I’d like to talk a little bit about
television because obviously one of the
reasons I’m here at Shark Tank it’s it’s
a remarkable success that we’re all
amazed at we’re thrilled with what it’s
become it’s a platform to launch
businesses it’s the number one show in
America watched on Fridays the number
one show watched by families the
fastest-growing demographic is 9 to 18
year old women who knows they must
mature faster than guys I guess but it
continues to grow this it’s it’s
phenomenal and we talked a little bit
about that because people ask me why do
you do so much to television or you’re a
narcissist you love to see yourself talk
do you want to turn every channel and
see your face and I’m going to argue
today and we’re going to do a little
experiment together that the discipline
of business the science of business is
very binary either you make money or you
lose it it’s black and white television
is sure giving us and yet I’m going to
show you a marvelous synergy between the
two
now obviously Shark Tank is a platform
there’s no question about that and
what’s occurred on this show as many
people have realized that if you can get
on it and you have a product in the
market you can grow your sales by 10,000
percent in 24 hours but the true test of
its power would be to take a commodity
something that is ubiquitous in America
that we can buy anywhere and see if it
went on Shark Tank would it
differentiate the outcome of that
company how powerful is Shark Tank how
powerful has it become so my theory was
why not finance a commodity something
you can get anywhere and see if somehow
we could build a national brand on
something that has no proprietary value
whatsoever that would be the true test
of what Shark Tank was now what could
that be well let me give you an example
what is more common than a cupcake sugar
water flower anybody can make it along
came a company from Kohath Massachusetts
called wicked good cupcakes on to the
shark tank none of the other sharks were
interested but I had this theory in my
mind let’s test it so I’m going to show
you a couple of minutes of video from
this particular deal we’re going to see
the actual deal itself see how it was
structured and then I’m going to show
you the numbers what happened in the
first 24 36 week months since then what
has happened to look at good cupcakes so
watch this first okay so what happens to
this company it airs at 9 o’clock on a
Friday night sales the first month
before Shark Tank or the month prior to
airing with 24,000 look what happens to
it afterwards run rate is 450 thousand a
month it’s going to make 800,000 free
cash flow Danny
the young girl 27 just got married I
helped it with a prenup
she has $800,000 going this company’s
actually owned by her he said heard her
mother so this is the fastest-growing
cupcake company in America right now it
recently got a 10% purchase acquisition
from the Fisher family in Chicago who
took the crumbs retail chain out of
bankruptcy as of next week this will be
in retail across America we’ve moved
into pies and we’re charging 20% more
for gluten-free I love that I just
absolutely love that and so the shark
tank factor is very much alive and I
think it’s studying what this is is it
truly is a launch platform this is
clearly a commodity and it’s growing
very quickly and I think America’s
figure that out we have a hundred and
ten thousand applications for the
current year we’re starting to shoot
everybody understands how this works but
what’s really going on here with wicked
cupcakes is they figured out their
customer acquisition costs by being on
Shark Tank are zero they don’t spend any
money on advertising what they try and
do is stay on television and because
they’re a husband and or sorry I’ve got
a daughter mother team which is a very
on trend in America now for getting on
daytime television they’re ubiquitous
they’re everywhere they’ve hired lots of
new people we’re creating jobs here
actually 42 new ones this is a little
outdated this slide you see them on
every week on one show another Good
Morning America next week plotting their
success this mother and daughter have
figured out how to stay on television
and continue to grow now let me give you
some stats about venture capital over 50
years
it’s a highly risky proposition if you
look at ten deals over the last 50 years
including the internet bubble only two
out of ten ever returned capital that
means you lose 80 percent of the time
nothing changes that so if you look at a
typical venture capital firm give it a
big one eighty percent of the time they
lose their money after six years
Shark Tank is now achieving what
Capital One 40% of it steals four out of
ten why here’s my speculation for a
marginal company that would be spending
twelve to fifteen percent on advertising
to break through those costs are removed
they get that for free so even a cupcake
company can enjoy tremendous growth at
no costs of acquiring customers and so
this platform is a giant infomercial
worth about twelve million dollars a
year to a company to get on it how do I
know that let me give you a case study
that is 48 hours old how many of you
remember groovebook
remember this one 11 months ago Brian
and Julie a young couple from Chatsworth
California brought this deal to shark
tank very simple takes a hundred images
off your phone each month and ships you
this catalog cataloging your life your
kids your family for $2.99 how is it
possible they can do that because this
groove allows the book to bend thirty
four degrees so that it’s considered a
magazine not a book it ships for 85
cents as opposed to 250 the value is in
the groove
they had 14,000 subscribers when they
aired today they have half a million
Shutterfly called me up a public company
said we must buy this you’re stealing
our share and they offered seven million
dollars for it eleven months later and I
said are you kidding never they bought
it on Thursday for 14.5 million dollars
cash Julie and Brian are
multimillionaires 11 months later the
American Dream is alive in a very big
way and we watch it happen on Shark Tank
why is Shark Tank so successful why
would anybody be watching this why would
a nine year old girl be interested in
watching something about business the
network’s want to know the advertisers
do the competitors want to know there’s
seven different shows trying to knock it
off right now I have a thesis I’ll tell
you what it is
what are you watching when you watch
Shark Tank you’re watching the pursuit
of freedom
is there anything more noble than
creating your own wealth and setting
yourself free no that’s what shark takes
about it’s the essence of personal
freedom it’s not about getting rich is
about achieving something for yourself
that is unique to our society and
capitalism personal freedom and that’s
why I’m here today I want to talk to you
about that that’s what matters that
‘lets creates everything that’s great in
America is the ability to start a
business from scratch in your basement
whether it’s a cupcake or a group or
thousands of other ideas create a
business worth millions of dollars
employ hundreds of people provide for
your family yourself their families and
all the good things we enjoy from
capitalism which is freedom now there’s
a lot of sacrifice involved on speaking
to those of you in this room that want
to become entrepreneurs so let’s try and
learn something from the shark tank
experience I want to share with you
other than funny pictures like this
three common attributes to all of the
deals that got funded on Shark Tank
versus all the ones that didn’t this
does not speak to the outcome of the
businesses it speaks to those
entrepreneurs that are able to sit in
front of investors or stand there and
actually get their money and I want you
to realize that there’s a huge
opportunity to understand something
unique here because in each of these
three cases they were present in 100
percent of the deals that got funded
over thousands of presentations but in
every case these three attributes were
there and why I’m bringing it up now is
I know some people are going to be up in
front of me in just a few minutes and I
want them to hear what I’m saying here
because maybe they want to modify their
presentations a little bit
all right number one in 100% of the
cases the deals got funded the
entrepreneur was able to articulate the
vision in 90 seconds or less the idea
was so blindingly simple that you could
understand it in a minute this is a
cupcake we put it in a jar we ship it to
