'Shark Tank' investor Barbara Corcoran reveals the worst mistakes aspiring entrepreneurs make
Barbara Corcoran has invested in nearly 30 companies over the past six seasons of "Shark Tank."
In a new Reddit AMA (Ask Me Anything), Corcoran says that from her experience, the worst mistakes an entrepreneur can make are "pissing away money on patents and PR" and not being confident enough.
The right dance steps are: 1) make the product 2) get some sales 3) make the big guys envy you and only then get a patent.
But what gets in the way of all young business is self-doubt. The little poisonous voice inside all of us that whispers "don't go there. You can't do it. Don't take the chance." It took me 20 years to kill that voice and set myself free.
Her first point, that money can't buy success for a new company, is a reflection of her belief that great entrepreneurs have a need for success. It's why she told Business Insider last year that she never invests in "rich kids" who can easily recover from a financial failure.
Fellow Shark Daymond John, who agrees with Corcoran on the danger of "pissing away money," told us that "if you can't prove your concept when you're broke, you won't be able to prove it with money either."
How entrepreneurs should approach patents is more controversial. Another fellow Shark, Lori Greiner, holds more than 120 patents and writes in her book "Sell It, Bank It!" that "if it is remotely within the range of possibility, I would urge you to try to get one" as soon as possible for both marketplace protection and assurance for investors. Greiner says, however, that it's ultimately a personal choice.
Corcoran's point ties back to what John said: If you're spending anywhere from $2,500 to $15,000 securing a patent on a product that customers may not even want, you're throwing away money that could be put toward growing the business.
Corcoran got her own start when she cofounded the Corcoran Group real estate firm in 1973 with just $1,000. She sold the company to NRT Incorporated in 2001 for $66 million and then became a media personality.
She told Business Insider that the best "advice" she ever received came from her first business partner and former boyfriend, Ramone Simone.
They split the Corcoran Group in the '80s after their relationship turned sour, a move Simone was unhappy with.
"On the way out the door he said, 'You'll never succeed without me,'" Corcoran said.
It helped her turn that nagging voice of doubt into a source of power.
"That was the 'advice' that got me through the thick and thin, mostly because it slammed me in my gut, and I didn't want to let him have the satisfaction of seeing me go down. That's what I always leaned on when things were bad. I'd be like, 'Damn, I'm not gonna let him see me [like this].'"
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