Posted on 02/27/2015 8:48:56 PM PST by 2ndDivisionVet
Anybody who’s watched “Shark Tank” more than once will tell you he’s hooked on the Sharks, just as much as they are on the little fishies swimming around in the tank. The Sharks—a panel of billionaire investors ranging in expertise and net worth—scowl, laugh, cry, ridicule, and jest like a bunch of frat boys (and a sorority chick or two) on steroids, 30 years post-college.
If “business is the ultimate sport,” as Shark investor, billionaire businessman, and owner of the Dallas Mavericks Mark Cuban said in an interview last year with Inc., Magazine, than every episode of “Shark Tank” is like the Superbowl, NBC Championship, and Stanley Cup rolled into one. “Shark Tank,” now in its sixth season, certainly exemplifies free-market capitalism, the economic foundation upon which America thrives.
‘Shark Tank’s’ Winners and Losers
I like to watch “Shark Tank” because of Cuban, what with his no-frills demeanor, straightforward business advice, and chiseled good looks. Basically he’s a biker dude in a business suit; a bad boy who pretends to be…even more bad. Some of the deals are interesting, too (but did I mention Mark Cuban?).
Others like to watch entrepreneurs strut on the show and crash and burn. Remember season two, where a guy invented a contraption that would cook bacon—bedside? It operated as an alarm clock, as well—bonus! The Sharks nibbled a bit but ultimately passed, although Kevin O’Leary did walk away with the prototype, despite its fire hazards. Then there was the guy who sold Kymera, a jet-propelled boogie board. In ten years, he hadn’t sold one. One of the strangest has to be Man Candle. With scents like BBQ and “fart,” one can’t imagine why the Sharks declined to invest.
There have, of course, been some amazing deals brokered on the show. Tom & Chee boasted a restaurant that offers twists on the classic grilled cheese (including a grilled cheese donut of sorts). Barbara Corcoran, one of two women on the show, couldn’t resist the mouth-watering temptation and now there are 19 locations, 13 more scheduled to open by spring, and 2,000 franchise requests. For. Grilled. Cheese. The biggest deal in “Shark Tank” history was Groovebook, a company that enabled users to make photo books out of all their pictures on their phones. Shutterfly recently acquired it for $14.5 million. No big deal.
Would it surprise you to know one of Cuban’s favorite “Shark Tank” success stories did not occur with a slick-looking, fast-talking salesman but a girl named Lani Lazzari selling body scrubs—Simple Sugars—who was 19 years old when she pitched to the Sharks? In my recent email conversation with Cuban, he paid her a high compliment, at least in the world of billionaire investors: “[Lani] works her @$$ off. She is always learning. Always improving her product and company. Always selling. She is my mini-me.”
Breaking news, Lani: As Cuban’s “mini-me,” you’re going to have some haters, but you’re going to retire with some cushion, so go forward, my child, and remember the little people.
Adam Smith Would have Loved ‘Shark Tank’
No, really, he would have Tivo’d it. Heck, he’d probably have produced the show. Sure, it’s made-for-TV venture capital so it’s dramatic and edited. But, aside from all that, ‘Shark Tank’ is about many things—innovation, salesmanship and financial savvy, among others—but it is ultimately about how the competitive market responds to a creative idea or product. Smith said it better, in “The Wealth of Nations.” “In general, if any branch of trade, or any division of labour, be advantageous to the public, the freer and more general the competition, it will always be the more so.”
Think of “Shark Tank” as a means through which investors can clear their throats before singing opera on Broadway. (Albeit, on television.) Some entrepreneurs on the show haven’t sold products at all or are unable to relay an accurate financial breakdown of their business. In our correspondence, Cuban told me he sees this kind of ignorance often in the business world and encourages greenhorns who want to approach him for an investment to do their homework first. “They don’t learn from what others in their industry have done and what their competitive risks are.”
