metal straws, and jewelry. And they use the same model before rolling out this product.
