Kevin Harrington: Lessons from a Shark Tank Member

Well, here we are for National Entrepreneurship Week presented by Microsoft. This is Microsoft Launch the program. I'm Alan Taylor from INC. Radio. Scott Duffy, the author of the book Launch. And our next guest is Kevin Harrington. Now, Scott, he is one of the original sharks.

Kevin's the man.

So on top of that, he's also the inventor of the infomercial. And I can see here pioneer of as seen on TV industry, which is a huge industry.

What's really exciting about talking to Kevin this week during National Entrepreneurship Week is this is that Kevin was one of the original founding board members of the biggest entrepreneur organization in the world, eo And Kevin, I'd love to hear how you got involved in welcoming you to the program.

Great to be here. Thank you, Scott. Al And Entrepreneurship Week, I love it. It seems like old home for me because I'm an entrepreneur every week. But it was back in the mid-80s, and I was hanging out on the west coast with Entrepreneur magazine, believe it or not, it was in their headquarters. I met a guy named Vern Harnish. And I don't know if that name rings a bell, but Verne said, hey, look, I'm hanging out with some really cool young entrepreneurs. Kevin, my Michael Dell, and another one, a guy named Ted Leoncis. And Ted, if you don't know today, he was like a big shot at AOL and sold out. And so Ted was one of the original guys. And so we're all hanging out like, hey, why don't we start a group of entrepreneurship? And it was actually originally called the Young Entrepreneurs Organization. So we were under 40, and the year was 1987. By that time, there was discussion for a year or two before we actually formed it. But we all kicked in a little money and said, let's help entrepreneurs, young entrepreneurs get their business started, and maybe they can learn some of the things that we've all learned. And maybe we could learn some things, too. So that was the early days. It was a lot of fun. We started going city by city and chapters, and I think it's now in 150 cities. It's in 45 countries and all over the world. I was in Shanghai recently. I called beforehand and said, hey, I'm coming to Shanghai, EO Shanghai. Can I come say hello? And wow. They had like 30, 40 people showed up, and it was just like, it's so cool. Wherever you want to go, EO is going to be there to support you. They gave me a list of people to do business with there, and I needed some help on some web services. And so EO is just this major group around the world. I'm just so excited that I can say that I was one of the original guys to be involved in that crew.

I want to just tell everybody also that Kevin does a national radio show every week called Big Pitch Radio. He gets pitches from people five days a week on about 40 radio stations. And since you've had so many pitches over the years, and of course even all the way back to Shark Tank, I mean, you could probably help these entrepreneurs that are watching learn how to give that good pitch. Right, Scott?

Yeah, the perfect pitch. That's funny because I say Shark tank has over 45,000 people a year that come to pitch. They only pick about 200 people per season to go on the show. So what happens to the other 44,800? They get turned down. And why do they pick the 200? I say because they have a perfect pitch. There's a whole bunch of things I look for. I'll just start with something real simple because I know we don't have all day. First thing you have to do is I say you have to kind of tease a little bit, get the attention with some kind of a problem. Right? So is there an attention getting problem you can identify then you please by solving the problem or showing benefits, features, magical transformations, that kind of thing. And then you seize by giving an irresistible offer. Right. If you're dealing with Mr. Wonderful Kevin O', Leary, you better have a good seize because it's got to be irresistible and make sense. So it's called tease, please, and then sees if you are demonstrating along the way. And that's this, this kind of pleasing function with, I'll say, I like to see demonstrations. I like to see multifunctionality. I like to see magical transformations before and after. Maybe testimonials, maybe a little bit of competitive analysis might help too, because if you're going to be looking, and now if we're talking about pitching in an investment mode, you're looking for cash. So you sort of have to may take my mind off who else is doing this. Is this unique? Is there any kind of unique positioning? And when I use the word unique, let me say these words, is it unique enough such that there's no other business or service that solves the problem in a similar fashion? So think about that. So you want to solve problems uniquely and then talk about, you know, how it's unlike anything else and maybe there might be some intellectual property, some IP as we say, Right.

I got another question. It's T's please. And C's now, how about the don'ts?

Exactly.

