Here we go again, another season of Shark Tank.
People ask me why I do it, and for me it is a no brainer; I get to hang out with four really interesting and funny people for three weeks whilst filming, I get to torment Steve and spend my time thinking of ways to play practical jokes on him or give him grief about his Diet Coke and Twisties fetish, but most importantly I get so see some amazing people who are at the start of their business journey.
These young businesses were in a place that all of us sharks were at some point and it is exciting to see what comes through those double doors. People think we are the teachers and for much of the time we are, but there is so much to learn from each and every person that comes on to Shark Tank. It is nerve racking for them, and each and every one of them are brave for taking that step into the shark tank.
Each pitch in the tank goes from 30m – 1.5 hours, and you get to see maybe 10 minutes of the pitch, so often you may not get a full insight into why we liked the business or not.
So this blog is my take on each episode, to give you insight into each pitch and explain why sometimes we are out quicker than Speedy Gonzales or why we are doing everything we can to get a deal.
Let’s look at the first episode.
What I love about these guys is that they saw a problem and they worked together to find a solution. They were really impressive, they had thoroughly researched their market to really understand their needs and find out what the missing pieces are in people’s cancer journeys.
Cancer is not going away, and for these guys to create something that makes it easier and in turn safer for their patients who are going through the scariest thing in their lives, is really exciting.
I don’t think there is too many people who don’t know anyone who has had cancer; so anything that makes the journey just that little bit easier for patients is a great thing.
The guys mentioned that the business model is about licencing. So what does Licensing mean?
Licensing is when you have a product that you own and have the appropriate protection i.e. Patent or Trademark and you allow another business to use it for a fee, or another business takes over the product completely including manufacturing of the product and they in turn give you a royalty for the idea.
Another way of licensing is what the guys have done which is to allow other institutions to use the brand and maybe even brand it their name, i.e. Cancer Council, and for this they charge a lump sum yearly fee depending upon the size of the institution..
The potential for growth is high, as it does not require a great deal of ongoing capital to grow into a large business, so even thought it was not fully proven it was easy to see how it could be scaled.
Why did the sharks offer the same? Despite the pitch there is still risks in the business, so it was not worth it for me to offer more. In other words it was fully priced, and during the pitch it was clear that for them it was about who they wanted more than the deal. Congrats to the Glen and Andrew on this business.
Despite the fact that I got the shock of my life when I looked at an 80 year old Janine staring back at me from the box, I thought the business idea had merit.
The models themselves were hideous, but his other products were not too bad, and I can see people liking the idea of getting their loved ones made into plastic. I could see kiosks in shopping centres selling the products and parents having a bit of fun with making little models of their kids or pets.
But he had no answers; he wasn’t sure how much people would pay, he did not know how much it would really cost, how to market it, what his market was, and I could go on.
So even though I thought there was something in it, I could not invest in him.
- I did wrap the model of myself and gave it to my husband for a present, his reaction was very funny.
If ever you saw a Shark in business this guy had that feeling. He is all about the dollars and not about the business or he did not seem to have any passion for his business. He also lived in Lala land even thinking his business was valued at 9 million. This valuation showed to me that he really did not understand the basics of business nor had the respect for the investors’ money.
He said he had 10 years of business experience and was 29 years old, which for me was not necessarily a positive, due to the fact of how many businesses he has actually gone through.
His answer to Naomi’s question of “when will the investors get their money back” and his response of not understanding, was a massive warning sign.
For me he was not believable and I feel for those investors that have put money into the business, as I would be surprised if they see a cent. (I may be wrong.. but do not think so)
Jenny was a delight. The food was seriously good, she is living proof that you are never too old to start a business and my hope is that when other people in their later years see Jenny, that they get inspired to get started in their own business. Jenny is a 60 year old gem and a very clever cook. Forget that it was gluten free, her breads were amazing to eat, not matter what was in them. Jenny’s problem was not whether the customer wants the product, they do – in droves, but her ability to keep up with demand, and also her want to continue to drive the business and the hours required to grow the business. Jenny did not want to work 100 hours a week, which in the early stages of business is what you need to do. She needed and wanted help.
Why you ask did we not invest; I am the foodie? One of the things that Jenny mentioned during the pitch was that she was pretty much at capacity with the business. Jenny needed a business partner not an investor, and with Perth being a long way away, I knew I was not the right person for Jenny.
What Naomi offered was actually quite fair, and she could really assist and help her.
Thrilled Jenny got a deal
One episode down, there are some amazing business people and inventions still to come, tune in next Tuesday at 8.45pm.