What changed
Teaspressa filed Chapter 11 (Subchapter V) to restructure about $3M of debt
When
Filed September 11, 2026; reported in early October 2026
Who it affects
My Little Tea Kettle LLC, dba Teaspressa, Phoenix, Arizona
What to do
Brands: fund growth from margin, not debt, and keep fixed costs flexible

Key takeaways

  • Teaspressa filed Chapter 11 on Sept. 11, 2026, to restructure about $3 million of debt.
  • Sales more than tripled after its 2016 Shark Tank episode, but store costs and debt outgrew revenue.
  • Brands should prove repeat demand before turning a spike into leases or loans.

Teaspressa from Shark Tank to Chapter 11

  1. Pitches on Shark Tank season 7, no deal

  2. Sales more than triple, first store opens

  3. Five storefronts

  4. Four of five stores close

  5. Revenue of $1.89M, per Inc.

  6. Files Chapter 11 under Subchapter V

What happened to Teaspressa

My Little Tea Kettle LLC, which does business as Teaspressa, filed a voluntary Chapter 11 petition on September 11, 2026, in the U.S. Bankruptcy Court for the District of Arizona, according to the Phoenix Business Journal, ABC15 and TheStreet. It filed under Subchapter V, the faster and cheaper route for small businesses, which lets owner Allison DeVane keep control of the company while it repays creditors from future earnings.

The filing lists 50 to 99 creditors, assets of $50,001 to $100,000 and liabilities of $1,000,001 to $10 million, below the $3,424,000 small business debtor cap. TheStreet reported the company is seeking to restructure about $3 million of debt, and the filing estimates that no funds will be left for unsecured creditors after administrative expenses.

The Shark Tank boost that did not last

DeVane pitched Teaspressa, a tea brewed like espresso and sold as a coffee alternative, in a season 7 episode of Shark Tank that aired in February 2016. She left without a deal. It did not matter at first: DeVane wrote that sales more than tripled after the episode, which paid for the brand's first store, and Tasting Table reported orders kept coming for years as reruns aired.

At its peak Teaspressa ran five storefronts. Four closed during the Covid pandemic, leaving one location in Phoenix. Inc. reported the business still made $1.89 million in 2025, so this is not a brand with no customers. It is a brand whose costs and debt outgrew what the sales could carry.

Why a TV spike is not a business model

Shark Tank is one of the strongest free marketing events a small brand can get. But Teaspressa shows the common trap: a sudden wave of demand gets used to fund fixed costs, such as leases and staff, that stay long after the spike fades.

  • A one time demand spike was used to open physical stores with long term leases
  • Retail stores carried high fixed costs that hit hard when Covid shut four of five
  • Growth was funded with debt that the remaining business had to service

Before you spend a demand spike

  • Track sales 60 to 90 days after the spike
  • Know margin per channel after all costs
  • Keep fixed costs flexible
  • Do not borrow against peak sales
  • Turn spike buyers into repeat buyers

What this means for sellers and brands

For D2C and Amazon brands, the lesson is about what you do with a demand spike, whether it comes from TV, a viral TikTok, a Prime Day win or a big influencer post. Treat the extra cash as a test of repeatable demand, not proof of it. Before you sign a lease or take on a loan, check that sales hold for several months without the spike, and that each channel makes money after all costs. Our guide to Amazon seller cash flow shows how to plan inventory and debt around real sell through.

It also shows the value of low fixed cost channels. Marketplaces like Amazon, Walmart and TikTok Shop let a brand turn spikes into repeat sales with search ads and subscriptions, and scale spend down when demand cools, without paying rent on a storefront. Our DTC marketing strategy examples cover how brands build demand that does not depend on one moment.

What sellers should do

If your brand just had, or is hoping for, a big media moment, use this checklist before you spend the upside.

  • Measure sales for 60 to 90 days after the spike before adding fixed costs
  • Calculate contribution margin per channel after fees, ads and shipping
  • Avoid funding expansion with debt that only works at peak sales
  • Capture spike buyers into email, SMS and subscribe and save to make demand repeatable
  • List on a marketplace with search demand so rerun or viral buyers can find you
  • Run a free Amazon audit to see whether your ad spend is profitable

Where PPC Spider helps

PPC Spider runs Amazon, Walmart and D2C growth for consumer brands, with SpiderOS watching bids, budgets, search terms and stock every day, and target ACoS set from product margin after fees. Our Shopify and DTC agency team builds the owned channel. More brand stories are on the Shopify and ecommerce news channel.

Sources

  • TheStreet via Yahoo Finance: 'Shark Tank' beverage brand files Chapter 11 bankruptcy (finance.yahoo.com/small-business/articles/shark-tank-beverage-brand-files-180300863.html)
  • ABC15 / Phoenix Business Journal: Phoenix tea brand featured on 'Shark Tank' files Chapter 11 (abc15.com/news/business/phoenix-tea-brand-featured-on-shark-tank-files-chapter-11)
  • First for Money via Yahoo: Drink brand made famous by 'Shark Tank' files for Chapter 11 bankruptcy (sg.finance.yahoo.com/news/drink-brand-made-famous-shark-184549040.html)
  • Inc.: Teaspressa made $1.89 million in 2025. Its bankruptcy filing reveals how the 'Shark Tank' brand unraveled (inc.com/rachel-suleymanov/teaspressa-made-1-million-dollars-2025-bankruptcy-filing-reveals-how-brand-unraveled/91415319)
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