Chubby Buttons Shark Tank Update – Net Worth, Pitch & Deal

Michael Cherkezian and Justin Barad appeared on Shark Tank’s Season 14 Episode 17. The duo introduced a convenient way to handle your smartphones using a smartphone accessory product. The product was a chubby button that could be used to control your smartphone whether it be when you’re skiing, handling oily food, or being on a yacht.

The business model had potential, but the sharks raised concerns regarding the future relevancy of the product. They thought that the upcoming tech advancements, like better AirPods, and Alexa would make the Chubby Buttons unnecessary. But did the founders score an investment for Chubby Buttons? Check out our Chubby Buttons Shark Tank Update!

Chubby Buttons Net Worth

Michael and Justin asked for a $250,000 investment in exchange for 8% equity in their company. This meant they valued their company at $3.1 million. However, they did not secure a deal on the show.

After the show aired, Chubby Buttons saw a big increase in website traffic, sales, and social media exposure. With an estimated 10% yearly growth rate (typical business growth), the current net worth of Chubby Buttons is about $3.7 million.

What Happened To Chubby Buttons After Shark Tank?

Chubby Buttons are still operational as of today. They’ve managed to sustain their business and maintain a strong market presence. Michael and Justin have kept the momentum going and focused on driving down custom acquisition costs, while at the same time increasing production. The founders have managed to keep the company debt-free with over $1.6 million in sales. Their presence on Amazon with ravishing reviews has helped the company gain lots of momentum.

Did Chubby Buttons Get a Deal On Shark Tank?

Chubby Buttons didn’t get a deal on Shark Tank. The product posed a higher risk for the future because the technology it was competing with was advancing at a much higher rate.

Mark refused involvement, worried big competitors like Google and Amazon could make better headphones, making Chubby Buttons irrelevant. Robert opted out despite profits, concerned improving AirPods could make Chubby Buttons obsolete, like Mark’s view. Lori initially liked the product but later had doubts about its future, so she didn’t invest. Barbara didn’t invest as it was a technology business, an area she lacked expertise in and couldn’t bring sufficient value.

Seeing profitability in the simple product, Kevin first proposed $250,000 for 10% ownership and $10 per item royalty until $1 million. The founders countered the same investment for 10% but $2 royalty per item until $1 million, which Kevin declined. His negotiations ended after rejecting Michael’s later royalty adjustments from $3 to $1 and an increased 15% ownership offer.

Shark(s) NameOffer and DemandCounterofferAccepted?
Kevin O’Leary#1: $250,000 for 10% equity and $10 per unit sold until $1 million is paid to him.#1: $250,000 for a 10% stake in the company, and $2 per unit sold until $1 million is paid to Kevin.

#2: $250,000 for 10% equity in the company, and $3 per unit sold until $1 million is paid to Kevin.

#3: $250,000 for 15% equity in the company, and $1 per unit sold until $1 million is paid to Kevin O’Leary.
No
Mark CubanOutN/AN/A
Robert HerjavecOutN/AN/A
Barbara CorcoranOutN/AN/A
Lori GreinerOutN/AN/A

Chubby Buttons Shark Tank Update

chubby buttons net worth

Founders Backstory

The inspiration for Michael and Justin’s Chubby Buttons came when they went on a ski trip together to Colorado. While they were skiing,  Michael had the skiing gear on, and he was listening to music. While skiing, he struggled to remove his gear just to control his phone. This struggle led the two founders to come up with the business idea for Chubby Buttons.

Initial Pitch

Michael and Justin arrived on Shark Tank to ask for $250,000 for an 8% equity in their company “Chubby Buttons”. Michael came in his skiing outfit to demonstrate how the chubby button worked. He was listening to music while wearing his full skiing outfit.

After a few minutes of clearly struggling to take the outfit off, he stopped the music. This showed how hard it is to control devices when wearing bulky winter sports clothes.

Justin showcased the chubby button which was wrapped around the arm of Michael. They told the sharks about the versatile nature of the button. Apart from skiing, it could also be used in the outdoors when you’re riding a motorcycle, pilots, and by being on a yacht.

