via @mcuban
You see him weekly on the Shark Tank episodes where he gauges business viability. You also know him as the successful owner of the Dallas Mavericks. Entrepreneur Mark Cuban is no stranger in the business or technology world. In fact, he is so well ingrained in these industries that any conversation on the topic is incomplete without discussing this self-made billionaire. Watching him on Shark Tank over the years, I have learned much that has propelled my interest in technology entrepreneurship and investment.
Unique strategy and competitive advantage
On the show, you will notice Cuban seeking a convincing business strategy from the presenting company. In his discussions, it is clear he likes identifying the competitive advantage a product or service offers right away. The effort an entrepreneur has invested in solidifying their business model is a Cuban pre-requisite for investment. I give equal importance to a unique selling proposition and a readily recognizable benefit to any effort that I invest my time or money in. If, as the investor, you do not see a business’ place to shine, then what promise does the business hold for anyone else?
It’s all about the market to make money
If the cool idea has no strategic partners or no sells, the product or service is probably just creative and not a business. Salability is obviously a large part of what the Sharks at the Tank are considering when they see a new pitch. Cuban looks for entrepreneurs that already know to sell, have the business digits to show for it, and have a loyal client base and prospective investors to boot. He is not looking for a business that needs him to get off the ground. Cuban seeks entrepreneurial types that have already done that part and will now best use his own resources, be that connections or knowledge or some other aspect, to further stimulate business growth. If none of this is visible, then the business is clearly nothing but a hobby.
It’s better to have a niche.
Pair business investment with personal interests or with your ability to leverage the technology into your other business interests. Take a close look at Cuban’s undertakings. They are almost all technology or sports related. He often invests in projects that he can then use in some way with his professional sports team. Many of his technology investments go hand in hand. He is not only an investor in these companies but also an advisor in many others. His actions are clear – make the effort to hone in on your niche. Then pair that with your existing business interests. Or ensure new entrepreneurial endeavors support those businesses. In fact, Cuban goes so far as to state that investing in the stock market should be set aside and investing in oneself should be more the norm.
Go with your gut
If Cuban believes someone is only on Shark Tank for publicity or non-genuine purposes, he is quick to state it and withdraw from consideration. There have been many episodes where he has verbally expressed his displeasure at such publicity tactics and backed out of the running for businesses that looked perfectly viable to you and I. It is the oldest rule in the entrepreneur book, as it is in life – go with your gut. I have had several instances where a gut feeling has saved me from the turmoil that later circumstances could have potentially produced. In business, that gut feeling takes on a whole new meaning especially with the monies and professional reputation involved.
Going by Mark Cuban’s many business successes and entrepreneurial wins, his words are not to be taken lightly whether applied to his technology entrepreneurship and investment advice or his business growth and strategy knowledge. I learn something new every day and it never ceases to amaze me how much more I can learn from his shared thoughts on any facet of the investment business.
