Having interviewed a number of past Shark Tank guests, I’ve heard from many of them that they were big fans of the show before auditioning for a chance in the Shark Tank. As regular fans of the show see, the Sharks are relatively predictable in terms of what questions they’ll ask: sales, manufacturing costs, other investors, business plan, and distribution.
As a business owner, you know the most about your business; for better or for worse. The best Shark Tank tip to follow is to take a scrutinizing look at your own company before appearing in the Shark Tank, so you can best anticipate what the Sharks will ask about, and what their biggest concerns will be.
Take Revestor, from Season 4, for example. Founder and CEO Bill Lyons entered the tank, looking for an investment in his proprietary algorithm that helps investors determine future real estate property value. Because multiple Sharks have a history in real estate, this created both opportunities and problems for Bill’s company. Unfortunately, he didn’t know the Shark Tank Tip of prepping for hard-hitting questions ahead of time. When he was unable to answer the Sharks’ technical questions about who Revestor’s target audience was, it was difficult for the Sharks to get on board with his business concept.
Another example is Sub Zero Ice Cream, who appeared during Season 4, represented by owners Jerry and Naomi Hancock. The Sharks were impressed by Sub Zero’s multi-million dollar sales, but then they had questions about why the Hancocks needed money if they had such a profitable business. Eventually, the Sharks learned that the Hancocks had to buy out a bad partner, to the tune of $500,000. This isn’t the first time that Sharks have uncovered worrisome details about the businesses in the tank. Had the Hancocks been learned the Shark Tank tip about being more prepared for this type of tough questioning, they might have been able to explain their past in a more favorable light.
Business owners can follow this Shark Tank tip by anticipating the heavy-hitting questions, and having answers ready to go. Take an honest look at your business and prepare to defend any weaknesses and demonstrate your strengths. Identify any areas that may be cause for concern, and prepare your pitch and responses accordingly.
How do you answer the tough questions about your business?