Tonite’s first CNBC episode was one of the very first Shark Tank episodes ever…….an oldie but a goodie.
The first entrepreneur appearing on the show was Tod Wilson from Tod’s Pie Factory. By his own admission Tod was tapped out and needed money to keep his business going. He was knowledgeable and passionate about his business and ended up getting a $460K investment from Daymond and Barbara. Apparently he’s doing fine now because he appeared on CNBC today when he was interviewed by Tyler Mathisen (and then served Ty hot chocolate from his truck!).
The next entrepreneur was Daren from Ionic Ear. His “hearing aid” required surgery to “install” the product. It got worse…..you have to stick a needle in the patient’s ear every day to re-charge the device. The Sharks were scared and quickly swam away. Daren countered by asking “What’s the first thing you thought when you first heard about breast implants?”. Daymond quipped, “I loved it”.
I think everyone felt sorry for the next contestant, Kevin from Wispots. He is a former Marine with a wife and two young kids. He had invested $550K of his own money in his business and had two mortgages on his house. Despite his passion, his concept was doomed to failure because of new technologies (smart phones) that would make his product obsolete. It was time for him to re-invent himself or cut his losses and move on. This was a tough message to deliver, but the Sharks did so.
Tiffany from Emmy the Elephant reminded Barbara of herself and she proceeded to consummate a deal despite the fact that Tiffany’s product was a just concept and she had no sales history. If investors feel a personal connection, anything is possible.
Nick and Omar from College Foxes Packing Boxes faced an interesting dilemma. Their first business (College Hunks Hauling Junk) was very successful and had quickly grown to $3 million in sales. Their new business (College Foxes) was just starting up and Nick and Omar wanted the Sharks to invest just in this business. Of course the Sharks wanted them to bundle the two businesses, but they refused.
It is a very common practice for investors to try to minimize their risk by investing in the proven company as well as the fledgling company. Nick got mad at Mr. Wonderful when he bowed out and said , “Now you can stop talking”. It’s never a good idea to be disrespectful to any potential business partner or investor. It can, and will, come back to bite you someday.