Gift Card Rescue Update | Shark Tank Season 1

Kwame Kuadey identified a common issue: billions of dollars worth of gift cards go unclaimed each year. To solve this problem, he founded Gift Card Rescue, a platform where people can sell their unwanted gift cards for cash, benefiting both sellers and buyers. Will his company secure a deal? Find out in our Gift Card Rescue update and pitch recap.

If you’re short on time, here’s a quick overview of what happened to Gift Card Rescue after Shark Tank.

Kwame entered Shark Tank Season 1 to pitch his gift card reseller business, Gift Card Rescue. He sought $150,000 for 30% equity. After his pitch, he made a deal with both Kevin O’Leary and Robert Herjavec for $200,000 for 50% equity.

In terms of a Gift Card Rescue update, the company gained significant media recognition, which translated into substantial sales revenue. However, the success was short-lived. Financial problems and customer complaints eventually crippled the business. Kwame sold the company for an undisclosed amount and has since moved on to a new venture.

Shark	Result
Kevin O’Leary and Robert Herjavec	Accepted offer of $200,000 for 50% equity
Kevin Harrington	No offer
Daymond John	No offer
Barbara Corcoran	No offer

Shark Tank Gift Card Rescue Pitch

• Entrepreneur: Kwame Kaudey
• Business: Unused gift card exchange
• Ask: $150,000 for 30% equity
• Result: $200,000 for 50% equity
• Sharks: Kevin O’Leary and Robert Herjavec

Kwame presented his gift card exchange business, Gift Card Rescue, on Shark Tank, seeking $200,000 to scale his business.

He aimed to tap into the billions of dollars in unused gift cards circulating in the market.

Gift Card Rescue is an online marketplace that facilitates the buying and selling of gift cards.

Consumers can sell unwanted gift cards to the company at a discounted rate, and the company then resells these cards at a higher price, generating revenue through the difference. 

The platform categorizes gift cards by brand and verifies their authenticity.

It benefits sellers, who can convert unused gift cards into cash, and buyers, who can purchase discounted gift cards.

Kwame was facing a common start-up problem as his business had outgrown his personal resources. 

Operating out of his home with the help of his wife, Gift Card Rescue had a gross margin of around 25% per gift card.

At the time, Kwame had earned $55,000 and was on track to bring in $120,000 in sales for the year. However, with the required capital to grow, his profits could increase significantly.

The business model is simple: acquire gift cards from customers at 65-70% of their face value and resell them for 90% of their face value.

Kwame had done extensive research to determine which cards would sell. 

He had also confirmed Amazon’s interest in partnering with his business. Without the influx of cash, he would not be able to continue his start-up.

During the pitch, Robert Herjavec asked pointed questions about the business’s value.

Kwame responded confidently, highlighting the importance of the capital investment, the potential partnership with Amazon, and his management skills. 

Daymond John and Barbara Corcoran both decided not to invest, stating it wasn’t their kind of business. 

Kevin Harrington felt the company was too early for an investment and also declined. 

Kevin O’Leary offered $150,000 for 50% equity. 

Robert Herjavec teamed up with Mr. Wonderful and offered $200,000 for 50% equity, and Kwame accepted.

What happened next for his company? Keep reading our Gift Card Rescue update to find out.

Shark Tank Gift Card Rescue Update

Our research on the Gift Card Rescue update revealed that Kwame eventually turned down the deal with Kevin O’Leary and Robert Herjavec because giving up 50% equity was too much for him.

Since appearing on Shark Tank, Gift Card Rescue initially soared in popularity. Leveraging the show’s publicity, they secured a partnership with Amazon.

In 2012, the company had grown to $6 million in annual revenue, and by 2013, it had surpassed $10 million, making Gift Card Rescue one of the fastest-growing startups on Shark Tank. 

However, their rapid growth led to financial strain and numerous customer complaints. 

Our Gift Card Rescue update found that by 2015, their annual sales revenue had reached $15 million, but in July 2016, a lender’s loan default judgment froze the company’s bank account, forcing it to shut down. 

Kwame attempted to raise funds and renegotiate loan terms but was unsuccessful. The company could not sustain its rapid expansion without adequate financing. 

Subsequently, the Better Business Bureau received 300 complaints, primarily from unpaid sellers.

At the time of writing, the Gift Card Rescue website is still active but under new ownership. 

Today, Kwame is the CEO and founder of Pioneer Branding, which focuses on helping entrepreneurs build magnetic personal brands.

This will be our final Gift Card Rescue update.

Would you like to learn about the other companies featured in Season 1, Episode 4? Follow the links below for our other company updates from the episode.

• Souls Calling Update
• Coffee Brand Gifts Update
• Graffiti Removal Services Update
• Coverplay Update

Before you go, check out our Shark Tank Season 1 page for more updates.