How a 15-year-old's apparel start-up notched $2.2 million in projected 2021 sales — and a $300,000 'Shark Tank' deal
At age 12, Trey Brown spent $178 in birthday money to buy, customize and sell 16 T-shirts.
They "sold out instantly," Brown said on Friday's episode of ABC's "Shark Tank."
Today, Brown is 15 years old. At the time of the "Shark Tank" episode's taping, he said, his Philadelphia-based streetwear apparel brand Spergo was on pace to bring in $2.2 million in 2021 sales.
Brown founded the start-up in early 2018 with the help of his mother, Sherell Peterson, a retired seamstress who's now Spergo's full-time COO. Spergo sells apparel like socks, T-shirts, hoodies and sweatpants — priced at $12, $45, $80 and $98, respectively.
And on Friday's "Shark Tank" episode, Brown landed a $300,000 investment deal from Daymond John, the founder of apparel company FUBU, in exchange for a 20% stake in Spergo.
"Obviously, I relate to this," said John. "I started a clothing brand, and my mother was — and is — a huge inspiration in my life."
Brown said he launched Spergo — the name is a combination of the words "sports," "heroes" and "go-getters" — after growing increasingly aware of violence and drugs in his local community. Successfully selling T-shirts, he thought, could help encourage his peers to stay out of trouble.
"I wanted to be the light, and role model," said Brown.
After selling his first batch of shirts to friends and family, Peterson asked him what he wanted to do with the proceeds. His response: Reinvest back into the company.
Several months later, Brown was selling shirts door-to-door at local Philadelphia businesses. His hustle impressed a barbershop patron who happened to have Sean "Diddy" Combs' number, and a FaceTime call quickly followed.
Combs, impressed, decided to help raise Spergo's profile — with both an Instagram post highlighting Brown's story and a $25,000 grant, which Brown used to open the first of his company's three brick-and-mortar stores in Philadelphia.
At first, John was hesitant to offer an investment because, he said, Spergo was already successful on its own. "You're already blowing up," John told Brown. "I'm not sure if you are ready for a partner."
But when fellow Shark Mark Cuban offered Brown $300,000 for a 25% stake in the company, John decided to match it. Brown then negotiated John down to 20%, with Peterson assuring John that the money would help Spergo grow more quickly.
John's investment will go toward hiring a fashion designer, upgrading the start-up's e-commerce technology and getting further ahead on upcoming production, Peterson said.
Brown said his goal is to become a billionaire by age 21. But, he noted, a partnership with John already feels like a full-circle moment.
"I used to bring Mr. Daymond's book to school and I would read it any time I would finish my work," said Brown. "Now, to be partnering with [him], it's still soaking in right now."
Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank."
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