Shark Tank, ABC's hit series about entrepreneurs pitching wealthy investors, is casting for its new season. Coincidentally, Bloomberg Businessweek is reporting that two-thirds of Shark Tank deals never get inked once the cameras go dark.
Bloomberg tapped T.J. Hale, who hosts a Shark Tank podcast, to learn more about what actually happens after the handshakes at the end of a successful pitch. Hale estimates the majority of deals fall apart, based on his conversations with 70 Shark Tank entrepreneurs. Said Hale:
"One entrepreneur said basically the shark just never called them."
Those red flags may be legal issues, financial irregularities or tax concerns; or either party can simply have a change of heart. Sometimes entrepreneurs re-think the equity stake they have given up; some were always in it for the Shark Tank exposure and never really wanted a deal to begin with.
The television show, however, is quick to feature the deals that end well and the companies that go on to have great success. As Hale puts it:
"Not every deal closes, and not every deal ends well, but you probably won't hear about that because Shark Tank is the hand that feeds, and nobody wants to bite it."
You can watch that dramatic piece of Canadian television here:
According to the CBC, the JobLoft entrepreneurs sold their company within the next year. Shark Tank returns for a sixth season this fall.