How To Make A Shark Tank Pitch? (PDF Templates Inside)

Every Shark Tank pitch is unique. None of the products and services pitched on the show are entirely identical to another. However, some aspects are common in all pitches. A prospective contestant can consider addressing the important things (the outline) to ensure the pitch has all the prerequisite data to compel an investor. 

This article covers all the relevant aspects you must consider before preparing for a Shark Tank pitch. These simple steps will work as a Shark Tank template for students to pitch their startups to investors. The list is not exhaustive because several industry-specific requirements must be considered while preparing. 

Shark Tank Pitch Template PDF (For Students & General audience)

How To Make A Shark Tank Pitch?

Know Your Product

The foremost thing that a contestant must do is understand his product or service. Often, you would see Sharks questioning the entrepreneur regarding their product, but they do not answer them satisfactorily. This step is the most basic and critical step in deciding whether you will get a deal on Shark Tank. 

As an inventor or manufacturer, you must know the problem that your product solves. Assessing the market position of your brand is also an important thing to do. Moreover, the features and benefits of the product are the least that you can prepare. A well-prepared always knows four things:

  1. Product – It involves knowing the features of the product and the needs that it fulfils. 
  2. Price – The price at which your company sells the product to a retailer or even the wholesalers. 
  3. Place – The place where the product is sold must be known. It might be a direct-to-consumer sale through a website or availability on the retail stores. 
  4. Promotion – You must know the promotion campaign you are running or planning to run. It might be a paid promotion on social media or a QVC advertisement.

Bring The Right Valuation

Most entrepreneurs fail on Shark Tank because they value their businesses unrealistically high. Higher valuation is justified in just two cases. A valuable business will either have heavy money investment in it or have significantly high lifetime sales. 

As an entrepreneur who is about to demand investment for his business, you must know how strong the investment and lifetime revenues are. Furthermore, you can hire a consultancy firm to help assess the right value of your business. 

Tell A Compelling Backstory

Sharks look for more than the numbers and profits in a pitch. They ask entrepreneurs about their backstory to know their expertise, academic background, and entrepreneurial experience. This backstory helps them understand how well the owner can manage the business and his connection with the processes.

Writing down the timeline of your struggles and highlighting the challenges you have successfully overcome so far is preferable. The backstory must be sufficiently concise and meaningful to ensure that you do not waste too much time bragging about your personal achievements. 

Listen Carefully

Entrepreneurs are often too excited to listen and understand the questions asked by the Sharks. This mistake costs entrepreneurs deals because they do not answer the question accurately. 

As a preparation for your future appearance on Shark Tank, you must develop the habit of listening carefully and understanding what the panellist would ask. Once the listening is effectively done, answering becomes much easier. 

Handle The Pressure Or Objection

It is okay if a panellist bullies or pressurizes you. It would be best if you were mentally prepared for this. Practice staying calm in uneasy situations. If a Shark objects to your approach and criticizes the business model, then you must take it positively. 

It is better to never try too hard to convince or over-explain when a penalist disagrees with you. State facts and accept the deficiencies if they really exist. Sharks mostly object to the approach of helping entrepreneurs change it. 

Know Your Numbers

Not knowing your number means that you are not entirely familiar with your business. A well-prepared entrepreneur must know important financial information and numbers. These numbers include gross margin, lifetime sales, yearly sales, projected sales, price per unit, cost per unit, gearing ratio, interest cover, etc. If you have previously raised money on another platform, then you should know the valuation at which the investment was made. Numbers are important because not knowing them will portray a negative image.

Study The Modes Of Finances

Sharks fund projects using different financing methods. It is better to know the most popular type of financing deals offered by investors on the show. The most popular modes are:

  1. Equity – Equity investment in your business gives the Sharks direct ownership in your business. They get the right to vote and profits.
  2. Debt – Investors on Shark Tank offer loans to a company if it faces problems funding its purchase orders and working capital. They get no right to vote and profits, but interest payments are made periodically.  
  3. Royalty – Royalties are common when a high number of units are sold and the profit margins are high. Royalties can be in perpetuity, or they can expire upon recoupment of a fixed amount. This mode of finance is the safest for an investor because the return is continuous.
  4. Advisory shares – Advisory shares are simply equity options offered to investors against their expertise and business connections.
  5. Preference shares – Preference shares are similar to loans. The investors receive predetermined interest payments prior to distributions made to the owners.

Confidence And Honesty

No matter how hard it gets on the show or how weak a business number might seem, you should focus on remaining confident and honest. An honest businessman is a green flag for an investor because honest people rarely cheat. If you falter or get caught sharing misleading information, then it not only costs you the deal but also brings disrepute to your business on national TV.

Be Open To Criticism And Rejection

It is impossible to compel everyone to buy your narrative and believe in your vision. Sharks have rejected several million-dollar ideas because they did not benefit them in the short term. 

If you get rejected on the Shark Tank, you must know that it is not the end of the world. You can still sell your product and make millions. However, the rejection from Shark Tank comes with valuable advice from the Shark. It helps the rejected businesses improve their business models and product features.

Bonus: Important Questions To Address Before Appearing On Shark Tank

What Should I Know About My Product?

  1. Product differentiation – Homogenous and old-school products have a lower success rate on Shark Tank. Investors like investing in differentiated products that provide unique value to the customers. You must know how your product is different from other suppliers on the market.
  2. Target market – Every product has its target market. A target group can be described on the basis of demographics or social status. For instance, entrepreneurs manufacture goods specifically for infants or old-age customers.
  3. Revenue model – An investor likes to know how early he would get his investment back. You must explain if your product is provided with credit or cash. Moreover, upfront fees and affordable prices are ideal for success.
  4. Distribution – You must know your current or prospective distribution channels. Distribution channels might consist of presence in retail stores, supply through distributors and wholesalers, and direct-to-consumer sales via the official website.
  5. Customer acquisition – You should know and be able to demonstrate how your product can penetrate the market and acquire customers. Customer acquisition costs are usually a critical indicator for online businesses.
  6. Price and cost – Whether you are a manufacturer or a retailer, you must know the price and cost of your product. It is the most basic information that you must have ready for the investors. The costs usually reduce when the business scales.
  7. Projections – You must know what your product will do in the future. This might include making assumptions about the future price and demand.
  8. Competitors – A smart businessman always knows his competition. Stating that you do not have a competition might mean that you do not know your competition. However, a well-differentiated good has less competition.

How Do I Value My Business For Shark Tank?

Shark Tank pitches are mostly accepted or rejected on the basis of valuation. A realistic and accurate valuation is usually based on several methods. The most common method is to take the present value of inflows from revenues in perpetuity. Another indicator of valuation can be the capital invested in the business and the profit reserves accumulated over the years.

Is A Loan Better Than Equity For My Company?

Equity and loans are upfront investments that give companies the leverage to fund their operations immediately. However, both methods have their merits and demerits. Equity investments dilute your control of the business, but the distributions out of profits are not fixed and mandatory. Loans do not dilute the control, but they require fixed and periodic interest payments.

Conclusion

Preparing for a pitch on Shark Tank is similar to getting ready for an interview. The whole presentation comprises a Q&A session and a discussion of what the panellists want to know. However, covering all the required aspects can be tricky for an inexperienced entrepreneur. 

I have listed and sufficiently explained the things that you must prepare for before appearing on the show. Knowing your business is the first but not the only thing to consider while preparing a pitch for Shark Tank. No generalized template is available for businesses to copy. Every business is different, and the relevant questions might change. The above-mentioned information provides just a guideline for not forgetting the important aspects. 

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