ABC's Shark Tank is between seasons at the moment, though I'm glad to see it still showing up on Friday nights, but it's getting a third season in the fall. The show had me as a fan long before it ever aired, because I had already been hooked by the British and Canadian versions for years.
The show of entrepreneurial hopefuls, and the Sharks (Dragons in the other incarnations) who may or may not give them money is going strong, and I was very glad to see it picked up for another round.
I had a chance to talk with one of the Sharks recently, and it was a surprising treat. Well, surprising because, you know, they're Sharks. Luckily, as we'll see, and as I'm sure you already know, I was chatting with the least "sharkiest" Shark, Barbara Corcoran. I apologize in advance for the lack of editing here, but for all that there is some theory of a rhyme and/or reason for interviews, we really just rambled about the show, much as I suppose anyone who is a fan might if given the chance.
I want to jump right in, because this is fairly lengthy, but I want to mention that she has a new book out. Shark Tales: How I Turned $1,000 into a Billion Dollar Business. I also want to make sure to tell you to be sure to catch Shark Tank as the re-airs continue on Friday's, and keep it on your radar for the fall.
Also, the show is looking for contestants - http://abc.go.com/shows/shark-tank/casting
Here we go -
How did you get connected to the show?
Barbara - I got a phone call one day from someone the studios hire to recruit people for the show. They asked if I was interested, and I thought it sounded perfect for me. I said, "Yes, how do I get it," and they asked for tapes and various things, which were all about real estate, of course, because I had nothing on entrepreneurship. A month later, they sent me a contract, which I signed as quick as I could. I sent it back, and knew I was going to L.A. within five days. That was so exciting, I felt like a little kid. But then, two days later I got a call that they changed their minds, and they weren't going to hire me. I couldn't believe it.
Little did I know, they sent lots of contracts out to lots of "sharks," and they cancelled out most of them. I didn't know that. So, I got it, and lost it, and that's when I think I'm always at my best. I sat down and slammed out an email - I should send it to you, it's framed on my wall. I'm so proud I sent the email. - and I sent it to Mark Burnett, and I made the woman who called for him promise she'd walk it over and put it under his nose, because nobody reads emails.
It worked, and that turned it around. I suggested that he bring the other blonde bombshell out to compete with me for the spot, the lone female spot, and he said he would.
That's so interesting. I don't think anyone watching would imagine that there was...
A fight for the spot?
Well, least of all me. I never saw that one coming. I had already gone to Bergdorf Goodman, and bought five new outfits, just for signing autographs. I had the whole Hollywood thing going on in my head. But, of course, that was banished with one phone call.
Well, you have to have the right outfits if you're going to be on TV, right?
I think outfits are part of it, and speaking of outfits, I'm making headway on the Shark Tank. They would only let me wear very dark business suits, which I never wear, and I had to shop just for the show. Now, Clay, my executive producer is allowing me to wear color. So, I'm finally getting to break from that old mold that a businesswoman wears a dark, man suit, because they don't.
So, were you involved with the entrepreneurship side of things before this?
Not at all, and that's why it was such a special opportunity for me. Because, I had to recreate myself after I sold my brokerage firm, and so I recreated myself as a real estate expert. The most natural thing to do in the media world. But, to have a ticket into the entrepreneurial space, which is so natural to me, that's what I do well, that's why I was so excited when i got the phone call from Mark Burnett.
I think that's all really interesting, because people watch the show, and... I think that's not what they think.
In which regard? I'd be curious why you say that.
Well, A) that there was a fight for the spot, and B) that this is not what all of the Sharks do anyway, and they just made a show about it.
Oh, interesting, I hadn't thought about that. Well, each of the Sharks has their own business, and are entrepreneurs building their own business, but their business per se is not angel investing like this. It's new to all of them. Although, I shouldn't say that, because two of the sharks come from Canada. Kevin O'Leary and Robert Herjavec, so they've been doing this, and it's not new to them, but still, their business is not really one of being an angel investor.
So, in getting into the show now, have their been any products or businesses that stand out to you as the ones that you wish hadn't gotten away from you?
Yeah, I would say the first one that comes to mind is Notehall. That was from the first season. That was the fish that got away. That was my introduction to the concept that there are Sharks on both sides of the table.
