Although all four entrepreneurs were passionate, no Sharky Awards will be given this week. This was a sorry group of entrepreneurs…..each with one or more glaring weaknesses. There are some good lessons to be learned from this episode, however.
No one received offers from the Sharks until the last twosome of Arlene and Desare of Go Go Gear somehow managed to get an investment from Daymond despite their “insane” company valuation and their “horrible, horrible, horrible strategy” (per Mark Cuban) of going to Europe before penetrating the US market. These two worked for a big company for a number of years before getting laid off. They then proceeded to start a company in an industry they knew nothing about and spent about $400K of their own money in two years. It was obvious these two had a “big company” mindset and did not have a good understanding of how company valuations are even calculated.
By giving away 65% of their company to Shark Daymond, they risk being pushed out of their own company some day. Since these two are pretty clueless in the ways of small business, I can only assume that was what Daymond had in mind.
Nick Romero from The Ave had a nice little business printing custom images on hats, shoes, etc. Nick was a gutsy guy who fought for everything he had and was given nothing. Nick was a little too much of a hustler, however. He said he wanted to live “the LA lifestyle” and said he thought he could get by on a six figure salary! He wasn’t sure what he would do with the money if the Sharks invested in him. This was a red flag for the Sharks. This is a very common question investors ask entrepreneurs before investing. You need a definitive answer to this question…..including how much you will pay yourself.
Blake St. Clair invented a solution to a problem that doesn’t exist. His Bark’ems To Go allowed dog owners to carry food in molded plastic while away from home. I suppose this would eliminate a plastic bag or two. Not enough of a value proposition here.
The three guys from Brewer’s Cow made beer-flavored ice cream. They kept contradicting each other when asked questions by the Sharks. It was obvious these guys knew how to make a good product, but knew very little about the 4M’s of entrepreneurship…..Mindset, Marketing, Money, and Management. When multiple partners are presenting, at least decide before the presentation who will field what type of questions.