They each gave the shark their chubby buttons. Kevin questioned the device’s Bluetooth connectivity. The founders excitedly explained that the device pairs effortlessly with the Bluetooth on your phone.

They showed Barbara Corcoran using the Chubby Buttons remote to change the volume and music on her phone while wearing gloves. She showed enthusiasm and praised the founders for the usefulness of the product.

Queries About The Product

what happened to chubby buttons after shark tank

Kevin asked how long they had been selling the product. Justin excitedly said they sold it for 3 years, and in 2021 the product had generated $500,000 in revenue. He further added that in 2022 revenue grew to $600,000.

Mark Cuban asked about the costs to make and sell the product. Justin said it costs them $11.57 and $13.57 to produce, and they sell each unit for $79.99. The selling price gave them an impressive 83% profit margin.

Mark then asked about the company’s monthly marketing spend for the Chubby Button. Justin estimated they spend between $12,000 to $15,000 per month on advertisements. He also questioned the customer acquisition cost, to which they responded it was $26.86 per customer.

Robert asked about other uses besides skiing. Justin said the chubby button was made for skiing, but it had become popular with motorcyclists, pilots, boxers, and sailors too.

Kevin calculated it costs $26.86 to get one customer and $11.57 to $13.57 to make the product. So the total cost was $40, which is the price they could sell it for. The founders also said they had gotten a $250,000 investment earlier but did not name the investor.

Sharks’ Response And Final Deal

Mark Cuban was the first shark to say no to the founders. His main reason was the competitors like Alexa headphones and Google headphones coming out each year with more sophistication.

Barbara was quick to reject the founders, as she believed the business was not in her expertise, and she couldn’t bring more value to the company.

Robert liked the product but didn’t invest. He had the same concerns as Mark. AirPods are now improving on each iteration, so there might not be a market for chubby buttons in the future.

As an inventor herself, Lori appreciated the founders’ efforts. She also had doubts about the product’s future if competitors gained an advantage. Therefore, she decided not to invest.

Kevin saw the product’s potential and wanted to invest. The founders initially sought $250,000 for 8% ownership. Kevin offered the same amount but for 10% ownership plus a $10 royalty per unit, until $1 million was paid back to Kevin. This surprised the founders, who countered with $250,000 for 10% but only $2 royalty per unit until $1 million was paid back to Kevin. Kevin declined, saying it would take too long to get his money back.

Next, the founders offered a $3 royalty per unit until $1 million was paid back to Kevin, but Kevin rejected it again as insufficient. Their final offer was 15% ownership but just $1 royalty per unit until $1 million was paid back to Kevin. Kevin also turned this down. Ultimately, Michael and Justin left without an investment deal.

What Went Wrong With Chubby Buttons On Shark Tank?

Three sharks stepped out of the deal because they didn’t see the future relevance for the product. Barbara didn’t want to invest because the business was outside of her expertise. Kevin was interested in the product, but they couldn’t come to an agreement on the royalty fees to be paid to him.

Product Availability

With the help of this accessory, you can keep your smartphone safe from any danger, like keeping it safe it’s not waterproof. All you need to do is use a chubby button to control your smartphone.

The product is available on their official website, Amazon, Hemisphere Off Road, and Melbourne Snowboard.

Pricing of the product will vary based on the region and where you purchase it from. For example, on the official website, you can buy it for $79.99. But, it’s currently listed for $74.99 on Hemisphere Off Road’s website. They have a strong online retail presence on Amazon with a rating of 4.4/5  based on 1,036 ratings.

Conclusion

Even though the founders didn’t get the deal they wanted on Shark Tank, that didn’t deter them from their original goal. After appearing on the Shark Tank, the company saw an increase in the demand for their product.

With just one product before, they’ve now introduced more variations of the Chubby Button to cater to different customer profiles. With effective marketing strategies and raving reviews online, the company continued to grow and build trust with its consumers. That was the key to their success.

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