Scott Jordan Reports

This is the first in my series of reviews of Shark Tank, Season 4 as the “6th Shark.” As you may remember, I was the Entrepreneur who appeared in Episode 7 of Season 3 pitching www.TechnologyEnabledClothing.com, but when the Sharks wanted to include my “retail company,” SCOTTEVEST, I had no other choice but to turn down a $1 million offer and bow out gracefully (you could argue if I was in fact graceful). For some background on my appearance and why I couldn’t accept the offer, counter or mention the name of my “retail company,” see this post.

After my appearance, I was inundated with emails, some calling me disrespectful to the Sharks, a media whore, a patent troll, but most of the feedback I got told me that my “performance” was brilliant, telling me that I belonged on the other side with the Sharks. I was honored when Rob asked me to write this blog and when his website named me the most intriguing entrepreneur and the best episode of Season 3. Enough about me. This blog is about the other Entrepreneurs and the other 5 Sharks.

My commentary will:

■ Attempt to get into the Sharks’ heads to describe what I think they were thinking, or in other words what I would be thinking if I was evaluating this business proposition.
■ Post-mortem some of the entrepreneurs appearing on ST about how they “should have” handled the situation.
■ Give my commentary as “The 6th Shark” about whether I would have invested my money in this deal or at what point would I have gone out.

Then, I will select one of the Entrepreneurs and do a video review.

So, without further delay, here I go.

I thought the episode was good TV, and after all let’s not forget this is a TV show first and foremost. A lot of people believe that Shark Tank is really about raising money. That could not be further from the truth. If you want to raise money, there are many easier and better ways to do so. As you may or may not know, only a percentage of the deals that are made on the show actually close after the show airs. This was recently revealed in this article.

Raising money is one of the intended outcomes but the real purpose of the TV Show is the same as any other TV Show, and that is ratings. Based upon the ratings Shark Tank is receiving (consistently the highest rated show on Friday nights and up for an Emmy), there is no doubt that it is doing a great job at making compelling and interesting TV.

Last night’s show had all the makings of a good TV show. There was drama, suspense, compelling characters, conflict, and then some. I cried, laughed, and even yelled at the TV set. I love the show just as much today as when I was first introduced to it over a year ago when I could not get enough of it. I had to watch all the old episodes, and suspect that many people when first introduced will do the same.

Enough background. Let’s get to the meat of it. The episode had 4 different pitches. Only one was compelling enough to me to even be marginally interested in investing, and I will save that for my video review.

The first into the Shark Tank was Derek Pacque for Coat Chex. I thought Derek’s presentation was solid, but the idea stupid. I am a firm believer that if something is not broken, why use technology to fix it. I have checked my coat and car on many occasions and have never lost my ticket. I know that some people have lost their tickets, but it is pretty easy to identify your coat. I was shocked to hear that they have a patent pending on this idea. It doesn’t seem like an idea that is patentable to me. I have been taking pictures of my car in parking lots as long as I’ve had a smart phone to remind me where my car is, and never occurred to me that is a patentable concept.

You can only imagine my reaction when, of all Sharks, Mark Cuban bit, given his feelings about patents. He never questioned the validity of this patent or inquired about how far along in the process they were in getting their patent. His biggest concern was whether the technology was “tested”. Really? How hard is it to test the technology in this case. The technology is not complicated. I was utterly shocked that Cuban made an offer, not only in light of his disdain for stupid patents, but primarily given the fact that they had NO sales whatsoever. The excuse for no sales was that it was too warm when they launched their business and thus no demand.

I disagreed with Kevin’s reason for going out: he hates seasonal businesses. There are MANY successful seasonal businesses.

