Shark Tank is coming! We’re mere weeks away from the season premier and we couldn’t be more excited! Our pal Kevin Brass did a piece for Wall Street Journal, where he had the opportunity to meet with some of the Sharks, who had plenty to say…
Come armed with research, confidence in your idea and a flair for selling others on that confidence. And you’ve got to be ready to do all of it under heavy fire. Unlike the real world, the investors are told nothing about the companies before participants take the stage—which means contestants have to make the equivalent of an elevator pitch in front of a national audience. Not to mention that the investors are eager to embarrass the hopefuls to make for better television.
“It’s reality on steroids,” says shark Robert Herjavec, a high-tech entrepreneur.
Here are 10 tips for making a winning pitch on “Shark Tank,” direct from the judges’ mouths. And the advice just might come in handy for making a pitch in the real world, too.
Stand Up Straight. Mr. O’Leary looks for certain body language—a strong stance and a confident, authoritative demeanor. “I can tell by the way they look back at me or the way they stand whether I’m going to invest in them,” he says.
It also helps to look appreciative. Mr. Herjavec revoked an offer to sisters Donna and Rosy Khalife, founders of Surprise Ride, a children’s activity-subscription service, when they appeared ungrateful for his interest.
In hindsight, they could have handled it differently, Donna Khalife says. “I think it’s crucial to acknowledge any interest from investors and explicitly thank them immediately,” she says. “We were grateful for Robert’s offer and it was unfortunate that it may not have come across that way to him or to viewers at home.”
Get to the Point. The sharks don’t want to search for the bottom line. “It’s very important to pitch the top three most important and impressive things,” emphasizing the existing revenue and, most important, the opportunity for growth, says shark Lori Greiner, who is best known for her shows on the QVC shopping network.
Keep it Simple. Real-estate executive Barbara Corcoran hates “fancy talk,” and says her eyes roll at any mention of “burn rate” or “liquidation events.” Stick to basic concepts like revenue, growth and the potential market. “There is nothing fancy about starting a business,” she says.
Participants on the show must also appeal to a broader TV audience. “You can’t be talking algorithms, clouds,” says Silicon Valley veteran Charles Michael Yim. He raised $1 million on “Shark Tank” for his company, Breathometer, which lets users monitor their blood-alcohol level on their phones.
Why You? Spunk and a perky presentation won’t cut it. Participants need to prove they can run a successful business. Ms. Corcoran invested in Cousins Maine Lobster because the owners convinced her they had the salesmanship and perseverance as well as the business plan to make it work. “It was not because they invented lobster. It was the work ethic,” Ms. Corcoran says. (Representatives of the company didn’t respond to requests for comment.)
Show Your Toughness. It’s fine to acknowledge failures. “Businesspeople understand you will fail, it’s not all sunny,” says shark Daymond John, who works in fashion and branding. The sharks look for entrepreneurs who can take a hit. “A good entrepreneur keeps coming back,” Ms. Corcoran says. She invested in Pork Barrel BBQ after co-founder Heath Hall was unfazed when she compared his appearance to the company’s pig logo. (“I felt she was testing me to see if she could get a negative reaction out of me,” Mr. Hall says. “So I chose to go with the flow and let her know I could take a punch and stay on my feet.”)
Don’t Be Greedy. Confidence helps, but not if you don’t have the numbers to back it up. “The biggest mistake is people ask for a valuation that is so stratospheric that it is not on the planet anymore,” Mr. O’Leary says. Unlike the real world, there is little time for negotiation or analyzing offers. Sharks liked the business plan for Intelli-stopper Technology, a food-preservation system, but balked at the price tag of $250,000 for 10% equity. “There is so much we could be doing together if you weren’t such greedy pigs,” Mr. O’Leary told Chase and Bill Hoyt, the father-son team behind the company.
“Obviously, the greedy-pig comment was tongue-in-cheek,” Chase Hoyt says today. “It’s almost impossible to find an investor who will agree with an entrepreneur’s valuation, especially with a prerevenue company in a large potential market.”
Show Somebody Cares. Don’t have big revenue numbers right now? No problem, the sharks say. But you’d better have some evidence of market interest. And be objective—nobody wants to hear about the praise of your friends and family. “It’s important to show the traction you have,” Ms. Greiner says.
Where’s the Pot of Gold? Likewise, the sharks want to know “the potential for scalability” in a business, says Mr. John. They’re rarely swayed by entrepreneurs who are satisfied with their current market and just want cash to make modest improvements.
“I want somebody who says this is just the beginning,” Mr. Herjavec says. For instance, the sharks weren’t interested in investing to open just one new retail outlet for Cinnaholic, a “cinnamon-roll experience,” but Mr. Herjavic perked up when the founders mentioned their e-commerce business.
“It is pretty clear that pitching the online model in the first place would have been the right move,” says Cinnaholic co-founder Florian Radke. “All of the sharks are looking for a business model with rapid growth potential” and a quick return on investment.
Please, Please Know Your Numbers. Mr. O’Leary promises to “eviscerate” anybody who isn’t prepared to answer tough questions about their business. When brothers Richard and Albert Amini couldn’t answer basic questions about the potential market and revenue sources for their RoloDoc app—which is designed to securely connect doctors and patients—shark Mark Cuban called it the “worst pitch ever” on the air. (Remember: Nothing makes better TV than a shark stalking a floundering entrepreneur.) Albert Amini could not be reached for comment.
Don’t Beg. Mr. John is not interested in tales of woe. “How badly they need the money for their life, that’s not something that should be taken into consideration,” Mr. John says.
And the sharks aren’t interested in your “mission,” just the mechanics and promise of the business. “I don’t want to change the world, I want to make money,” Mr. O’Leary snapped at the founders of Zoobean, a service that curates children’s apps and books.
Are ready for the Sharks when Shark Tank returns at a sepcial time FRIDAY SEPT 26 8|7c? We are!