Jacob*, a fledgling startup founder, and college student, has entrepreneurial visions. He is studying marketing at school, working part-time, and wants to be pitching his idea on Shark Tank. He has a great product idea and is already envisioning spending those millions he is going to make quickly. Although he has the heart, desire, and product, he is going to fail. When I met with him at the urging of one of his family members, a dear friend, he refused to listen to advice, was distracted and on his phone. Jacob had already decided he was going to be successful and didn’t need someone giving him advice.
Jacob isn’t an arrogant person however like many fledgling startup founders, he has delusions that do not match startup reality. Pitching a business that will get funded requires a willingness to learn from those who have walked that path before. The odds of getting an audience with The Sharks are miniscule. Based on data, here is what Jacob, or anyone, needs to know in order to pitch a Shark.
7 Stats About Pitching on Shark Tank
- Approximately 45,000 people apply to pitch on Shark Tank each year.
- Less than 1% of applicants get to pitch.
- 56% of founders get funded on Shark Tank.
- The average investment is $286,000.
- The average amount of equity given up is 27%.
- 94% of startups that pitched in seasons 5-9 are still in business.
- 80% are profitable.
I have the utmost respect for the Sharks. They have an impressive success rate that outperforms time and again. Where the failure rate for startups is 90% , The Sharks, as stated, have over 90% success in terms of their startups staying in business.
If Jacob makes it past over 44,500 other applicants and has the chance to pitch his deal, he will literally get eaten alive. The last time I spoke to him, he referenced a ‘D-Corp’ and said that he was in the process of registering it. ‘You mean a C-Corp,’ I said.
‘Yeah – that,’ he replied.
As someone who has pitched her share of investors and VC’s, my advice for Jacob and those with dreams of making it to the Shark Tank stage is to start by being coachable. As an investor and tech cofounder myself, I have navigated the tenuous waters of pitching VC’s (venture capitalists) for more money than the average Shark investment. In Silicon Valley and Wall Street, you will hear time and again, ‘we invest in the team and the founder.’ Those with experience, resilience, and tenacity tend to get funded over those that have a great idea led by a founder who is consumed with their own ether.
If you want to pitch a shark, or any VC, be willing to take all of the advice you can from those who have gone before you. You will need it. Famed Shark Daymond John said, ‘I think that in the earlier days, when I was a ‘wantrepreneur,’ I was really doing things because I thought what I wanted was to be rich.’ There are many Jacob’s out there who dream of getting rich; however until they learn how to be coachable, their entrepreneurial vision will remain an unrealized reality.