Everyone I know who has watched ABC’s show Shark Tank has enjoyed it, because it reinvigorates the idea of the American Dream in just an hour per week. It shows that a great idea and hard work can pay off tremendously. But there are nuances to closing the deal, and these are lessons from which consultants too could learn. In an article for Inc., Allison Fass outlines some tips garnered from Kevin O’Leary on how to seal the Shark Tank deal:
- Articulate your idea succinctly.
- Explain why you have the right team.
- Know your members.
Invest with the Fishes
In the first place, for those who do not know, Shark Tank is a show where entrepreneurs seek an investment from well-known investors like O’Leary or Mark Cuban. Entrepreneurs pitch their business and articulate its value in a presentation, and if they land a deal with the investors, the results can be dramatic. If you have ever eaten the awesome Baby Back Rib Burger at Hardee’s, you can thank a Shark Tank investment for that.
Those who succeed in getting the deal are statistically succinct: All entrepreneurs who have received a deal on the show were able to describe their business concept in 90 seconds or fewer. Most were able to do it in 60 seconds or fewer. What this alludes to is that understanding of your own business is critical. If you cannot explain your business simply, that in itself is a serious flaw of your leadership.
Another thing successful entrepreneurs have been able to do in Shark Tank is explain why they and their people are equipped to make the business successful. After all, anyone can have a great idea; execution is another thing entirely. When people can prove their expertise, O’Leary says, “Things are simmering.”
The final and crucial differentiator on landing a deal is whether entrepreneurs know all the numbers of their business. Much of this discussion often gets cut out of what is actually shown on TV, so listen up:
This includes: your gross margins, when you’ll break even, how fast the sector is growing, how much market share you have now, and how much you could gain in five years. “If you don’t know your numbers, I will personally eviscerate you,” O’Leary said. “You got a spot [on Shark Tank]and you don’t know your numbers? If you don’t, you should bring someone who does.”
If you do not know your numbers, it means you are flying blind, and there could be a mountainside in your immediate future.
You can view the original article—and a funny story about O’Leary advocating that a guy dump his fiancée—here: https://www.inc.com/allison-fass/kevin-oleary-shark-tank-successful-pitches.html