Okay, so that's good. So have plenty of passion. So don't put people to sleep. Think of it this way. In many cases, whenever you're pitching, you're generally going to be around other people that are pitching so that like, if it's Shark Tank, we start at 8 in the morning, we go till 8 o' clock at night. It's pitch after pitch after pitch. In one day, I took 93 pitches on a preliminary. This wasn't taping for the show, actually. But think about taking 93 pitches in one day. By the time I got to 35, I thought, you know, I was ready to chew my arm off, right? So like, I'm like, we gotta keep doing this. But so these were three minute pitches and if you do the math, that takes a long time to get through 93 because very seldom did it end at three minutes. So you need to have some excitement to and passion to your pitch, right? Also be prepared to give an offer that makes sense. Don't talk about how.

If we only get 5% of this $10 billion market, we're going to, you know, we're going to have this $500 million business, right? Those percentages and numbers mean nothing if you don't have a marketing plan and a plan on how you're going to build the business. And one other thing, be prepared to talk about the use of proceeds because a lot of the finance guys, you're there, okay, I want a quarter million dollars for 10% of my company. You need to explain the valuation, you need to be prepared to explain the use of proceeds. So in the don'ts, don't come unprepared is probably the biggest thing I want to say. So know that you're going to be up against when you're asking for money, you're going to be up against pretty any question that can come out from under the sun. What do you need the money for? Where's it going to be used? When am I going to get my money back, et cetera, et cetera, right? So that's what the sharks want. And I'm going to give you one real big tip right now. If there's anybody listening that's going to go in front of a finance guy, a bank, a shark, whatever, but more of it like an investor type as opposed to say a big bank. Because banks, they just want security, they want assets, they want real estate or something like that. A shark wants to 10x his income don't say, oh, I'll give you 5% interest on your money. Right. I want to know that if I put up $100,000, I'm not getting back $105,000 or $110,000. I want back 500,000 or a million maybe. And I'm not trying to be greedy here. It's just think of the risks that's involved in investing in some of these small businesses. So this is a tip that works when somebody comes on Shark Tank and they say, or they come to my office, they say, I want, I need. Kevin, I'm so concerned for you, the shark, that you get your money back first, that I'll give you 100% of the proceeds, 100% of the profits until you get all your money back. Then we'll work out our 50 split or your 10% or whatever it might be. But you own equity for life then. But it's called an accelerated payback. Now when somebody tells me that now, I really know they have my interest at heart. Because the one thing that most people forget when they go to pitch the shark is they have to get the shark to write the check. And so I want to know what's the big upside here, you know? So always think about what it takes to get that check.

So, Kevin, tell us what you're working on today.

I have a lot of things I'm working on today. I still am doing infomercials in the world of as seen on tv. So one of my hot products, there is a product called Igro. And Scott, not to say it too.

In a funny fashion here maybe, but it's a hair growing helmet. Okay? So you wear this and it grows hair. Unbelievable. So it's on qvc, it's doing millions of dollars a month. It's FDA cleared for men and women, unbelievable products. So that's the world of as seen on tv.

But now, hey, wait, Kevin, are you going to send me one? You holding out? What's up?

You go check it out. If you want one, we'll get it for you. Okay?

Okay. So, so now there. It's no secret that there's fewer people watching TV today than there was even five years ago or ten years ago because. So, because kids today are on their mobile phones, the millennials, etc. Right. So we're doing a mobile deal. I've been in this as seen on TV commerce for 30 plus years now. I'm going to be in the mobile commerce field. Because if you, if you're not looking to go to the mobile phone. You're going to be out of business here real, you know, at some point, Right. So I cut a deal with Sprint. We launched a mobile app that's a commerce app called Star Shop. So it's celebrity shopping on your mobile phone. That's. That's another one of our ventures. So I'm doing a lot of commerce. I have a new book out also called Becoming a Key Person of Influence. And that sort of takes you as an entrepreneur. I call it Becoming an entrepreneur on steroids is kind of what it's like, right? So how to raise your profile, how to become the expert in your field. It's one of the new things that's kind of keeping me hopping is running around the country. I do a little speaking to various corporations and organizations around the US Talking about building your personal brand and become either a key company of influence or a key person of influence.

Well, that's Kevin Harrington, everybody. You can find him at KevinHerrington TV. And Kevin, thanks for being with us and helping to celebrate National Entrepreneurship Week presented by Microsoft. Thank you, Kevin.

Fabulous. Thanks for having me, guys. All right.

Appreciate it. This is Microsoft. Launch the program. And we hope that you'll continue to watch because there's a lot more to come.