Entertain Your Kids By Choosing The Toy Rental Services of Toygaroo
Are you searching for a convenient way to make your children happy with new toys every month? Toygaroo is a subscription-based toy rental company that allows parents to rent toys for their children.
The other name of Toygaroo is The Netflix of Toys. Nikki Pope, the founder of the company pitched her company on Shark Tank intending to bring a revolution in the way parents and children access toys.
Although she was able to secure a deal with Mark Cuban and Kevin O’Leary, it is supposed to be one of the biggest failures in the history of Shark Tank. Toygaroo went bankrupt and as of 2023, the worth of the company is $0.
Keep reading this article to know the story behind Toygaroo, and the experience of the founders of Toygaroo on Shark Tank.
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Toygaroo is a toy rental service that offers toys online so that parents can take them on rent for their kids. It is also called the Netflix of toys.
It enables parents to give their kids the latest and most expensive toys at a very low price. The most interesting feature of this service is that it helps to save some space.
Parents are allowed to choose a subscription plan containing the number of toys they want. They are also allowed to exchange the toys they have bought for new ones while their kids get bored with their toys.
Moreover, if your kid loves a specific toy you will be able to buy it.
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Who Is The Person Behind the Birth of Toygaroo?
Nikki Pope is an entrepreneur from Los Angeles, California. She was born and brought up in an enormous family. She has 11 siblings and 13 nephews and nieces.
She completed her education in Psychology from Sam Houston State University. Although Nikki appeared on Shark Tank alone to represent Toygaroo, she was not the only person behind the foundation of the company.
Besides Nikki, the other co-founders of the company are Rony Mirzaians, Hutch Postik, Phil Smy, and Young Chu. They started the business in 2010. Nikki Pope served as the face of the company as she appeared on Shark Tank alone.
The Story Behind The Foundation Of Toygaroo
The company began with Nikki and her experience with her relations. She understood that kids always want to have new toys but they get bored of playing with them very quickly. So, it is sometimes a waste of money for parents.
That is why she came up with the idea of making a subscription-based service so that people can take tots on rent until their children get bored of them. As soon as they get tired of their old toys, they can return the toys and take new ones in place of them.
Though the idea for this business came out of the head of Nikki, she is not the only person behind the foundation of Toygaroo. Several co-founders helped her to set up Toygaroo in 2010.
When they launched their company, it contained 500 subscribers that paid $42 every month. Most of the early users of this toy rental service adored it and it grabbed the attention of a huge number of customers through word of mouth.
Nikki Pope appeared on Shark Tank season 2 with her unique approach to reducing the expenses of parents to entertain their kids. She lives in Los Angeles, California.
She has shared on the Shark Tank stage that she had a very big family, thirteen nieces and nephews. And they loved to play with toys like the other kids.
She referred to her nieces and nephews as playtime pros. Then she told me the fact that the kids got tired of their toys very quickly.
Nikki said the sharks that fit this reason she and her husband decided to launch Toygaroo.
Toygaroo is one of the most reasonable solutions for parents to keep their home clean and clear at the same time keeping their kids entertained by providing new toys.
According to Nikki Popes, they did not have any kids but they wanted to be parents soon. If the sharks accept the Toygaroo that would be a great financial security for the family of Nikki Pope and her husband.
She believed that the vision behind her business would be useful for every family having children who love to play with toys. That is why she was expecting that the sharks would accomplish her desire.
How Was The Shark Tank Pitch Of Toygaroo?
Nikki Pope came up on Shark Tank and asked for an investment of $100,000 in exchange for a 10% stake in her business. She called her Toygaroo venture Netflix for toys.
After coming up on the Shark Tank stage, she started to illustrate how this service would be more convenient and more cost-effective than getting the toys directly. The sharks expressed their doubts over the offer.
They examined Nikki on different topics like how much money she would like to invest in stocks and how much the family would spend per year. Finally, Nikki Pope managed to secure a deal from Mark Cuban and Kevin O’Leary.
They agreed to invest $200,000 in exchange for a 40% share in her business.
Toygaroo Shark Tank Update
Toygaroo after Shark Tank became very popular. As soon as the Toygaroo Shark Tank episode was aired there was an incredible amount of traffic on the Toygaroo website.
It seemed that it was a good thing. But it was the beginning of their downfall. Due to the quick growth of customers, they faced issues with their inventory and shipping costs.
To fulfil the demand of customers, employees started to buy individual toys from nearby stores in place of making any wholesale deals. The costs spiralled without any system to scale the business.
In the initial stages, they only concentrated on development over toy sourcing. Moreover, the toy companies did not like Toygaroo as they took them as a competitor that devoured their sales by providing toy rental services.
After securing a deal with Mark Cuban and Kevin O’Leary, they expected that Kevin would introduce them to people who are in the toy business. As per Phil Smy, Mark Cuban was not active but he had an associate who kept monitoring the business.
Toygaroo requested the two sharks to look for money to save the company when the costs were spiking continuously. Both Cuban and Kevin O’Leary denied it.
