We had the opportunity to interview Shaan Patel, the founder and CEO of Prep Expert. If you’re a fan of ABC’s Shark Tank, or if you’ve got a college-bound teenager, you’ve probably heard of Shaan’s best-selling SAT prep company, formerly known as 2400Expert. That’s Shaan on the right with business partner Mark Cuban!
Shaan was kind enough to share his insight, the challenging journey of making Prep Expert a success, and a few key takeaways from the Shark Tank experience with us.
From making a perfect score on the SAT to scoring a deal with Mark Cuban on Shark Tank, Shaan has a can-do attitude and doesn’t know the meaning of the word impossible. His story will inspire you.
Shark Tank Success Story: Shaan Patel, Founder of Prep Expert
- You’ve had some incredible success already, from achieving a perfect score on the SAT to closing a deal with billionaire and entrepreneur Mark Cuban. Can you tell us about the way Prep Expert – formerly 2400Expert – started and how your personal experiences shaped the company?
Like all entrepreneurs, it all started with an idea. In high school, I studied hundreds of hours for the SAT and raised my score from average to perfect — an accomplishment achieved by approximately 0.02% of all students. This resulted in admission to top universities, hundreds of thousands of dollars in college scholarships, and opportunities such as meeting the President of The United States.
I couldn’t believe how much my life had changed because of one test score. When I got to college, I wanted to help other high school students improve their own test scores. My original idea was to write the first SAT prep book authored by a perfect-score student. However, 100+ literary agents and publishers turned my book proposal down citing that the SAT prep market was too competitive and that I didn’t have a platform to write such a book.
This is when I took my destiny into my own hands. I decided to teach an SAT class based on the curriculum I had been writing for the book in my hometown of Las Vegas. While it was very difficult to get students to enroll in the beginning, after news spread that the average SAT score improvement in my classes was 300-400 points (equivalent to going from the 50th percentile to the 90th percentile), I had parents knocking down the door for more classes.
Prep Expert (formerly 2400 Expert) was a success in Las Vegas! That’s when I decided to pitch the company on Shark Tank to expand it to more cities and scale our online reach. Ironically, after McGraw-Hill, the world’s largest education publisher, saw what I was building with Prep Expert, they offered me a book deal after they had originally turned my book proposal down. The book ended up going #1 on Amazon for SAT Prep and selling tens of thousands of copies. My dream of becoming a bestselling author did come true! I just had to take a different path to get there — an important lesson for all entrepreneurs.
- You appeared on Shark Tank last year and handled the pressure of being grilled by the sharks really well. You’re in the test prep business – what kind of preparations did you make before going on the show? Is it a grueling process to be selected to appear?
Getting on Shark Tank is almost as hard as getting a perfect SAT score. Of the 1.4 million students who take the SAT every year, approximately 400 will get a perfect SAT score — about 0.02%. Of the 50,000 entrepreneurs who audition for Shark Tank every year, approximately 100 will air on television — about 0.02%. The chances of doing both? 1 in 25 million! I consider myself very lucky.
The first step to getting on Shark Tank is attending one of their open call auditions. This is where casting call producers watch 1-minute pitches from aspiring entrepreneurs about why their businesses should appear on the show. I spent dozens of hours crafting the perfect 1-minute Shark Tank audition pitch. I was nearly the last person in a line of 500 people at the Shark Tank open call audition in New York and had to wait over 8 hours before I got to pitch a casting call producer.
However, it was well worth it because my pitch advanced to the next round a few weeks later: a 5-10 minute video audition! All of the Shark Tank producers watch this video audition to make sure that your product or business is right for the show. I spent nearly 50 hours working on my video audition to make sure that I would appear interesting and entertaining enough for television. You can view my video audition here.
Once I got the call from Shark Tank that they were going to fly me out to Los Angeles to pitch the Sharks, I was ecstatic! I spent nearly 100 hours preparing for questions that Kevin, Lori, Daymond, Mark, Barbara, and Robert could potentially throw at me. Preparation is key to anything you do in life whether it’s getting a perfect SAT score or landing a deal with billionaire Mark Cuban on Shark Tank.
- You made a great deal with Mark Cuban on the show, selling a little more equity than you originally planned but getting the dollar amount you asked for. How has that changed your business? Have you experienced “the Shark Tank effect?”
