You’re walking through a dimly lit, wood paneled tunnel. Five of the most powerful investors in the world are waiting for you on the other side. Your palms are sweating. Your heart is racing. You’re reciting the words over and over in your head… words to the 90-second pitch you’ve practiced and perfected. Words that have the power to convince the investors waiting for you to invest hundreds of thousands of dollars in your company.
Oh, you’re also on national TV and there are cameras swarming around to capture every move you make.
This is what it’s like to pitch on Shark Tank.
In the Tank, some entrepreneurs get bought; others get bitten. So… what’s the secret to the businesses that are successful in convincing sharks to invest?
Whether you’re preparing for your spot on the show or practicing your elevator pitch, you can learn from those who have been successful and those who have not. We’ve analyzed successful pitches, dissected the unsuccessful, heard from the sharks about what exactly makes them want to invest in your company, and have some results to share with you. (Spoiler alert: the answer is practical and possible to implement for your company now — so read on!)
We’ll start with the bad news — here’s an example of what not to do from Pavlok, who has been widely heralded as the worst Shark Tank pitch of all time. The entrepreneur began with data and numbers. Logical start, right? Wrong: he completely lacked heart, had a big ego and had no story. Without any background or narrative to follow, three sharks went out almost immediately. Mark and Kevin stayed in a little longer, but ended up yelling at the entrepreneur to get out of the tank with a less-than-cordial farewell.
A few clear lessons to learn from the worst pitch ever:
- Engage investors with the story and heart of your company, not just facts.
- Leave your ego at the door.
- Listen and respond.
So how does a company avoid going down in flames and stand up in the heat of the tank? With $63.1 million dollars that have been invested by sharks throughout the shows history, it’s clearly possible to make a great deal when equipped with the right strategy.
Kevin O’Leary is arguably the toughest shark in the tank. Here’s his #1 tip for a standout pitch is:
“Each pitch must tell a story about money: the lack of it, the need for it and how it can be made. As a born marketer and salesman, I tell my employees all the time: if you cannot tell the story and put your prospective customer into the narrative of our financial products, you will fail. Good TV is no different from good storytelling…Oh and you better be able to get your story out in less than 90 seconds, or you can pack your bags because my money’s already looking somewhere else.”
With this advice from Mr. Wonderful in mind, we looked over some successful pitches from the tank to see if his words translate to dollars for entrepreneurs.
Simple Sugars and Combat Flip Flops were two standout pitch examples. Robert Herjavek commented that 18-year-old Lani Lazzari from Simple Sugars was one of the best pitchers they had ever seen on the show. What did she say to earn that praise?
She started with her story.
Simple Sugars CEO Lazzari battled eczema as a young child. The itching and irritation on her skin was awful to live with, so after she got home from middle school she researched solutions. No product existed to help her… so she decided to create one. When she explained this background story to investor Mark Cuban, he immediately connected to his own experience and his family.
“I have three kids, and my wife would come and make your bed everyday — I would too, for that matter — if it kept my son from itching all over,” said Cuban.
Cuban made Lazzari an offer of $100k for 33% of her company. Since making that deal, Simple Sugars has gone from $44,000 in sales to well over $6 million.
This trend continued when we analyzed the Combat Flip Flops pitch.
Griff and Don were Army Rangers serving our country in Afghanistan. While there, they got to know hard-working, creative Afghanis who were looking for jobs — not handouts. When the guys got back to the States, they decided to try and make jobs happen for innocent people in war-torn nations around the world. They started with flip-flops and sarongs to try and make apparel items that people in every country on the planet wear weapons for positive change.
Daymond John, Lori Griener and Mark Cuban wanted in on the action and made a triple-shark deal of $300k for 30% of the company.
When Cuban went up to greet Griff and Don after making the deal, he remarked that he didn’t even know what a sarong — one of the key items of the business — was, nor did he care. He just loved their story and wanted to be a part of what they were doing.
Since the tank, Combat Flip Flops demand has increased 600%.
O’Leary sums up the experience of connecting to a story with tears in his eyes as he talks about a company he felt strongly impacted by, Bottle Breacher:
“It just hit me. I had an emotional connection to the product. Even though I know I shouldn’t let emotions get into my investments… this was different. I wanted to make damn sure they would be successful.”
O’Leary said that this business impacted him because their story touched on being a parent. When O’Leary thought of his own role as a father, he couldn’t help but to act. He invested $150k for 20% of their company.
Out of 495 pitches analyzed by Science of People, 58% of successful deals had a story. And it’s no coincidence that on the top of the websites for both Combat and Simple Sugars they have a tab titled “Our Story”. It’s not just sharks that story means a lot to, it’s your customers.
At StoryDriven, we tell stories every day that engage, inspire and connect our customers with their audience. We’re on a mission to use the power of storytelling to tells stories of great things going on in the world. Are you doing something worth sharing?
To learn more about how to tell your story, check out StoryDriven. Our team studies the science and business of story and can harness its power for your company.
StoryDriven is a 7 time Emmy Award winning firm that specializes in human centered marketing videos. We tell human, product and company stories that live your website, social and live event spaces.