During the show’s emotional 11th season opener, John Sorial was looking for $300,000 and a chance to save his plant-based East Mediterranean frozen snack company in exchange for 10% ownership of TaDah Foods. What he walked away with was an unexpected $500,000 investment for 25% of the company from Daniel Lubetzky – founder of KIND Snacks and a guest ‘shark’ on the show.
“I grew up in Queens, NY, and so when it comes to flight or fight, I am always going to fight,” especially for a company that sprang to life nine years ago from a passion to help fund nonprofits that are actively engaged in social change, Sorial told FoodNavigator-USA. He also joked that being a strategic negotiator is part of his ethnic background as the son of Egyptian immigrants who came to the US and worked in the food industry.
And while that passion and dedication may have caught the attention of Lubetzky as well as fellow ‘shark’ and billionaire Mark Cuban, whose offer for $300,000 Sorial rejected, Sorial said it was his self-awareness, realistic assessment of his company’s value and deep understanding of what was at stake that really helped him win at the negotiating table.
'Daniel and I really connected'
He explained: “There was a lot of back and forth... and so I would say if you don’t believe in what you are doing or you are not prepared to answer the difficult questions, then how can you expect an investor to give you their time or money? So, I think the key to [a strong negotiating position] is to go in knowing who you are, what you want to accomplish and what your value is – not just as a company, but as a founder.”
Sorial’s value as a founder as well as that of his company was tested in the year leading up to the June taping of Shark Tank when a production partner became financially insolvent and Sorial suddenly found himself on the production floor shoveling chickpeas alongside four others in order to fulfill as many product orders as possible.
The ordeal cost Sorial and TaDah, which saw annual sales slide to $1m in the year prior to the taping compared to previous annual sales as high as $2.3 million. But it also helped build a bridge with Lubetzky, who recalled on the show that a production problem during the early years at KIND almost caused the snack company to close.
“Daniel and I really connected. It was this moment where he saw a lot of himself in my struggles and in my background, and so that right there was, I think, why he was able to feel confident making the offer that he did,” Sorial recalled, noting the value of connecting with others at a key element of succeeding at the negotiation table.
'I wasn’t just fighting for a Shark Tank investment. I was fighting for the future of my company'
The third element that Sorial attributes his negotiating prowess to is the ability to see beyond himself for the greater good of the company, an attribute that was on display when he began to cry on national television.
“I never cry. You can ask my wife and child – they have never seen me cry. But it was just so intense [on Shark Tank] and I just kept thinking that I wasn’t just fighting for a Shark Tank investment – I was fighting for the future of my company and our ability to actually do good, like we set out to do all those years ago,” he said.
“Having that degree of passion integrated into the DNA of your company is so important, but it is what is going to see you through the difficult times that are most definitely going to occur as an entrepreneur in the food CPG space.”
Funding will fuel expanded distribution, production
The influx of funding will allow TaDah to significantly ramp up production and distribution of the brand’s frozen falafels and poppers, which were popular before Sorial’s appearance on Shark Tank, but which likely will see exponential demand in the coming months.
“The night of the show, we had over 50,000 hits on our website and retail surges as people were looking for the product,” and while the brand is distributed nationally it is limited, Sorial said. “So, our goal is to really expand the offering of the product line, not just in the wraps but also the poppers and make it readily available.”
He also hopes to expand the company’s portfolio in 2020 with the investment money, including new flavors for wraps and poppers and “a few surprises” as well.
In addition, he said, he wants to use the funds to improve the efficiency of manufacturing and also boost marketing, which up until now has relied heavily on the product’s packaging at shelf and word of mouth.
'I am still learning every single day'
While the money is much-needed, Sorial said he is more excited about Lubetzky mentoring him as part of the arrangement.
“I am 43 years old and I am still learning every single day. I have been doing this now for nine years and it is has been an amazing, amazing ride. But I think this next chapter from TaDah is going to be unprecedented in terms of growth and having Daniel there to guide me and mentor me and get me out of my own way in some cases,” Sorial said.
“I think we have a partnership that is going to allow us to take our flavor-obsessed product and put it in freezer doors all across the country.”