Hacker News Reader

I've read interviews before where it was indicated they know nothing (and want to know nothing) until they walk through the doors to make their pitch. The extensive due diligence is done after the show, which is why deals struck on the show often fall through later on. For example, some of the companies that pitch indicate that they have patents, but of course the validity and defensibility of such patents is something that has to be researched, not something you can take their word for. So on the show they're like, "Do you have a patent?" and they reply, "Yes (or no)" and that's the end of that line of questioning because it has to be researched independently.

The reason they seem to get to the crux of the issues so quickly, is because like most reality shows, it is heavily edited. A five or ten minute segment on the show reflects sometimes hours of questioning and discussion. From what I understand they have VERY long days (much longer than 8 hours, more like 12-14 hours a day) so it's almost an endurance thing for the sharks, because they spend so much time fleshing out the issues (and why wouldn't they since they're investing real money).

Personally I love the show also. Also check out Dragon's Den, which has both a Canadian and a British version (same format though, 5 investors all competing), and more recently CNBC's show The Profit where Marcus Lemonis (who was on the Secret Millionaire) by himself goes to failing businesses and invests a hundred K or two and takes over management for a week to turn things around.

I love this new era of entrepreneurship-themed TV, beats the hell out of Survivor or Lost. =)

Have always seen Dragon's Den but didn't pay it much attention for the same reason. I may just revisit it now, based on your recommendation. Thanks :)

The patent move always had me scratching my head - how they could just take their word for it and move on so quickly. Never understood it, but now it makes sense.

I'm sure there is always due diligence since the people pitching can always lie about purchase orders and the like. Sometimes a shark will even explicitly mention that the deal is contingent on something else coming through.

I've watched both and for some reason I find Shark Tank much better. I'm not sure if it's production or just that spark for reality TV that seems to be perfected in America. The personalities of the sharks probably has something to do with it, or the mix since both Robert and Kevin are also on Dragon's Den.

I've seen all three shows extensively and actually prefer the BBC show the most. IMHO, the BBC one is the most serious version and even though you have to get your head around some of the UK-specific stuff at first, you'll learn a lot from the show. Canada's Dragons Den and, even worse, Shark Tank, are more heavy on the drama and personalities, so there's more flash, but less substance.

Also, Peter Jones on BBC Dragon's Den strikes me as an incredibly intelligent investor.

I believe they mentioned in one of the Dragon's Den specials that something like 75% of the deals fall through during due diligence.

Having been on the Canadian Dragons' Den[1] to pitch my game Rejection Therapy[2], I can verify a lot of what you said.

To add: the narrative and chronology of the exchange between contestant and the Dragons is sometimes manipulated, either to spice up the drama (let's face it, some contestants are boring) or create a more logical sequence of events or questioning.

That said, there was lots of drama before and during my pitch. I had my ass kicked.

[1]http://www.cbc.ca/dragonsden/m/site/ [2]http://rejectiontherapy.com

Why can i not buy your game? :/

Not sure what you mean. Are you having problems with the purchase process?

Contact me via email and I'll get you a copy for free.

Glad I ran across this thread. Just the game I needed. Checking it out.

No.

The extensive due diligence is done after the show, which is why deals struck on the show often fall through later on.

Another reason is that many of those doing pitches don't actually want a deal, but instead simply want the exposure provided by the platform (which, I presume, is how the show managed to get that ridiculous equity clause in). Getting a "deal" is useful in that it makes it more likely that you'll make the cut and actually appear in an episode.

Dragons Den did a follow-up show where they talked about the majority of deals falling through afterwards for various reasons, among them that the pitchers had a change of heart.

"and more recently CNBC's show The Profit where Marcus Lemonis"

A great show. I did business with Marcus before he was on the show. Then I saw the show (had literally forgotten who he was) and got an idea and did more business with him.

His negotiating style is to go in at or very close to his final position and then walk. He did that both times. Funny thing was he probably overpaid using that strategy.

"Never knew this was a clause...glad he pushed for this."

You are right in the way you phrased this "glad he pushed for this".

But I think in reading all the other comments here there is an assumption that Mark should get the lions share of the credit for this event.

But Mark didn't say he was the only one who pushed for it.

He said (from the tweet that the story is based on)

"I told them I wouldn't come back this season if it wasn't (removed)".

We have no idea if this was also the bargaining position of any or all of the other sharks as well (nobody has asked them) or if the production company had already decided to do that.

It's great that Mark has done this but I think w/o knowing about the others at this point he may be getting more credit than he deserves (or, maybe not! We just don't know).

Well the meetings are heavily cut, I remember reading that typically each of the pitches is atleast a couple of hours. The sharks have no information on the companies pitching before they walk in to the room, but I'm sure the producers do some home work to only let in entrepreneurs that will make for good TV. The sharks are all smart people so they know what to ask but its no where near a ten minute affair.

All the due diligence is done after the show ends. The deal you see on TV is only tentative until after the due diligence. Quite a few of the deals on the show have actually fallen through after some shady things have been uncovered

"but I'm sure the producers do some home work to only let in entrepreneurs that will make for good TV. "

Also heavily favors attractive women particularly those with blond hair (I'm serious).

Oh really? "Heavily favors attractive women particularly those with blond hair"?

http://abc.go.com/shows/shark-tank/episode-guide?category=Se...

Looks the usual to me - mostly white guys, that is.

The broadcast versions of the negotiations are edited, sometimes heavily, so you can't necessarily assume that things happened as quickly in real life as they did on the screen. (Every once in a while, I'll catch them referring to a remark someone made earlier which I didn't hear, presumably because it didn't make the broadcast.)

I thought the clause was a good way to charge for the free marketing they're giving companies. Maybe it was too high, but most couldn't afford the cash.

Perhaps the reason he was able to convince them to do it retroactively is the companies weren't worth much. Watching a company worth 100K for your 5% stake just isn't worth the time and effort.

The reality TV show model is so profitable because they get free actors. It seems a bit much to expect those actors to pay to provide free content.

I knew about the 2%/5% but thought it was a pretty fair deal. The amount of advertising that this brings to a many of the companies on the show is worth a ton. Some of the food or plain merchandise companies where all the sharks passed have updates where their sales have grown enormously.

I think it's also because the pitches are actually much longer than what goes on TV - cutting a few hours down to 10 mins or so, while still trying to make it flow well.

full length unedited pitches might make for interesting DVD extra material