people for six ninety five I get it
this is a groovebook I carved a groove
in it so I could ship it at the price of
a magazine I get it you see what I’m
saying
all right 100 percent of the cases 90
seconds or less number two in every case
the entrepreneur usually a team over 80%
of the time we’re able to articulate why
they were the right people to execute
the business plan what credentials what
confidence what experience
why were they able to take an idea and
turn it into a business very important
present in 100 percent of the deals that
got financed now this is far more
sinister this last point because in
front of me multiple times I have seen
deals that are now like an isotope
sizzling the first two are present
Sharks are fighting everybody wants in
and then this happens in 100 percent of
the time the people got financed they
were able to answer every single
question about their business model and
their numbers with perfection
when you are sitting listening to an
entrepreneur and you start to ask them
how much market share do you need to
break even
what’s your margins how large is the
market how fast this is growing who’s
your number one competition how much
free cash flow you think you’ll make
them in the first three years if you
can’t answer those questions or you make
a mistake or you seem lost you’re
screwed this is really important
as last ones a killer and I want you to
remember that because I tell
entrepreneurs today if you’re not good
with numbers bring someone who is it’s
incredibly important I want to talk
about the economic environment we’re in
for a moment because you’re going to be
going into the workforce I run about a
billion dollars in one of my companies
in a mutual fund company so I have lots
of data with me and I don’t want to make
it complicated or long but I want to
talk to you about the environment you’re
going into and what’s changed over the
last ten years first of all we’re very
lucky in North America even if you can’t
read this Charlie explain what it says
our company’s the sp500 have record
earnings as of yesterday record cashflow
record profits record stock buybacks
record free cash to distribute and
dividend increases never in our lives as
the sp500 made more money that it’s
making right now ever so that’s the good
news you’re going into a really
interesting economy even though we have
lots of bad things to worry about
pandemics Isis Russia our our companies
have never made more money than they’re
making right now that’s good a lot of
people say to me gee that bull market is
long in the tooth it’s going to correct
it’s going to come crashing down just
when you’re graduating take the emotion
of it let’s go look at the data I love
to look at data this is a chart of how
many days between 15% Corrections in the
stock market a 15% correction is painful
we are 714 days since the last 15
percent correction there are many
periods in history where thousands of
days have gone by before the market
corrects I think we’re in the third
inning of our roaring bull market that’s
how I’m investing not only in small
companies been in large ones I like to
take the emotion out of date
the challenge everybody has in America
today particularly those that are
retiring is this record low interest
rates
most of us women retired would buy muni
bonds our ten-year government bond and
make five to six percent for one hundred
years we could do that and in the last
few the rates have dropped to below
three but I want to show you something I
spend a lot of my time studying what
economists are thinking is going to
happen in the next 24 months and what I
see coming our rate hikes about the 30
basis points one third of a percent in
the next 24 months that’s the general
consensus globally and what’s going to
happen so should we worry about that if
rates go up will the market crash let’s
look at that what happened way back in
1999 when rate swap or more recently in
2004 basically nothing rate hikes mean
enhanced economic activity market goes
down 67 percent and within ten months
comes roaring back also good news for
all of you because you want to be
graduating into a growing economy there
are some changes obviously to this
economy and I’ll tell you what they are
the demand and I’ll explain what this
chart says institutional investors today
have changed their minds about a lot of
things and one of them is the concept of
dividends because of all the volatility
from 2007 2008 2009
what’s actually happened in the market
is you can buy two kinds of companies
once that do pay dividends and ones that
don’t so I’ve taken the data and said if
you invested in the S&P 500 and bought
all the companies half of which my
dividends have don’t you made about 10
percent if you only bought the companies
that were growing dividends you made the
same 10 percent but here’s the
difference you had 40 percent less
volatility in the price of those
companies stocks so now all of a sudden
institutional investors have put a huge
premium on dividend paying stocks
because they don’t want stocks to go up
and down in our volatile which is why
Apple Computer after Steve’s job died
declared a dividend they couldn’t
attract institutional investors because
everybody wants to reduce the volatility
and that matters to you as well because
you’re going to be asked to make more
money than ever before when you get a
job your managers whether you start a
company or whether you work within one
the pressure for you globally to provide
returns that are based on cash flow are
going to be unprecedented because people
want safety now that’s what they care
about let’s talk about what it takes to
be a great entrepreneur
I want to talk about balance in life
first this is not good news for some of
you if you’re going to take the path of
entrepreneurship there will be no
balance in your life not during the
period you’re growing your business ever
and I’ll tell you why you have to fall
in love with your business it’s going to
consume you it will eat your hours alive
and if you don’t have the passion to do
that your competitor will and they will
kick your ass because they’re so in love
with what they do I’m going to tell you
a little story it’s difficult to hear
but it’s the truth I was teaching a
class very much like this and an evening
in a college recently when a young man
up at the top at the end of the class at
9 o’clock at night put up his hand and
said can I ask a question mr. O’Leary
I’m struggling with a problem a personal
problem and I said well I’m not dr. Phil
but let’s hear it he told me that his
fiancee in the morning was a Friday had
told him that if he/she couldn’t spend
or he couldn’t spend more time with her
family she was going to leave him I said
what consumes your time he said well I’m
still in love my last year here but I’ve
started a software company that provides
compliance software to hedge funds in
the Boston region there’s tons of hedge
fund companies my subscription run rate
is 5 million dollars a year and I’m
running out of my dorm I said Wow
are you kidding what’s the problem he
said well I have to work all day all
night I got to go to school and I got to
work on my coding I’ve got 16 people
working with me globally coding with me
I’m busy and then building this thing
and it’s working we’re providing
compliance reporting the SEC and we’re
making five million dollars a year but
my fiance is gonna leave me and I said
we’ll wait let’s be pragmatic which one
is easier to a place
my point here is that if you choose to
become an entrepreneur you have to have
a partner that understands the journey
and the reason you’re doing it you’re
doing it to set yourself free one day
that’s why you do it and if you’re ready
to make that sacrifice you may be on
your way I don’t know what happened to
that couple but I’m guessing it didn’t
work out and I’m sure he’s still making
money great entrepreneurs have a
tremendous amount of knowledge of what
they’re selling they know a lot about
everything but they better know a lot
about what they’re selling you never
want to be caught explaining yourself
and not knowing your product that’s
because you’re so passionate you’re
spending all your time doing it that’s
exactly what matters
[Music]
they put shareholders first the minute
you take someone else’s money you are
definitely number two for the rest of
your life the reason you can raise
capital is your shareholders understand
that this is incredibly important in
your life if you’re going to be an
entrepreneurial taking other people’s
