Key Takeaways: Wendy’s Gnome Shop’s Shark Tank Pitch

  • Investment Request: $200,000 for 20% equity.
  • Sales: Over $688,000 from 23,000 gnomes sold in 18 months.
  • Platform: Primarily sells on Etsy, aiming to move to direct-to-consumer.
  • Offer Accepted: Daymond John offered $200,000 for 30% equity.
  • Business Goal: Increase profit margins by reducing reliance on Etsy.

Wendy’s Gnome Shop: A Quick Company Overview

In the wake of a lost relationship, labor and delivery nurse, Wendy Hoffmeister, was looking for a hobby to fill her time and began crafting gnomes.

Known for spreading good luck and prosperity, gnomes are a very popular and timeless decor item in many homes.

Wendy creates gnomes for every holiday and occasion and also offers a custom design-a-gnome feature.

As she quickly gained traction selling her gnomes on Etsy, Wendy realized she had a real business on her hands and created Wendy’s Gnome Shop.

Over the course of the last 18 months, Wendy has created and sold over 23,000 gnomes which equates to $688,000 in sales.

Because her business is growing so quickly, both Wendy and her daughter have retired from nursing to focus on Wendy’s Gnome Shop full time.

They are hoping to completely move away from Etsy, which accounts for about 80% of their business currently.

Because of the fees through the platform, Wendy would like to partner with a Shark that can help her sell direct-to-consumers through her website to increase her profit margins.

Seeking an investment of $200,000 in exchange for 20% equity in Wendy’s Gnome Shop, Wendy is hoping to partner with a strategic investor that is able to help the company boost its SEO and online marketing to reduce its reliance on external websites.

The Sharks React to Wendy’s Gnome Shop

Although some of the Sharks feel as though Wendy has created too niche of a business, Barbara Corcoran and Daymond John are both impressed by Wendy and the volume of sales she has been able to acquire during such a short time.

In an unusual scene in the Shark Tank, Barbara and Daymond found themselves in a bidding war over Wendy’s Gnome Shop.

Although Barbara laid out a clear path of strategic change, Wendy felt that Daymond was the ideal partner for her and she accepted his $200,000 investment in exchange for 30% equity in Wendy’s Gnome Shop.

Closing Thoughts

If you were a Shark would you have invested in this company? Do you think that Wendy made the right choice by partnering with Daymond over Barbara? Start the conversation in the comments below!

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