Many entrepreneurs dream of having their products on store shelves and exceeding their sales projections. For many, it is just that, a dream, but others do find that golden ticket in the form of the TV show, Shark Tank.
The “sharks” are top-level entrepreneurs and possible investors, who look at and consider investing in each product presented. But do they get paid for offering their knowledge and insight?
What is Shark Tank?
Shark Tank is a reality show by producer Mark Burnett, who is known for other reality shows like Survivor, The Voice, and The Apprentice. The show first aired in August of 2009. It was a spinoff of the international show Dragons’ Den, which first aired in 2001.
Throughout the years, the sharks have changed, but the initial core group includes Kevin O’Leary, Mark Cuban, Daymond John, Barbara Corcoran, Lori Greiner, and Robert Herjavek.
The show features entrepreneurs who have a short time to convince the “sharks” that they should invest in their product and business. The sharks ask questions and then determine if the entrepreneur deserves their investment.
Shark Tank has won numerous awards during its tenure, including the Primetime Emmy Award for Outstanding Structured Reality Program and Outstanding Reality Program.
Do the Contestants on Shark Tank Get Compensated?
While the contestants do not get paid, they do get the opportunity to gain the attention of the shark investors and get them to invest in their business. Understandably, competition is tough to get to appear on Shark Tank, so they must have some business acumen and a viable product just to get considered.
Those that do get the opportunity to pitch their products to the sharks have the invaluable insight that the sharks offer, even if they do not walk away with investors. Many have taken this feedback to heart and altered their products or pitches with the feedback they received on the show.
Even those that don’t get an investor because of their appearance, can get their businesses and products in front of the viewing audiences of millions of people. They gain brand recognition by just appearing. Many that received no investments have gone on to have very successful businesses as a result of being on the show.
Do the Shark Investors on Shark Tank Get Paid for Their Appearance?
While the contestants do not get paid for their appearance, the sharks do get paid. And they should! Business owners that do not get an investment get important feedback from successful entrepreneurs.
They can then take that feedback and upgrade their product, make it more affordable and hone their pitches to gain interest from other investors. The feedback they gain from some of today’s top business minds is invaluable.
As expected, when the show was new and not guaranteed a viewing audience, the sharks made less than they do today. According to Cheatsheet.com, what the sharks make from season to season seems to be a well-guarded secret.
Back in the early years of Shark Tank, it was reported by Shark Tank Success, that the sharks were making around $25,000 per show. But remember, these are hugely rich entrepreneurs that aren’t doing it for the money.
For episodes recorded between five and seven, Business Insider reported that Mark Cuban made between around $30,000 and $32,488 per episode. By 2016, Variety reported that each shark made a minimum of $50,000 per episode, which translates to $1.2 million per year.
Not the Highest Paid Reality Stars:
While they probably wouldn’t like to be considered reality stars, they are. They just also happen to be extremely wealthy and have made wise investments.
When it comes to other TV reality stars, they are at the low end of the meter. Some of the top reality stars, like Ellen DeGeneres, Judge Judy, and Katy Perry, earned around $10 million per season, according to Variety, in 2017.
One of the top earners in the earning category was none other than Donald Trump. Our former president earned $50,000 to $1 million an episode in the early days of The Apprentice.
So, even though it is a lot of hard work, getting a gig as a reality star can pay very well.
How Much do the Sharks Invest in New Businesses?
An article that appeared in Forbes magazine in 2016, chronicled how much money the sharks invested.
In the first seven seasons, the sharks offered over $60 million to contestants that highlighted their products on the show.
Here is how it all breaks down:
- Mark Cuban is the largest investor with $18.7 invested. This includes $11.7 million in solo deals and $7 million in group deals.
- Robert Herjavec invested $16.7 million; $11.7 million in solo deals and $7 million in group deals.
- Lori Greiner invested a total of $10.6 million. Of that, $4.7 in deals were solo and $1.7 million in group deals.
- Daymond John invested $6.4 million in deals with contestants. Of those, $4.7 million was in solo deals; $1.7 in group deals.
- Kevin O’Leary, also known as Mr. Wonderful, invested $5.4 million. Solo deals added up to $3 million; group deals were $2.4 million.
- Barbara Corcoran is the most conservative investor with $5.4 million in total deals. Solo deals added up to $3 million; group deals came to $2.2 million.
As you can see, even though the sharks get paid for their work on Shark Tank, they also spend a lot of their money on funding investments they think are worthy of their time, energy, and money.
One More Way to Grow their Wealth:
The sharks are a group of very talented and wealthy individuals who have made smart investments and recouped the gains from those investments. Most wealthy investors look for ways to add to their wealth. This is one reason some of these entrepreneurs initially joined the shark tank. Instead of looking for investments, investment opportunities are presented to them.
Mark Cuban is by far the richest of all the sharks. He started the internet company Broadcast.com and owns the Dallas Mavericks basketball team. Cuban is worth an estimated 3.9 billion dollars.
The other sharks are worth $80 to $400 million.