Entrepreneurs

How 'Shark Tank' helped this bagel company hit $2 million and get a deal with Starbucks

Nick and Elyse Oleksak with Lori Greiner (center).
Source: Bantam Bagels
Nick and Elyse Oleksak with Lori Greiner (center).

When Nick and Elyse Oleksak worked in corporate finance, they would watch the hit reality pitch show "Shark Tank" every Friday night. Nick would call Elyse from work on Monday with his ideas for starting their own business.

"She would tell me they were terrible," says Nick. Until one night in May 2012 when Nick dreamed up the idea to make mini bagel balls stuffed with cream cheese. That, Elyse says, she knew was genius. They were both instantly obsessed.

"We were both doing fine and had no reason to go out on our own other than just wanting to chase the American dream and really go forge our own destiny," Nick tells CNBC. "We were really inspired by 'Shark Tank.'"

"The perseverance of the 'Shark Tank' fan is unmatched." -Nick Oleksak, co-owner of Bantam Bagels

After coming up with the bagel recipe in their Brooklyn kitchen, the couple raised a friend and family round of seed financing to open their bakery, Bantam Bagels, in New York City in 2013.

They also applied to be contestants on their favorite TV show, and Bantam Bagels was invited to pitch in June 2014. The husband-and-wife duo studied up and watched a ton of "Shark Tank" episodes to get a sense of the questions the "sharks" would ask.

"It is one of the most intense, exciting, exhilarating experiences that I think either one of us has ever had. We studied harder than any college exam," says Nick. And that's saying something, coming from two Ivy League graduates.

Bantam Bagels
Source: Bantam Bagels

If they did well, they knew the potential benefit to their business would be huge.

"It's your one opportunity to present your business in front of five of the most influential, intelligent, powerful entrepreneurs in the country, so you have to be prepared," Nick says. "We prepared. We understood our business and our numbers inside and out so that any question we were asked, we were prepared and ready to answer."

The couple went onto the show hoping to get a $275,000 investment from shark Lori Greiner, and that's exactly what they got. They did, however, have to give away more than two times the equity they'd intended in exchange for the cash. They'd hoped to get the investment for 11 percent of their business, but Greiner negotiated for 25 percent.

The couple knew that giving away such a hefty piece of their business was a risk, but they also determined that the potential upside was worth it.

Their risk paid off. "We aired on 'Shark Tank' in January 2015, and that was really the inflection point for us as a business. It's like everyone says, there is the 'Shark Tank' effect," says Nick.

The benefits were immediate. Overloaded by the surge in traffic, their website crashed while their segment was airing. Nick and Elyse left their friends-and-family watching party to get the website back up, which they did about 15 minutes after their segment concluded.

The technical malfunction didn't keep customers from showing up at the bakery the next morning. After going to bed at 3 a.m. the morning after the show aired, the couple got a call at 6 a.m. from their baker. There was already a line out the door of their Bleecker Street location, which didn't open until 9 a.m.

"Just from an overall brand awareness perspective, what 'Shark Tank' does for companies is it gives you supporters and fans," says Nick. "They look at the sharks as the ultimate vetters. They vet these companies. And if you get through the Shark Tank, then people just believe in you."

Before they went on the show, Nick and Elyse had done $200,000 in sales. A year later, they were doing more than $2 million.

Today, Bantam Bagels is still growing fast. The couple recently secured a deal with Starbucks for their bagels to appear in more than 7,700 stores across the U.S., all the company-owned Starbucks in the country. And while the family-run business is a full-time team of three — Elyse, Nick and Nick's younger sister — the tiny team contracts out various legs of the supply chain.

Being on "Shark Tank," Nick says, "changes everything in all ways that businesses want things to change. It accelerates your growth in ways that you could never have really imagined. The perseverance of the 'Shark Tank' fan is unmatched."

Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank."