All-American Sharks

by Lee Habeeb
What Shark Tank can teach us about capitalism

It’s an exceedingly simple show: A panel of potential investors — “the sharks” — sit in a row, taking business pitches from Americans of every imaginable stripe, and every imaginable walk of life. They are hoping to get those rich guys and gals — themselves a walk through the American diversity quilt — to fund their start-up businesses.

The show is ABC’s Shark Tank. Now in its fourth season, it’s exceedingly entertaining. It’s so entertaining that it’s the No. 1 show in America in the coveted 18-to-49-year-old demographic on Friday evenings. And what’s not to enjoy? It is part American Idol, part The Gong Show, but with a twist: The contestants aren’t wannabe Lady Gagas; they’re wannabe entrepreneurs.

They’re the American next door who wants to start a business and grow it. Maybe into the next McDonald’s or Apple Computer. Or maybe something big enough to make a difference in their community, and hand down to their children. Or sell for a tidy profit.

They’re Americans of all kinds: kids and adults, black and white people, Asians and Hispanics. But there is only one color on Shark Tank that matters: green.

Contestants come from cities, from suburbs, and from rural America too. Some pitch their businesses in suits and ties, others in flip-flops. We’ve seen firemen and teachers, housewives and executives, grade-schoolers and college kids, surfers and salesmen on the set of Shark Tank. All get treated equally. Equally well and poorly.

If the pitch is good, there are offers. Sometimes, the sharks compete against one another to land a deal. If it’s bad, things get ugly. Sometimes, things get funny, too.

But one thing is certain: On Shark Tank, no one gets preferential treatment because of his race, or class, or where he’s from.

What could be more American — and more likeable — than that?

The contestants want to own their own lives and build their own businesses, and need funding. And they’re hoping against hope that one of those sharks takes the bait and invests in them.

Millions watching hope against hope, with them.

It’s the show that every capitalist should watch. And tell his friends to watch, especially those who don’t like capitalism. Because it makes capitalism cool.

It makes capital cool, too. Cool to want. Cool to have. And cool to invest in others. Because that’s what the dreamers on the set of Shark Tank want: capital. Capital is oxygen to aspiring entrepreneurs. Most Americans just don’t know it.

Karl Marx had a different view of capital, as do many leftists today. Why should rich people own a slice of a business for doing nothing more than investing in it? They aren’t actually doing the work. Why should they reap the rewards? That’s why many on the left think we should tax the heck out of capital. Because money that makes money is tainted. It would be far fairer if that money went to the government to redistribute and “invest.”

Peddle that line at most American universities and you’ll get some uninformed students to buy it. But peddle it to the contestants on Shark Tank and see how far it gets you. They are on the show to joyfully and voluntarily trade a portion of ownership in their businesses for capital.

But they looking for more than capital. It’s stunning how often the contestants on Shark Tank tell their potential investors — plead with them — that what they want is their experience, too. Experience with distribution, cash flow, marketing, and more.

What they are seeking is knowledge, and knowledge is the capital of capitalism. That’s what capitalism does best of all: It creates vast pools of knowledge no central planner or bureaucrat could ever manage.

In this respect, Shark Tank isn’t just great entertainment. It’s a great education. Indeed, no single show has been a better distillation of the genius of capitalism than Shark Tank. Nothing Milton Fredman ever did for PBS matches it. Nothing Adam Smith ever wrote by candlelight can touch it.

Shark Tank does more than just give capitalism a good name; it also gives being rich a good name. The 1 percent’s wealth can fuel dreams and create more wealth — and jobs.

Shark Tank makes being in the 1 percent cool. That’s because the cast is cool, and thus very different from the caricature leftists generally paint of the rich. What makes the cast so good is that all are self-made millionaires, and all of them love growing small businesses into bigger ones, and making lots of money doing it.

The show is all about underdogs overcoming the odds and doing great things. The cast reflects those virtues.

One “shark” is Barbara Corcoran. She grew up in a lower-middle-class New Jersey town, the second oldest of ten kids. She was a D student in Catholic school, and worked at 20 different jobs before she graduated from college, doing everything from selling hot dogs to being an orphanage housemother.

While waitressing at a diner, she took a $1,000 loan from a man who soon became her live-in boyfriend, Ray Simone. He got 51 percent of the company she was starting. When he decided to leave her to marry another woman, she dissolved that company and started her own firm. What motivated Corcoran to succeed? She told CNN that it was what Ray Simone told her as she was walking out the door.

“‘You’ll never succeed without me,’ he told me. Those words branded my soul. I started the Corcoran Group to prove my ability to succeed.” Corcoran sold her company for $66 million.

Then there’s Robert Herjavec. He was born in Croatia and his family fled Communist Yugoslavia when he was eight, settling in Toronto, where the family lived in a friend’s basement for 18 months. Herjavec was in his twenties and between jobs when a college roommate learned of an opening at a computer company that sold IBM mainframe emulation boards. He was underqualified for the position but talked his way into the role by offering to work for free for the first six months to prove his ability.

That’s something they don’t teach you in college.

While working for free, Herjavec did what Corcoran did — he waited tables at a local restaurant. He ended up becoming general manager of that computer company, left it to start his own business from the basement of his home, and ended up selling it to AT&T for over $100 million.

Then there’s Daymond John. He spent his childhood in Queens, N.Y., raised with seven sisters and brothers by his mother. In high school, he worked full-time as part of a co-op program, which he credits with stoking his entrepreneurial zeal. When he graduated from high school, John started a computer van service. But it was selling hats and clothing that would make John his millions. He got together with some friends, his mom mortgaged her home, and John started his own company. John held a full-time job at a local Red Lobster to make ends meet, working on the clothing business between shifts.

That small business, FUBU, is now an apparel empire. And did I mention that John is African American?

Then there’s Mark Cuban. His grandparents came to America with nothing but their name — Chabenisky. They lost even that possession: the Russian-Jewish family had their family name shortened at Ellis Island to Cuban.

Cuban grew up the son of an automobile upholsterer in a suburb of Pittsburgh, and started thinking about being an entrepreneur when he was twelve. He credits Ayn Rand’s The Fountainhead for helping formulate his philosophy of life. “It was incredibly motivating to me,” he has said. “It encouraged me to think as an individual, take risks to reach my goals, and responsibility for my successes and failures. I loved it.” A serial entrepreneur, he sold his stake in Broadcast.com, a company he started, for $5.9 billion, just before the dot-com bust. He owns the Dallas Mavericks.

And then there is the show’s Simon Cowell, Kevin O’Leary. His nickname is “Mr. Wonderful,” but there is nothing wonderful about being on the receiving end of his criticism. He is the guy everyone loves to hate on the panel. O’Leary too is a self-made millionaire, the son of a salesman and a seamstress. He too is a serial investor and entrepreneur.

That’s what makes Shark Tank so good. The self-made millionaires and billionaires sitting on that panel are no different from the contestants pitching them. They were once those very same people, pitching their business to rich people. Struggling to acquire capital to grow their businesses. Seeking their piece of the American Dream.

That’s why young people and older people alike like Shark Tank. It’s aspirational — and egalitarian.

But what they really like best about Shark Tank — and may not know it – is that the star of the show is capitalism itself.

Is there anything more all-American than that?

Lee Habeeb is the vice president of content at Salem Radio Network, and a senior adviser to America Strong. He lives in Oxford, Miss., with his wife, Valerie, and daughter, Reagan.