As an 8-year-old, Joel Clark sold his mother’s line of flapjack and waffle mixes in the neighborhood. They sold out like hot cakes! Joel later took over his mother’s business and partnered with Cameron Smith. The guys pitched the product on Shark Tank and rejected a deal. The Sharks missed out big time! As of 2023, Kodiak Cakes is worth $160 million.
Meet the Founders
Joel Clark was raised by a health-conscious family in Salt Lake City, Utah. His mother only prepared whole foods and baked goods for him and his four older siblings. There was no sight of junk food in their home.
It’s safe to assume that Cameron Smith grew up differently. He is from Park City, but not much is known about his family background. Cameron and Joel first met after graduating from college.
The Birth of Kodiak Cakes
The birth of Kodiak Cakes was back in 1982 when Joel Clark was eight years old. His family made the financial decision to sell their whole wheat pancake mix recipe. In 1994, his older brother Jon started the business with the goal of making a healthy product that tasted awesome. They made nearly $60,000 in the first two years, but the profits were slim.
After getting a $35,000 investment from a local businessman, the company expanded into local grocery stores and big retailers such as Target. In 2009, Joel hired Cameron to lead the sales and marketing strategy. Together, they helped the startup reach $3.5 million in sales by 2013.
Shark Tank Deal
Joel and Cameron wanted to raise capital to fund growth and launch more innovative products. They appeared on season 5 of Shark Tank, asking for $500,000 for 10% equity. A $5 million valuation was ambitious but they were already in Target and were forecasting $5 million in sales for that year.
Sadly, the entrepreneurs didn’t get the reactions they hoped for. The Sharks didn’t seem to show much interest in the product or belief in its potential. Kevin was a bit disrespectful and believed the business was worth $2 million. At one stage, he told Robert to shut up!
Kevin O’Leary offered $500,000 but for 50% and then went out. Barbara offered half the money for 20% and wanted to split the deal and Kevin was happy to partner. Robert Herjavec made a better proposal of $500,000 for 35% but the equity was still too high. Because of this, the founders rejected all offers.
Success After Shark Tank
After their episode aired in April 2014, the company generated $1 million in additional revenue in six weeks! The success helped fund new products and they released a protein-rich pancake mix called Power Cakes. This product, in particular, is hugely popular with bodybuilders.
All their products are available at Walmart, Target, Amazon, and KodiakCakes.com. The original pancake mix has an average star rating of 4.8 from over 10,000 Amazon reviews.
By 2018 the business was making over $100 million in annual sales and reached $200 million in 2020. Due to its success, Kodiak Cakes was acquired by a private equity firm called L Catterton in July 2021. No details were shared on the final sale price as L Catterton isn’t a public company.
The following year, the executive team hired Zac Efron as the Chief Brand Officer. Kodiak Cakes is currently making $200 million in annual revenue and is worth an estimated $160 million.