That said, the pitch process you see on Shark Tank is at least somewhat within the realm of realism given it's made for TV. Mark Cuban is a shark now, but he was a minnow at one time making the very same pitch for capital for his start-up Broadcast.com, which was purchased by Yahoo for $5.7 billion. Cuban was already a well-known technologist and had connections into the financial industry. What can you learn from Mark?
- Network aggressively. Use your resources to make connections. Host a monthly margarita get together to talk business. Keep it simple and tell people what you're doing. These types of get togethers are often way more effective than sitting in a chamber of commerce meeting with 100 people and exchanging business cards. Get to know people in banks, investment companies, accountants, lawyers, etc. They all need business leads, too. Keep it casual and find an interesting topic for discussion each month, then let the conversation flow.
- Focus. Do one thing really well. A jack of all trades doesn't get funded. Investors want to know where their money will be invested. A little here and there screams hedging one's bets instead of having a laser focus.
- Develop a business plan. Trust us, behind the scenes of Shark Tank, there's a lot of discussion about the business. Any of the offers you see on TV are subject to or have been subject to the completion of "due diligence" which is a fancy way of saying the investors can get out of a bad deal if they don't like what they see. We'll talk more about the business plan in upcoming blogs.
- Build a trusted group of insiders. We build an advisory board for every company we get involved with. They get some benefit for being involved, which is rarely company ownership and is never pay. You have to figure it out based on your industry. If you're a restauranteur, make sure your advisors can always get a reservation and have your hosts treat their guests like royalty. If you're in construction, send someone over to make your advisor a doggie door. Get the point? Make them feel like you care about them, and you'll get free business advice on a variety of subject from business leaders you trust.
Stick to the basic things that investors expect and your own version of Shark Tank may soon become a reality.
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