money and that goes way ahead of you the
great thing about entrepreneurship is if
you’re passionate and you’re successful
you’ll wake up you’ll wake up one day
rich you won’t really be going for the
cash it’ll just happen to you everybody
I talked to this has success doesn’t
remember the day they became a
millionaire no idea not important to
them they remember winning they remember
building a business of being successful
again the pursuit of freedom manifests
itself in passion that’s really what
it’s about you have to love what you
sell if you don’t don’t bother
you have to love it more than
then-fiance you just gave up I know
that’s cruel but it’s true it’s the idea
that you spend so much time at the
beginning of the journey to get the
freedom you want at the end I’ve also
noticed great entrepreneurs have used
all the technology that’s available
today to make themselves more and more
efficient if you’re working on your own
business you work about 14 to 15 to 16
hours a day it’ll just happen that way
and there’s so much great technology to
enhance what you do and it’s inexpensive
which is why our productivity keeps
going up in America that’s really what’s
going on here is people are using this
stuff the barrier to entry to start a
new business is practically zero you can
do it online doesn’t mean it’s any
easier than was 10 years ago but it’s
pretty interesting that you could do it
for practically nothing I want to talk
to you about something else here that’s
unique to your generation
you’re not just keep competing with
America anymore you’re competing with
everybody all around the world somebody
in China right now wants to kick your
ass
250,000 engineers a year graduating
there they’re not copying us anymore
they’re creating brand new technologies
even if you have a product or service
you’re selling right here in this town
somebody somewhere else wants your
market share
you can’t think domestically none of you
you have to think globally let me show
you a picture and it’s a snapshot of
market capitalization for the first time
in your life and mine there are more
billion dollar market cap companies
outside of America than in it while
we’ve been growing at 2 to 3 percent the
rest of the world’s been growing four to
seven percent so in every industry that
we compete in there is a giant
competitor in everything it’s a vicious
game out there now you don’t even know
the name of some of these companies and
they’re bigger of many domestic
offerings here the first time ever so
when you graduate think global because
your competitor certainly is and they
want your market share look at this
image of Shanghai is a dump 11 years ago
probably had no fish alive in that river
look at it today you have any idea how
much capital it takes to do that
billions of dollars I looked at this
image and said to myself I bet you I
could call the CEO of Otis Elevator and
ask him a very simple question largest
provider of elevators and escalators in
the world there must be a lot of
elevators there one of the great things
about being a sharkus everybody returns
your call
so I asked them how many elevators are
selling in America this year he told me
around the world there’s five hundred
and forty thousand elevators installed
annually this year in America 12800 will
be installed in China and four hundred
twenty thousand Wow
that’s competition and I want you all to
be very cognizant of it I want to close
with a few thoughts that may be
controversial for you but I have
observed over a long career as an
investor successful investments and
failures both of them so I believe these
you may not I hope what they’ll leave
you with is to think about them they
stimulate thoughts for you
that’s what I’m here to do today all
right let’s start with some of the basic
premises of what makes a great
entrepreneur and a great manager
first of all employees are the core of a
company whether there’s 2 or 200,000 and
they are linked together by something
called the culture which you if you’re
the CEO create guide nurture and move
forward that’s the good news if
everybody is on board linked in the
culture you get tremendous productivity
beyond their salaries but here’s the
downside when you recognize somebody is
going off course and no longer believes
in the mission and are not on site
anymore with your vision of the future
you have to fire them you have to take
them behind the barn and shoot them you
know why because they do tremendous
damage inside the organism and it’s very
hard to do that but make no mistake
about it even if it’s your mother she’s
gone the business has to survive that’s
what matters
this sounds cruel and heartless it’s
true and the way you’re gonna find out
is you’re going to be weak and you’re
not gonna do it
it’s gonna cause me major having for you
and you can remember my speech today and
you’re gonna thank me when you have to
make that tough decision unfortunately
in my life I fired thousands of people
it’s hard every time and I do it myself
and I explain to them why I give them
the best package I can and I move on
because I have to make money for my
shareholders that’s what’s important
this seems so obvious and people don’t
get it the customer always comes first
above everything and I’ll tell you why
I’m saying this to you because there’s a
really interesting change going on in
the way people invest today it turns out
I’m going to give you some good examples
that service Trump’s price I’m good
example everyone in this role
understands if you can create great
customer service in your product or your
service or whatever you’re selling
somebody and that everything they need
from your organization is provided and
you’re top of the pack in customer
service you can charge an outrageous
price over your competitors what’s a
great example of that Apple Computer you
pay 35% more for a Mac laptop than a
Windows one why it does exactly the same
thing you love the brand you love the
customer service you like the way the
store looks you’re comfortable knowing
they’re backing
back every time you need them there’s a
theory today in venture capital and in
private equity you buy businesses with
really weak customer service do nothing
except fix that and raise prices 15% get
a 33 percent IRR it turns out around the
world customers want the path of least
resistance it’s a little bit of secret
sauce I want you to know if you create
an organization spend third of your time
worrying about your customer service
listen to what they say if they’re not
happy you’re going to be unsuccessful
there is no question about that
now something a little controversial
most recently I spoke at another
Business School we had quite a debate
about this when I want to buy a company
and take a control position in at 51% I
don’t ask to me with the CEO I want to
meet with the man or woman that is
running sales and I want to drink some
good Burgundy with them take them out
for dinner get to know them a little bit
and ask them all about their challenges
in any organization in America the
person that knows most about the
business about the challenges about the
competitors about the product about the
market is the head of sales they know
everything
and what I’d like to do is spend a
couple of days with them and then I go
meet the CEO and if they know less than
I do the first person I fire when I own
the company is the CEO who don’t want to
pay the most Head of Sales I believe in
an organization the number one person in
terms of compensation should be the head
of sales should make the most money
always who has the hardest job the head
of sales who knows the most the head of
sales who determines the destiny of the
company the head of sales that’s how I
run my organizations I take the caps off
and I let who’s ever running sales have
unlimited upside I want them to be
stinking rich why because that’s the
fuel that makes any business successful
and it’s also the hardest job I’ve also
learned over a long career that
everybody is replaceable I love it
when somebody says to me oh we can’t get
rid of that person they’re irreplaceable
I fire them right there
everybody has to understand that
whatever you do somebody can do it
better you have to bring your a-game in
every single day there’s nothing unique
about any one individual what’s unique
is their passion their ability to
execute to meet targets and exceed them
the minute you lose that ability in
capitalism you’re gone it’s a fair trade
the engine that makes you rich can take
it all away from you there are no
