Start-ups participating in the reality television series Shark Tank India, seasons 1 and 2, have secured investments totalling Rs 106 crore. Nearly 90 per cent of the pitches focused on customer-facing concepts, while the rest were B2B, according to a report by Redseer Strategy Consultants.
Most of the start-ups that appeared on the show secured deals six times greater in value from outside investors within the next 1.5 years, the report noted. “Their current valuation is also 2.5X greater than their valuation on Shark Tank season 1,” said Kanishka Mohan, partner at Redseer.
Following up on companies that either secured a deal or were rejected on Shark Tank season 1, the study found that 27 start-ups successfully secured funds from external investors regardless of whether they scored a deal, dropped out, or were rejected on the show. In fact, most start-ups that appeared on the show fared well afterward, securing better deals and valuations.
Sharks cut good deals
In terms of the high rate of conversion in the B2B deals on the show, Mohan added, “Of 19 deals, 10 came from the healthcare and manufacturing sectors. The majority of the B2B deals were made by [the potential investors or “sharks”] Namita (Thapar) and Peyush (Bansal), having expertise in healthcare and manufacturing sectors, respectively.”
On the investors’ side, due to tough negotiations, the sharks got better deals with significantly higher equity than what was pitched on the show.
Aman Gupta was the most active shark, securing 70 deals involving investment of Rs 24.6 crore. Bansal and Thapar secured 67 and 62 deals, respectively, with investment of Rs 21.55 crore and Rs 20.66 crore.
F&B in favour
Furthermore, six of the eight sharks appearing on the show preferred businesses in the food and beverage industry, while the rest preferred healthcare.
Most deals on the show had one shark onboard, but there was no instance of all the sharks investing in any single business, said the report.
As for those pitching, most hailed from metro cities and had studied at the top IITs and premier business schools. A majority of the businesses were headquartered in metros, and the rest in Tier 1 and Tier 2, or smaller cities. Redseer also noted that most of the start-ups featured in the show had been in business for more than two years.