Another one got away this year. I think in both of those instances, I think I definitely was used, or, I should say, the venue of the show was used to get notoriety versus genuinely looking for investment capitol. I was a little surprised. I always take people on face value until proven guilty. So, I had to lose one big fish in each season. And, I was thinking, I don't want to do this. I don't want to get used. But, guess what. Now I've made my new rule. I'm going to be used once every season.
But, Notehall was a great technology company, that had already raised a first round of financing, and it's a method by which kids at different schools share their notes. You remember that one?
I do remember them actually.
Well, the two guys were adorable. They looked the part. They acted the part. They believed in their product. But, when I finally competed with two other Sharks, and got it, I gave the guy a money-back guarantee. Like, if you don't like me as a partner, or whatever, don't worry about it. Give me the money back. Forget it. Don't worry, the deal's off. Then I realized he could use me. I said, you're not going to use me, right?
I heard that cock crow three times. No, Barbara, I would never use you. But, they got overbids on that price within two days from many technology angel investors, and knocked me right out of the box.
Well, I have watched the British and Canadian versions of the show for years, and it seems like you get a certain amount of that all the time. There are some people who just want to get the free ad of being on the show.
I don't blame them.
Well, sure. It seems strange, but I guess you can't blame them.
It's too tempting. Think about it, primetime exposure.
Well, and then every once in a while we see the "where are they now" spots, and you have people who didn't get deals, but they're doing great anyway.
Definitely. We hate those stories. They turned us away, and they're doing good anyway. Not a good message.
Are there any deals that you did make, that turned out even better than you imagined they would?
Yes. Definitely. That is, of course, the dessert of being a Shark on the show. To have an entrepreneur wind up much better than you dreamed, much faster than you envisioned. The two in this season that stole the show, in terms of product orders, and fast start, were Daisy Cakes, and also Ride-On Carryon, the children's seat that attaches to your luggage.
Really? Those were big?
Yeah, that surprised you? You probably don't have a little kid at home. Have you traveled with a little kid?
I actually have three, and I'm a work-at-home dad.
Oh my God. You're like the perfect guy to sell it to. Do you travel with the kids with luggage?
Well, you know, we don't travel by plane a whole lot... so...
Yeah, you really need to travel by plane for this.
It just didn't seem like the next greatest thing on the show.
Well, it's a niche product, no doubt. It's not like everyone is going to buy it. You have to be in that window where you have a kid under five. And, you have to be traveling. And, you have to be annoyed. So, there are a lot of contingencies. But, I'll tell you, it was received so well. The orders were through the roof. We ran out of product in a week.
Now, in my second season, I'm a much better planner. You know, the website has to be right. Everything has to be set.
But, despite that knowledge, when Daisy Cakes came on, we had 75,000 hits in three minutes, and it took the website right down. And, we had planned for it. Then we couldn't produce cakes fast enough. Then we found out we had a shipping issue. It was too expensive to ship them. But, it was one happy problem after another.
It was too much notoriety, too soon, and the audience responding well to her. That's what I find. It's not just the product, it's how people resonate on air.
There are a lot of times that I'm watching the show - Like I said, I've been a fan of some version for years - and, I find it so strange that there are products, and I'm thinking, I kind of like that product, but I would never be in business with that guy. It strikes me that here are people coming on, trying to get money, and I'm thinking, Wow, I don't think I could...
Have him as my partner.
Yeah. And, you do hear the Sharks saying that sometimes. They will pick out that it's the person.
People tread lightly on that one, I think. I think it's very hard to say on air, I don't like you, or I don't trust you. Or, I find it very hard anyway.
Well, not for Sharks.
I think you manufacture some other reason. Well, for me it's hard, I have to tell you.
Well, I think you probably stand out as the least sharkiest Shark.
That's not good for my career. I'm supposed to be a Shark. I don't want to hear that.
I don't know. Don't you think though?
I hear that a lot. That people like me the best.
Well, the other Sharks are mean.
Well, it has to be. It's a Shark Tank.
But, I don't know that you necessarily seem like you're mean to anyone ever.
