Shark Tank has become a famous television platform that many small businesses rely on to voice their best pitches and present their products. Many of the best Shark Tank products have become very successful, partly due to being on the show. However, not all business owners see success after appearing on the show. Read further to learn about unforgettable Shark Tank failures and how you can avoid losing out on business opportunities.
Why Some Shark Tank Pitches Fail
Some Shark Tank participants lack business sense and knowledge to help their organizations succeed. They pitch their products and services while unprepared, risking their entire presentation. While some failures are mainly related to poor product development, others happen due to unprofessional entrepreneurs.
Here are a few factors that are relevant to the Shark Tank pitching process:
- One positive opinion about a business doesn’t guarantee an offer.
- All sharks have their perspectives on a company and its owner(s).
- Some companies appear on the show only to drive new customers and get exposure.
- Successful independent companies with a large customer base are more likely to secure a good deal with a shark.
Not all entrepreneurs prep for a Shark Tank appearance and try their luck at getting an offer. They may also be curious about a shark’s opinion about their business and its worth. Read below for a few signs a company is a potential failure:
Underperformance and Low Sales
Many business owners rely on Shark Tank as a final chance to save their establishments from shutting down. They often prove they can’t succeed independently, putting the company in danger while losing money and customers. As a result, the sharks will likely want to have complete control of a contestant’s company due to small profits, excessive losses, and bad investments.
Shady Business Tactics
As a business owner, you must be able to explain what your company is about and why you deserve a financial push from a shark. Shark Tank investors can usually sense a scam or when something is wrong with an entrepreneur’s business practices.
If a product or service is similar to one on the market, an investor may accuse a contestant of stealing an idea or copyright infringement. Participants who decide to proceed with a shady pitch can ruin their reputation on national television. Unfortunately, some individuals don’t care or believe they can trick the sharks into a deal.
Loan sharks do more than help individuals who need a specific amount of money to keep their businesses running. They also watch behavior closely and listen carefully during interviews with potential clients. However, a candidate’s true negative character may show while under pressure, leading to a poor presentation and an angry shark.
For example, famous investor Kevin O’Leary engaged in a heated argument with Pavlok entrepreneur Maneesh Sethi during a taping of Shark Tank. Sethi pitched to four sharks, excluding O’Leary from the deal before he began his presentation. O’Leary responded with insults due to Sethi’s arrogant attitude and then dismissed him.
Conduct matters when representing a brand and trying to gain exposure for a business. If you show entitlement or fear, your behavior could negatively impact you as a professional.
Poor Product and Service Development
Unreliable products and unproven services rarely see positive results, such as high sales or demand. However, some entrepreneurs are so anxious to get exposure for their business that they pitch too soon. They often end up disappointed or facing rejection because they don’t live up to their claims.
The Most Memorable Shark Tank Failures
Some Shark Tank pitches leave a lasting impression because they’re intense. On the other hand, the rejections and secured deals are even more memorable. Read what happened when the cameras stopped rolling, and the sharks began working with specific brands.
ShowNo Towels appeared to be a unique product when presented on Shark Tank. The founder, Shelly Elher, won the interests of a few sharks, eventually securing a deal for distribution in retail stores. Also, she obtained partnerships with a popular theme park and Legoland, which both ended due to disappointing sales and poor management.
Unfortunately, Elher lacked the experience needed to grow and maintain her brand successfully. She also didn’t have the expertise to keep up with the trends of her competitors. Her determination wasn’t enough to help her company thrive, causing the establishment to shut down and never reopen.
Charles Michael Yim developed the Breathometer, a portable device that monitored blood alcohol content levels and alerted drivers of their intoxication. It was smartphone-compatible and allowed users to blow into a mouthpiece, mainly to see if they traveled over the legal alcohol limit.
The company gained a following of customers who rushed to purchase the device. Buyers eventually criticized and complained about its performance and features. They also requested refunds due to their dissatisfaction with the product despite their prior interest.
Yim never recovered from the negative reviews, failing to produce a better version of the gadget to compete with its competitors. As a result, the company finally shut its doors after constant criticism, an FTC investigation, and many low product ratings.
CateApp provided users with a way to hide or erase their text messages, preventing their partners from seeing their communication. Creator and owner Neil Desai thought of the idea after a friend told him about his cheating wife. Customers began flocking to the company based on their high interest in the app’s features.
While the app was reliable during its early stages, it also became an issue due to its errors, exposing secretive information. It turned out to be a disappointing invention and failed to prove itself worthy of competing with similar apps. Also, some users were able to find ways around its restrictions, showing how easy it was to invade another user’s privacy.
Toygaroo was a brand inspired by Netflix’s subscription service. The business model would’ve allowed parents to order specific toys using an interactive feature, making the process fast and convenient. Viewers expressed interest in the product and continued to ask about it on social media.