guarantees I think that’s incredibly
important now the one that always gets
me in trouble
in today’s world and perhaps even here
your professors are telling you that
your responsibilities go beyond just
making money for your shareholders that
you have a responsibility to society
that you’re not just leading a business
that you’re an organism that should
solve many problems beyond just profit
I think that’s crap
I think the DNA of a business is to make
money for its shareholders it is the job
of the shareholders to take their
profits and redistribute to any cause
they wish after they receive their
dividends or their profits your job is
to go out into the world and understand
who you serve it is not your
responsibility to solve all the
society’s problems and pay taxes to a
government to do that your job is to go
to war every day and win to win market
share to solve the earth your
competitors walk on to steal their
customers and to take their profits and
win that’s your job and to make profits
for your shareholders so they give you
more capital to create more jobs to be
more successful to pay more taxes to
provide the standard of living that we
have in America today your job is not to
solve everybody’s problem is to solve
your customers problems your
shareholders problems your employees
problems I’m very distressed when people
tell me a business should give a third
of its profits to charity that’s so
Regus it should give all of it to its
shareholders who then give to charity
think of all the great things that are
done today by the Bill Gates of the
world the warren buffett’s of the world
the only reason they can do that is they
make money for their shareholders don’t
get lost in this debate stay focused and
true to the mission business is war you
have to win and you take the spoils with
your profits and you help your fellow
man but first you make money looking for
the simplest case on Shark Tank we had a
soccer company come out and say every
sock we sell they give a dollar to
charity to the homeless who eat socks
you know why they’re gonna fail it turns
out that the price of socks are
incredibly price sensitive that if
you’re a dollar more expensive than
everybody else on the Shelf you’re going
out of business it would’ve been much
better to sell a better sock at a lower
price make profits and then give it to
the homeless that’s my point
now not everybody agrees that’s okay
try it my way first get out there and
with create businesses create jobs great
profits and don’t let somebody take you
off course
that’s the essence of business we’re
going to leave it with a story I have an
18 year old son my dad lives in
Switzerland he’s 84 my mother died six
years ago he’s alone so I often will fly
over there from Boston or wherever I am
and to make one a my daughter my son my
wife whoever wants to come we leave on
Friday night and have dinner with him a
Saturday get back on the plane on Sunday
and fly back so my son likes to do that
recently he got on the flight with me
and as he was getting on the galley it’s
about a six-hour flight to Geneva he
said to me the first time ever dad why
does it want to get on this plane I have
to take a left and sit in the back and
you get to sit in the front with the
good food the big screens and all the
movies I said Trevor you don’t have any
money thank you very much your time
today
[Applause]
I went over about 11 minutes so I’ve got
a couple of minutes for four questions
but I want to keep us on schedule
because we’re gonna look at three deals
today I will say one thing about the
deals I’m gonna look at quickly I
intentionally did not look at the
business plans because I want you to
know something about Shark Tank we are
not allowed to see the businesses
first-ever we have no knowledge of what
they do and that puts the pressure on
the entrepreneur and the ones that are
going to present to me today to be very
concise on what they’re doing remember
we looked at the three things that
mattered so if you thought I looked at
your deals
I didn’t you better be really good at
presenting them that’s what matters and
by the way if somebody does contact you
on Shark Tank or you don’t admit that
they did or they don’t they’re kicked
off the show and so are you so anybody
comes running up the street says I want
to talk to about something on a pond a
shark tank I immediately say please
don’t say anything to me because I’ll
have to disclose you did and you’ll
never make it on the show but that’s why
it works we do the discovery together
does anybody have a question yes sir
that’s a great question sir in fact in
this cohort the stats say that about 25
percent will start their own business of
those 20 percent will be very successful
so it’s a hard road but for those of you
that decide to go and work for somebody
else understand you get a better balance
of life but every day you’re in there
you have to help your boss or whoever
you are make money otherwise you’re
worthless you’re a cost you’ll get fired
today in America we’re trying to cut
costs every day in the first place we
look is which heads do we not need the
most expensive part of an organization
after its input costs are people if
you’re going to be an employee be a good
one make sure that you set your goals
and you achieve them it can be a great
life there’s nothing wrong with it and
there’s no dishonor in it
I was working once at an ice cream
parlor when I was about 15 years old my
first real job and on the second day I
was asked to scrape the gum off between
the Mexican tiles on the floor and I
said to the woman who owned the storms
called Macomb’s ice cream parlor you
didn’t hire me to scrape gum you hired
me to scoop ice cream and this this girl
was shoe store across the way that’s
looking at me I don’t want to see her me
scraping the gum and she said what are
you talking about
I own this store I’ll do anything I want
with you get down on your knees and
scrape that gum when I said I’m not
doing it
she said you’re fired
last job I ever had I owe that woman
everything I don’t like to work for
people many of you in here I hope
inherit that there’s nothing wrong with
it
but you want to control your own destiny
you work for yourself that’s how it
works I’m trying to inspire those of you
are on the tipping point take the chance
you’re young go for it
there’s nothing better than being able
to wake up in the morning 10 years or 20
years so now and do what ever you like
it’s about freedom that’s what matters
I’m not saying being employees bad
but believe me being an entrepreneur is
better I’m a little biased
any other questions yes sir
what I’ll repeat the question what
happens to the deals that don’t make it
on TV 300 300 deals are taped about 230
air sometimes would get in front of the
lights you lose it we have a
psychiatrist there at the set bad things
happen sometimes some people can’t take
rejection it’s it’s it’s real life
they’re so convinced they’re right they
don’t get a deal or they collapse they
blow it or they don’t know their numbers
and I have to shoot them all these
things happen can you imagine getting
that chance on Shark Tank and you don’t
know your numbers you should be thrown
in jail
one more discern
I love that thing so one of the main
things he said was that you have to love
what you do a lot of people that come on
Shark Tank you’ve told them that your
love for your product is slightly me so
how do you determine that
a business is failing that you’re not
just giving up too soon
or you’re not passionate enough the
difference between that’s it like I
didn’t get that the last part not
passionate or not what not giving up or
giving up to sue because you tell a lot
of people just give up on it this idea
is oh I see yeah you know you know I get
a lot of flack for you know telling the
truth I’m the only shark that tells the
truth because think about your tenures
and as an entrepreneur you have X number
of years it breaks my heart to see
someone spend months and then years and
then all of their families money on a
really stupid idea it’s better to face
the truth and give up that pursuit and
start another one the great thing of an
entrepreneurship is if you fail you try
again but after three years if you have
if you’re not making any money it’s a
hobby it’s not a business some people
can’t take it I couldn’t care less you
know what’s gonna happen reality’s gonna
bite you in the hiney
anyways you’re lucky you met me I’ve
saved you a year that’s why they call me
mr. wonderful
you
[Applause]
[Music]
[Music]