I can't. I know I'm supposed to be, but I just don't have it in me. It wouldn't be convincing. I stopped worrying about that. I was worried about that the first season, and a little part of the second season, and I thought, you know what, when you're just yourself, it's usually the best course of action for anybody. If it fits, it fits.
But, you know what I feel very strongly about is that I've always picked the entrepreneur. Now sometimes in the due diligence, maybe 20% of the deals I do kick out. I either find things that aren't factual, like purchase orders that really don't exist. But, mostly what I keep my eye on is the nature of the beast. The nature of the person I'm about to get married to for a long time. If they are arrogant, or obstinate. That's probably the main thing. If they want to do what they want to do, they don't need a partner. They want money.
I think those people are the most entertaining. The ones who think they know everything.
It's funny, because these people are on a lot of television. Shows like Supernanny, or Kitchen Nightmares, where you have basically people who can't do it (whatever "it" is) go to an expert, and then won't listen to them. And, it turns out to be the same a lot on your show.
I'm happy to hear you say that. I thought it was miscasting, but you're thinking it's intentional, and works well for TV.
Well, I don't know about that.
I think so, because we're talking about it.
I mean, I suppose it could be, but I think it's just how a lot of people are. You know, people don't want to admit that they don't know everything. I mean, some people. People don't want to be wrong.
I just find it hilarious that they would come to the Shark Tank, and think they know better than everyone else. Especially when you have someone who has a lot to do with that industry, and they say, you know what you need to do is this, and they say, no, there's no way I'd ever do that. That's crazy. I mean, why show up? If you don't want the expertise of the Sharks...
Why are you there?
I feel like the money is not really a big thing. To me.
Really? You mean from the entrepreneur's perspective, you don't think that's their motivation? That they're in there for the money?
I think that it might actually be a lot of people's motivation, but if it is, it shouldn't be. I think, you know, you could get money other ways. But the people who have the expertise, and who have done it...
And, who have the contacts.
...is worth a lot more than just having a pile of cash.
If you don't know what to do with the pile of cash, then it doesn't get you anything anyway.
Absolutely. I actually very much believe my value in any deal is me. And, I'm not trying to be cocky or anything, because I'm a great business nose and can guide someone.
Right, and whatever money you put in, you actually know what to do with it. If they knew everything there was to know about what to do with the money, they probably wouldn't need any money. Their business would be wherever it needed to be.
The other thing that I find amusing about the show is all the people who have the crazy values and want crazy amounts of money.
I don't get that, and you know they're hammered away by the producers before the show. To try to get them to a real value. They're worked over, believe me. Because they really want to see a deal happen, and they know with these crazy values nothing is going to come of it.
Well, yeah, and if you're watching the show and all you hear are Sharks saying, "Where did you get this crazy valuation," that becomes boring.
I just find it strange that all these people come out and want too much money, when the money doesn't really matter. It's the deal, right?
Yes. I think.
I mean, let's say someone comes out and wants $100,000. If they'd have asked for $50,000, they would have got a deal, and the other $50,000 makes no difference.
Oh, definitely. You know what else happens that they're not aware of, and it happened with all my season one deals - for example, I don't know if you remember Tiffany who had the little clay elephant that gets a child to take their medicine...
Yes, I hate that product.
You hate it?
Yes, it's crazy. I mean, I might wish I had a piece of it, but it's the weirdest thing. But, ok, there are a lot of products that sell great, that I think are crazy.
Well, we sold 50,000 units to CVS, and we just sold another 10,000 to another big chain. And, they're selling very well.
Well, they are the kind of thing that I can see people buying. I'm not sure that it's not the sort of thing that's like way in the back of the drawer, and you never see it again after you buy it, but...
Well, I don't want to overlook the point I wanted to make about the $50,000 vs. $100,000. I think what a lot of people don't realize is that once you buy in - using Tiffany as an example, I paid $50,000 for 51% of her company - it was the first product I ever bought, and I don't know how I could have been so stupid, but by the time I signed the deal, which happened very quickly, and we got the mold made, and got everything in place... we already spent the $50,000. Then we got orders in, well, I had to put $100,000 more in to produce the products.
