Mind your own Business: Demystifying Shark Tank India

With the greatest hype in recent times, Shark tank India commenced a sequel on 2nd January 2023. With an average viewership of 4.5 million for season 1, With an expected viewership of 7x, that of season 1, Shark tank season 2 had become a household television show. As per Sony’s projection compared to last season, Shark Tank India Season 2 generates 3X as much income on Sony LIV. But is it worth the hype it has created in the Indian market?

The Pitch

In 2018, there were roughly 50,000 startups in India, with 8,900 to 9,300 of them being technology-focused. 1300 new tech businesses were founded in 2019 alone, indicating that 2-3 startups were founded each day. Indian startups have raised almost $12.9 billion in 2019 which is an increase of 15% compared to 2018 and annual growth of 27% and 11% for seed and bridge funding.

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Shark tanks aren’t a new concept. Of Course for India it is but this concept is widely popular in Australian and American media houses. Australian rights are registered with TV 10 and American content can be viewed on Amazon prime.

With the startup culture being popularized in late 2015’s, Sony seized the occasion and commenced the Indian version of the investment ecosystem.

A startup’s development is facilitated by various rounds of funding. The first or basic step is bootstrapping, in which the creator invests his own money. The subsequent stages include seed funding, venture capitalists, and angel investments, in which participants, such as sharks, receive a stake in the company in exchange for a monetary investment.

Is The Hype Worth It?

Sony Liv, the Shark Tank India platform, has grown in popularity among Indian audiences. The show Scam 1992, which featured the Harshad Mehta story, was viewed by 116 million people in 2020. In FY22, their monthly active users increased from 130 million to 200 million or more, with 350 million app downloads. More or less the recent growth and viewership can be considered and accounted for the Sharky show. But is this hype really worth it is the vexed question that has to be answered?

Season 1 has featured prominent entrepreneurs like Ashneer, Aman Gupta and Vineeta Singh who turned out to be the sharks for their renowned unicorn empires. The pilot season did win hearts with some worthwhile investments (Skippi Ice Pops), A sense of emotion and sympathy with Jugadu Kamlesh and some witless pitches (Naabhi Shaper). The Indian version of this investment series is a perfect fit for our audience as the Indian consumer is emotionally sensitive and has a soft corner for drama in the content. With a subtle balance of drama and cognizance, Chapter 1 of the investment show is a grand success. But are the businesses of the investors assisting in building the ecosystem profitable?

Mind your own business.

It was rightly said to “Mind your own Business”. Sharks on the panel have been building great ventures but are they worth the time and effort? Are the businesses profitable? Profits are considered to be the objective of every business and profitability portrays the health of a business. It’s an irony worth recognising about the investments backed out by so-called sharks for not being profitable. Coming to the core point of this article, evaluating the business profiles of these companies helps in understanding it better.

SUGAR Cosmetics, owned by Vineeta Singh, recorded a loss of INR 75 Crore in FY22, up from INR 21.1 Crore in FY21.

For the first time since its establishment, Ghazal Alagh’s Mamaearth reported a profit for FY22 of INR 14.44 Cr after experiencing losses of INR 1,332 Cr in FY21 and INR 428 Cr in FY20. Additionally, the business disclosed an approximate 4 crore net profit for the first half of FY23. Consequently, the company has only recently started to earn a profit. As per reports, they are planning an IPO with a valuation of INR 24000 Cr again minuscule profits and mighty valuation.

In FY 2022, BharatPe had a total loss of Rs 5,594 crores. The business reported a total loss of Rs 277 crore for FY 2021.

Shark Tank USA

With a prominent and notable panel on board shark tank US is a victorious chapter of the Tank series running its season 14. Every judge (Barbara Corcoran, Mark Cuban, Lori Greiner, Robert Herjavec, Daymond John, and Kevin O’Leary) on the US edition of the show is in charge of companies that really make money instead of relying solely on venture capital funding or sinking in enormous losses.

They aren’t from the Ivy but they understand the business better than our IIT and IIM graduated panel. So to conclude Indian markets are so fragile to drama and emotions. Most of the pitches on the Indian show are there to market their business rather than funding. It was evident that ventures grew after being telecasted on the show irrespective of converting the pitch or not. Rather than an investing platform, Shark tank India can be viewed as a marketing platform for undervalued firms. To see what is right not what entertains you!

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