“Shark Tank” (Dragon’s Den for my Canadian friends) is an ABC reality show that features a panel of billionaire investors (“sharks”) who are willing to invest their own money into businesses and ideas pitched to them by aspiring entrepreneurs.
The Sharks are: Mark Cuban, owner of the Dallas Mavericks and software/media billionaire. Daymond John, the founder of the FUBU clothing brand. Kevin O’leary who founded “The Learning Company” and later sold it to Mattel. Barbara Corcoran a Manhattan real estate mogul, and Robert Herjavec. Who, honestly, I’ve never heard of before the show.
One by one entrepreneurs are led into the shark tank to be grilled by the sharks. Some stand up to the fire and walk away with a hefty investment and new business partner. Others wilt under the pressure and get sent back from whence they came.
I’ve been a huge fan of the show since I started watching in the first season, but while watching the current season of “Shark Tank” some lessons for success are showing up again and again, becoming quite clear. These are lessons I believe apply to anyone, whether you’re the next entrepreneur thrown into the shark tank, or a parent looking to teach your child some valuable life lessons.
1. Know your Numbers! – I cringe every time an entrepreneur goes into the shark tank asking for $100,000 for a 10% stake in their company and then blankly stare at the Sharks when asked “So, you have $5,000 in sales. What makes you think your business is worth $1,000,000?”
The successful entrepreneurs are the ones that know their business and its numbers inside and out. The Sharks know the math, and any successful investor or business owner will know these numbers and valuations inside and out. You may think you have a million dollar idea, but without the numbers to back it up you don’t have anything.
2. Know what you have. – So many people show up in the Shark Tank pitching a product they think is great, while the Sharks see tremendous value in something totally different.
The best example I’ve seen of this is the case of Copa di Vino. The entrepreneur came in pitching his brand of wine, Copa di Vino, which was sold by the glass in his patented packaging system. The Sharks, specifically Kevin O’Leary saw HUGE value in licensing the patent for the wine by-the-glass packaging out to every major wine maker in the company. The entrepreneur however couldn’t get over his desire to only build his brand of wine.
While the business owner may be very successful in building his winery, I have to believe that he could have made billions of dollars licensing out his packaging patent and getting paid every time someone bought a sealed glass of wine anywhere in the country.
3. Know Your Added Value – I get it, each one of us is brought up to believe we’re special. While it’s true to a certain extent, this thinking often leads us to vastly overestimate what we bring to the table. Will you really work harder than anyone else the Sharks have ever met? Are you really what makes your idea impossible to copy? Chances are the answers to these are no. Be it in the Shark Tank or a job interview, you may think these are the kinds of things people want to hear. If you stay realistic, and focus on what you really bring to the table you’ll be taken more seriously and have more success in whatever it is you do.
4. Learn To Negotiate – As you can imagine, the Sharks often make less than ideal offers to the entrepreneurs. Those that can tactfully negotiate a better deal without offending the Sharks make out better for themselves. The same holds true outside the Shark Tank. Learning to negotiate can save you thousands of dollars on a new car or earn you thousands more in salary from a new job offer. Knowing how, and how far you can push back in a negotiation is an invaluable skill.
5. Decide What to Be, and Go Be It – Whatever your goal is, make it your obsession. Eat, sleep and breathe it. This is a something Mark Cuban hits on over and over in his book and it is echoed by successful people everywhere. If you aren’t willing to sacrifice to meet your goals you’ll never reach them. There was an entrepreneur on Shark Tank who had a great idea, he invented a way to print custom images on any pair of sneakers. He even had a store with rapidly growing sales. However when the Sharks asked what he was going to do with their money he replied that he would use it to expand his business along with paying himself a “comfortable” six figure salary.
As you can imagine he was laughed right out of the Shark Tank with no investment. If he had been willing to sacrifice parts of his lifestyle for the sake of the business he would have gotten the money he came looking for and his business, and lifestyle would be better off for it.
I’ve found that the entrepreneurs who succeed in the Shark Tank are those who have mastered these lessons. However the show provides many more business lessons than I’ve written about here. If you haven’t done so already, tune in or set your DVR’s to ABC at 8pm eastern Friday nights. Shark Tank really is a mini-MBA in each hour-long show.
Do you watch Shark Tank? If so leave a comment below and let me know what the most important lessons for success you’ve taken away from the show are.