television because obviously one of the
reasons I’m here at Shark Tank it’s it’s
a remarkable success that we’re all
amazed at we’re thrilled with what it’s
become it’s a platform to launch
businesses it’s the number one show in
America watched on Fridays the number
one show watched by families the
fastest-growing demographic is 9 to 18
year old women who knows they must
mature faster than guys I guess but it
continues to grow this it’s it’s
phenomenal and we talked a little bit
about that because people ask me why do
you do so much to television or you’re a
narcissist you love to see yourself talk
do you want to turn every channel and
see your face and I’m going to argue
today and we’re going to do a little
experiment together that the discipline
of business the science of business is
very binary either you make money or you
lose it it’s black and white television
is sure giving us and yet I’m going to
show you a marvelous synergy between the
two
now obviously Shark Tank is a platform
there’s no question about that and
what’s occurred on this show as many
people have realized that if you can get
on it and you have a product in the
market you can grow your sales by 10,000
percent in 24 hours but the true test of
its power would be to take a commodity
something that is ubiquitous in America
that we can buy anywhere and see if it
went on Shark Tank would it
differentiate the outcome of that
company how powerful is Shark Tank how
powerful has it become so my theory was
why not finance a commodity something
you can get anywhere and see if somehow
we could build a national brand on
something that has no proprietary value
whatsoever that would be the true test
of what Shark Tank was now what could
that be well let me give you an example
what is more common than a cupcake sugar
water flower anybody can make it along
came a company from Kohath Massachusetts
called wicked good cupcakes on to the
shark tank none of the other sharks were
interested but I had this theory in my
mind let’s test it so I’m going to show
you a couple of minutes of video from
this particular deal we’re going to see
the actual deal itself see how it was
structured and then I’m going to show
you the numbers what happened in the
first 24 36 week months since then what
has happened to look at good cupcakes so
watch this first okay so what happens to
this company it airs at 9 o’clock on a
Friday night sales the first month
before Shark Tank or the month prior to
airing with 24,000 look what happens to
it afterwards run rate is 450 thousand a
month it’s going to make 800,000 free
cash flow Danny
the young girl 27 just got married I
helped it with a prenup
she has $800,000 going this company’s
actually owned by her he said heard her
mother so this is the fastest-growing
cupcake company in America right now it
recently got a 10% purchase acquisition
from the Fisher family in Chicago who
took the crumbs retail chain out of
bankruptcy as of next week this will be
in retail across America we’ve moved
into pies and we’re charging 20% more
for gluten-free I love that I just
absolutely love that and so the shark
tank factor is very much alive and I
think it’s studying what this is is it
truly is a launch platform this is
clearly a commodity and it’s growing
very quickly and I think America’s
figure that out we have a hundred and
ten thousand applications for the
current year we’re starting to shoot
everybody understands how this works but
what’s really going on here with wicked
cupcakes is they figured out their
customer acquisition costs by being on
Shark Tank are zero they don’t spend any
money on advertising what they try and
do is stay on television and because
they’re a husband and or sorry I’ve got
a daughter mother team which is a very
on trend in America now for getting on
daytime television they’re ubiquitous
they’re everywhere they’ve hired lots of
new people we’re creating jobs here
actually 42 new ones this is a little
outdated this slide you see them on
every week on one show another Good
Morning America next week plotting their
success this mother and daughter have
figured out how to stay on television
and continue to grow now let me give you
some stats about venture capital over 50
years
it’s a highly risky proposition if you
look at ten deals over the last 50 years
including the internet bubble only two
out of ten ever returned capital that
means you lose 80 percent of the time
nothing changes that so if you look at a
typical venture capital firm give it a
big one eighty percent of the time they
lose their money after six years
Shark Tank is now achieving what
Capital One 40% of it steals four out of
ten why here’s my speculation for a
marginal company that would be spending
twelve to fifteen percent on advertising
to break through those costs are removed
they get that for free so even a cupcake
company can enjoy tremendous growth at
no costs of acquiring customers and so
this platform is a giant infomercial
worth about twelve million dollars a
year to a company to get on it how do I
know that let me give you a case study
that is 48 hours old how many of you
remember groovebook
remember this one 11 months ago Brian
and Julie a young couple from Chatsworth
California brought this deal to shark
tank very simple takes a hundred images
off your phone each month and ships you
this catalog cataloging your life your
kids your family for $2.99 how is it
possible they can do that because this
groove allows the book to bend thirty
four degrees so that it’s considered a
magazine not a book it ships for 85
cents as opposed to 250 the value is in
the groove
they had 14,000 subscribers when they
aired today they have half a million
Shutterfly called me up a public company
said we must buy this you’re stealing
our share and they offered seven million
dollars for it eleven months later and I
said are you kidding never they bought
it on Thursday for 14.5 million dollars
cash Julie and Brian are
multimillionaires 11 months later the
American Dream is alive in a very big
way and we watch it happen on Shark Tank
why is Shark Tank so successful why
would anybody be watching this why would
a nine year old girl be interested in
watching something about business the
network’s want to know the advertisers
do the competitors want to know there’s
seven different shows trying to knock it
off right now I have a thesis I’ll tell
you what it is
what are you watching when you watch
Shark Tank you’re watching the pursuit
of freedom
is there anything more noble than
creating your own wealth and setting
yourself free no that’s what shark takes
about it’s the essence of personal
freedom it’s not about getting rich is
about achieving something for yourself
that is unique to our society and
capitalism personal freedom and that’s
why I’m here today I want to talk to you
about that that’s what matters that
‘lets creates everything that’s great in
America is the ability to start a
business from scratch in your basement
whether it’s a cupcake or a group or
thousands of other ideas create a
business worth millions of dollars
employ hundreds of people provide for
your family yourself their families and
all the good things we enjoy from
capitalism which is freedom now there’s
a lot of sacrifice involved on speaking
to those of you in this room that want
to become entrepreneurs so let’s try and
learn something from the shark tank
experience I want to share with you
other than funny pictures like this
three common attributes to all of the
deals that got funded on Shark Tank
versus all the ones that didn’t this
does not speak to the outcome of the
businesses it speaks to those
entrepreneurs that are able to sit in
front of investors or stand there and
actually get their money and I want you
to realize that there’s a huge
opportunity to understand something
unique here because in each of these
three cases they were present in 100
percent of the deals that got funded
over thousands of presentations but in
every case these three attributes were
there and why I’m bringing it up now is
I know some people are going to be up in
front of me in just a few minutes and I
want them to hear what I’m saying here
because maybe they want to modify their
presentations a little bit
all right number one in 100% of the
cases the deals got funded the
entrepreneur was able to articulate the
vision in 90 seconds or less the idea
was so blindingly simple that you could
understand it in a minute this is a
cupcake we put it in a jar we ship it to
people for six ninety five I get it