They gave a proposal to take over the entire company. Finally, the founders stopped their business and started to involve themselves in other opportunities.
Toygaroo went bankrupt and in 2013 they ceased their business operations officially.
Among all the founders of the business, Smy is supposed to be the only active entrepreneur. He is now operating two websites: Zonmaster and LotteryCanada.
There is not much information available about Nikki Pope. She started to run a PR company named The Prime Effect but now it has gone out of business.
Toygaroo never faced any problem in catching the eyes of customers or the media. They got publicity from Shark Tank very quickly. So, it seems that if they did not appear on the Shark Tank show things might have been different at this time.
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How Did Toygaroo Earn Money?
Toygaroo provided different types of subscription levels. Their entry-level plan is named the Joey Package which is priced at $24.99 and contains four toys.
Moreover, they provided other varieties of packages like six toy bundles and eight toy packages. They were available from $32.99 to $42.99.
According to Nikki most of the family have to send $1200 to $1500 every year only for toys. This service would help them to bring the expense down to $500.
Moreover, this service would help the families to manage the storage and space in houses that are generally taken up by toys. If anyone likes a specific toy and wants to keep it, they have to buy it.
Toygaroo offered free shipping to all customers and they were able to acquire the first 500 customers through the word-of-mouth portion at approximately $40 for each toy.
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The founders of Toygaroo managed to get an investment of $200,000 from the sharks but they were not able to sustain their business a few months after the show.
The main reason behind this failure was that inventory and logistical costs were very costly. That is why the company had to invest in inventory and logistics.
The company announced that it went bankrupt soon after that. They filed for Chapter 7 bankruptcy protection in 2012.
The website of Toygaroo has been inactive since 2012 and it was completely shuttered in 2016.
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The sharks Mark Cuban, Barbara Corcoran, Daymond John, Kevin O’Leary, and Robert Herjavec were present on Shark Tank when Nikki was giving her pitch. Kevin O’Leary offered to invest $200,000 in exchange for a 35% share in the business.
Barbara Cocoran asked Nikki whether she had the right to sell the company. She replied that she could do whatever she wanted with it.
Barbara was not satisfied with the deal and hence she left. Daymond John generally deals with people who are not in control of the firm and hence he left the deal.
Mark Cuban made a partnership with Robert Herjavec on the deal but Robert Herjavec liked it. The CEO of the company suggested completing the sale by giving her a proposal of $200,000 in exchange for a 40% stage of the business.
Nikki asked Mark and Robert whether they were ready to accept a bargain of $200,000 in exchange for 40%. Nikki accepted the proposal of Kevin to fulfil the purchase at that price.
Mark offered to split the contract with Kevin excluding Robert. Both the sharks agreed finally.
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The pros and cons of Toygaroo are mentioned below:
- It is easy to subscribe and there are plenty of outstanding items available on the website.
- It is available at affordable and fair prices.
- You do not need to go out of your way to obtain it.
- Though the boxes are always filled with new toys, they are not always good quality.
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Toygaroo is an outstanding way for parents who are on a tight budget. Parents who do not want to spend a lot of money on toys would be able to entertain their kids with a wide range of toys and that too without cutting their pocket.
It enables the parents to keep their home clean and live a normal lifestyle by letting them exchange old toys for new ones every month.
Parents are allowed to choose from 500 toys and add them to their carts sitting at home. That is why the company helps parents to save time and stress as they do not need to go to the mall or any toy shop to buy toys.
The company also enables parents to choose various subscription plans as per their needs. Parents are also allowed to purchase some of the toys at minimal prices if their kids get attached to them and do not want to let them go at the end of the month.
The company has also a struct sanitization procedure in place for the toys. This includes steam cleansing, washing with a bleach-free and organic cleaning solution, and examination by a sanitization expert before getting packaged for shipping.
Toygaroo is an outstanding way for parents to keep their kids happy and offer them an opportunity to play with a variety of toys which in turn help them to improve their cognitive skills and encourage creativity.
The company pays the shipping charges. So, the parents do not need to worry about paying any extra shipping charges.
Nevertheless, the company has limited its services only to kids and elementary-going children. Older people would find it difficult to find perfect toys for themselves.
According to us, this is supposed to be one of the reasons which led the business towards failure.
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We do not know perfectly what occurred to Toygaroo after the Shark Tank episode. They are not active in business any more for a few reasons. But they have shown a new way to cut down the expenses of buying toys. That is praiseworthy.
Are there any alternatives to Toygaroo?
Some of the alternatives to Toygaroo are as follows:
What Is The Net Worth Of ToyGaroo?
When Toygaroo appeared on Shark Tank, the net worth of the company was $1 million. As of 2022, the net worth of the company is not known as it has gone out of business.
Who Are The Investors Of Toygaroo?
Mark Cuban and Kevin O’Leary were the investors of Toygaroo. They were ready to invest $200,000 in exchange for a 40% stake in Toygaroo.
Nevertheless, as per the research, it has been found that people can buy toys at a lower price in local stores because of the high shipping costs, high inventory costs, and subsequent studies.
For the reasons mentioned above the founders were compelled to close their business.