Image of the sharks on the show Shark Tank. (Image via Google Images)

‘Shark Tank’ Will Teach You How To Become an Entrepreneur

Watch ABC's hit reality business show to learn more about the world of venture capital.
December 9, 2020
6 mins read

The growth of any society is closely tied to the distribution, exchange and flow of capital: labor, ideas, financial assets and so on. Due to the constraints of time, space, capacity and capability, any entity — from an individual person to a global corporation — would only be able to grow beyond its initial constraints and maximize its potential with both internally-generated output and the involvement of external parties.

Weaving these seemingly separate swaths of the societal quilt together through trade would not only benefit each individual entity, but also the world as a whole.

Venture capital is an economic catalyst that accelerates the flow of capital. Because of it, entrepreneurs who have innovative ideas, passion and capability are connected to investors who have capital to leverage and expand. The combination of these two players leads to synergy and maximization of benefits to both sides, and to society.

The business reality TV program “Shark Tank” makes the world of venture capital accessible to members of the general population. Though it is hard to say that “Shark Tank” paints a comprehensive picture of the world of entrepreneurship and venture capital, the show at least gives the audience a glimpse of what this world looks like in an entertaining and engaging way.

“Shark Tank” shares with its viewers the facets that entrepreneurs — especially those in the early-stages — should consider about their ventures. It also discloses the factors that a venture capitalist normally takes into account when making an investment decision.

After a simple pitch of their projects, entrepreneurs on “Shark Tank” are bombarded with questions critical to the development of their business  — What are the up-to-date sales? Why is the business overperforming or underperforming? What are the overhead costs and variable costs? What needs to improve in order to enhance the financial performance of the company?

Through these questions, members of the audience have a chance to sharpen their business sense and learn the most effective ways to measure the commercial viability of a particular venture project.

Watching “Shark Tank” may subconsciously instill a “decision-making” mindset, which tells viewers how to balance costs and benefits now and in the future. This way of living also impacts the opportunities and challenges in your own decision-making process, regardless of whether or not the decisions are related to business. Because of the nature of the business world, economic benefit is the first priority and the absolute ration is demanded in the decision-making process.

“Shark Tank” gradually steers its audience toward following a procedure of making rational choices decisively after performing a meticulous investigation. Due to constraints, such as the length of each episode and the production team’s goal to capture and retain the audience’s attention, the show goes at such a fast pace that viewers can absorb information in an efficient manner. Viewers’ hearts beat just as quickly as those of the entrepreneurs on the stage while anxiously awaiting the opinions of the judges.

In addition, the interactions among the “sharks” offer examples of critical and independent-minded thinking in the process of rational decision making. In a social system where people are more or less trained to be influenced by a source of authority for the sake of knowledge acquisition and operational efficiency, the role of authority in decision making might be much more powerful than originally thought.

In the investment decision-making process on the “Shark Tank” stage, these seasoned business sharks are so shrewd that they are immune to the influence of others. Alongside their lack of susceptibility, the sharks can also discern the nuances inherent in each investment opportunity based on the resources and expertise they have acquired over the course of their careers. The fact that the sharks can have disagreements and differing opinions undermines the assumed omniscience of authority.

This observation is important; it encourages people to cultivate a form of “resistance capital” in their minds that strengthens independent and critical thinking. Resistance capital can be immensely helpful in an environment where unique ideas or identities are different from the surrounding crowd.

Some people might consider entrepreneurship to be out of their reach — a mere fantasy. However, entrepreneurs on the “Shark Tank” stage look as normal as people in everyday life, not lofty visionaries or established successful entrepreneurs such as Steve Jobs or Elon Musk. The fact that these entrepreneurs appear to be normal people reveals that a person who doesn’t have full knowledge of what it means to be an entrepreneur could gradually become one, and be successful — with drive, passion and a willingness to learn.

No matter how much success an individual achieves, or how large a business already is, there is always room for improvement. “Shark Tank” ignites possibilities for people who don’t have an entrepreneurial idea yet, as well as for those who have one but haven’t considered how to take action to bring the idea to fruition. Furthermore, the creative ideas from the entrepreneurs on the show might challenge the audience to think beyond the status quo.

Thanks to the negotiations between the sharks and the entrepreneurs, viewers can discern the fundamental elements of an economically scarce world. Throughout these discussions, the audience learns which factors matter the most when making a venture capital deal — that is, getting the “capital flow” started.

Expertise (human capital), connections in a particular industry (social capital) and funding (financial capital) are the primary elements viewers witness on the show. These three forms of capital are all combined in the package of a venture deal. If more than one shark wants to get in on a deal, the sharks then fight against each other by presenting these elements that any entrepreneur might leverage.

“Shark Tank” is a free, tasty sample of venture capital available to the general public. The show will increase the audience’s hunger to embark on the journey of creating its own masterpiece.

Benjamin Chen, Columbia University

Writer Profile

Xiaobin (Benjamin) Chen

Columbia University
Economics and Psychology

Benjamin Chen is an economics and psychology student at Columbia University. He is always motivated to innovate and change the world for the better. He is driven and guided by values, principles and love.

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