You're here on Inc.com, so I'll assume that probably means you're interested in entrepreneurship. And if you watch a little television now and then, I'll bet you probably have an opinion about Shark Tank.
It's the show I'm most likely to get sucked into (sometimes one episode after another). About a year ago, I did a pretty comprehensive analysis of every pitch made on the show through the first five seasons. Updating the data for season 6 has been on my agenda-but then I came across another such analysis, written by investor Halle Tecco of venture fund Rock Health. (Her data includes season 6.)
I don't know Tecco, and our methodologies don't line up exactly. Still, between our examinations and a few other sources, here are 17 of the most surprising things about Shark Tank that entrepreneurs, fans, and even would-be contestants should know.
1. Two Sharks dominate the deals.
Kevin O'Leary often has the biggest personality, but he's dead last in the number of deals closed, according to Tecco, with just 35 over the course of the show. Instead, Mark Cuban and Robert Herjavec dominate deal-flow.
Cuban was part of 76 out of 323 deals (23.5 percent), with a total of $17,817,500 invested. Herjavec had fewer deals-just 53-but he was in second place and on Cuban's heels in terms of total amount invested, $16,297,500. Daymond John did 57 deals, while Lori Greiner and Barbara Corcoran each did 51.
(Of course, even if she didn't have as many deals, Corcoran is, hands down, the coolest shark. Check out my article about her Reddit AMA if you don't know why.)
2. Women are successful more often than men.
Tecco's analysis showed that 53.6 percent of founding teams that were made up of only female founders were successful; almost the same percentage (53.33 percent) applied to teams with mixed-gender founders. Teams with only male founders, however, succeeded only 48.14 percent of the time.
That said, when male founders were successful, they achieved nearly twice the average valuation-$1.53 million for men, versus a little over $760,000 for women.
3. Women sharks fund women entrepreneurs more often.
This was actually the headline on some of the coverage of Tecco's analysis. Bottom line, women entrepreneurs have a better shot at getting funded by one of the two women Sharks--Corcoran and Greiner--than they do by male Sharks.
Corcoran invested in female-led companies 47 percent of the time; Greiner invested in female-led companies 29 percent of the time. Cuban led the men in this category, investing in female-led companies 26 percent of the time. To put this in context, Tecco counted 125 female-led entrepreneur teams and 295 male-led teams-meaning about 29.7 percent of the teams were all women to begin with.
4. It's not all about Barbara, Mark, Kevin, Daymond, Robert, and Lori.
The first two seasons saw entrepreneur Kevin Harrington as a regular Shark. Guest Sharks over the years have included Nick Woodman (founder and CEO of GoPro), Steve Tisch (film producer and chairman and executive vice-president of the New York Giants), and billionaire John Paul DeJoria (co-founder of Paul Mitchell hair products and the Patrón Spirits Company).
Perhaps most surprising, comedian Jeff Foxworthy appeared as a guest Shark in two episodes of season 2.
5. Mark Cuban changed the rules (in the founding teams' favor).
If you're a hard-core fan, you might already know this, but when Shark Tank first took to the airwaves, simply appearing on the show meant entrepreneurs gave up equity in their companies. As my colleague John McDermott wrote in 2012, "to appear on Shark Tank, entrepreneurs must give Finnmax, the show's production company, either a 2 percent royalty on profits or a 5 percent equity stake."
Cuban reportedly refused to stay on the show unless that term was removed from the standard contestant agreement, reasoning that many good entrepreneurs wouldn't be willing to appear otherwise.
6. It was Japanese first.
Shark Tank has its roots in a Japanese game show called Dragons' Den. Here's what producer Mark Burnett (also the man behind Survivor, The Apprentice, The Voice, and many other top reality shows) had to say when he acquired the rights to produce an American version:
“It’s about seeing people squirm, either in their unpreparedness or their lies. People come in with an idea they think is brilliant, and it’s awful. But then you get the truly inspired ideas, and the Sharks have a chance to fight it out.”
7. Your odds of getting on the show are about three in 1,000.
Both Tecco's analysis and mine show that 49 percent of teams received at least a handshake deal during the first five seasons. Of course, that just means that contestants got to the point of trying to get through due diligence.
