Is Your Product Right for Shark Tank?
Since ABC’s Shark Tank premiered on August 9th 2009, it has become incredibly popular. Nearly 8 million people tune in to the reality show each week to watch entrepreneurs pitch their product businesses to a panel of potential investors, otherwise known as the sharks. Shows with the same premise, like Canada’s Dragons’ Den, exist in dozens of other countries.
Shark Tank is highly entertaining and we at inventRight enjoy watching it. There are a number of similarities that exist between pitching the sharks and pitching a potential licensee, like the fact that both are highly risk-averse. To win a shark, an entrepreneur must reduce risk. The same goes for securing a licensing deal. The way we see it, there are benefits to appearing on the show regardless of whether you’re offered a deal. The publicity is substantial, to put it mildly!
If the following is true of your product, you may be a good fit for the show.
It is already being sold in the market.
It has a clear benefit.
It is easily demonstrated.
A large market for it exists.
It has a high profit margin.
You have established perceived ownership over it.
It fits into one of the shark’s area of expertise.
Does your product meet these requirements? If so, Shark Tank could be a great opportunity for you. The reality is that the producers of Shark Tank want to be able to report what a positive influence the shark has had on a business as soon as possible. In other words, they not only want to tell success stories—they want to tell success stories quickly. A product whose lifecycle has just begun doesn’t fit that format. To succeed on Shark Tank, you need to already be in business. And in truth, the sharks invest in people, not products. They are looking at you and wondering, can he lead? Does he have the right skillset?
The great benefit of Shark Tank is that each of the sharks has a vast network of resources and contacts. In our opinion, when it comes to growing a business, having access to those contacts is even more valuable than a financial investment. However, unlike a licensee, it’s not as if the shark is going to run your business for you. Manufacturing, marketing, and distribution—those are all still on you.
However, it’s important to keep in mind that Shark Tank is explicitly about entertainment. Unlike licensing, succeeding on Shark Tank is as much about selling your story and your personality as it is about your product—if not more. They are looking for people who jump off the screen, not the next great idea. The casting director has plainly said that he has passed on great ideas simply because they weren’t presented in an exciting enough way.
It’s also worth keeping in mind that Shark Tank is highly competitive. In 2013, 40,000 entrepreneurs applied to be on the show. Out of those, a mere 180 actually made it. A few walked away with investment deals.
It’s our opinion that entrepreneurs should try a lot of things. We think the best opportunities for inventors provide them with the best chances of success. Like any good businessman, do the math. Is appearing on Shark Tank a good bet for you?