Why Shark Tank is one of the greatest shows for aspiring entrepreneurs
Let’s admit it. We are dreamed of quitting our full-time jobs and starting out something on our own because we simply want to be in the driver’s seat. However, entrepreneurship is tough as hell. Startup failure rates are approximately 90%. That means in 10 people, only 1 is able to survive this brutal world. However, you can start a side hustle now and expand your income stream.
Having watched over 50 episodes of Shark Tank, here’s why I think this show is one of the greatest not just for aspiring entrepreneurs, but also for ANYONE who intends to add new income streams.
- You realize that business opportunities and idea generation comes from pure observation.
With people from different nationalities, race, backgrounds all having a common goal of improving their own lives and the lives of others, ideas of all kinds get pitched every episode. From adjustable bras to portable ice cooler to ugly Christmas sweaters, most ideas developed out of a need or to solve a personal pain point that they face. You’ll realized through observing in your day-to-day life that anything and everything can be a business opportunity. Have the habit of thinking what can I monetize with and how can I expand it into other channels?
- The show teaches you a fundamental skill in life: Negotiation
You have to give a stake of your business in exchange for cash. The sharks are out there to get you. They want more equity for the same amount of cash. How do you push back on it? When do you push back on it? By how much do you push back for? All these boils down to how good you are at negotiating and the show will teach you just that. This is more of an art than a science, although the science part comes in the form of running your own numbers. Conclusion: only accept a stake which you are comfortable with. If you give up too much equity to a strategic partner, there is very little upside left for you.
- Logistics and distribution channels are equally important
You may have one of the greatest product invention in the world. But if you do not have the right logistics to expand it and the correct distribution channels, you will be foregoing a lot of revenue. Don’t just think online as one channel. Think about retail, corporate, whole seller etc. Find creative ways to reach more people. Most people underestimate the amount of work needed to find the right logistics partner. Hence, do not leave this part of your business out of the equation.
- Only fundraise when you need it
Fundraising too early into your venture / business may be detrimental for you. You stake gets diluted and you have too many stakeholders to please. Only raise money if you need to and if a strategic partner can bring your business to the next level. Shark Tank shows us that the sharks are usually avoidant on businesses that have been funded a whole lot by other investors which have not been cash flow positive. Who wants to invest in a loss-making business anyway?
- Think of creative ways to finance your business
The use of debt can work to your advantage if you know how to use it to your advantage. Eg. securing a low interest loan or using it for bridging purposes or to fund your inventory. I notice that Kevin O’Leary is always creative in structuring his deal to work in his favour. Most notably is getting a royalty for each product until he earns twice or thrice his initial investment. On top of that, he still wants the equity stake! What a shark indeed.
- Presentation and pitching skills can make or break an investment
The show teaches us that you need to be an all rounder before you can secure an investment from the sharks. This includes good presentation and pitching skills. Think about it: the sharks get pitched more than ten thousand times on new ideas and how are you able to make yours memorable? You want to be in a situation where you give a good pitch and good product demonstration that you have multiple offers on the table. The best way is to think out of the box and be creative. Related personal experience to it as it makes it more tangible and relatable.
- Last but not least
Even if you don’t actually start a side business, just thinking of creative ways to make money and to problem solve is actually very satisfying and fulfilling. You become a more creative and innovative person just by doing so and who knows one day you may just think of the right idea.
I encourage everyone who has a full-time job to also start thinking of additional ways to make money because every penny counts. A dollar you make today can be a million dollars in future.
Who’s your favourite Shark? Let me know your thoughts in the comments box below.