Startup wins deal on TV’s ‘Shark Tank’
Updated: Jul 16
Editor’s note — This article won fifth place for best business reporting in the California News Publishers Association’s 2023 California Journalism Awards.
When Tia Lupita founder Hector Saldivar first re-created his mother’s treasured hot-sauce recipe, his friends and family funded his startup. They would try the thick, pepper-forward salsa, love it, and invest.
Now the Tiburon resident appears to have a big new funding source by winning a deal on ABC’s hit reality-TV show “Shark Tank.” And it was a rare offer from the five-member investor panel’s “Mr. Wonderful,” a tongue-in-cheek nickname for a venture capitalist known for his brutal negotiations.
“I’m super happy that we’re able to make a deal with Kevin O’Leary,” Saldivar said in an interview with The Ark. “Just being able to negotiate with him was a feat. Was that the best deal in the world? Maybe, maybe not. They’ve offered better deals, but I think under the circumstances and the stage that we’re in, it’s a great deal.”
In an episode that aired April 14, Saldivar pitched his business plan for Tia Lupita Foods, now a full line of handcrafted, small-batch salsas, tortillas and tortilla chips made with healthy and sustainable ingredients that he said did about $4 million in business last year.
Off the bat, he sought a $500,000 investment in exchange for 5% of the company — a $10 million valuation.
“The tortillas are great, but you’re in a business that’s a grind,” said Mark Cuban, perhaps best known as the owner of the Dallas Mavericks and Magnolia Pictures, before bowing out. Three other sharks quickly followed.
But O’Leary’s interest was piqued. He’s also a master chef, with a Chef Wonderful line of foods, and has been seeking a grain-free tortilla chip like Saldivar’s.
“That’s my whole schtick these days — healthier eating, healthier living — and this is one of the best I’ve tasted,” he said.
Then he lived up to his reputation, offering the $500,000 in debt as a three-year loan with 12.5% interest, in exchange for 10% of the company, prompting gasps from his panel colleagues. They all rushed to help Saldivar get something better. Saldivar’s sticking point was giving up so much of the company.
But after an intense back-and-forth, with a rejected counter and O’Leary repeatedly digging that his offer wasn’t negotiable, it was Saldivar, not the other sharks, who found the eventual dealmaker: O’Leary’s 5% wouldn’t get diluted as the company grew.
“Hector, you have a deal,” O’Leary said.
The deal made on camera isn’t always the one that startups actually get, and Saldivar confirmed his is still under negotiation. But he says he’s overjoyed.
Right now, the 46-year-old CEO has six employees, and the focus is on growth and raising money. Saldivar said he’s not making a salary. But he is following his dream and his passion.
Just getting on “Shark Tank” is a major achievement. One of Saldivar’s co-workers applied on the company’s behalf more than a year ago. The show gets 40,000 applications per year, with 156 founders invited to a taping and only 88 making it on air.
“That’s validation that they loved the products. They all loved them, there was no negative feedback at all, only positive,” Saldivar said.
He said his main objectives with Tia Lupita have always been to offer a healthier, sustainable choice when it comes to Mexican food, and to connect people from all over through his food under the motto: “We’re saving the planet one taco at a time.”
“It’s a little bit surreal for sure. I did not expect to grow so quickly. It’s a validation and a testament to my vision, that there is a need for better Mexican products,” Saldivar said. “It’s been a lot of hard work but really has been worth it. People connect with the story of the brand. They’re willing to take the chance.”
Saldivar’s story begins in Monterey, Mexico, where the father of three was born and raised. When he moved to the U.S. 18 years ago, he left Mexico with high hopes and big plans to succeed in the U.S. He worked in sales, marketing and business development for several big-name food companies. And each month, his mother, Lupita, would send him bottles of her homemade hot sauce. The recipe was passed down from generation to generation and had the flavors of home. When he would share bottles with his friends, they would rave about it, he said, to the point where they would request bottles be shipped directly from his mom.
“There wasn’t anything that resembled my mom’s hot sauce in the United States. Most here are vinegar based, are runny, watery. With her hot sauce, the first ingredients are the peppers,” Saldivar said.
In 2016, he was forced to make a difficult decision. His employer, Diamond Foods, was acquired and operations were moving to North Carolina. He either had to move his family or stay put and figure out the next chapter in his career.
He chose to stay. And with that decision came the idea to re-create his mother’s beloved family recipe. Tia Lupita Foods was born in 2017. The small-batch sauces come in five flavors: original, chipotle, habanero, salsa verde and salsa matcha.
Saldivar has also added unique tortillas and chips to his line, made from nopales, the prickly pear cactus, grown widely in Mexico and used extensively in its cuisine. The cactus is harvested, dehydrated and pulverized to create a flour. That flour is then mixed with corn flour to create his corn masa tortillas.
The cactus tortillas and five types of tortilla chips mix the nopales flour with cassava flour instead, making them grain and gluten free. Nopales is also considered a superfood like kale, beans, nuts and chia — high in antioxidants, fiber and calcium with a low glycemic index and low calorie.
“I wondered why no one has used it in the U.S. since it’s also sustainable. It’s like a no-brainer,” Saldivar said.
What was also a no-brainer was to pay homage to his mother, Lupita. Saldivar knew he had to name his food line after her. “Tia,” which means aunt, is what many call her in Mexico. As for the cartoon logo of Lupita, with a large, pink curler in her hair; well, that reflects reality.
“I wanted to show that Tia Lupita is a real person. My mom always has a curler in her hair when cooking to keep her bangs out of her eyes,” Saldivar said.
His line of Mexican snacks is now available in 7,000 stores nationwide, including Nugget Market, Whole Foods and Walmart.
In fact, the first store to give Saldivar his big break was Tiburon’s Woodlands Market at The Boardwalk shopping center. It stocked the aisle with Tia Lupita salsa not long after hearing Saldivar’s proposal.
“Tia Lupita is truly a one-of-a-kind product line,” said Scott Buhagiar, grocery buyer at Woodlands. “The chips are one of the best grain-free chips on the market.”
To learn more about Tia Lupita Foods, visit tialupitafoods.com.
Contributor Lisa Amin Gulezian of Tiburon is an award-winning journalist with more than 20 years of experience.