Saturday, December 6

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ZipZ Wine - Biggest Deal in Shak Tank Histoy

Shark Tank's Biggest Deal Completed

Kevin O'Leary Makes Largest Shark Tank Investment in ZipZ Wines

 Kevin O'Leary just made Shark Tank History in last nights episode 614 with the largest investment ever seen on the Shark Tank Show. Andrew McMurray, the president of Zip-Z Wine, came into the Shark Tank asking for $2.5 million for a 10% equity stake in this single serving wine glass. With an initial valuation of $25 million walking into the Tank, this assessment alone set a new record for the largest investment (percentage wise) the Sharks have ever seen on the Show. The big question was "would the Sharks bite, and if so, how much could they lower the $25 million valuation and still complete the deal?"
Considering Kevin O'Leary just so happens to own a winery appropriately named "O'Leary Wines", you'd think this Shark would be the most interested in this product, and you would be right. If you want to see what Kevin looks like when He's laser-focused on a deal, just watch this episode 613 again. He immediately brings up Copa Da Vino that had two chances to make a deal on the Shark Tank, but still couldn't come to an agreement.
Andrew brings up an interesting point about Copa Da Vino the Sharks were unaware of concerning the patents on the wine by the glass Brand. Apparently a company based out of France owns the patent rights to the glass and the tear off lid design. According to McMurray, Martin doesn't own the patent but is more like a Franchisee using this technology.
To ensure there wasn't any patent infringements between the first single serve wine glass seen on the Shark Tank and the ZipZ Wine's design, they flew out to France and personally met with the owners. When you compare the two wine-by-the-glass products side by side, there's no comparison as one product has a shelf life several times longer. The Copa Da Vino's tear off lid covers only the wine glass rim, while the ZipZ Wine completely shields all the light with this tear-off design.
The ZipZ Wine is using this new patented technology to build this Brands name, but they're also interested in licensing the single glass concept to larger wineries around the world. The business at the time this Shark Tank episode was filmed was only 16 months old and so far raised $8.5 million in investment capital from 25 Wall Street Investors. Six of these initial investors retired from Goldman Sachs and three own Major League Sports Teams.
Now here's where this story gets interesting from what happened during ZipZ's appearance on the Shark Tank.
Kevin O'Leary seems very disappointed a single serving glass of Zipz wine retails for $2.99 per serving. He claims in America 97% of all wine costs $9.95 or less per bottle, so why would anyone pay $3 for a single serving. The cost to produce a single serving of Zip-Z wine is 95 cents, but Kevin thinks the retail price should only be $1.49 per serving which drastically cuts into the margins. If they could increase production to meet this price point, O'Leary practically guarantees He could get ZipZ Wine into Costco. The product was already successfully selling in 1200 stores at this price-point including a recent contract with Walmart, but O'Leary for the first time ever, is more interested cutting the retail price in half. What is it about making a deal with Costco that has O'Leary willing to consider such a deal?
Being a Shark on the #1 Business Reality Show in the World does come with benefits few other Venture Capitalist's enjoy. When Kevin decided his Award Winning O'Leary Wine would be sold in the one store selling more wine than just about all the competition combined, Costco, he had no problems getting in the door. The only problem was, even Kevin O'Leary couldn't get the Costco team to budge when it comes to the price-point they required. After two years perfecting what it takes to get a wine deal with Costco, He's more determined than ever to make his dream a reality.
Kevin doesn't even try to renegotiate the $25 million valuation put on ZipZ Wine and agrees to pay $2.5 million for a 10% stake in the company. He again confirms he knows exactly what it will take to get Zip Z on the shelves of Costco from what he's already learned over the past two years. For making this happen, O'Leary also wants the option for an additional 10% at the same valuation in the event of an exit potentially raising his investment to $5 million.
The combined 25 Wall Street Investors agreed its worth giving Kevin O'Leary the option for an additional 10% of ZipZ wine if he can indeed close a deal with Costco.

ZipZ Wine Update after Shark Tank Show

First off it appears the deal between ZipZ Wine and Kevin O'Leary did indeed get completed. Kevin tweeted "I've never been so excited about a Shark Tank deal" which speaks volumes how big of an opportunity this will become now that he's involved.
Now about the Costco deal. As far as I can tell neither O'Leary Wine's or ZipZ Wine is available at Costco at this time. Knowing the first part of this deal completed, Kevin now has more incentive than ever to learn the Costco ways.
Until then, it looks like the investors convinced O'Leary the $2.99 retail price-point is an acceptable price most consumers would willingly spend. In fact, they now have packaging selling the ZipZ single serve wine by the 12 pack at this same price level per serving. Now "that" sounds more like Kevin O'Leary, LOL.
Even though Lori Greiner was in this episode of the Shark Tank and didn't make an offer, she seems to have changed her mind and publicly tweeted her interest getting involved with this product.
One main benefit Kevin also received while investing in ZipZ was the opportunity for O'Leary Wines also to be sold by the glass. I think any wine coinsurer would have to admit; the O'Leary Wine By The Glass has an exceptional classy design looking like a bargain at this price.
This might be the biggest Shark Tank investment ever completed on the Show, but this could also become the Best Investment any Shark has ever made on the show.

Look for a ZipZ and O'Leary Wine Success Update on the Shark Tank Show coming very soon.


  1. I just tried the pinot grigio--undrinkable. Seriously. Love the concept, but poorly executed...

  2. They've increased the price to $3.50 a glass on their website. Not a price I would pay.

  3. Discount resellers selling 24 for $15.00. Looks like that price point didn't stick.