By Jordan Puyear | firstname.lastname@example.org
Shark Tank, an entertaining reality show about hopeful entrepreneurs getting the chance at the real American Dream. Actually, most of the show consists of people’s dreams either getting validated, or painfully crushed. The plot of Shark Tank consists of up and coming entrepreneurs pitching their ideas to try and get an investment from the show’s successful business people, aka the “sharks”. I started watching this show for my Introduction to Business class, and after the first episode, I was hooked. I love the fresh ideas, crazy personalities, and I have even formed a bond with every one of the sharks. In fact, I even learned a thing or too from watching this reality show. Don’t believe me? Here are the top ten things I learned from watching Shark Tank.
1. How to calculate valuations.
During every pitch, the sharks talk about valuations. It actually took me a couple of episodes to figure out what the heck valuations are. According to the International Glossary of Business Valuation Terms, the definition of business valuation is “the act or process of determining the value of a business enterprise or ownership interest therein.” It then took me another 15-20 episodes to figure out, not only how to calculate valuations, but how to calculate valuations in my head. All you have to do is take the money the business is asking for, and divide it by the percentage they are offering the sharks. Lower percentage=higher valuation!
2. How to use liability issue in a sentence.
You only hope that, one-day, you can use liability in a sentence in real life to make you seem smarter than you actually are. I learned that a liability issue is an issue you are responsible for. Luckily, Shark Tank showed me that so many factors in a business can be liability issues, and could be the eventual downfall of a business, especially when it comes to products having to do with a person’s health or safety.
3. What a royalty is, and why investors prefer it.
If you are a die-hard lover of Shark Tank, then you know that if Mr. Wonderful has any intentions of a deal with a business, then he is going to offer a royalty deal. Again, it took me good couple episodes to understand even what a royalty is, but when I finally figured it out, I understood why businesses were so against it. According to Webster-Dictionary, a royalty is “an amount of money that is paid to the original creator of a product based on how many copies have been sold.” Investors prefer it because they know they will get their investment back no matter what, but businesses hate it because they are always giving money to the investor.
4. What is takes to grab an investors attention.
The sharks are known to film at least 12 hours a day, every day when recording a new season of Shark Tank. When you are an entrepreneur asking the sharks for money, you have to come into the tank and make an impression right away, whether it is with food, animals, children, or just bringing your outlandish personality. In the end, at least they will be talking about you.
5. What is takes to be a good entrepreneur.
This is the main question when it comes to owning a business and trying to get an investment. Of course, all investors will be different, but on Shark Tank, the sharks are usually looking for dedication, focus, loyalty, diligence, willingness to grow, and prior experience/success as factors that they want in their investments.
6. Being nice could actually pay off in the long run.
To my surprise, kindness does really make a difference in whether or not you will get a deal. The sharks seem to be more open, understandable, and excited about your product or service if you are nice as a person. For example, Johnny Georges did not have the most sound business plan or idea, but was very kind and had good purpose. Even after every shark went out, guest shark John Paul DeJoria went back in and decided to make a deal with Georges because he loved his personality.
7. How to take rejection.
This show really taught me that, most of the time, you will get rejected no matter how much you show that you need something. No matter how confident or successful you are, rejection hurts. From watching Shark Tank, I have seen those who take rejection well look like a better person and more secure in their business. On the other hand, when the person bad mouths the sharks and the show for rejecting them, it makes themselves and their business look unprofessional.
8. How to learn from your mistakes.
Even if the sharks reject your business, they explain their reasoning, such as the business needs to be all online, or the product is too niche. The sharks do this so that, even if they do reject the business, they can grow to be successful on their own. In every episode of Shark Tank, they do updates on some of the businesses throughout the show, some who got investments, and some who didn’t. In each update, the people grew and learned something from their experience.
9. Even if you get an investment, that does not mean you’ll be successful.
There are plenty of cases throughout Shark Tank history where a business does not make it, even with the help of the sharks. This isn’t just Shark Tank though, failure is a possibility with any entrepreneur or business starting up. So many factors goes into failure such as, lack of sales, poor leadership, lack of communication, and the list goes on and on.
10. It takes a special type of person to be an entrepreneur.
The biggest fact I have learned from Shark Tank is that being an entrepreneur can be one of the hardest jobs out there. You have to literally deal with every aspect of your business until you are big enough to delegate your tasks. Sure, anyone can come up with a good idea, but it takes a certain someone to put that idea into action. That’s why Shark Tank is there, to give people that one opportunity to grow their business. To give people the chance at that American Dream.