Top 10 Shark Tank / Dragons’ Den Lessons

Posted on 09/04/2011

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Hey guys!


Those of you who follow me on Twitter may already have noticed that

I’m a devoted fan of Shark Tank.  And Dragons’ Den.


We’re fortunate to be able to view both versions of the British original – Dragons’ Den

– here in Barbados compliments the wonderful world of cable TV.


On ABC, we get the US’ Shark Tank on Fridays;

and on Wednesdays on CBC we have Canada’s Dragons’ Den: with glorious

reruns weekday afternoons (love you, CBC for your spot-on consumer

insight).


The list that follows is for two types of readers:


(1) Fellow Sharkies/Dragonettes who consume the

Shark’s/Dragons’ advice like I do – to hone their VC

presentation skills for that all-important investor pitch.


And (2) for Shark Tank/Dragons’ Den newbies, who have yet to see the show:

hurry up and convert – you guys are seriously missing out!

So here’s my list.  Feel free to comment and to share any lessons you’ve

learned from the show:


1.  Watch the show before you go on it.  This one seems so obvious.  You’d expect that the

reason entrepreneurs go on the show is because they have seen it.  Well, I don’t have the

stats on this, but watch a few pitches and you’ll be as baffled as I am that some people really

do go on the show seemingly not knowing what to expect.  There really is no excuse here.

People who pitch on Shark Tank have the advantage over us real world entrepreneurs who

most likely will never get to see our potential VCs in action before we pitch them ourselves.

What a ridiculously wasted opportunity!


2.  Know your numbers. The show’s resident Great White,

Kevin O’Leary, said it best: “It kills me when they don’t know

the numbers. Never come on the (show) without the numbers.

You die an awful death!” (tweeted by the man himself during

last night’s show). There is nothing I need add to that – except

…know your numbers. It’s your business. You want/need the VC’s money.

If you don’t know your numbers, then why should they want to invest in you?

Besides, not knowing your own company makes you appear really really careless,

fairly stupid, and thoroughly unprepared. Right, Kev?


3. Plan your pitch. Again, you might think this is so obvious.  It should be.  But I can’t begin

to count the number of times I’ve sat cringing behind my specs watching hopeful

entrepreneurs turn into quivering shark bait as they fumble, stumble, or stare wide-eyed

and open-mouthed at the Sharks’ perfectly routine and expected (by me) questions. What’s

clear is that these people haven’t planned.  Or they have planned, but only a rote rehearsal

of what it is they want to say.  They’re not prepared to receive questions from the Sharks.

My favourite Shark, Robert Herjavec tweeted about this doozy last night: “Whenever

someone asks you what your sales are never – and I mean ever – start the answer with

“well – unfortunately…”  This happened on last night’s show.  That guy was not prepared.


4. Don’t make it hard to like you. Don’t present with an obvious bad attitude.

Don’t insult the Sharks (I’ve watched pitchers call the Sharks “old”, “bald”, “rude”,

“my least favourite”…) . Don’t respond to Shark questions with disdain, sarcasm, or a silly roll

of the eyes. Don’t sulk like a spoilt child, cry like a girl, or argue like a fool.  I’ve seen

entrepreneurs do all of the above. The Sharks weren’t impressed.



5.  Don’t overvalue your company. I’ve seen too many otherwise great businesses be

chewed up and spat out by the Sharks due to this one common and completely avoidable

mistake.  And the Sharks let those founders know it.  Sometimes I can just about feel the

entrepreneur kicking himself through my TV screen.  But not always.  There are times

when it’s clear the presenter walks off out, head held high, muttering too himself about

his “amazing company” and how the sharks have “made a HUGE mistake and missed out”.

Most of these people still don’t get that they might well have an “amazing company”.

But “amazing” is just an adjective.  And no adjective, however amazing, is worth

X million, billion bucks.


