"Valuation is insane" Pepsi to pay $1.9 billion for Poppi, a brand rejected by Shark Tank's Kevin O'Leary and Mark Cuban 

In a startling development that perfectly captures the capriciousness of entrepreneurship, PepsiCo revealed that it will acquire the prebiotic soda firm Poppi for $1.9 billion. The transaction has brought attention to a notable Shark Tank episode from 2018, in which the company—then called Mother Beverage—was turned down by well-known investors Mark Cuban and Kevin O'Leary.

During that pitch, husband-and-wife co-founders Stephen and Allison Ellsworth sought $400,000 for a 10% stake in their apple cider vinegar beverage company. O'Leary dismissed their proposal with biting criticism:

"Every beverage company comes into Shark Tank and says the future is so bright that you have to wear shades. The valuation is insane," before announcing he was out.

Cuban, despite his Dallas roots matching the company's home base, also passed, saying:

"As much as I would like to help a Dallas company, I'm out.

Fast forward to 2025, and that "insane" valuation has transformed into a billion-dollar acquisition, marking one of the most dramatic "Shark Tank" success stories that almost wasn't.

What happened during Poppi’s Shark Tank pitch?

When the Ellsworths appeared on Shark Tank, they started their pitch with a risky move – having the sharks taste shots of apple cider vinegar. This was meant to highlight how Allison had created beverages that included healthy ingredients but actually tasted good. While the sharks agreed the samples were tasty, most quickly backed out.

Guest shark Bethenny Frankel criticized their manufacturing approach, saying:

"You're still in the kitchen," before declining to invest.

Lori Greiner praised the product but also passed, saying she'd be a customer but not a partner.

Only guest shark Rohan Oza, who had experience in consumer products, showed interest – but with a catch.

"Beverage is savage," Oza warned, before offering $400,000 for a 25% stake.

The couple accepted, beginning a partnership that would prove remarkably fruitful.

In order to make delicious, healthier drinks, Allison Ellsworth started Poppi in a Dallas kitchen by combining fruit juices with apple cider vinegar. The couple first sold at farmers' markets before a Whole Foods buyer noticed them and helped them land a regional contract.

After their Shark Tank appearance, the Ellsworths rebranded to Poppi and shifted their production strategy. They abandoned plans for a bottling plant and instead partnered with co-packers, launched canned products alongside bottles, and rapidly expanded their retail presence.

Poppi's yearly revenue reached $50 million by 2024. Partnerships with celebrities like Post Malone, Hailey Bieber, and Jennifer Lopez, as well as national distribution in stores like Walmart, Target, and Costco, drove the brand's expansion.

Poppi’s success and the PepsiCo acquisition

The $1.9 billion acquisition by PepsiCo validates Oza's prediction that the brand would become "Shark Tank's first billion-dollar brand." According to reports, Oza's venture capital firm, CAVU Consumer Partners, invested $25 million in Poppi over the years before the sale.

"Poppi is a true testament to the American Dream! From the kitchen to Shark Tank to becoming an iconic brand, this couldn't have been done without the amazing founders Allison and Stephen Ellsworth," Oza said following the announcement.

PepsiCo's interest in the brand reflects broader industry trends. As Ramon Laguarta, Chairman and CEO of PepsiCo, explained:

"More than ever, consumers are looking for convenient and great-tasting options that fit their lifestyles and respond to their growing interest in health and wellness."

Poppi's success stems from its ability to create a lifestyle brand rather than just its product. Younger consumers are drawn to their vibrant, vintage cans, and their marketing approach combines contemporary influencer relationships with conventional retail distribution.

"Poppi's become so much more than a soda, it's a tight-knit community and lifestyle at this point," Allison Ellsworth shared with Forbes.

Explaining:

"From exclusive merch to exciting collaborations with other brands, we're creating hype and interest that goes beyond a product."

The brand has twice secured Super Bowl commercials, with their 2024 ad becoming the most-watched commercial of the game, reaching 29.1 million households.

The brand's acquisition signals a shift in the beverage industry. By reinventing soda formulas to reduce sugar while maintaining flavor, the company tapped into growing consumer demand for healthier alternatives.

The functional beverages market reached $134 billion in 2024 and is projected to hit $231 billion by 2033. Poppi's success demonstrates that the next generation of soft drinks isn't just about ingredients – it's about building community and lifestyle connections.

For the sharks who passed on investing, the Poppi story serves as a reminder that sometimes, the most promising opportunities are the ones that initially seem to have an "insane" valuation.

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You can watch Shark Tank in the U.S. on ABC, stream it on Hulu, or purchase episodes on platforms like Amazon Prime Video and Apple TV.