Is getting funded on Shark Tank an ultimate prize? Not everyone likes the show, but I find it entertaining and actually good education for entrepreneurs. Yet I have always wondered what really happens?
Last week I heard an amazing business growth story from Patrick Whaley, founder and CEO of TitinTech (www.titantech.com). The story has two parts: 1) Incredible growth; and 2) The Shark Tank experience. Incredible growth — from $100,000 monthly revenues to $1m monthly revenues in seven months. How — Google and Facebook. Their product is a very advanced weight garment used by amateur and professional athletes who wear it to train so that they feel lighter and faster when competing. While they are now in Dick’s and other major retailers the driver continues to be on-line sales. They are a model of the new marketing reality and an inspiration to anyone launching a new product without millions to spend on traditional advertising.
The incredible growth occurred before actually filming the Shark Tank episode, which takes about five hours. His first ah-ha was that it is reality tv, and they are going to define you and make you the character they want. In his case, Mark did not believe his growth, and Patrick was not allowed to bring financial on the set. Patrick kept inviting Mark to go backstage to see for himself, but instead the back and forth lasted for two hours. The in-person Patrick and the filmed Patrick seem like two different people.
He did get funded but learned that the deal you end up with is not necessarily what you agreed to on the show. Makes sense in some ways after additional due diligence. The real issue is that one waits months to actually film the show, then several more months to close the deal, then more months to “activate” the deal. Patrick’s product sells for several hundred dollars, and cash flow for manufacturing and inventory was his biggest need due to his explosive growth. This became a key part of his deal, but it took seven months to place the first order after the deal was closed.
Time is money to any entrepreneur. Waiting first for the filming (they film each season across two weeks, not weekly as aired), then for the busy Sharks to focus on and close the deal, and finally to get the deal activated could mean missing a market. It is hard to imagine having a really hot product, then taking a year to fund enough product to meet demand. Once in the Shark Tank web it is hard to get out — so one just has to ride it out.
In Patrick’s case, they were so impressed that they asked him to help mentor other companies which takes precious time. Furthermore, he does not agree with all of the advice they offer his company. So Patrick would say the reason to be on Shark Tank is to gain market exposure for your product — not the money.
It was a great story, and he is an impressive young Georgia Tech alumni. Go Patrick!
– Jim Deupree