this is a groovebook I carved a groove
in it so I could ship it at the price of
a magazine I get it you see what I’m
saying
all right 100 percent of the cases 90
seconds or less number two in every case
the entrepreneur usually a team over 80%
of the time we’re able to articulate why
they were the right people to execute
the business plan what credentials what
confidence what experience
why were they able to take an idea and
turn it into a business very important
present in 100 percent of the deals that
got financed now this is far more
sinister this last point because in
front of me multiple times I have seen
deals that are now like an isotope
sizzling the first two are present
Sharks are fighting everybody wants in
and then this happens in 100 percent of
the time the people got financed they
were able to answer every single
question about their business model and
their numbers with perfection
when you are sitting listening to an
entrepreneur and you start to ask them
how much market share do you need to
break even
what’s your margins how large is the
market how fast this is growing who’s
your number one competition how much
free cash flow you think you’ll make
them in the first three years if you
can’t answer those questions or you make
a mistake or you seem lost you’re
screwed this is really important
as last ones a killer and I want you to
remember that because I tell
entrepreneurs today if you’re not good
with numbers bring someone who is it’s
incredibly important I want to talk
about the economic environment we’re in
for a moment because you’re going to be
going into the workforce I run about a
billion dollars in one of my companies
in a mutual fund company so I have lots
of data with me and I don’t want to make
it complicated or long but I want to
talk to you about the environment you’re
going into and what’s changed over the
last ten years first of all we’re very
lucky in North America even if you can’t
read this Charlie explain what it says
our company’s the sp500 have record
earnings as of yesterday record cashflow
record profits record stock buybacks
record free cash to distribute and
dividend increases never in our lives as
the sp500 made more money that it’s
making right now ever so that’s the good
news you’re going into a really
interesting economy even though we have
lots of bad things to worry about
pandemics Isis Russia our our companies
have never made more money than they’re
making right now that’s good a lot of
people say to me gee that bull market is
long in the tooth it’s going to correct
it’s going to come crashing down just
when you’re graduating take the emotion
of it let’s go look at the data I love
to look at data this is a chart of how
many days between 15% Corrections in the
stock market a 15% correction is painful
we are 714 days since the last 15
percent correction there are many
periods in history where thousands of
days have gone by before the market
corrects I think we’re in the third
inning of our roaring bull market that’s
how I’m investing not only in small
companies been in large ones I like to
take the emotion out of date
the challenge everybody has in America
today particularly those that are
retiring is this record low interest
rates
most of us women retired would buy muni
bonds our ten-year government bond and
make five to six percent for one hundred
years we could do that and in the last
few the rates have dropped to below
three but I want to show you something I
spend a lot of my time studying what
economists are thinking is going to
happen in the next 24 months and what I
see coming our rate hikes about the 30
basis points one third of a percent in
the next 24 months that’s the general
consensus globally and what’s going to
happen so should we worry about that if
rates go up will the market crash let’s
look at that what happened way back in
1999 when rate swap or more recently in
2004 basically nothing rate hikes mean
enhanced economic activity market goes
down 67 percent and within ten months
comes roaring back also good news for
all of you because you want to be
graduating into a growing economy there
are some changes obviously to this
economy and I’ll tell you what they are
the demand and I’ll explain what this
chart says institutional investors today
have changed their minds about a lot of
things and one of them is the concept of
dividends because of all the volatility
from 2007 2008 2009
what’s actually happened in the market
is you can buy two kinds of companies
once that do pay dividends and ones that
don’t so I’ve taken the data and said if
you invested in the S&P 500 and bought
all the companies half of which my
dividends have don’t you made about 10
percent if you only bought the companies
that were growing dividends you made the
same 10 percent but here’s the
difference you had 40 percent less
volatility in the price of those
companies stocks so now all of a sudden
institutional investors have put a huge
premium on dividend paying stocks
because they don’t want stocks to go up
and down in our volatile which is why
Apple Computer after Steve’s job died
declared a dividend they couldn’t
attract institutional investors because
everybody wants to reduce the volatility
and that matters to you as well because
you’re going to be asked to make more
money than ever before when you get a
job your managers whether you start a
company or whether you work within one
the pressure for you globally to provide
returns that are based on cash flow are
going to be unprecedented because people
want safety now that’s what they care
about let’s talk about what it takes to
be a great entrepreneur
I want to talk about balance in life
first this is not good news for some of
you if you’re going to take the path of
entrepreneurship there will be no
balance in your life not during the
period you’re growing your business ever
and I’ll tell you why you have to fall
in love with your business it’s going to
consume you it will eat your hours alive
and if you don’t have the passion to do
that your competitor will and they will
kick your ass because they’re so in love
with what they do I’m going to tell you
a little story it’s difficult to hear
but it’s the truth I was teaching a
class very much like this and an evening
in a college recently when a young man
up at the top at the end of the class at
9 o’clock at night put up his hand and
said can I ask a question mr. O’Leary
I’m struggling with a problem a personal
problem and I said well I’m not dr. Phil
but let’s hear it he told me that his
fiancee in the morning was a Friday had
told him that if he/she couldn’t spend
or he couldn’t spend more time with her
family she was going to leave him I said
what consumes your time he said well I’m
still in love my last year here but I’ve
started a software company that provides
compliance software to hedge funds in
the Boston region there’s tons of hedge
fund companies my subscription run rate
is 5 million dollars a year and I’m
running out of my dorm I said Wow
are you kidding what’s the problem he
said well I have to work all day all
night I got to go to school and I got to
work on my coding I’ve got 16 people
working with me globally coding with me
I’m busy and then building this thing
and it’s working we’re providing
compliance reporting the SEC and we’re
making five million dollars a year but
my fiance is gonna leave me and I said
we’ll wait let’s be pragmatic which one
is easier to a place
my point here is that if you choose to
become an entrepreneur you have to have
a partner that understands the journey
and the reason you’re doing it you’re
doing it to set yourself free one day
that’s why you do it and if you’re ready
to make that sacrifice you may be on
your way I don’t know what happened to
that couple but I’m guessing it didn’t
work out and I’m sure he’s still making
money great entrepreneurs have a
tremendous amount of knowledge of what
they’re selling they know a lot about
everything but they better know a lot
about what they’re selling you never
want to be caught explaining yourself
and not knowing your product that’s
because you’re so passionate you’re
spending all your time doing it that’s
exactly what matters
[Music]
they put shareholders first the minute
you take someone else’s money you are
definitely number two for the rest of
your life the reason you can raise
capital is your shareholders understand
that this is incredibly important in
your life if you’re going to be an
entrepreneurial taking other people’s
money and that goes way ahead of you the
