What really matters in business?

downloadI have a confession to make.  I have become addicted to the Australian series of Shark Tank.  It’s a master class in negotiation, pitching and influence all rolled into one!

Shark Tank is where budding entrepreneurs pitch to potential investors known as sharks.  The sharks decide whether to invest and negotiate deals for equity and capital.

It is reality TV so it’s high drama!  But what makes it work is the sharks, who are all successful business people in their right.  They impart insight and business news that is sometimes brutal, but often priceless.  So in the wheeling and dealing that makes up business what matters?  Is it quality of the idea, the execution or the business plan?  This is what has emerged over the past few episodes:

People buy people   
In one preview, real estate entrepreneur John McGrath bluntly tells a candidate: “I can’t invest in you.” When you are pitching, presenting, or leading, ask yourself: would people invest in you?  This is about personal credibility and believability.   The wisdom out of Silicon Valley echoes this: venture capitalists say they invest in the founder as much as in the idea.

Get out of the passion prison
The sharks are totally unimpressed by passion, and the show is littered with passionate entrepreneurs who did not make the cut.  What the investors look for in addition to passion is commitment, some level of execution and persistence.

Show – don’t just tell
One unsuccessful contestant was talking about a software product without any sort of demonstration.  One of the most successful pitches was  Adam Riley with a foldable electric skateboard.  Janine Allis one of the judges even used it on the spot and it worked perfectly.  Adam had all the sharks battling each other to invest.  The more real you can make your idea the better. Showing a prototype, and moving abstraction into reality, makes it easier for people to be persuaded.

So how can you use these principles in your next pitch, your next meeting, or when the stakes are high at work?  Please comment – I love hearing from you.

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  • Ning

    Hitting the bullseye three times in a row, Yamini! Each time I read your newsletter, it’s timely, concise and exactly what I want to read. Not only do you share things that are applicable to some areas I’m working on, but I also mentor a young man who’s a recent college grad and your words are perfect for him to read!

  • Sundar Rajamanickam

    Good topic and story. Nowadays it is even true on how companies are using demos, free trials etc to sell their products and services to customers.

  • Reply

    Once again you have nailed a very topical point and reminded us that learning opportunities abound even in reality TV,I too am enthralled by the program and the John McGrath episode was a wonderful example of how NOT to build rapport,the sad part is that the guy pitching didn’t get it,thanks for making the links

  • Som

    Great blog. Get out of the passion prison. This is one of the learnings taught by entrepreneurs to young fashion designers for whom their creations are like their babies.

    We often forget to answer the viewer’s question- What’s in it for me?

    • Yamini Naidu

      Thanks Som, WIIFM (what’s in it for me) is the first step in any successful pitch.

  • Anne Axam

    I too like this program having watched the UK version for some time (Dragons Den).
    One of the most important messages I took from this was to be prepared and know your subject. So many budding inventors had no idea on costs, overhead, projected returnss etc and quite a few had not thought the actual process through. If you are looking for investors you need to have the right information.

    • Yamini Naidu

      Anne I loved Dragons Den too and yes having a complete handle on numbers was very important, but that almost felt like the price of entry. Yet surprisingly a lot of candidates didn’t do this basic homework.

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