The Shark Tank Effect: What Is It And Is It Real?
It's easy to see why entrepreneurs flock to appear on ABC's "Shark Tank." They get a chance to get facetime with extremely wealthy individuals who can take their products and ideas to the next level. Of course, as a reality show, not everything is as it seems on camera. Some sharks are more hands-on than others, and just because two parties make a deal on the show doesn't mean it'll follow through after the fact.
However, one thing that is real is that simply appearing on the show can be enough for small business owners to reap all kinds of benefits. It's what some refer to as "The Shark Tank Effect." As Forbes detailed, this is a phenomenon where entrepreneurs report an increase in sales regardless if a deal gets made or not. Simply getting that level of exposure, where a single episode can draw in millions of viewers, can launch a new business into the stratosphere. It sounds almost too good to be true, but there are various cases that support the credibility of this theory.
Ring is one example of a business benefitting from The Shark Tank Effect
Forbes interviewed several "Shark Tank" entrepreneurs, and almost everyone admitted that simply appearing on the show was a huge asset. Mark Cuban, one of the sharks on the show, admitted this is one of the advantages of having a show as successful as this one as part of the zeitgeist at the moment. He stated, "Shark Tank is designed to help companies started in basements, in small towns, started by inexperienced founders to take their companies places they could never dream of going."
And the results speak for themselves. Jamie Siminoff pitched DoorBot on the show, which would go on to become the ever-popular Ring security system. All but one of the sharks passed on the product, and Siminoff just couldn't close a deal. However, after appearing on the show, the company saw a major boost in investments and was ultimately bought out by Amazon to become Ring. In this instance, other people watching the show saw the value in the product and rushed to be part of something monumental, with the sharks surely kicking themselves after the fact.
Bombas apparel and Scrub Daddy are other examples of businesses that failed to find funding through "Shark Tank" but succeeded elsewhere. This can be attributed to the pervasive prevalence of "Shark Tank," as episodes are syndicated on CNBC, with full episodes landing on Hulu and clips going to YouTube. All it takes is for the right person to see a product pitch to take an entrepreneur's dreams to the next level.