I love watching the Canadian Dragon’s Den. Shark’s Tank is basically the same show. Now, for those who have never seen the show(s), people come in to meet with 5 wealthy investors, they pitch an idea, as for investment, the investors say yes/no/come back in a year with more sales. Sometimes more entertainingly they say, “You’re full of it, get out.”
Usually, they are buying less than 50% of the business, which means they are an investor, not a controlling investor. So, they are reliant on the individual pitching the item to make good decisions for the business in the future.
Because of the reliance on good decision making abilities, I cannot fathom why they are excited to make a deal to the point of forcing them to say “yes/no” without listening to all of the offers/feedback from the 5 individuals they went to meet in the first place. Sometimes they will walk out, and one of the investors will say, “I’ll give you $150,000 for the 20% of the business. You have 30 seconds to answer, or the offer disappears.” Sure, the offer disappears if they say no, but if they say yes, they have just demonstrated they are unwilling to seek out what is best for the business. They are saying, “I am going to knee jerk my reaction, and grab the first offer out there. I am not going to explore other offers, or see what the others have to add to my business.”
Now, I am not a multi-gazillionare, probably won’t ever be. If I were, the only difference in my life would be travel more, but still on the cheap. So, this is 2 cents worth of my opinion. It seems to me to be bad business to jump into bed with a company run by a guy who can be so easily pushed around at the bargaining table. It strikes me as they should be expecting an answer like, “I appreciate your offer, but you would not want to be in business with me if I am not willing to seek out what is best for the company. I hope you will keep your offer on the table until after I explore all options, and choose what is best for the business.”