Mohit and Shraddha (real names altered) have always had a knack for founding enterprises. Before settling on the beauty industry in 2021, the couple from a tier II city dabbled with a few different business ventures. Their plan was to offer cheaply priced beauty tools to Indian customers who were concerned about costs.
The pair discovered the ideal venue to present this company concept in 2022: Shark Tank India. Their objective was to raise more than INR 50 lakhs in exchange for a specified percentage of startup stock. Their presentation demonstrated how their business had grown after doing product testing and had seen encouraging sales on several e-commerce platforms. The Sharks were impressed as they ought to be.
At least four out of the five sharks on the show assured Shraddha and Mohit that they were willing to invest and that their company had promise. Two of the sharks agreed to make a combined investment, came to a valuation, and even penned a cheque in their behalf.
''It's interesting that a year later, they still have no cash and have the unfulfilled promise from the Sharks to invest in their company. They have paid a high price for their months of preparation for Shark Tank India and the subsequent wait for funding, the couple told Inc42.''
Many Shark Tank India Season 1 and Season 2 contestants have informed us in recent weeks that the Sharks have been purposefully postponing investments under a variety of justifications. These members created a WhatsApp group, to which Inc42 was also granted access, and it attests to their awful situation.
The host of the programme, Sony Entertainment Television, asserts that the prominent businessmen (Sharks) jointly spent INR 123 Cr (for both Season 1 and Season 2) in a variety of ventures. Sources claim that, thus far, just 20% of the total promises have come to pass, but the Sharks have profited handsomely on the glamour the reality TV programme has to offer.
Between Seasons 1 and 2, the high-profile entrepreneurs (Sharks) invested INR 123 Cr in numerous companies. However, according to reports, just 20% of the total promises have come to pass thus far, while the Sharks gleefully profited off the glamour that the reality TV show afforded.
Not to mention that the show's fundamental premise, which was to provide entrepreneurs a platform when they struggle to secure startup capital for their businesses, looks tenuous.
Many Shark Tank India contestants have posted on social media sites lamenting the negative impacts of the protracted delay on their businesses.
For this piece, Inc42 spoke with more than a dozen startup entrepreneurs in interviews. We have decided not to reveal the names of these founders as asked.
Commit, Embarrass, And Ghost:
This may seem silly, but Vedika (name changed per request), the CEO of a services company, described her experience swimming with sharks in exactly this way.
Before appearing on Shark Tank India, Vedika had already obtained some seed money. She was able to experience the Sharks' enthusiasm as three of them decided to invest in her firm.
Vedika was happy, but only for a little while. One of the Sharks summoned her to his office two weeks after she secured funding commitments to discuss the next step.
"We did comprehend that the Sharks would perform due diligence and that we might be required to present our business plan and financials. Additionally, we provided one of the Sharks with an office in Mumbai with all the documentation he had requested. The candidate from Shark Tank Season 2 said, "After months of procrastination, we were eventually called to meet the Shark in Mumbai who bluntly branded our business plan defective and said there was no demand for the services we offer.
Vedika continued, "Surprisingly, the celebrity CEO, who appears to be very amiable on television, treated them rudely and gave them the impression that they should not even consider their venture, much less make investments."
"It's one thing to disagree with an opinion, but disrespecting someone is never acceptable. The Shark was quite rude and made us feel unimportant. The Shark's actions horrified us, "Vedika said.
The experience of Rohit Jain (name changed), who received right away assistance from one of the Sharks, was comparable. However, things quickly became ugly.
"I required some early capital to test the product in a few areas because my venture was at the minimum viable product stage. I was able to secure a cash commitment from one of the sharks since almost all of the sharks on the show appreciated my proposal, according to Jain, who spoke with Inc42.
One of the judges committed INR 50 lakh to Jain in exchange for a specific amount of equity in his business. But what happened next was a heated email argument between Jain and the Shark's office executives, which led to the Shark and his staff ghosting him.
"I used to receive some responses when I conducted due diligence before. The Shark's staff even sent me an ownership agreement through email after that. I sent it back after signing the same. Since then, they no longer return phone calls or reply to emails. The participant added that meeting this Shark at his Mumbai office only promoted anguish, loathing, and self-doubt.
Exists a legal remedy?
Surprisingly, no legal documents are signed by any parties during the Shark Tank India process, making it difficult for the contestants to pursue legal action.
According to a Delhi-based corporate lawyer who spoke with Inc42, even though the video clips, which have been broadcast and are available on Shark Tank India's website, serve as evidence, the Sharks really stand to benefit from the lack of a formal contract or agreement.
Sony Television's lack of involvement in ensuring that the promised investments are made in a timely manner once a programme is broadcast presents another difficulty for these participants.
One Shark Tank India winner remarked, "They won't even react to your questions after the broadcast because they work closely with the Sharks."
Another participant stated that candidates can only contact Sony Entertainment Television by phone or email, which is likewise unchallengeable in court.
Another participant stated that candidates can only contact Sony Entertainment Television by phone or email, which is likewise unchallengeable in court.
In addition, Sony TV merely guarantees to provide a platform; in the event that judges break their word, there are no rules and restrictions in place to safeguard our interests.
You must be logged in to post a comment.