Barbara Corcoran, one of the investors on ABC’s “Shark Tank” show, hears tons of pitches from eager, ambitious entrepreneurs every season. But which ones are strong enough to earn her backing? In this lesson for small business owners looking to grow, Corcoran explains how to prepare a convincing pitch for potential investors — and which red flags to avoid.
The single best pitch I ever heard on Shark Tank and I bought into was Cousins Maine Lobster. Two guys, young guys, owning a food truck in LA that originally came from Maine. They loved lobster. They had passion. But why were Jim and Sabin the owners of Cousins Maine Lobsters so good at pitching? Because they had grossly over prepared. And the over preparation became disguised as confidence. They had such confidence on that set. Every shark was trying to get a piece of that business and what was their secret sauce? They had watched all four seasons of Shark Tank, wrote down every question any shark had ever asked any entrepreneur and came up with two individual answers for each question. And they practiced for two solid months. Do you know it wasn’t until after I closed on their business and handed them my money that I found out they had only been in business two months. I didn’t know that because they were over prepared. Born natural entrepreneurs that hone their skill – they’re making me the most money – no surprise. They’re thorough at everything.
When I’m sitting in my chair on Shark Tank I’m looking for the red flags that tell me don’t put your money here. And it’s always the same stuff. When an entrepreneur doesn’t look the part of his business I’m out before he even says a word. Why? Because you’ve got to look the part. People perceive your business based on the guy on the front end – that’s you. I passed on a great shrimp business. The guy was phenomenal but the minute he walked on the set he had a dirty apron on. I figured his bookkeeping was a mess and I would never get my money back. I mean he’s on national TV and he wears a dirty apron? I’m out.