Shark Tank may represent an unattainable goal to some, but to others with the fiery entrepreneurial spirit, it’s just a tough-to-reach destination. And tough to reach it is. We’ve interviewed a handful of Shark Tank contestants – those who made huge deals with Sharks, and those that failed miserably – and the sentiment seems to be the same across the board: It’s even more challenging and stressful than it looks, but it’s worth it if your business is doing well.
We’ve taken the best advice from each Shark Tank interview we’ve done and compiled it into a guide that will help you determine whether or not your business is ready to audition for Shark Tank. Should you audition for Shark Tank? That depends on a number of factors.
Should I audition for Shark Tank?
When deciding whether or not to enter a literal tank filled with sharks, it would be prudent to think long and hard about the situation before leaping in. It’s no different when considering if you should audition for Shark Tank.
Ruthless, experienced, focused investors know that time is money, and they don’t mince words when contestants deliver their pitches. They call themselves sharks for a reason!
Answering rapid-fire, detailed questions back to back on camera isn’t easy for even the most prepared contestants. And those intense 8-minute segments you see on TV are actually the heavily cut and edited stubs of the approximate hour most contestants will spend in front of the investors.
“If we made it look easy, then we did our job! We were in the “tank” for an hour and a half and it was scaled down to 8 minutes of air time.” –Diana Harbour, The Red Dress Boutique, $600K deal with Mark Cuban
And don’t forget the ever-present possibility of failing to deliver a successful pitch – not just in front of the Sharks, but in front of a TV audience of millions – after you’ve prepared for months and dedicated so much of your time to it.
“It didn’t help that we pitched dead last on a really long day of filming…In an ideal world, we would have gone on the show when we were more established, but we were still happy with how our segment turned out, criticism and all.” – John O’Connor, ‘brellaBox
With all this information considered, why would anyone still decide to audition for Shark Tank? I have 4 words for you: The Shark Tank effect.
The legendary Shark Tank effect
Ask any contestant who’s appeared on Shark Tank – the Shark Tank effect is an undeniable bonus. Even companies that don’t manage to make a deal with the Sharks experience a noticeable, predictable spike in website traffic and orders each time their episode airs. The phrase “There is no such thing as bad publicity” may hold true here.
“The exposure from Shark Tank is invaluable. Not only that, doing the show is fun and it’s a challenge. Where else can you present your startup to two billionaires on national TV? If you get the chance to do the show, take it.” –John O’Connor, ‘brellaBox, featured on Shark Tank
And the companies that do manage to make a deal with a Shark (or Sharks!) really have to be ready for the “tsunami that is the Shark Tank effect” – it’s often enough to crash what appears to be a perfectly good website.
“So a couple things about the Shark Tank effect. Number one, as much as it’s a gigantic push for your brand, if you’re not ready to execute, you’ve just blown a multi-million dollar commercial for your brand. You MUST be ready. Our website was the first not to crash the night we aired. It’s funny to watch the website analytics when we air or have an update. The peak and tail are identical in shape to the original airing…it’s so predictable which is awesome for us.
Our sales to date since having appeared on Shark Tank 4 years ago are upwards of $14 million. Never in a million years did I ever think that such rapid growth could ever happen to us but that’s the magic of Shark Tank and the Shark Tank effect!” -Tracey Noonan, Wicked Good Cupcakes, $75K deal with Kevin O’Leary
The sales boost the Shark Tank effect provides is another important piece of the puzzle, as The Red Dress Boutique and Prep Expert quickly found out:
“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!” –Shaan Patel, Prep Expert, $250K deal with Mark Cuban
“We had to quickly learn how to streamline our warehouse processes in order to fulfill all the orders for the “Shark Tank effect.” No one can anticipate the giant wave that comes at your from the initial airing. We did $1 million in sales in 5 days!” -Diana Harbour, The Red Dress Boutique
Who shouldn’t audition for Shark Tank
If you haven’t yet proven that your business model works, if you don’t have sales to back it up, or if you’re working on the business only on the weekends, don’t bother going on Shark Tank. The investors want to see traction and a little stability in your idea. They want to see that you’re willing to put in the work – full time.
“The first lesson that was reinforced for me is that investors want to see real traction. You can have a cool idea, but ideas don’t mean much without execution and market demand…It didn’t come as a huge surprise when the Sharks weren’t too excited about ‘brellaBox, although Mark Cuban did see the potential. If Anusha and I hadn’t both been part time on the project, I think he may have made us an offer.” – John O’Connor, ‘brellaBox
Shark Tank is like a giant mirror for your business. It can turn that mirror back to you and force you to look at the ugly side of your business – what isn’t working, what you’ve done wrong, and what changes you’ll need to make. Or it can turn that mirror to the world and get your business in front of millions that want to buy your product or do business with you.
Can you ensure that you’ll make a deal with the Shark of your dreams if you audition for Shark Tank and manage to get in front of the Sharks? Of course not. In fact, you might walk into that place fully expecting to be rejected. But what if you succeed?
For the founders of hugely successful companies like Wicked Good Cupcakes, Scrub Daddy, Prep Expert, and The Red Dress Boutique, Shark Tank is a reminder that sometimes just one big win can change your path entirely.
“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.” -Shaan Patel, Prep Expert