Mark Cuban’s investments now include a DIY vegan milk machine. On an episode of Shark Tank that premiered on March 26, the wealthy businessman eagerly invested $2 million in a company called Numilk, which was founded by entrepreneurs Ari Tolwin and Joe Savino in 2018.
Numilk produces kiosk-style machines for stores that create plant-based milks, such as almond milk and oat milk.
Each kiosk generates approximately $50,000 in revenue per year, Tolwin explained on the show. It costs the company $30,000 to manufacture one machine. However, he expects the cost to come down by about half as the machines grow popular and more consumers shift toward plant-based milk.
As Tolwin and Savino explaIned to Cuban and the other sharks, their business model also features two other products that are designed to make plant-based milk more accessible to consumers. The current Numilk product line includes a stainless-steel, countertop unit for cafes and coffee shops, which sells for $699 each.
However, a smaller, in-home countertop unit with a $199 price tag really piqued Cuban’s interest. The in-home unit won’t be released until summer 2022, but is already available for pre-order via the Numilk website. It’s basically like a Keurig-style coffee machine that dispenses vegan milk instead of java. And, it can make a variety of drinks, like almond milk, oat milk, matcha lattes, and protein shakes, from ingredient pouches.
“We took our grocery machine and we shrunk it down so it works on your countertops,” Tolwin noted.
Mark Cuban’s Numilk Investment Strategy
Numilk’s products intrigued Cuban, so he tested out the kiosk himself. At each kiosk, a customer spends $2.00 for a reusable bottle, and it then costs $3.99 each time they fill the bottle with fresh plant-based milk.
Cuban selected almond milk for himself and was impressed by how “fast” and “cool” the kiosk was. The final product also dazzled the billionaire. “The milk I just made is incredible,” he declared. “You can tell it’s fresh almonds.”
Despite the ingenuity of the kiosk and forthcoming in-home machine, Numilk has yet to be profitable. Tolwin revealed that in over three years in business, Numilk has lost $7 million in total, largely due to high research and development costs.
Cuban wasn’t prepared to give Tolwin and Savino what they asked for—a $1 million investment for just 5 percent equity, which would be a $20 million company valuation—, but he had an investment plan.
Because he saw great potential in the in-home countertop machine, Cuban offered to give Tolwin and Savino $2 million. Per his terms, $1 million would be for 7 percent equity, while the other million would be a loan at 3 percent interest. Cuban also asked for “an additional 3 percent of stock as advisory shares or straight up equity.”
He added: “But, if you don’t use the loan, you don’t have to give me the additional 3 percent. So in total, if you use all the capital, it’s $2 million for 10 percent.”
Explaining his decision to invest despite some financial hiccups, Cuban told Tolwin and Savino: “I obviously love the stainless-steel version that you’re putting in coffee shops right now. I think that’ll sell like hotcakes at home. I think you’ll sell a million units easily.”
The pair ultimately accepted Cuban’s offer.
Mark Cuban’s Vegan Investment Portfolio
Numilk is hardly the first vegan brand Cuban has invested in. In fact, the Pittsburgh native has been investing in plant-based companies for years and has become a key figure in the meat-free food space.
Cuban invested $300,000 into vegan meat brand Everything Legendary during another Shark Tank episode that aired earlier this month, and his extensive investment portfolio of plant-based brands also includes Wild Earth, Mrs. Goldfarb’s Unreal Deli, and several others.
“[The vegan meat market] is going to keep on growing quickly,” Cuban recently told LIVEKINDLY. “People realize [eating plant-based is] better for their own health, for the environment and it now tastes great!”