I think Derek was a fool for rejecting Cuban’s offer. He should have accepted the offer on air. I believe it would have been likely that this deal would not have closed anyway. I think after Cuban’s lawyers reviewed the patentability of this idea, they would have advised him to walk away during due diligence. But, in my opinion, there is huge public relations value in making a deal on the show, regardless if it ultimately closes. Remember this is a TV show after all, and it is the job of the Entrepreneur to leave the audience with a lasting memory that they were successful. Making a deal with Cuban would have done that.

So, all in all, for Coat Chex, I give:
● 4 Sharks high marks for getting out and making good TV
● Cuban gets very low marks for making an offer on what otherwise was a silly idea with no sales and likely unpatentable technology
● The Entrepreneur high marks for a solid presentation but very low marks for turning down a solid offer from Cuban.

Next into the Shark Tank was Jay Kriner with his Bev Buckle. I think Jay did a great job on his presentation. I thought immediately his valuation was ridiculous, $50k for 10% valuation: $500,000, with effective no sales over 4 years. I thought his presentation of Option 1 (Urban Outfitters, etc.) vs. Option 2 (Raceways) was silly. This isn’t the Price is Right. You can do both things.

Personally, I don’t like massive belt buckles and think this idea would only apply to a select crowd. I would not have invested in this business. Jay had manufacturing issues with his first production. This product should not be that hard to produce in my opinion. I would have gone out fairly early. I do think the idea was clever though, and in my opinion patentable. I am not sure if his patent was still pending as of the taping.

From the Entrepreneur’s perspective, I think Jay should have taken Kevin’s offer for licensing but negotiated from 12% of the Sales to something more reasonable, e.g. 5% of the sales. $50,000 for 51% of the company was not a good deal for him in my opinion. Based solely upon my review of the website, it appears this deal did not close as of yet. It would be interesting to see if it fell apart during the due diligence review.

So, for Jay and Bev Buckle, I give:
● the Sharks average marks for making good TV and presenting deals that were one sided, although as indicated I would not have made an offer here at all.
● I give Jay poor marks for not negotiating with Kevin on the licensing deal.

Next into the tank… Todd Miller Body Walking Institute. What can I say here. No real idea, high valuation, no sales. I would have gone out as soon as he said he only had a total of 30 sales in 7 years.

Todd’s presentation was solid, but his idea was not. I thought Barbara’s attempt to pretend she was sleeping was hokey to say the least. I completely disagreed with Cuban’s reason for going out. Mark said that because Todd was into fitness he could not focus on the business. I believe just the opposite. In my opinion, if someone is in shape, their mind will be sharper and more focused. We offer Boot Camp twice a week where we encourage our employees to work out together. We also have a massage therapist come to the office once a week.

For Todd and the Body Walking Institute, I give:
● High marks to all the Sharks for getting out
● Low marks for Todd on essentially zero sales over 7 years and a ridiculous valuation
● Poor marks to the producers for picking such a lousy idea from the thousands of submissions.

Last into the Shark Tank was Maria Curcio and Veronica Prolongo Buggy Beds. To hear my commentary on this, you will have to click on the link below and watch.

This post was written by Scott Jordan and the opinions expressed in this post are his. They do not reflect the opinions of The Shark Tank Blog, ABC or anyone else but Mr. Jordan himself.

ABOUT SCOTT:

Scott Jordan is the lawyer-turned-entrepreneur who founded SCOTTEVEST over a decade ago with his wife, but you know him as Scott of TEC-Technology Enabled Clothing from Season 3 of Shark Tank!  Sharp teeth and a sharp business sense make Scott more than a match for the Sharks.  Check out his (thriving) business here atwww.SCOTTEVEST.com, read and watch all about his Shark Tank experience atwww.SCOTTEVEST.com/sharktank or email him at scott@scottevest.com.

Rob Merlino

Entrepreneur, auteur, raconteur. Rob Merlino is a blogger and writer who enjoys the Shark Tank TV show and Hot Dogs. A father of five who freelances in a variety of publications, Rob has a stable of websites including Shark Tank Blog, Hot Dog Stories, Rob Merlino.com and more.