Simply getting on the show to begin with is a much harder slog. During the last season, 35,000 people applied to be on the show, and 157 were invited to pitch on film. Of those, about 112--meaning .3 percent--actually made it to the air.
8. The Sharks are 40 percent Canadian.
Two of the Sharks on each episode are Canadian. O'Leary was born in Montreal; Herjavec was born in Croatia but emigrated to Canada with his family at age 8 and grew up in Toronto. (That's a lot of Canadians, eh?)
The reason is that Shark Tank followed the Canadian version of Dragon' Den, and both O'Leary and Herjavec had starred as "Dragons" on the CBC version. At one point, it was the second-highest rated program in Canada, after Hockey Night in Canada.
9. It got some pretty bad reviews to start.
Mercifully, most of the negative press seems to have been pulled from its original homes on the internet, but thanks to the Internet Archive Wayback Machine, we can find reviews by the Chicago Sun-Times' Paige Wiser: "There are so many things I hate about his new show, Shark Tank, that I started numbering them just to calm down." Also, the Boston Globe's Laura Bennett: "[T]he show is like watching fish getting shot in a barrel. It offers up poor souls with harebrained schemes and makes merry sport of eviscerating them."
10. It's survived the worst time slot on television.
Since its debut, the show has spent most of its life airing at either 8 p.m. or 9 p.m. on Friday nights on ABC. That's one of the worst time slots in television--yet Shark Tank averaged about 8.4 million viewers per episode last season, putting it in 55th place. It actually ranked a little higher in the coveted ages-18-to-49 demographic--it tied for 46th.
11. It's super popular in reruns.
During 2014, Shark Tank reruns averaged 596,000 viewers every night, adding up to the biggest prime-time audience CNBC had seen since the financial crisis of 2008.
12. Clothing, food, and beverages lead the pack.
My analysis found that clothing, food, and beverage pitches are the most successful. Clothing had a whopping 73 percent success rate. Food and beverages did well too, succeeding 55 percent of the time.
13. Media and entertainment kills it.
Perhaps fitting, since the show itself is entertainment. Tecco tagged 11 pitches in this category, six of which were successful (55 percent), with an average valuation of nearly $5.38 million. Second place went to green- and clean-tech pitches, successful five times out of nine (the same success rate--55 percent) and averaging a $3.23 million valuation. (I used a different tagging system, but I similarly found that tech pitches had a 56 percent success rate.)
14. The back of the pack? Business services and pet products.
Despite our different methodologies, Tecco and I both found the same least-successful industry for contestants: pet products. Only 2 or 3 percent of pet contestants were successful. (That's a little surprising, because the pet products market is about $58.5 billion in the U.S., at least if the American Pet Products Association is correct.)
15. The producers aren't above having people on for pure entertainment value.
Did anyone really expect, for example, that the first-ever contestant on Shark Tank, who wanted backing for a company that would perform surgery to implant Bluetooth devices in people's heads, had any chance of getting funded? (Hint: No.)
16. Trendy pitches are hard.
We'll wrap up by reiterating two points from an earlier article, but I think they're important. The first is that much like in real life, trendy products, or things that seem pegged to future trends, are often the most exciting. Unfortunately, they're often the least successful.
I think this comes down to the idea of entrepreneurship including two games--an investor's game and a founder's game. Professional investors take on dozens or even hundreds of projects, accepting that many will fail but also strategizing that a small minority will turn out to be outsize winners. Most founders get fewer at-bats, so to speak, since they're the ones actually building and running the companies. Thus the risk-reward calculation-and the definition of success-can be very different for each group.
17. Women are better customers.
This is tricky, and I touched on it in an earlier article, but I felt compelled to examine this point a little more deeply. About 56 percent of pitches that I tagged as targeting primarily women as customers were successful. Further, pitches that were tagged as "educational," which most often had to do with children's education, were successful 73 percent of the time.
Of course, it's hard to know sometimes whether women would ultimately be the true customers of any particular product. However, I found this interesting in light of the fact that Tecco found women were more successful overall as contestants.