The Shark Tank and Elon Musk: A Lesson

If you’re a product inventor, you’re certainly a fan of the Shark Tank. It’s a great show because it gives us a front row seat into how investors think.

Surely, you’re also a fan of Elon Musk, because his ability to bring ideas to life is astounding.

There’s an important lesson we can learn from both.

Let me start with the Shark Tank...

What’s the number one lesson we can learn from the Shark Tank? No, it’s not “know your numbers”, although that’s important. And it’s not “don’t ask for a ridiculous amount of money”.

The main lesson has to be “GET SALES AND FINE TUNE YOUR SALES PROCESS BEFORE YOU SEEK AN INVESTOR!”

I know this is hard to hear, because life would be soooo much easier with a sugar daddy (or mommy) who can give you money and “poof” everything’s Ok. Product inventors are great idea people and they come up with fantastic solutions, but even if you have the best product in the world, it means nothing if you can’t sell it. Sales are everything.

“But that’s what I need the money for. Give me money and I’ll hire a great salesperson and everything will be Ok.”

Prove it!

Prove that people want it.

Prove that your product is good.

Prove that you know what you’re doing and can get sales.

If you don’t prove it, it will cost you – BIG TIME!

At the least, you won’t get an investor and your idea will die. At the worst, you will get an investor, but you will have to give away a ridiculous chunk of your company (and then you’ll be under even more pressure).

Before you get an investor you have to generate sales. Even better, create an automated sales machine!

If you don’t have funds to pay for tooling and your initial inventory, presell the product. This is how I launched my business. And this is how I still launch new products. Each product has to prove itself and fund itself and we do this by generating presales (I will talk about how to generate presales in another article).

If you can go out and generate sales and prove that people want your product and that you know what you’re doing, you will be in a MUCH stronger position to secure an investor at a reasonable rate. Even better, if you can get your sales machine running you may even decide that you don’t need an investor.

So this brings me to Elon Musk. When his Boring Company needed cash, what did he do?

He raised $1 million by selling a limited run of hats.

Then he raised $20 million by selling flame throwers.

Yes, Elon Musk is a billionaire. He could just put his own money in. But even with his billions he still chose to presell products to raise money.

Elon has investors drooling over his opportunities because he has proven himself over and over. He has proven that he has great ideas, that he can execute and that he is capable of selling his products.

As a product inventor, the most important thing you can do is prove that you can sell your product. If you don’t know how to sell, hire someone who does.

My name is Glenn Meder. I help businesses improve their sales processes so they can increase their sales, trust and authority. How I can help you?