Your business idea is only as good as your presentation. Take these entrepreneurial lessons learned from Shark Week to improve your pitch.
"Shark Tank," the reality TV show featuring real and successful venture capitalists investing their own money for business ideas they like is a great place to learn about entrepreneurship—from the straightforward quips of Mr. Wonderful, to the careful insights by Lorie Greneir, to the quick ’20-second-clock’ investments by Mark Cuban and other sharks.
The series provides people with great insights on what’s happening when inside the venture capital and startup world. I’ve compiled some of the things I enjoyed and learned from the series.
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1. Don’t Grow Your Business too Fast
A business goes through working capital easily. By expanding too fast and without proper cash flow projections and management, you’ll be running to banks and other financiers in a flash to seek new infusion of capital to save your business. If you look desperate in front of venture capitalists, you’ll be losing a big chunk of your ownership of your own business.
Image via Inc
2. Do Your Homework When You Face Investors
When you talk about money, things get serious. With their own money at stake, these sharks will ask for numbers, projections, your competition, the unique selling point (USP) of your product and how will they be able to make money by financing your business. So part of getting a loan or an equity infusion successfully is make sure your accounting is correct.
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3. Cash is King
- Trim down unnecessary business expenses;
- Keep a majority of your working capital in cash;
- Try to limit credit facilities to customers.
Always encourage them to settle their payments quickly. Make sure your liquidity ratios are solid. Financiers like businesses that are liquid because it means they can pay back creditors easily.
4. Learn How to Negotiate
This means having the ability to make counter offers and offer scenarios which can be win-win for both parties. If you don’t learn how to negotiate, you’ll always be on the losing side in deals.
5. Trust Your Gut Instinct if You’re Financing a Business Venture
Sometimes the numbers might not make sense, but your intuition tells you that your business venture can be a spectacular hit if you play your cards right.
Take the risk! Big risks can mean big rewards.
Image via Urban Beardsman
6. Show Your Business's Market Viability and Profitability
Investors like businesses that have good growth potential and can capture a big market if it gets the necessary funding. Serving a tiny niche market is not golden to big time venture capitalists.
7. Don’t be a ‘Wantrepreneur’
If your product or service is a "want," be able to convince your potential investors that it will become a "need." A product or service that is needed is a safer business and is a key consideration by many investors.
8. Highlight Your Unique Story Along with Your Idea
Practice narrating your unique story and how your business will provide a solution to its target market. Having a story gives your pitch a personal touch and can be a powerful way to influence people to invest in your idea.
Related Article: Telling Your Story: DIY Public Relations for Small Businesses
9. Be Realistic in Your Presentation
Without overvaluing your business, communicate your unique proposition. It’s not good to be overly optimistic about your business, though.
Understand that it does have challenges and weaknesses. When it comes to financial figures, try to be a bit skeptical or a little pessimistic.
10. Be Passionate About Your Business Idea
Investors know that passionate people are not in the business just to make money but because they sincerely believe their product can make a difference in the world. At the same time, be passionate of also growing it and making your company strong.
Entrepreneurs who leave the "Shark Tank" may not always take home the much coveted success investment at the show, but the lessons and opportunities arising from having the courage to come to the show and pitch their ideas to the world is simply priceless.