great thing about entrepreneurship is if
you’re passionate and you’re successful
you’ll wake up you’ll wake up one day
rich you won’t really be going for the
cash it’ll just happen to you everybody
I talked to this has success doesn’t
remember the day they became a
millionaire no idea not important to
them they remember winning they remember
building a business of being successful
again the pursuit of freedom manifests
itself in passion that’s really what
it’s about you have to love what you
sell if you don’t don’t bother
you have to love it more than
then-fiance you just gave up I know
that’s cruel but it’s true it’s the idea
that you spend so much time at the
beginning of the journey to get the
freedom you want at the end I’ve also
noticed great entrepreneurs have used
all the technology that’s available
today to make themselves more and more
efficient if you’re working on your own
business you work about 14 to 15 to 16
hours a day it’ll just happen that way
and there’s so much great technology to
enhance what you do and it’s inexpensive
which is why our productivity keeps
going up in America that’s really what’s
going on here is people are using this
stuff the barrier to entry to start a
new business is practically zero you can
do it online doesn’t mean it’s any
easier than was 10 years ago but it’s
pretty interesting that you could do it
for practically nothing I want to talk
to you about something else here that’s
unique to your generation
you’re not just keep competing with
America anymore you’re competing with
everybody all around the world somebody
in China right now wants to kick your
ass
250,000 engineers a year graduating
there they’re not copying us anymore
they’re creating brand new technologies
even if you have a product or service
you’re selling right here in this town
somebody somewhere else wants your
market share
you can’t think domestically none of you
you have to think globally let me show
you a picture and it’s a snapshot of
market capitalization for the first time
in your life and mine there are more
billion dollar market cap companies
outside of America than in it while
we’ve been growing at 2 to 3 percent the
rest of the world’s been growing four to
seven percent so in every industry that
we compete in there is a giant
competitor in everything it’s a vicious
game out there now you don’t even know
the name of some of these companies and
they’re bigger of many domestic
offerings here the first time ever so
when you graduate think global because
your competitor certainly is and they
want your market share look at this
image of Shanghai is a dump 11 years ago
probably had no fish alive in that river
look at it today you have any idea how
much capital it takes to do that
billions of dollars I looked at this
image and said to myself I bet you I
could call the CEO of Otis Elevator and
ask him a very simple question largest
provider of elevators and escalators in
the world there must be a lot of
elevators there one of the great things
about being a sharkus everybody returns
your call
so I asked them how many elevators are
selling in America this year he told me
around the world there’s five hundred
and forty thousand elevators installed
annually this year in America 12800 will
be installed in China and four hundred
twenty thousand Wow
that’s competition and I want you all to
be very cognizant of it I want to close
with a few thoughts that may be
controversial for you but I have
observed over a long career as an
investor successful investments and
failures both of them so I believe these
you may not I hope what they’ll leave
you with is to think about them they
stimulate thoughts for you
that’s what I’m here to do today all
right let’s start with some of the basic
premises of what makes a great
entrepreneur and a great manager
first of all employees are the core of a
company whether there’s 2 or 200,000 and
they are linked together by something
called the culture which you if you’re
the CEO create guide nurture and move
forward that’s the good news if
everybody is on board linked in the
culture you get tremendous productivity
beyond their salaries but here’s the
downside when you recognize somebody is
going off course and no longer believes
in the mission and are not on site
anymore with your vision of the future
you have to fire them you have to take
them behind the barn and shoot them you
know why because they do tremendous
damage inside the organism and it’s very
hard to do that but make no mistake
about it even if it’s your mother she’s
gone the business has to survive that’s
what matters
this sounds cruel and heartless it’s
true and the way you’re gonna find out
is you’re going to be weak and you’re
not gonna do it
it’s gonna cause me major having for you
and you can remember my speech today and
you’re gonna thank me when you have to
make that tough decision unfortunately
in my life I fired thousands of people
it’s hard every time and I do it myself
and I explain to them why I give them
the best package I can and I move on
because I have to make money for my
shareholders that’s what’s important
this seems so obvious and people don’t
get it the customer always comes first
above everything and I’ll tell you why
I’m saying this to you because there’s a
really interesting change going on in
the way people invest today it turns out
I’m going to give you some good examples
that service Trump’s price I’m good
example everyone in this role
understands if you can create great
customer service in your product or your
service or whatever you’re selling
somebody and that everything they need
from your organization is provided and
you’re top of the pack in customer
service you can charge an outrageous
price over your competitors what’s a
great example of that Apple Computer you
pay 35% more for a Mac laptop than a
Windows one why it does exactly the same
thing you love the brand you love the
customer service you like the way the
store looks you’re comfortable knowing
they’re backing
back every time you need them there’s a
theory today in venture capital and in
private equity you buy businesses with
really weak customer service do nothing
except fix that and raise prices 15% get
a 33 percent IRR it turns out around the
world customers want the path of least
resistance it’s a little bit of secret
sauce I want you to know if you create
an organization spend third of your time
worrying about your customer service
listen to what they say if they’re not
happy you’re going to be unsuccessful
there is no question about that
now something a little controversial
most recently I spoke at another
Business School we had quite a debate
about this when I want to buy a company
and take a control position in at 51% I
don’t ask to me with the CEO I want to
meet with the man or woman that is
running sales and I want to drink some
good Burgundy with them take them out
for dinner get to know them a little bit
and ask them all about their challenges
in any organization in America the
person that knows most about the
business about the challenges about the
competitors about the product about the
market is the head of sales they know
everything
and what I’d like to do is spend a
couple of days with them and then I go
meet the CEO and if they know less than
I do the first person I fire when I own
the company is the CEO who don’t want to
pay the most Head of Sales I believe in
an organization the number one person in
terms of compensation should be the head
of sales should make the most money
always who has the hardest job the head
of sales who knows the most the head of
sales who determines the destiny of the
company the head of sales that’s how I
run my organizations I take the caps off
and I let who’s ever running sales have
unlimited upside I want them to be
stinking rich why because that’s the
fuel that makes any business successful
and it’s also the hardest job I’ve also
learned over a long career that
everybody is replaceable I love it
when somebody says to me oh we can’t get
rid of that person they’re irreplaceable
I fire them right there
everybody has to understand that
whatever you do somebody can do it
better you have to bring your a-game in
every single day there’s nothing unique
about any one individual what’s unique
is their passion their ability to
execute to meet targets and exceed them
the minute you lose that ability in
capitalism you’re gone it’s a fair trade
the engine that makes you rich can take
it all away from you there are no
guarantees I think that’s incredibly
