Of Wine & Sharks: When Entrepreneurs and Investors Clash
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Shark Tank is a popular resource for many entrepreneurship educators. While a number of outstanding episodes can be used in the classroom, a two-episode arc focused on Copa Di Vino -- a winery that produces and distributes wines in a unique portable packaging -- is especially useful. It helps illustrate concepts related to understanding your business model, the value of intellectual property and the role of investors.
The first episode is episode 205 during season 2 of Shark Tank. The second episode is episode 308 in season 3. In the first episode, Jim Martin presented the Copa Di Vino opportunity to the Sharks. There was mixed interest on the part of the Sharks with an offer ultimately coming from Kevin O’Leary. However, O’Leary had a much different perception of the value proposition than did Martin. Specifically, Martin wanted to focus on a model in which Copa Di Vino produced the wine, packaged it and distributed it directly to retail stores, which would sell it to the ultimate consumer. O’Leary was interested mostly in the IP for packaging the wine, and wanted to license the IP to other wine and beverage producers. He offered to invest in the IP separate from the winery, allowing Martin to maintain full control of the winery. Martin did not want to separate the two and ultimately walked away from the investment offer. This serves as a fertile discussion for where the value of this opportunity truly lies and the nature of the relationship between investors and entrepreneurs.
In the second episode, Martin returns to the Shark Tank. He was the first entrepreneur allowed to return for a second presentation. In this round, Martin is seeking additional investment to help expand the brand, which has been successful and has enjoyed substantial growth. Spirited discussion between Martin and the Sharks again ensues. He is offered one deal that features several Sharks, including Mark Cuban, but this deal ultimately falls apart because Cuban suspects Martin of “playing games.” The possibility of a deal comes down again to O’Leary and Martin negotiating for control of the IP. It is obvious that the power dynamic has changed between the two parties, which serves as an additional interesting point of discussion -- but, again, the end result is that Martin turns down the investment. Once again, this provides a number of opportunities for classroom discussions on intellectual property, the role of investors, the changing valuation of Copa Di Vino and the role of advisors, as at one point Martin reaches out to one of the founders of Sam Adams.
These episodes are legitimately available, for a fee, from high-quality streaming sites such as Amazon and Hulu. The content can sometimes be found on sites such as Youtube, although the copies on these sites are not generally in adherence with copyright laws and the quality can be inconsistent.
Resources –
Copa Di Vino Website http://www.copadivino.com/
ABC News Report on Shark Tank Missing the Investment - http://abcnews.go.com/Business/multi-million-dollar-product-shark-tank/story?id=23051424
Amazon.com Links
Season 3 https://www.amazon.com/gp/product/B0070YR5Z2?ref_=aiv_dp_season_select
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College business professors looking for more ideas to enrich the classroom experience can find them here.
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