Since its premiere in 2009, Shark Tank has given numerous entrepreneurs the opportunity to present their business ideas to the “sharks” and, hopefully, negotiate their way into a business partnership. Over the years, the show has amassed a large following and has brought attention to countless start-ups, whether their owners decided to go through with a deal that was offered to them or not.
In each episode, these founders can be seen pitching their idea and being thrown into a quick negotiation period with the shark panel. However, for those who are not familiar with business negotiations, this may give off a false view of how this process works. Of course, the show must shorten the process in favor of screening time and audience engagement, but many wonder if this is an accurate depiction of business negotiations.
How Does Shark Tank Differ From Real-World Business Negotiations?
Viewers have grown accustomed to the general make-up of a Shark Tank episode. Typically, the business owners get around 10 or 15 minutes of time to pitch their product to the panel. However, in actuality, pitching a startup to investors is a much lengthier process. And rather than pitching to a panel of potential investors or business partners, the founders will likely have to make personal contact with each potential partner. This adds time to the process and requires effort on their end to make contact with these individuals and set a meeting time. But rather than this being the first time hearing of the company, the founders will have already made contact with the potential investor prior to setting up the meeting, so as not to waste their time if they truly aren’t interested in the start-up at all.
Within these meetings, there likely isn’t as much of a focus on the current sales as there is on Shark Tank. On the show, the panel of investors and entrepreneurs takes a lot of interest in the number of sales and profitability and will often duck out if they don’t see the financial potential. But in a real-life setting, most investors recognize that start-ups may not have much capital to bring to the table, hence the necessity for investors.
One other stark difference is that, in real life, the negotiations do not actually take place during the pitch. In Shark Tank, the entire process seems to go by in the blink of an eye. But in real life, the pitch generally is a time to introduce the company more thoroughly, talk through goals and strategies and answer any questions. Negotiations tend to come later in the process.
It makes sense that a television show would dramatize this process for higher viewings, especially as it wouldn’t be fit for television to follow each business owner’s journey the full way through. However, the show still offers an interesting view into the world of start-ups and pitching that wouldn’t normally be televised.