Daymond John is one of the original so-called “sharks,” the panel of investors on ABC’s Shark Tank. He has been patiently assessing pitches since the show’s debut in 2009. In that time, he’s likely seen the best and the worst that televised venture capitalism has to offer, and knows what works and what doesn’t when a business is looking for Shark Tank money.
On Thursday, Entrepreneur reported on John’s advice to entrepreneurs looking for an investment. More specifically, he identified the one thing that many pitchers do and really shouldn’t if they are looking to earn trust from potential investors.
“Don’t make your pitch, or your brand backstory, sound all rosy because I don’t care what brand you look at or how big they are now, all of us know that times have not been great all of the time. If you can’t come clean and tell investors how and why you failed, that raises a red flag. They need to see that you learned from it and came back stronger.”
According to Entrepreneur, John is no stranger to overcoming setbacks. His global brand success FUBU, which became FB Legacy in 2010, was a non-starter until 1992. He was attempting to launch the business in between his waiter shifts at a chain restaurant.
That idea of overcoming failure is at the root of the success of Shark Tank itself. When producer Mark Burnett first signed on with Sony to produce the program, based on the Japanese show Dragon’s Den, it was not the first attempt to create a U.S. version of the series. The studio had attempted to sell the show four years prior, but, as Variety reported in 2008, the powers that be thought there was not room for Shark Tank and Burnett’s Celebrity Apprentice, as both were business-themed shows.
Encouraging forthrightness is not new for John, who told Inc. in October 2013 the one television or movie character that he’d like to do business with was The Grinch, because “[h]e’s straight to the point. He’s a little crazy, and he clearly doesn’t let emotions get in the way.” In that same interview, John gave a perhaps surprising answer when asked what business he’d wish someone else would start.
“A puppy cuddle company. Take puppies around to different places, a bunch of puppies, and allow people to have the puppies jump all over them and cuddle with them. Like puppy therapy.”
Daymond John returns in the the new season of Shark Tank which debuted Friday, September 26th with a special two-hour premiere.