Of the more than 35,000 people who now try out each season, fewer than 150 make into the tank. Anyone who has seen the show knows how this plays out: Contestants spend up to two hours getting drilled on their business by the panel of sharks. The sessions are edited down to less than 15 minutes and invariably include an embarrassing shot of a bewildered entrepreneur. In every show, at least one lucky entrepreneur gets a hug and a handshake worth tens or hundreds of thousands of dollars.
What happens next is far less inspirational. As many as two-thirds of those televised deals never come to fruition, estimates TJ Hale, who has interviewed more than 70 participants for his show, Shark Tank Podcast. Investors receive no information prior to filming, so they get to perform due diligence only after taping. They may discover legal, tax, or financial red flags. Or they can just change their minds. “One entrepreneur said basically the shark just never called them,” says Hale.