From gmtoday.com: “Learning to swim with the sharks” — WAUKESHA – It’s a common question asked of start-up owners: Will you go on “Shark Tank” someday?
The ABC show that puts an entrepreneur before four venture capitalists and gives them an opportunity to pitch their products to gain financing for growing or saving their businesses has gained a steadfast following among entrepreneurs and consumers alike.
While many tune in to the show for entertainment, there are lessons to be learned too, said Dan Steininger, co-founder of BizStarts Milwaukee, which works with entrepreneurs, service providers, capital connections and other resources to help launch and grow new companies.
BizStarts Milwaukee hosts investor forums, which Steininger called a friendly version of “Shark Tank.” Entrepreneurs can go before potential investors for about 15 minutes.
Steininger said “Shark Tank” educates viewers on how to get investors to fund their companies by providing insight into the typical questions an investor will ask, such as amount of sales, profit margins and money already invested in the company.
Before entrepreneurs participate in the investor forum, BizStarts Milwaukee provides training, so sometimes they are often more prepared than the contestants on “Shark Tank,” Steininger said.
Peter Rathmann incorporates episodes of “Shark Tank” and “Undercover Boss” in the Intro to Entrepreneurship class he teaches at Waukesha County Technical College. He also teaches marketing classes at WCTC and Carroll University, in addition to owning SalesTechnik, which helps Individuals, organizations and companies increase their opportunities and sales.
Rathmann said many students start the class with an idea of what they would like to do. Both the class and TV shows can help them think about creating a business structure and learning the vernacular.
The students also learn to promote their product in terms of knowing their sales, costs, how they make money, the hurdles the business has encountered, why their product is worth investing in and more.
For Intro to Entrepreneurship, the final presentation is conducted in a Shark Tank format, Rathmann said.
“It kind of gives it a simple form at the end of the day,” he said of “Shark Tank.”
Jon Anne Willow, entrepreneurship director for BizStarts Milwaukee, said entrepreneurs can learn from the strengths and weaknesses of “Shark Tank” contestants.
“When the best entrepreneurs pitch on those programs, they are prepared, they are not defensive, they are open to ideas and suggestions,” she said. “They have a strong vision for how they want their business to grow.”
When entrepreneurs pitch in front of BizStart Milwaukee’s investor forum, which consists of venture capitalists, banks and angel investors, they need to be prepared, but local investors are more apt to work with the owners.
“It’s important to remember they want you to succeed; they want your idea to be fantastic, but it’s their money and it’s their risk,” Willow said.
Tough lessons can also be learned from TV shows, Seininger said.
“You learn you just can’t have a dream,” he said.
Unless you have real customers paying for your product, Steininger said, you don’t have a business.
One of the upsides to shows like “Shark Tank” is making business seem exciting.
“It’s about creativity and innovation,” Steininger said. “It is rewarding people for not just doing the same thing.”
Gary Bredow, host and creator of “Start Up,” a show highlighting successful businesses that often began in someone’s kitchen or garage, asks questions of the owners that provide insight about how they found success.
Bredow said the main thing he has learned from doing the show is there is no formula for success – each person has his or her own path to it. While some say a business plan was not useful, for example, others swear by it.
One constant, Bredow said, is that successful entrepreneurs need to have “drive and determination or don’t bother.”
The notion is that being self-employed means you have a lot of free time, but that’s not the case at all, he said.
“You have to be a very independent spirit,” Bredow said.
These are some lessons he learned while filming at Newaukee, Iron Horse Motel and Gouda Girls in Milwaukee in season one. He is in the process of shooting for season two, which will bring him to Madison.
While the show has been airing on PBS, Bredow said “Start Up” has been picked up by The Create Channel, which will begin to re-air episodes from season one.
Bredow said he has heard from fans of the show who have been inspired, including one person who decided to start Prohibition tours of Chicago.
Learning how to valuate a company is also an important skill and one viewers of “Shark Tank” can see work against an entrepreneur who is not well prepared.
Russ Roberts, manager of the Small Business Center at WCTC, said the show has illustrated how valuing a business can be more “art than science.”
“The most important is preparation and being ready to answer questions confidently,” Roberts said of lessons learned from entrepreneurial TV shows.
Others positive effects from watching “Shark Tank” include anticipating the questions you’ll get and being prepared to answer them. The contestants on TV must also be able to think on their feet, to get to the point and answer the questions, Roberts said.
The investors on “Shark Tank” illustrate how many people are looking to invest in the entrepreneur and not just the product, by the comments they make and the way they determine whom they will invest with, Roberts said.
The impact of shows like “Shark Tank” is widespread.
“It’s rare that I find anyone who doesn’t know “Shark Tank,” Roberts said. “It has had impact.”
“My hope is that programs like “Shark Tank” and “Start Up” do spur interest in entrepreneurialism and do inspire people to get out there and start businesses of their own and follow their dreams,” said Willow.