It's not uncommon for investors to find a company they like, throw a bunch of money at it, and then sit back and wait to collect their return. There are investors out there that feel their time isn't best spent giving individual attention to each one of their investments. Mark Cuban and Ashton Kutcher do not fall into that group.
The two well-known investors and entrepreneurs from the hit show, Shark Tank, invested in a hot startup together called Slyde Handboards over a year ago. Slyde Handboards is a travel-friendly and easy-to-learn wave riding board for the beach.
Smart money is more valuable than just a big check. Smart money is an investment of both time and money into a startup. I was able to interview the Slyde team and Ashton Kutcher to help explain the importance of finding smart money, and reinforce the massive benefits from being featured on Shark Tank.
According to Slyde, their business has grown over 300% in the past year--and that's not just the result of the money Cuban and Kutcher put into the business, but also their willingness to spend time nurturing the Slyde team and connecting them with the right people to succeed.
"They have supported us every step of the way," said the company's Founder, Steve Watts. "We are in contact with them on a weekly basis, and although they let us run the business and make all the decisions, to have that kind of infrastructure and contact with them both has beyond what our team ever expected."
This isn't the first time a company graced by a Shark Tank investment has spoken up about the added benefits of working with Cuban or Kutcher, or any Shark for that matter. In fact, the entire Shark Tank cast (and guests) seem to have set a standard for involvement, using their show as a platform to speak to a larger issue in entrepreneurship that money alone is not enough for a business to succeed.
"My personal philosophy around investing is that if you invest in the right people, it's in your best interest to be helpful but not overbearing," said Kutcher, speaking on his involvement with Slyde over the past year. "At times, I've done some consulting with them on their marketing efforts and distribution, but these guys run a tight, beautiful business."
Of course, exposure on the hit show Shark Tank isn't to be taken for granted. According to Slyde, the moment they appeared (and successfully landed an investment) on Shark Tank, they got access to over eight million potential customers that heard their story and saw their product. Overnight, they saw a huge increase in ecommerce conversions, and more importantly, the market started showing signs of understanding the value of their product.
"By the time we actually got to film, which was almost a full year before we aired, we had seen growth of 100% year-over-year," said Watts. "But immediately after airing, our growth has been over 300%. This is probably because, in the beginning, we appeared to be a very niche product that almost anybody outside the core surf and ocean communities had not heard of. So we were still very much facing the challenge of messaging and educating potential customers. That was our biggest barrier to entry."
It's no surprise that an appearance on the 3x Primetime Emmy Award Winning TV show means a big jump in business. But pure exposure doesn't always mean success. There have been plenty of Shark Tank flops as well.
Of all the sharks, Cuban has the most impressive history with successfully closing deals. According to Forbes, "After interviewing 237 business owners who got offers, Mark Cuban is the king of closing the deal. About 31% of contestants who succeeded on TV made a solo or group deal with him." In addition, Cuban's group deals closed on-air total more than $16 million, and his 32 solo deals total more than $11 million.
But closing the deal is only the first part of the battle, and as we've seen with Slyde Handboards, that's where Cuban's work truly begins. Once he finds a company he finds interesting, he's not the type of investor to inject cash into the business and never look back. He plays an active role in seeing the company succeed, and leveraging his own partnerships to help speed up the process--hence why his terms in his deals rarely change; he knows his value.
His value is equally appreciated, and clearly panning out for Slyde. Their most recent Kickstarter campaign for the Slyde Grom Handboard has already surpassed their fundraising goal by almost double the original amount. And if this past year's growth is any indication of the company's future, we'll be seeing a lot more Slyde Handboards at the beach in years to come.