Reality television is its best when the viewers can learn some life skill from watching the participants. Shows like American Idol teach viewers how hard it is to become a professional singer and performer and how much talent and work it takes.
A new show started in early August 2009, Shark Tank, on ABC is one of those shows that has drama, suspense, and eye-opening business lessons.
Entrepreneurs Meet the Tycoons
Who better to learn from than those who have been there and done that or created, sold, and or patented technology, clothing lines, big real estate deals, or sold millions of dollars of products through infomercials?
The tycoons consist of five multimillionaire business professionals that are looking for really good companies or individuals to invest money in order to make more money. The entrepreneurs are small companies run by individuals, partners, or family members looking for investors with money so that they can make more money. The entrepreneurs have to stand before the panel of the five experienced and shark-like investors and ask for the money.
The entrepreneurs want to give heart-felt presentations that explain their passion and the vision while the sharks want to only hear about the hard data.
Marketing Data Only
While Donald Trump may have made the “You’re fired” phrase a legend, the sharks are quickly making the phrase, “I’m out” one of the most dreaded and feared.
If the entrepreneurs come to the panel without hard research such as costs to produce, pricing, projected profits, marketing research, target market details and profiles, and a willingness to sell the investors a portion or percentage of the business, the sharks will send the entrepreneur swimming for shore. The panel interviews (ok, drills) three or four people per show so some of the interviews go really fast while others do get some negotiating time.
The Shark Panel
The five experienced and self-made millionaire panel members are:
- Kevin Harrington – started the infomercial industry 25 years ago.
- Kevin O’Leary – Educational software, he sold his company to Mattel for $3.7 billion.
- Robert Herjavec – sold his first technology company for $100 million.
- Barbara Corcoran – created a $5 billion real estate company.
- Daymond John – created the FUBU clothing line with earnings of $350 million in 1998.
The Entrepreneurs
People come from all over the United States to stand before the panel to present their ideas for children’s book series, musical instruments, kitchen accessories, safety products, and gourmet food just to name a few. They are women, men, families, partners, and individuals seeking investors to help get a company launched or to help an already formed company grow.
More often than not, the sharks want a percentage, usually controlling, of the company and many times the entrepreneur turns the offer down because of the controlling interest issue. The panel does a really good job of explaining why they want to invest or why they pass on the opportunity. Many times they pass because the entrepreneurs lack marketing savvy, experience, or even a plan.
Branding also is a hot button for everyone on the panel. Being able to see the ways a product or company can be branded is vital to whether they invest or pass.
Reality Television
The Shark Tank may well be staged like much of reality television, but the brutal questions that the panel asks are real time business questions that a new company would be asked by investors or by banks when applying for a loan.
Who is the target for the product or service? How much does it cost to produce? What is the marketing plan? Where, when, and why does the consumer need this product or service? What are the profits?
Shark Tank reality television is business and marketing 101. Forming a new company or growing a company are two activities based in reality when sometimes the person or persons starting the company are based in a fantasy.
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