Hungry Harvest CEO Evan Lutz appeared on ABC reality show "Shark Tank" Friday night and got quite the bite. Lutz received a $100,000 offer from celebrity investor and business owner Robert Herjavec for a 10 percent stake in his company — double what he had asked for.
The 23-year-old Pikesville native accepted. He began his segment by presenting his company before five celebrity “sharks," asking for a $50,000 investment for a 5 percent stake in his company.
The sharks on Friday's episode included Dallas Mavericks owner Mark Cuban, columnist and business consultant Barbara Corcoran, O’Shares Investment chairman Kevin O’Leary, QVC host Lori Greiner and Herjavec, founder of global IT security firm the Herjavec Group.
Lutz’s goal was to continue to “sell produce with a purpose” and to redefine waste, a mission he began after seeing extreme poverty in areas of Baltimore. According to Lutz, more than six billion pounds of produce are wasted each year due to cosmetic imperfections and logistic inefficiencies.
So for the past year and a half, Hungry Harvest has been selling bags of “ugly” but perfectly edible fruits and vegetables directly to the doors of people in the community. For every bag sold, Hungry Harvest donates food to people in need.
The sharks showed early interest in Lutz’s company, but once they heard the company’s profits, sentiments changed.
Within Hungry Harvest’s first six months, the company made $37,000 in sales and a little more than $100,000 in the most recent month, Lutz said on the episode, which filmed in June. But the company had a net loss of around $20,000 and Lutz said he was not making a profit.
“Evan, why bother doing that if you’re not profitable?,” O’Leary said in the episode. “If you’re not profitable, you’re not sustainable. If you’re not growing, you’re dying.”
Corcoran was also not convinced.
“I’m sitting here listening to you and I’m thinking what a great guy this guy is, but what disturbs me more than anything else is how much you are in love with the idea. I believe in a business that is greedy and wants to make a profit run by good people,” Corcoran said. She didn't believe Lutz had the experience it took to build a business.
"I'm out," she said.
But Herjavec disagreed. He liked the brand and he made the $100,000 for 10 percent offer.
“I can help you run this business. I can help you scale it out. This is what I do. Let’s give people hope. Let’s empower them,” Herjavec told Lutz.
O’Leary, a shark known for his tough demeanor, weighed in and expressed interest, but was soon interrupted by an impatient Herjavec.
“I’m not trying to be disrespectful but there’s no point. This is something I want to do. Either take my offer or argue with [O’Leary] and [Cuban] and [Greiner],” Herjavec said.
“It was the most stressful time in my life, seriously,” Lutz said via phone after the episode.
His next decision may have been a make-or-break chance of investment. And the bright camera lights and knowing millions of people would be watching didn’t make the decision any easier, he said. Be he said he knows he made the right call.
“It’s really great having [Herjavec] on as a partner,” Lutz said. “Him and his team have a lot of business intellect and a lot of experience and they bring a lot of value to the table.”
Herjavec and his company also assisted Lutz and his Hungry Harvest employees in preparing for an episode viewing party Friday night hosted at the Maryland Center for Entrepreneurship in Columbia. More than 100 people attended, including Maryland Lt. Gov. Boyd Rutherford and Howard County Executive Allan Kittleman, along with Lutz’s family, friends and Hungry Harvest customers.
Moving forward, Lutz said that Hungry Harvest is expanding with the help and expertise of his new mentor.
“Our goal is to be the best in the direct produce experience,” said Lutz, who plans to start produce pick-up stops in Philadelphia, Pittsburgh and Richmond in months to come.
But these steps are just a preview of what he’s planning in order to reach his goals. In five years, Lutz wants Hungry Harvest to be the best direct-to-home-produce company on the East Coast. In 10 years, he wants it to be the best in the country.
While on the phone, Lutz’ cell phone buzzed intermediately, a sign of more incoming orders, he said. Lutz had already received more than 100 new Hungry Harvest subscriptions by the end of his "Shark Tank" episode, he said.
“And we’re expecting a lot more than that as the night goes on,” Lutz said.