6.  Listen to the Sharks. A no-brainer…for those who have one.  Not so much for those

who don’t.  Entrepreneurs who don’t listen to the Sharks fall into two categories:


Category #1 is those presenters who come out determined to rattle off their pitch –

without being interrupted by any one of those pesky Sharks.  If a Shark does happen

to interject with a question (which obviously, they must have a very good reason for

doing), these presenters typically tell that (rude) Shark to wait, because they have

much more important stuff to reel off before getting to that (unimportant) query. Big mistake.

If you’re afraid you won’t remember the rest of your pitch should you pause halfway,

then you really don’t know your stuff well enough; and you shouldn’t be on the show.


Category #2 is the entrepreneurs who respond to Shark questions by

arguing.  Not by countering with their own perspective.  Not by respectfully

agreeing to disagree. Nothing so diplomatic for these know-it-all types.

Instead they out and out mount their high horse and refuse to consider that

the Shark – with their obvious experience and phenomenal success – might know a thing

or two worth listening to.  Duh.


7.   Leave home the dog & pony show. I’d say this applies

even more so in the real, non-televised, world of VC presentations.

So far I’ve only presented to one room of VCs; but from that single

experience I know that no one would have been impressed had I brought

fireworks, a clown, or my contortionist cousin to lead off the meeting

with 2 good minutes worth of tricks that have nothing whatsoever to do

with my social game/social networking site for teens.  The Sharks are not so fortunate.

They’ve seen it all.


I’d say that if your business isn’t good enough to speak for itself, then it probably

isn’t good enough to warrant VC investment.  Just get to the point and let your

hard work and results to date impress cashmere VC socks off.


8.  Don’t miss the forest for the trees. Or in this case, the vision for the baby.  This

one refers to all those entrepreneurs who appear to regard VC counter-offers as a scam.

It goes like this.

Eddie entrepreneur asks for $50,000 for 20% of his Winny Widget

company. The Sharks say distribution would require more money and besides,

the giant competitors would eat Winny Widgets alive.  However, they’re prepared

to invest on the condition that Eddie sells his licence (patent, etc.) to an ‘industry

giant’.  Eddie would receive a 7% royalty for the rest of his natural life.

Eddie baulks at this offer and is clearly suspicious.   “7 percent???  No thanks.

Is that your final offer?”

It is.  It was.


So Eddie leaves happy that he still owns his ‘baby’.  Oblivious that he has,

in return, lost the plot.  His goal was to get rich.  He just didn’t take the time to figure

out that 7% of millions of dollars is worth more than 100% of pretty much nothing.



9.  Bring along a co-pitcher if your presentation skills are weak.

I’ve never seen a Shark penalize an entrepreneur for admitting

their weaknesses.  I have seen Sharks in a virtual feeding

frenzy over entrepreneurs who come in solo knowing full well

they aren’t the best at presenting figures/describing their

market/running a demo.

If you know you know your business inside out, but also

acknowledge that you aren’t so great at articulating numbers…

don’t just fumble through and create an entirely avoidable poor impression.

Instead, bring along your accountant, your math whiz sister, your swotty friend.

Few things impress more than someone who recognises their own weaknesses

and takes corrective action.  I’ve seen it.  Sharks respect it.


And 10?  Sell yourself! The Sharks, like all other VCs, invest in people – not businesses.

If the business is great but the founder is sucky, you probably won’t see that

investment.  If, on the other hand, the business needs some work,

competition is fierce, and not much money has been made to date, BUT the

founder is the most pleasant, savvy, well-turned out, and thirsty for knowledge

entrepreneur the Sharks could imagine, the chances of her receiving an

investment shoot sky high. Barbara did this last season (with Ava the Elephant).

And Dragons’ Den Brett and Arlene do it all the time!  You are your company’s best

asset; and if you’re not, they you ought to be:  so work on it.


What have you learned from Shark Tank or Dragons’ Den?  Leave me your comments or tweet me!


Thanks for being here!


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