Some people think the way the Sharks react toward the fledgling entrepreneurs is harsh or rude, but in truth the Sharks are doing them a favor. They get to hear the truth straight up and dirty from a few knowledgeable folks who have been around that block instead of either continuing to limp along aimlessly or crash and burn in the real marketplace. Plus, they’re demonstrating how the market works by fighting for the products they like amongst each other. Way to go meta, meta, “Shark Tank.”
The best way a business can earn its chops toward success is when it’s allowed to thrive within the competition of the free market. Don’t believe me? With which entity would you rather mail a package, assured it will arrive on time and at an affordable price: The U.S. Postal Service or FedEx? Competition has enabled FedEx to reach a pinnacle in its niche market, while the USPS struggles.
So it is on “Shark Tank. “If an entrepreneur can suffer through some interrogation, some laughter, and maybe even some name-calling, it may pair him with an investor who can push him to the next level in the competitive marketplace.
Even Cuban has had to learn this the hard way. He said there was a time when he was caught “thinking a business [could] run itself.” Alas, he changed his mindset and now uses his now-infamous competitive edge to the utmost advantage. “There is always someone trying to kick your @$$ and you have to always work to stay ahead.”
Still, despite his penchant for eye-rolling and telling it like it is, Cuban is as hopeful as Smith was about our economy some 200 years later, and more optimistic than ever about starting a business. When I asked him how the political atmosphere has affected his investments, he didn’t even balk. “The last 5 years have been an amazing time to start a business because the costs for a startup have fallen dramatically. The shared economy has made it possible to do anything for far less.”
For those keeping track, Smith said something similar about “the shared economy:” It is the great multiplication of the productions of all the different arts, in consequence of the division of labour, which occasions, in a well-governed society, that universal opulence which extends itself to the lowest ranks of the people.”
Billionaire, Free-market-loving Capitalist, Libertarian?
Recently, at the Code/Media conference in California, Cuban made news when he said the Federal Communication Commission’s attempt to regulate the Internet via net neutrality was a bad idea. He said, bluntly, “Having them oversee the Internet scares the $#*+ out of me.” He was just as harsh when discussing the FCC’s push for regulations under Title II of the Telecommunications Act when he said, last year, “The government will [expletive] the Internet up.”
I asked him point-blank what was so scary about the government’s involvement in the Internet. He said because their track record proves their instability. “Because it’s absolute uncertainty regarding how they will regulate the net; looking at the TcA of 1996 will show many examples of intent not matching execution.” He cited as further insecurity generators the following: “[H]ow future commissioners will manage the regulations [...] how the courts will rule on the many lawsuits that will occur with any changes [and] how the FCC will respond to the legal rulings.”
If you doubt this, Cuban gave a perfect example of a situation that works just as he described. In his trademark quips, he said, “Verizon wins. Commissioner has one position. POTUS and public opinion take a different position. Verizon’s decision creatures the opportunity to change things. Chairman changes position. Does anyone think this series won’t occur again in the future?” His advice to the FCC—in case you’re wondering, guys—is to just “act in the same manner they have for the last 20 years.”
It seems Cuban is somewhat of a libertarian when it comes to policy. When I asked what improvements he would make to our country’s economic structure to release its full potential Cuban didn’t say he’d rewrite the tax code, but he’d decrease the number of dependents on welfare, thereby shrinking at least that part of our burgeoning government. “This may sound crazy but I would rather write checks to people who need help than have the overhead of government programs. It will cost us less and help those in need more.”
No, Mark, it doesn’t sound crazy. It sounds logical, a little conservative—heck, even radical. It sounds like the kind of stuff your political forefathers said before anyone even heard the phrase “venture capitalist.” It makes sense, too, that a Shark featured on a show about eating before getting eaten would think the power of this country’s economy lies within the hands of its innovative people, not their growing government.
I stopped caring what he believes when I saw him being interviewed before the election and he supported Obama.
It is probably the most interesting show on TV.
Plus Cuban has his peers who are as sharp, funny, driven and focused.
However, Cuban holds back and when ready, is most compelling.
LOVE it!! LOVE their comments about why they don’t go in on a deal....very insightful most of the time.
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