Think Like a Shark: Lessons Learned from “Shark Tank”

ABC’s hit show “Shark Tank” has inspired a nation of viewers to believe in the American Dream again. But besides the endless entertainment of seeing cringe-worthy pitches and banter between the sharks, what real-life lessons has the show taught us?

1. Do the work yourself.

Entrepreneurs must be willing to do every role in the company until profits are large enough to hire other employees. The sharks applaud entrepreneurs that enter the tank and describe how they have single-handedly created, packaged and distributed products all on their own instead of hiring a team to do so. Upon hearing that the Mission Belt creator was pounding on potential customers’ doors in Los Angeles to try to make a sale, Mark Cuban related the entrepreneur’s drive to his own, telling the story of how he used to sell garbage bags door to door to make money as a teen. In the beginning, entrepreneurs must be willing to be the entire sales, marketing, accounting and logistics team until financially ready to expand.

 

2. Don’t back yourself into a corner.

Yes, products directed to a niche market can be successful. Take GoPro, a camera strapped to the head to record users as they partake in extreme sports. Although it’s not exactly suitable for the mass market, it still managed to become a huge success. However, the majority of the time, entrepreneurs must make sure their market is large enough to be profitable. On Shark Tank, we watched as hopeful entrepreneurs pitched the Ledge Pillow, a product designed for women with breast implants who also prefer to sleep on their stomachs. The sharks were wary of taking a niche market (women with breast implants) and narrowing it further (women with breast implants who also sleep on their stomach). By limiting who your company’s customers are, you’re also limiting the potential to make money.

 

3. Listen as much as you talk.

One of the biggest mistakes that entrepreneurs can make is not valuing the input of others. It is great to believe in your product or service, but even better to believe there are always ways to improve. On “Shark Tank,” sharks offer advice on branding, packaging, and application that may improve an entrepreneur’s product. Take the team behind Bantem Bagel, a bite-size, donut-hole style bagel loaded with cream cheese, who were told to change their product’s name. Lori Grenier argued consumers would have no idea what a Bantem Bagel was, and would be more attracted to a name that explained the product, such as Bagel Balls. Despite this logical advice coming from a branding expert, the entrepreneurs were unwilling to budge on the name change. Not everyone will get this chance to be n front of the sharks, but listening to feedback from peers, family and friends will work just as well.

 

4. Be aware of your surroundings.

Don’t be naive to your competition in the market. ValPark, an app designed to ease the process of valet parking by allowing credit and debit payments, recently left the tank without an investment. A major downfall in the pitch was the entrepreneur’s unwillingness to admit that a) his product could be easily duplicated by any app developer and b) competition already exists. By ignoring what else is out there, you’re hindering the company’s growth and innovation. How would Samsung mobile phones look if the company didn’t pay attention to Apple’s iPhone? Staying on top of what your competitors are doing will keep you alive in the business world…and in the shark tank.

 

5. Know your business.

Knowing your business may be an obvious lesson, but one that bears repeating based on the number of entrepreneurs who simply don’t have all the answers once in the tank. Take Rolodoc, an app which was described by the creators as a business to bring social media into the medical field. Despite these goals, both inventors could not explain what made their product social to the sharks, and failed to be able to differentiate it from a simple email. To succeed in business, study your business inside and out. Entrepreneurs should be able to rattle off everything from the company’s value proposition to important numbers like cost of acquiring customers, retention rate, and projected sales. If you don’t show a passion for your business by knowing the nitty gritty, how do you expect others to share in your vision?

 

Now that you’ve learned the basics, you’re almost ready to swim with the sharks. But first, learn how to develop crucial leadership skills by taking this easy assessment, created by Orlando businessman Joel Goldstein, President of Mr. Checkout Distributors!