During a recent day of shooting on the Shark Tank soundstage in Culver City, California, the competition for one deal got particularly heated. Still, when the crew started striking the set for the next pitch, the Sharks were chill.
As the Sugarhill Gang’s “Rapper’s Delight” played, Daymond John and Lori Greiner, guest Shark Bethany Frankel and Robert Herjavec bumped hips as they danced around the set. Mark Cuban did an impressive job lip-syncing the lyrics: “I said a hip hop the hippie the hippie/To the hip hip hop and you don’t stop/The rock it to the bang bang boogie/Say up jump the boogie to the rhythm.” Even Kevin O’Leary tapped his feet and bopped a bit as he texted on his phone. And, when the song came to an end, John shared a joke: “What do you call a pirate who has two arms, two legs and two eyes?” (Punch line, revealed to groans from fellow Sharks: “a beginner.”)
“We’re very zen in the den,” Herjavec says, with a laugh. “If I lost out on a deal that another Shark got and it went on to become a successful business, it’s because it was meant to be. Success is a combination of the right time, the right opportunity, the right Shark and the right go-to-market strategy.”
Still, that assurance, which all the Sharks share, aside, there have been deals that the Sharks admit they regret making or missing.
The Deal the Sharks Regret
Early in season five, there was a rarity: all five Sharks on the show that day went in on a deal together, offering a total of $1 million for 30 percent of Breathometer.
The portable breathalyzer plugged into the audio jack of a smartphone. Blow into the device and an app on your phone provided what was described as a law enforcement-grade assessment of your blood alcohol level, feedback that could help you determine if it was safe to drive or you should leave your car behind and call an Uber.
But that unusual consensus among the Sharks was followed by problems rather than profits. First, the company struggled to fulfill its orders. Then, in an even bigger setback, the Breathometer was found to be far less accurate than promised, sometimes reporting low blood alcohol readings when it was, in fact, unsafe to drive. The Federal Trade Commission ordered the company to disable the app and offer its customers full refunds.
“They’ve had all kinds of challenges, to put it nicely,” Herjavec says. “That was the deal that made me resolve I was only going to invest in entrepreneurs who actually had some experience running a business.”
The Deal That Got Away
Greiner has strong instincts when it comes to evaluating a product’s potential, and she has made some of the most successful deals in Shark Tank history by relying on those instincts.
Never mind that John derided the SimplyFit Board as a “plastic potato chip,” Greiner became an enthusiastic backer and the fitness device has crossed the $170 million threshold in retail sales. Likewise, Scrub Daddy was assailed by O’Leary as a “little piece of crap.” Undeterred, Greiner invested in the innovative kitchen sponge; the company, with an expanded product line, recently hit $150 million in sales. “I don’t look back,” Greiner says. “I’ve gotten every deal I’ve ever really wanted.”
She concedes, however, that she did miss out on one winner, not because she was outbid, but because she ignored her gut. The year was 2013, the product a Wi-Fi-enabled doorbell called Doorbot that streams live video and audio to your smartphone or computer. Greiner’s fellow Sharks dismissed it, she recalls, as “already out there and not that special.” Despite a strong sense that Doorbot could be what Greiner calls “a hero product,” she was swayed into passing. Renamed “The Ring,” that video doorbell is now a business that’s valued at $1 billion, according to a Shark Tank update that aired in November, which would make it a contender for most successful Shark Tank deal ever. “I should have trusted my instincts, gone for it and then looked at due diligence later,” Greiner now says.
Still, the Sharks aren’t losing sleep over these acknowledged missteps. “Why cry over spilled milk,” O’Leary likes to say, “when you know there will always be another killer product coming through the door and into the tank.”