Entrepreneur Nikki Pope pitched Toygaroo to all five Sharks, who complimented her impressive presentation. She secured a deal, which later faced cancellation due to bad planning and unrealistic expectations. Although she tried to compete with other services with the same idea, she didn’t stand out among similar products of other companies that continue to climb in the industry.
The company filed for bankruptcy because Pope couldn’t execute her idea realistically. Production costs, manufacturing, and marketing were too tricky for her to handle. She stopped putting her time and effort into growing the brand, eventually abandoning the company.
Sweet Ballz is a cake ball company that won all five Shark Tank investors over with its presentation and high-quality pastries. Surprisingly, the failure occurred when founders Cole Egger and James McDonald began feuding. McDonald’s sued Egger for establishing the company, Cake Ballz, without his knowledge.
Both partners filed restraining orders against each other, but McDonald won the legal battle. As a result, Egger ended the Cake Ballz operation, and McDonald began running Sweet Ballz as a side business.
The conflict was an unfortunate experience for both owners, causing them to ruin a fantastic opportunity to get more sales and customers for their brand. Also, the entire situation serves as a learning experience for aspiring business owners who want to enter a partnership.
You Smell Soap
Megan Cummings received an offer for her business, YouSmellSoap, from Robert Hejavec. However, she rejected his $50,000/50% deal, which led to an alternative bargain. Cummings still wouldn’t compromise and caused the exchange to become frustrating.
Over six months, Cummings and Hejavec maintained minimal communication, which is a bad sign that an investor and business owner don’t have a close connection. They also both failed to reach a mutual decision due to their differences.
After her Shark Tank appearance, Cummings continued to run YouSmellSoap, eventually joining forces with another investor. Shortly after she secured a buyer, the company continued to fail before its closure.
Michael Desanti presented the Squirrel Boss, a bird feeder activated by remote control and released a shock intended to scare squirrels and other rodents away. He spent at least a couple of years working to improve the design and performance of the product before his appearance on Shark Tank.
The sharks knew nothing about squirrel hunting, but Desanti caught their attention because his product was unusual. Eventually, negative reviews outweighed positive ratings on Amazon. Desanti decided to close his business due to low sales and a failed chance to work with a shark.
The Body Jac
The Body Jac is an invention that targets specific muscle groups. It also allowed users to exercise physical areas more efficiently without straining their joints, spine, and muscles.
After Body Jac owner Jack Berringer lost weight, as Barbara Corcoran suggested, he secured a deal but didn’t see a rise in sales or customers. Corcoran later claimed that she regretted her investment, calling it one of her worst agreements.
Body Jac went out of business after an unsuccessful strategy change. Barringer tried to sell the company for an undisclosed amount of money but couldn’t find any buyers.
William Strange appeared on Shark Tank to pitch Three65 Underwear, a service that provides men with a regular supply of underwear. He attempted to handle two startup businesses but discovered he only had time for one. As a result of the sharks’ suggestions, the venture with the most potential won.
Strange received a substantial offer from guest sharks Naomi Simson and Janine Allis, but the situation changed behind the scenes. Later, he spoke about his experience and explained why he decided to reject a deal despite interest from the sharks. While he acknowledged that Three65 Underwear needed improvement, he still believed the company would do better independently.
What You Can Learn from Shark Tank Rejections
One or a few unfavorable opinions doesn’t mean you can’t be a successful business owner. Therefore, you shouldn’t give up on your business after rejection or negative feedback. You never know what can happen if you continue to put your time and effort into leveling up.
The journey could be challenging and discouraging, but maintaining a company is rarely easy. Check out a few significant factors to remember if you’re thinking about starting a business:
Employ a Reliable Team
Trying to handle each task on your own can only trigger stress and frustration, causing you to question your dedication. Therefore, you can’t run a growing business without individuals who can help you. Planning, time management, and manufacturing can be challenging if you don’t have the right connections.
If you can afford only two or three team members, at least you wouldn’t tire yourself trying to focus on multiple responsibilities at once. You also must be ready to learn about marketing to get your business in front of a specific audience, convincing them your product or service is worth trying.
Continue to Work on Your Business
Seeking investments too soon can put you in debt and cause devastating losses. On the other hand, business owners who work to improve their companies are more likely to continue their success. They understand the effort needed to continue to thrive as an entrepreneur.
Be Realistic About Your Percentage
One common issue with Shark Tank contestants is that they value their companies high while failing to live up to specific claims. They don’t have the history to prove they can continue to work on their growth without financial help from loan sharks. Also, they haven’t spent enough time perfecting their business tactics.
If a shark doesn’t believe your business is worth a high investment, they will increase the percentage or reject your pitch. It would be best to listen to an experienced professional who has a history of providing excellent advice.
An appearance on Shark Tank doesn’t guarantee that your business will become popular and profitable. However, many companies try their luck to see if they can get an offer or if they can get a low percentage. You can learn what to avoid and prevent by watching other entrepreneurs’ unfortunate Shark Tank failures.