Ever wondered how your business idea would fare on ABC's Shark Tank? Investor Barbara Corcoran has funded countless companies, many of which have gone on to enormous success. She's learned to spot the startups that are most likely to succeed -- and most likely to get funded.
Corcoran looks for several common characteristics in every company she funds. She shared them at a day-long seminar on entrepreneurship at the Tribeca Rooftop in New York City last Thursday, offering insights that can help you build a stronger business. Use her criteria as a litmus test for your own small business or startup. Here's how:
1. Use simple language. When you want to attract others to your cause, forget the insider jargon: plain language works best. Identify the essence of your company's product or mission and summarize it in one short sentence that will tell others what it's about.
Tiffany Krumins, CEO and inventor of Ava the Elephant, appeared on the first episode of Shark Tank and described her product in a simple sentence: "Ava helps children take medicine." Her message was so clear that Corcoran knew she wanted to invest. "Fancy talk doesn't work," Corcoran says. "Entrepreneurs have to talk plain to get bought."
2. Solve a problem you know from experience. When you're looking for your next business idea, focus on problems you've grappled with firsthand. Most likely, others have faced the same issue, so you'll know you're filling a need.
For example, Ride-On Carry-On, a kid's chair that turns a rolling suitcase into a travel stroller, was invented by a flight attendant who needed a better solution for traveling with her two-year-old son. "Whenever I see an entrepreneur who invents a business out of real life experience, it is almost always a good business," Corcoran says.
3. Identify your difference. In a saturated market, Corcoran looks for products that stand out -- products with a clear difference. She remembers Villy Custom, a cruiser bike company she funded in the third season of Shark Tank. The founder was a former fashion designer whose striking cruisers were truly unique. "They were the best looking bikes I had ever seen," she says.
In other cases, the founder stands out, rather than the product. Corcoran loves to point out that the co-founder of Pork Barrel BBQ, from Shark Tank's first season, looks like "an adorable pig," a marketing advantage that none of his competitors have. "You've got to have a gimmick," she says.
4. Persist past rejection. As an aspiring entrepreneur, many people will give you 'no' for an answer. Corcoran looks for people who won't stop there. "Pushy people always deliver," Corcoran has learned from experience. "They want it, they want it, they want it."
After Corcoran was accepted as a Shark Tank investor, she received another call saying the network had decided to go with someone else. Rather than backing down, she suggested that she and the other woman compete for the spot. As you know, Corcoran won. "All the best things that happened to me happened after I was rejected," she says. "I knew the power of getting past no."