important now the one that always gets
me in trouble
in today’s world and perhaps even here
your professors are telling you that
your responsibilities go beyond just
making money for your shareholders that
you have a responsibility to society
that you’re not just leading a business
that you’re an organism that should
solve many problems beyond just profit
I think that’s crap
I think the DNA of a business is to make
money for its shareholders it is the job
of the shareholders to take their
profits and redistribute to any cause
they wish after they receive their
dividends or their profits your job is
to go out into the world and understand
who you serve it is not your
responsibility to solve all the
society’s problems and pay taxes to a
government to do that your job is to go
to war every day and win to win market
share to solve the earth your
competitors walk on to steal their
customers and to take their profits and
win that’s your job and to make profits
for your shareholders so they give you
more capital to create more jobs to be
more successful to pay more taxes to
provide the standard of living that we
have in America today your job is not to
solve everybody’s problem is to solve
your customers problems your
shareholders problems your employees
problems I’m very distressed when people
tell me a business should give a third
of its profits to charity that’s so
Regus it should give all of it to its
shareholders who then give to charity
think of all the great things that are
done today by the Bill Gates of the
world the warren buffett’s of the world
the only reason they can do that is they
make money for their shareholders don’t
get lost in this debate stay focused and
true to the mission business is war you
have to win and you take the spoils with
your profits and you help your fellow
man but first you make money looking for
the simplest case on Shark Tank we had a
soccer company come out and say every
sock we sell they give a dollar to
charity to the homeless who eat socks
you know why they’re gonna fail it turns
out that the price of socks are
incredibly price sensitive that if
you’re a dollar more expensive than
everybody else on the Shelf you’re going
out of business it would’ve been much
better to sell a better sock at a lower
price make profits and then give it to
the homeless that’s my point
now not everybody agrees that’s okay
try it my way first get out there and
with create businesses create jobs great
profits and don’t let somebody take you
off course
that’s the essence of business we’re
going to leave it with a story I have an
18 year old son my dad lives in
Switzerland he’s 84 my mother died six
years ago he’s alone so I often will fly
over there from Boston or wherever I am
and to make one a my daughter my son my
wife whoever wants to come we leave on
Friday night and have dinner with him a
Saturday get back on the plane on Sunday
and fly back so my son likes to do that
recently he got on the flight with me
and as he was getting on the galley it’s
about a six-hour flight to Geneva he
said to me the first time ever dad why
does it want to get on this plane I have
to take a left and sit in the back and
you get to sit in the front with the
good food the big screens and all the
movies I said Trevor you don’t have any
money thank you very much your time
today
[Applause]
I went over about 11 minutes so I’ve got
a couple of minutes for four questions
but I want to keep us on schedule
because we’re gonna look at three deals
today I will say one thing about the
deals I’m gonna look at quickly I
intentionally did not look at the
business plans because I want you to
know something about Shark Tank we are
not allowed to see the businesses
first-ever we have no knowledge of what
they do and that puts the pressure on
the entrepreneur and the ones that are
going to present to me today to be very
concise on what they’re doing remember
we looked at the three things that
mattered so if you thought I looked at
your deals
I didn’t you better be really good at
presenting them that’s what matters and
by the way if somebody does contact you
on Shark Tank or you don’t admit that
they did or they don’t they’re kicked
off the show and so are you so anybody
comes running up the street says I want
to talk to about something on a pond a
shark tank I immediately say please
don’t say anything to me because I’ll
have to disclose you did and you’ll
never make it on the show but that’s why
it works we do the discovery together
does anybody have a question yes sir
that’s a great question sir in fact in
this cohort the stats say that about 25
percent will start their own business of
those 20 percent will be very successful
so it’s a hard road but for those of you
that decide to go and work for somebody
else understand you get a better balance
of life but every day you’re in there
you have to help your boss or whoever
you are make money otherwise you’re
worthless you’re a cost you’ll get fired
today in America we’re trying to cut
costs every day in the first place we
look is which heads do we not need the
most expensive part of an organization
after its input costs are people if
you’re going to be an employee be a good
one make sure that you set your goals
and you achieve them it can be a great
life there’s nothing wrong with it and
there’s no dishonor in it
I was working once at an ice cream
parlor when I was about 15 years old my
first real job and on the second day I
was asked to scrape the gum off between
the Mexican tiles on the floor and I
said to the woman who owned the storms
called Macomb’s ice cream parlor you
didn’t hire me to scrape gum you hired
me to scoop ice cream and this this girl
was shoe store across the way that’s
looking at me I don’t want to see her me
scraping the gum and she said what are
you talking about
I own this store I’ll do anything I want
with you get down on your knees and
scrape that gum when I said I’m not
doing it
she said you’re fired
last job I ever had I owe that woman
everything I don’t like to work for
people many of you in here I hope
inherit that there’s nothing wrong with
it
but you want to control your own destiny
you work for yourself that’s how it
works I’m trying to inspire those of you
are on the tipping point take the chance
you’re young go for it
there’s nothing better than being able
to wake up in the morning 10 years or 20
years so now and do what ever you like
it’s about freedom that’s what matters
I’m not saying being employees bad
but believe me being an entrepreneur is
better I’m a little biased
any other questions yes sir
what I’ll repeat the question what
happens to the deals that don’t make it
on TV 300 300 deals are taped about 230
air sometimes would get in front of the
lights you lose it we have a
psychiatrist there at the set bad things
happen sometimes some people can’t take
rejection it’s it’s it’s real life
they’re so convinced they’re right they
don’t get a deal or they collapse they
blow it or they don’t know their numbers
and I have to shoot them all these
things happen can you imagine getting
that chance on Shark Tank and you don’t
know your numbers you should be thrown
in jail
one more discern
I love that thing so one of the main
things he said was that you have to love
what you do a lot of people that come on
Shark Tank you’ve told them that your
love for your product is slightly me so
how do you determine that
a business is failing that you’re not
just giving up too soon
or you’re not passionate enough the
difference between that’s it like I
didn’t get that the last part not
passionate or not what not giving up or
giving up to sue because you tell a lot
of people just give up on it this idea
is oh I see yeah you know you know I get
a lot of flack for you know telling the
truth I’m the only shark that tells the
truth because think about your tenures
and as an entrepreneur you have X number
of years it breaks my heart to see
someone spend months and then years and
then all of their families money on a
really stupid idea it’s better to face
the truth and give up that pursuit and
start another one the great thing of an
entrepreneurship is if you fail you try
again but after three years if you have
if you’re not making any money it’s a
hobby it’s not a business some people
can’t take it I couldn’t care less you
know what’s gonna happen reality’s gonna
bite you in the hiney
anyways you’re lucky you met me I’ve
saved you a year that’s why they call me
mr. wonderful
you
[Applause]
[Music]
[Music]
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