The story of CoinOut after Shark Tank is a compelling example of entrepreneurial resilience and strategic adaptation. What began as a simple solution for digitizing loose change evolved into a successful cashback and rewards platform, culminating in a significant acquisition. This article details the journey of CoinOut, from its initial pitch on the popular television show to its eventual sale to a major data analytics firm.
The Shark Tank Pitch: A Vision for Loose Change
CoinOut first gained public attention through its appearance on ABC’s “Shark Tank.” Founder Jeff Witten presented an innovative concept aimed at solving a common annoyance: loose change from cash transactions. His initial vision for CoinOut was to provide a digital solution for consumers to receive their change directly into an app, eliminating the need for physical coins. This idea resonated with many, as it promised convenience and efficiency in everyday transactions.
Witten’s pitch was well-received by the Sharks, particularly Robert Herjavec. Herjavec, a seasoned investor known for his technology ventures, saw potential in the concept. After negotiations, a deal was struck: Herjavec offered $250,000 for a 15% equity stake in CoinOut. This agreement was contingent on a successful pilot program with a large national retailer, a crucial step to validate the business model on a broader scale. The prospect of a partnership with a major retail chain would have provided CoinOut with the necessary infrastructure and exposure to revolutionize how consumers handle their change.
The Deal That Didn’t Materialize: A Setback and a Turning Point
Despite the handshake agreement and the optimism generated on national television, the deal between Jeff Witten and Robert Herjavec ultimately did not materialize after the show. The reasons for the deal’s collapse post-show are varied in the Shark Tank ecosystem, often involving due diligence processes, unmet contingencies, or changes in business strategy. For CoinOut after Shark Tank, this meant returning to the drawing board without the direct financial backing and strategic guidance from Herjavec.
This setback, while disappointing, proved to be a pivotal moment for CoinOut. Instead of abandoning the venture, Witten and his team used this experience as an opportunity to re-evaluate their core offering and market approach. The initial focus on digitizing loose change, while innovative, presented significant logistical challenges in terms of merchant integration and consumer adoption on a large scale. The path forward required a strategic re-think.
The Strategic Pivot: From Loose Change to Receipt Scanning
Recognizing the limitations of their original model, CoinOut made a critical strategic pivot. The company transitioned from its initial concept of managing loose change to becoming a cashback and rewards application. This new model leveraged a more accessible and scalable mechanism: scanning retail receipts.
The revised CoinOut app allowed users to earn rewards and cashback by simply taking a picture of their receipts from various retailers. This approach offered several advantages:
- Wider Applicability: It was not restricted to cash transactions or specific retailers willing to integrate a new change-dispensing system. Any purchase, regardless of payment method, could generate rewards.
- Ease of Use: Scanning a receipt is a familiar and straightforward action for most smartphone users.
- Data Value: The aggregated data from scanned receipts provided valuable insights into consumer purchasing habits, which would later become a key asset for the company.
This pivot transformed CoinOut into a direct competitor in the growing market of cashback and receipt-scanning apps, such as Ibotta or Fetch Rewards. Users could accumulate rewards, which were then redeemable for gift cards or direct cash payouts. This new model proved to be far more scalable and appealing to a broader consumer base, setting the stage for significant growth for CoinOut after Shark Tank.
Growth and User Adoption: Building Momentum
Following its strategic pivot, CoinOut began to experience substantial growth in user adoption and engagement. The simplicity of earning rewards by scanning receipts resonated with consumers looking for easy ways to save money and get more value from their everyday purchases.
By June 2021, CoinOut had achieved impressive metrics, with users scanning over 3 million receipts per month. This high volume of scanned data indicated a strong and active user base. The company also reported an annual revenue of $12 million by the time of its acquisition. These figures underscore the success of the pivot and the effectiveness of the new business model. The consistent engagement and revenue generation demonstrated CoinOut’s viability and its strong position within the cashback app market. The ability to pivot and then scale so effectively highlights the agility and foresight of the CoinOut team.
The Acquisition by IRI Worldwide: A Strategic Partnership
The success and valuable data aggregated by CoinOut did not go unnoticed by larger players in the market. In May 2021, CoinOut was acquired by IRI Worldwide (now Circana, after merging with NPD Group). IRI is a global leader in innovative solutions and services for consumer, retail, and media companies. They specialize in market research and data analytics, providing insights into consumer behavior, market trends, and product performance.
The acquisition of CoinOut by IRI was a strategic move for both entities:
- For IRI: CoinOut’s extensive database of receipt data provided IRI with a rich, granular source of real-time consumer purchasing information. This data complements IRI’s existing capabilities, enhancing their ability to provide comprehensive market intelligence to their clients. The direct-from-consumer receipt data offered a unique perspective on purchasing habits that traditional market research methods might not capture as effectively.
- For CoinOut: The acquisition by a major player like IRI provided CoinOut with significant resources, broader market reach, and the stability of being part of a larger, established organization. It validated the value of their platform and the data they had diligently collected.
This acquisition marked a significant milestone for CoinOut after Shark Tank, transforming it from an independent startup into an integral part of a global data analytics powerhouse.
CoinOut Today: Continued Activity and Legacy
As of recent reports, CoinOut remains active and available for download on major app stores, including the Apple App Store and Google Play Store. This continued availability indicates that IRI has integrated CoinOut’s operations and continues to leverage its platform for data collection and consumer engagement. While the primary purpose for IRI is likely data acquisition, the app still serves its users by providing cashback and rewards for receipt scanning.
The journey of CoinOut serves as a powerful case study in entrepreneurship:
- Adaptability is Key: The willingness to pivot from an initial concept when faced with challenges was crucial to CoinOut’s survival and subsequent success.
- Value of Data: The shift to a receipt-scanning model not only attracted users but also generated valuable consumer purchasing data, which ultimately made the company an attractive acquisition target.
- Beyond the Deal: Even when a high-profile deal like the one on “Shark Tank” doesn’t close, it does not necessarily mean the end for a business. It can be a catalyst for re-evaluation and finding a more viable path.
The story of CoinOut after Shark Tank is a testament to how an initial idea, even if it doesn’t fully materialize as planned, can evolve into a highly successful venture through strategic shifts and a clear understanding of market value.
How did CoinOut do after Shark Tank?
Thanks for asking. However, just like “Shark Tank” alumni MTailor and MuteMe, the company continued seeing success despite this setback, as CoinOut was acquired by IRI Worldwide in March 2021. By this time, users had scanned over 3 million receipts each month, and by June 2021, CoinOut was reporting annual revenue of $12 million.
Who bought CoinOut today?
Great question! IRI has announced its acquisition of CoinOut, founded by Jeff Witten,’10CC, ’15LAW, ’15BUS and member of the Columbia Startup Lab’s first cohort.