Quick Shark Tank Update on Surprise Cake
- Product Highlights: The Surprise Cake stand provides a fun, reusable way to hide gifts inside cakes, making celebrations unforgettable.
- Founders: Founded by mother-son duo Jordan Long and Liz Charm, who have backgrounds in industrial engineering and law.
- Shark Tank Deal: Despite a memorable pitch, Surprise Cake did not secure a deal with the Sharks on Shark Tank.
- Annual Sales Figures: The company is generating between $1-2 million in revenue annually.
Surprise Cake didn’t just introduce a fun way to hide gifts within cakes, they grew to a $3.5 million company with annual sales reaching $1-2 million.
Their success is largely attributed to maintaining a unique niche in the gifting and celebration market.
However, it’s their strategic focus on the popping cake stand that truly fueled their growth. Want to know how this approach positively impacted their business?
Keep reading to find out how it shaped Surprise Cake’s journey and set them apart in a competitive market.
Case Study: How Surprise Cake’s Strategic Focus Can Inspire Your Path to Success
Surprise Cake’s journey underscores the importance of focus to prevent over-expansion.
During their Shark Tank pitch, founders Jordan Long and Liz Charm aimed to win over the Sharks with a clear, ambitious vision.
They sought $200,000 for 8% equity. The mother-son duo introduced themselves with charm, stating, “We’re a mother-son team from Newton, Massachusetts, and we’re here seeking $200,000 for 8% equity in our company.”
They proudly emphasized their family’s passion for celebrations: “Everyone knows a party without a cake is no party at all, but there hasn’t been much innovation with cakes until now.”
Innovation at the Heart of Surprise Cake
Surprise Cake brought a fresh approach to celebrations with its “reusable patented popping stand.”
This unique stand allows people to hide gifts inside cakes.
The founders described its wide-ranging appeal, saying, “For birthdays for all ages, gender reveals, holidays, or even pop the question—the pop abilities are endless.”
This unique twist positioned Surprise Cake as more than a cake stand. It became a memorable experience that reinvents traditional celebrations.
Sharks Warn Against Broad Expansion Plans
However, the Sharks saw a risk in the founders’ plan to expand Surprise Cake into a “one-stop shop” for cakes, stands, and gifts.
Mark Cuban advised caution, remarking,
“Listening to your customers is way overrated. The job of a customer is just to enjoy, not to predict, not to understand your business, not to give you guidelines on where to go, just to enjoy your product or service.”
Cuban’s insight highlighted a common business challenge: trying to do too much can dilute a company’s strengths.
This risk becomes especially high when decisions are driven by scattered customer demands rather than a clear strategic direction.
Financial Realities: “What’s Your Profit?”
When questioned about their finances, Jordan disclosed a modest start with only $10,000 in sales in their first five months in 2018.
By 2019, sales rose to $280,000, and in 2020, they projected nearly $900,000 in revenue. Yet, despite these figures, net profit remained slim.
“We’re going to net $50,000,” he admitted. This underscored a key issue: while revenue was growing, profit margins were still low.
Mark Cuban identified the underlying problem, saying the business was “chasing revenue and not chasing profits.”
Focusing on Core Strengths to Maximize Resources
This exchange emphasized a valuable lesson. Prioritizing core strengths is critical, especially when profitability is a challenge.
Instead of entering the complex bakery market, where issues like freshness and spoilage could introduce additional risks, Surprise Cake’s best move would be to double down on their unique popping cake stand.
By concentrating on this central product, they can fully utilize their resources without diluting their impact. This approach follows a strategy that has proven essential for many successful companies.
Harvard MBA-style Analysis : Why It Worked
Carving Out a Unique Niche in the Gifting Market
From the beginning, Surprise Cake stood out by offering a novel twist on cake presentation.
Allowing customers to “hide gifts inside a cake” gave the founders a unique entry into the celebration and gifting market.
This approach carved out a “blue ocean” space where there was little direct competition.
The innovative idea created a memorable product that brought special moments to customers. It helped set Surprise Cake apart.
Risks of Entering a Crowded Bakery Market
Despite their initial success, the founders considered expanding into the bakery market. However, this shift presented significant risks.
Moving into this “red ocean” would mean facing issues like spoilage, complex logistics, and high delivery costs for fresh baked goods.
Shark Kevin O’Leary cautioned against this move, pointing out the operational challenges: “What you’re selling is a product that has no spoilage, doesn’t have a shelf life issue… Cakes have all kinds of issues around their freshness when they’re shipped, how they’re shipped.
Why would you want to do that to yourself?” His feedback served as a clear warning. Entering unrelated lines of business could weaken their competitive edge and lead to logistical hurdles.
Staying Focused on the Core Product
A focused strategy allows businesses to invest in their strengths and avoid costly distractions.
For Surprise Cake, success lies in centering on their patented popping cake stand instead of diversifying too soon.
Keeping this product as their main offering lets them expand meaningfully through complementary items, such as curated gift pods, without adding food industry complexities.
The founders even mentioned the idea of “curated gift pods.” This could allow them to offer customers more variety while staying true to their core product.
Emphasizing Quality and Reusability
Barbara Corcoran highlighted Surprise Cake’s potential to become a family tradition. She noted, “This can become family tradition for people… think on New Year’s, every new year, you know, money inside or whatever.”
Her feedback underscored the importance of focusing on the product’s unique qualities: fun, reusability, and the joy of hidden surprises.
By emphasizing these strengths, Surprise Cake can continue standing out from typical cakes or bakery items. This focus helps sustain its appeal and advantage in the celebration and gifting niche.
The Takeaway
The lesson from Surprise Cake’s journey is the importance of strategic focus. By keeping their vision clear and centering on what they do best, offering a unique, reusable cake stand, the company can build a sustainable brand.
Often, effective strategy is as much about deciding what not to pursue as it is about identifying where to focus efforts.
Surprise Cake’s founders have an opportunity to maximize their impact by avoiding unnecessary diversifications and staying committed to their core product, which already has a strong appeal.
How You Can Apply These Insights to Your Own Business
- Set Specific Goals: Focus on measurable, impactful objectives that align with your core product. This helps avoid mission drift and keeps the focus on what generates the highest returns.
- Create a Unique Space in Your Market: Like Surprise Cake, concentrate on creating a memorable, differentiated product that stands out rather than entering competitive fields. Success often comes from standing out, not from trying to match others in crowded fields.
- Identify Your Best Market and Play to Win: Stay focused on areas where your business has the strongest advantage. Surprise Cake’s gift-giving angle allows them to capture customer attention without the complexities of food production, letting them grow within a lucrative niche.
Surprise Cake’s story is a testament to the power of focusing on core strengths and resisting unnecessary diversification. By embracing their core product, the company has the potential to thrive, capturing a unique market space and continuing to surprise customers with their innovative take on celebrations.
