One of my favorite shows on TV right now is Shark Tank on ABC. If you are not familiar with the show, the premise is that hopeful entrepreneurs pitch their business idea to millionaire investors looking to secure a deal for their company. Over the years there have been some incredibly good and bad ideas that have been on the show. As a hopeful entrepreneur myself, I have learned many lessons from watching the deals that take place on Shark Tank. Here are a few things that I have learned over the past 4 seasons:
All it Takes is One Good Idea
Over the first 4 seasons one thing that always amazes me is that all it takes is one idea and you can be a millionaire. More often than not many of the ideas are something that makes you think “why didn’t I think of that?”. The best ideas have always been ones that solve common problems such as the dishwashing tool “Scrub Daddy” which has become a huge hit.
Know Your Competition
One of the most commons things that I see on the show is that the hopeful entrepreneurs really do not know what they are up against. A common question by investor Kevin O’Leary is “what keeps the large companies from squashing you like a cockroach?”. This is a very valid question. O’Leary always wants to make sure that your idea is proprietary. That is, you own the patent and can control the competition that you will face for your product or service.
Don’t Over Value Your Idea
Another common problem is that many of the people come in and just ask to much from the investors. As an investor the Sharks are most of the time only interested in what the company is worth on that day. They do very little speculation. Sometimes they will think outside of the box but more often than not you better have sales to match your evaluation of your company.
Likeability is Very Important
During their pitch the entrepreneurs who have charisma and likeability consistently do better at securing deals. If they are nice, pleasant people the Sharks are much more likely to offer them a deal. Working with people that they like is a very important factor to each of the investors. That is except for Kevin O’Leary who only cares about money and could care less how it is done.
Discipline in Investing
Another thing that I have taken from the show is that it very difficult but important to separate your emotions from your money. Often times the hopeful’s on the show will have a sad back story and really need the Sharks help to get through a difficult time in their lives. The Sharks keep it together though and regardless of the background will try to make the most educated decision on an investment.
So there it is, 5 lessons that I have learned from Shark Tank. If you have never watched the show I would recommend you tune in one Friday at 9:00 EST on ABC.