Shark Tank’s Top 3 Lessons In Dealmaking
Rich dad always said, “Never take no for an answer.”
In 2013, an entrepreneur named Jamie Siminoff appeared on the show “Shark Tank” to pitch his new product, “DoorBot.”
The product was a smart doorbell that allowed you to see who was at your door via an app on your phone and talk to them, even if you were away from the house. Siminoff’s ask from the sharks was $700,000 for a 10% stake in the company. Unfortunately, the sharks passed on the product and sent Siminoff packing.
For most people, that would have been the end of the road. After a failure like that, they would have quit and moved on to something else, perhaps even gone back to an old job. But that’s not what Siminoff did.
Rather than take no for an answer, he believed so much in his idea and his product that he continued searching for investors, eventually rebranding the product to be called “Ring” and building his company to over $100 million in sales and over 1,000 employees.
Amazon bought Ring for $1 billion. Yes, you read that right. By the time Amazon came along, the company was worth an estimated $760 million and had raised $209 million in financing.
Siminoff’s story gives three valuable lessons that all entrepreneurs need to embrace.
Lesson #1: Don’t take no for an answer
I resonate with Siminoff’s story. Many people do not know this, but when I first wrote Rich Dad Poor Dad, no one would publish it. In 1997, I pitched the book to multiple agents and publishers, but they all told me to move on and that the book would never sell.
Instead of listening to the naysayers, I believed in my idea and my dream to help people gain financial independence so much that I took matters into my own hands. By lining up as many interviews as I could and using the media for free publicity, I was able to sell enough books to get on the New York Times Bestseller list.
In 2000, my big break came as I got on Oprah’s show and sold my book to Warner Business Books. The rest was history as the book has gone on to sell over 30 million copies and be published in 51 languages. My original printing was 1,000 copies.
I share both this story and Siminoff’s story because they illustrate an important lesson that every aspiring and even seasoned entrepreneur needs to hear: you cannot let others tell you no. Only you know when it is time to move on from an idea or a dream to start something else. If people do not see what you see, then move on and keep working. If you do, most times the breaks will come.
Lesson #2: There is money out there
One of the best lessons that my rich dad taught me was to see the world as one of abundance. For my rich dad, there was always money out there. Your job was to find it.
It would have been easy for Siminoff to conclude that since the sharks didn’t want to invest in his product that no one would. After all, the sharks are some of the smartest business people and investors around. If they didn’t want to invest, who would?
Siminoff didn’t let them define his reality. Instead, he simply went on to the next investor to give his pitch, eventually raising $209 million in financing before Amazon came along with their big wallets.
I’ve seen this happen over and over again in my entrepreneurial and investing career. In 2008, Rich Dad Advisor Ken McElroy was finding one amazing apartment deal after amazing apartment deal. The financial markets were crashing and the cost of real estate was dropping. Even more, the only institutional loans you could get at the time were Freddie and Fannie loans. It was prime time to invest in the multi-housing market. The only problem was no one wanted to invest their equity. Most people were scared. Undaunted, Ken and his partners kept pitching. I was one of those investors who said yes. Today, all of us who said yes are all much richer because Ken kept pitching.
The money is always out there. Whether it’s raising money for a real estate deal or pushing a product you believe in, you have to keep asking for the money you need from investors. It won’t be easy, but it’s worth the work. Which leads me to my third lesson.
Lesson #3: There are no overnight successes
Siminoff pitched DoorBot in 2013. Five years later, after a ton of hard work building his business, Amazon came along and bought it. I published my book in 1997, and it wasn’t until the year 2000 that it finally caught on. Ken McElroy researched and bought many apartment properties in 2008 and started realizing the fruits of those efforts many years later after the economy improved. None of these stories are get-rich-quick stories. They do not represent overnight success.
The path to successful entrepreneurship is one of steady commitment and hard work. But the good news is you’re working for yourself.
I meet many people who think that Rich Dad teaches you how to get-rich-quick. Nothing could be further from the truth. Rather, our mission is to teach people how to think differently about money. This often means starting small and working hard, just like my wife Kim did. Her first investment was a small house in Portland, Oregon. Today, she owns thousands of apartments. Between then and now is thousands upon thousands of hours of pounding the pavement, failures, successes, and a lot of fun.
Long but Rewarding Road
As you can see, by no means are start-ups for the fainthearted. To keep on track, let your mission statement serve as your beacon. Start with it and end with it, and revise it along the way if necessary. In the process, you’ll discover that all setbacks can be resolved. Even if you don’t see profits right away—and you probably won’t—the experience you gain from a start-up will be worth its weight in gold. If you discover your market niche, and your product or service ends up making the consumer’s life better, easier, or happier, then eventually you will prosper.
Editor, Rich Dad Poor Dad Daily