In Season 4 of Shark Tank, mother-daughter business owners Tracey Noonan and Dani Vilagie made a deal with Kevin O’Leary for their cupcake in a mason jar company, Wicked Good Cupcakes. At the time, critics called the royalty deal — which gives O’Leary a few dimes of every jar of cupcake sold in perpetuity in exchange for his original $75,000 investment — crazy. But as recently as last year, when they gave an update to Shark Tank viewers, Noonan said the deal worked out extremely well. They kept 100 percent of their equity and O’Leary continues to push the business. At the time of the update, they had all-time sales of $10 million.
Earlier this month, Noonan and Vilagie told the Huffington Post about their next stage in business expansion: franchising. But don’t expect to see any brick-and-mortar Wicked Good Cupcakes locations near you anytime soon. The company is focusing on food trucks, supplying a vehicle and product inventory to franchisees. In addition to their one physical location in Boston, the company has a thriving online order business. Recently, they partnered with actor Jennie Garth for a line of “Wicked Good Pies.”
The company posted a video of Garth checking out the baking operations. She even spent time with a piping bag to add icing to some of her “pies in a jar.”
During an episode of CNBC’s Squawk Box in August 2017, Noonan described Wicked Good Cupcakes as a gifting business, whose momentum has maintained largely because people give their product away. Birthdays and Valentine’s Day are two examples of prime Wicked Good occasions. Noonan described focusing on “the customer experience” by offering packages perfect for special moments and gift exchange. You can get cupcakes in a birthday box or with a “thinking of you” message.
According to Fortune, which listed some of the most profitable Shark Tank investments as of September 2017, O’Leary said he has made more money out of the Wicked Good Cupcakes deal than any other. Although the on-air deal was that O’Leary would receive a 45 cent perpetual royalty after he’d been paid back with a dollar per jar, Business Insider later reported that the deal was $1 per jar until O’Leary recouped his $75,000 investment and then 50 cents per jar thereafter.
As one of O’Leary’s investments, Wicked Good Cupcakes has engaged in cross-promotion with other Shark Tank successes, offering discounts on other O’Leary companies like Honeyfund and Bottle Breacher.
But of course, O’Leary is just an investor. Wicked Good Cupcakes has experienced high levels of growth because of Noonan and Vilagie’s leadership. They told the Huffington Post that they’ve trusted the recommendations of their current employees to expand their team, which currently includes 25 people. While Noonan is an ambassador for the brand, Vilagie handles day-to-day operations. Tracy Noonan celebrated the end of 2017 by posting a weight loss success story — her own — to the company’s Instagram page, noting there will be a low-sugar Wicked Good Cupcake on the market in 2018.
Speaking of new product lines, the pair told the Huffington Post that they’ve learned not to maintain too many different items on their menu. To put it bluntly, they just get rid of flavors that are not working.
The company has certainly been known to experiment. During the August 2017 Squawk Box appearance, Noonan offered the hosts samples of alcohol-infused bakery concoctions and a maple bacon cupcake.
Despite what some may have considered a risky Shark Tank deal, the Wicked Good Cupcakes team kept full ownership and control over their company — with the support of Mr. Wonderful. It may still cost them a bit of the profit off of every jar of cupcake, but they do get the ongoing promotional kick of the Shark Tank investor.
Shark Tank will return in January, airing Sunday nights on ABC.