So, I'm a little more careful, because if the product is successful, it may be the tip of the iceberg. So, they are crazy to ask for a lot of money.
That's just further reason that it's so weird that they insist on so much money for the deal, because if you get 50% of this company, and you have money in, and you get to a point where you say, "Ok, we have all these orders, but we need more money," you're not just going to say, "Well, too bad."
Even at times if I'm thinking, I'm just chasing bad money now, why am I doing this, you have to make that judgment along the way.
The other hurdle you almost always get into is, if the business does get some traction, well, the entrepreneur is usually working another job, and all of a sudden they don't have the time to run the business. Now they're coming back to you asking for a salary, so they can quit their real job.
So, I'm a lot more sober now than I was the first season.
It's a different world now.
Different enough for me to have the wherewithal to say to Daisy Cakes, and it sounded so cheesy, that I want a dollar on every cake you sell. But, let me tell you, she's sending me a check now for over $5,000, and it's going to feel really good. But, I want to see some money back, and now I realize the dance steps involved, and there are multiple steps.
So, when the pitches happen in the next season, now you know you're actually looking at a whole lot of other things than you thought.
Listen, I'm thinking and listening twice as hard now, you betcha. I'm a seasoned Shark now. Which isn't as nice, or easy as I used to be. And, I hope to eventually get mean. We're going to have to see.
Well, you have the King of Mean right next to you, so it's almost like you don't need to bother, right? If there's anything mean to say, you don't...
Oh, he says it. If anything, I fault myself for not stopping him when he starts drilling down on somebody. I don't think it's good TV. Sometimes he goes too far.
I think he does go too far, but sometimes I think there are people who need to hear that. I agree with him sometimes when he says that you're doing them a disservice to not give it to them. It's kind of like Simon on American Idol, you know, somebody has to say, Look, you can't sing, or they're just going to spend the rest of their life, you know, throwing more money into their business.
Yes. I agree wholeheartedly.
Ok, so, finally, I have to ask, what did you do with that first $1,000?
Oh. Easy. I spent $18 installing a Princess phone. I remember because I was so careful with the money. I placed my first ad in the New York Times. A three-line ad. I think the cost on that at the time was roughly $30. That's what I did with the money. The best thing I did was the ad. I had one listing. It was a one-bedroom, and it was owned by the man that I was his receptionist, so he gave me a listing. It was $340. I'm looking at the New York Times, and I'm seeing reams of one-bedroom. One-bedroom good loc. One-bedroom this. One-bedroom that. I went back to my boss and said, "How would you like to put up a half-wall in the dining L? I could get you another $20, I think." So, I raised it to $360, and I advertised one-bedroom and den. And, my phone rang off the hook.
I did it in another apartment, and another apartment, and used that same ad. So, that's all I did. I ran one ad, and made a $340 commission, and I never really went backward from that. I didn't ever get drained. Until, of course, I started opening five or six offices, and putting in new technology, and hiring well-paid people.
The beginning years were pretty easy though, really. It was about trying to get the most bang for your buck. And, I think that is the charge for every young entrepreneur.
And, speaking about my young entrepreneurs. The first thing they all want to do. They all want the same two things. I'm going to start taking a salary. Oh, no you're not. And, then the next thing they want to do almost immediately is, let's hire a public relations company. It's the first two things on everybody's dream list. It means their nose is on the wrong stuff.
So, that's a long way around from where did the $1,000 go, but I never really spent it, quite honestly. I just kept rolling it into that same ad.
Well, you know, the show keeps saying, "Turned $1,000 into... multi-whatever empire, and I'm not the only person thinking, you know, I could get $1,000... what do I do with it? They sell that so much on the show, that people have to wonder.
Yeah. You know, you're the first person that has asked me that, would you believe it?
I... I, wouldn't. No.
That's the truth. I'm more surprised that I remember, but you're the first person that ever asked where the $1,000 went.
And, that's pretty much it. I have to give a huge thank you to Barbara. She was a real pleasure to talk to, and simply far more cheerful and easygoing than I would have expected from the wealthiest person I've ever talked to.
Keep enjoying Shark Tank, and check out her new book.
© 2011, Are You Screening?. All rights reserved. Reprinting without express permission of the author is prohibited.