Actually, I didn’t give up more equity than I had originally planned. The deal that I would have been comfortable making with any Shark was $250,000 in exchange for 20% equity for my company. However, I know Shark Tank. All of the Sharks are master negotiators. So I didn’t want to go into the Tank asking for $250,000 in exchange for 20% equity. Instead, I gave a low-ball offer. I went into Shark Tank asking for $250,000 in exchange for 10% equity, and knew the Sharks would likely negotiate the equity up to 20%. And that’s exactly what happened. In fact, during my pitch after Mark negotiates $250,000 for 20% equity in my company, I actually said “That’s exactly the offer that I figured you would offer me.” However, this part was cut from the televised pitch. So it all worked out exactly according to plan!
Yes, Prep Expert has experienced the “Shark Tank Effect”! Prior to the show, my SAT & ACT prep products and services had generated approximately $1 million in lifetime revenue over 5 years. After airing on the show, my SAT & ACT prep products and services have generated nearly $10 million in revenue in less than two years. The Shark Tank Effect is the most powerful marketing machine in the world — allowing entrepreneurs to get 15 minutes of primetime television airtime worth $9 million in marketing for free!
- What percentage of your business is now online courses vs onsite courses? On the show, you had about 40% of your students choosing the online courses.
Online SAT & ACT prep courses are huge at Prep Expert now. We now have about 80% of all students enrolling in our online courses. While we can offer in-person classes in 10 cities across the United States, we can’t offer classes in 1000 cities. But with online courses, we can offer classes to students in every city around the globe! We even have students enrolling in our classes who live in Europe, India, Singapore, Dubai, etc.
In addition, online virtual classrooms are getting a lot better in terms of quality. And Gen Z students are accustomed to taking classes online. Therefore, online SAT and ACT prep is our biggest area of focus now at Prep Expert!
- Are you still teaching SAT prep classes every now and then?
Unfortunately, I rarely have the opportunity to teach one of our flagship 6-week SAT or ACT preparation courses at Prep Expert because my jam-packed schedule. I just graduated with my MBA from Yale in 2016 and my MD from USC in 2017. I also just started my residency program for dermatology, which is currently keeping me busy.
However, we have top-notch instructors who teach my curriculum. We only hire instructors who have scored in the 99th percentile and who have a significant amount of tutoring experience to teach our SAT and ACT classes at Prep Expert. For parents and students who really want me as their instructor, I have recorded a Prep Expert Video Course that students can watch online anytime of me teaching.
I also occasionally offer a Free Online Prep Expert Class for both parents and students to go over SAT & ACT prep tips, college admissions guidance, and scholarship assistance.
- Looking back, what lessons did you take away from the Shark Tank experience?
I think the biggest lesson I took away is that rejection is an inevitable requirement of entrepreneurship. I have been used to getting rejected on my path to building to Prep Expert. I have been rejected by literary agents, publishers, potential business partners, media writers, etc.
For some odd reason, I went into Shark Tank thinking that I would not be rejected. I thought that I would have multiple offers from different Sharks. However, reality struck once I entered the tank and I was rejected once again. Every Shark was not interested in investing in my company once they found out that I was still in the process of becoming a physician. They simply didn’t understand how I could run a business while doing other things, which was odd to me because they all do exactly that.
So no matter where you are in entrepreneurship, expect to be rejected 80% of the time. But the 20% of the time you succeed is the only thing that matters. In this case, I was rejected by 80% of the Sharks (Daymond, Lori, Robert, and Kevin), but only 20% of the Sharks mattered — Mark Cuban!
- Do you think appearing on Shark Tank a worthwhile goal for business owners looking to grow their business? Why or why not?
Yes! Appearing on Shark Tank can skyrocket any business. Prep Expert has 10x’d our sales since appearing on the show. We have attracted better employees, business partners, and media opportunities because of it. However, do not go on the show if you are not serious about making a deal. The benefits of giving up a little equity in your company typically far outweigh the costs. The way I think of it is the following:
What is more valuable — a business that I own 100% of on my own or a business that I own 80% of with Mark Cuban?
To me, it’s a no-brainer. ♦
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