Yet there is often a better way.
Last week I attended and participated in the Inc. GrowCo conference in New Orleans which is my favorite conference of the year. It is exhilarating and stimulating to be in a community of about 600 entrepreneurs who have come together to learn and grow. Everyone has an idea, and the energy is powerful.
Kevin O’Leary, aka “Mr. Wonderful” from Shark Tank was one of the main speakers at the event and many of the CEO’s of his portfolio companies were on site participating in panels.
His presence and the excitement around him reflects what I call the ongoing “Shark Tank Myth” which is the belief by many entrepreneurs that the key to their success and fortune is to get that one famous or great investor who has all the answers and will lead them to the golden land.
The reality is that there is often another way. And sadly, despite the dream, Kevin O’Leary and his counterparts would probably only consider 1 in 100 companies they meet potentially investable.
While entrepreneurs pursue the “Shark Tank Myth”, many of them are wasting a fortune of time pursuing a path that will likely not work for them.
I met with many CEO’s during the conference whose goal was to raise about a million dollars from an investor like O’Leary. And I would automatically challenge them to ask what they would do with a $350,000 SBA loan at a reasonable rate with a long amortization.
Invariably, most of them had not considered the debt to be an option. And based on the existing cash flow in many of their businesses they could likely get a loan.
They can likely get a lot further with a $350,000 thousand infusion in their business today, than the pipe dream of a $1,000,000 raise that may never come to fruition. In fact, many of them could not clearly articulate what they would do with the bigger sum of money.
My best advice is do not fall for “The Shark Tank Myth”. You can do more on your own than you think.