- What We Learned From Turning Down a Deal on Shark Tank - July 28, 2020
When we appeared on Shark Tank to pitch our popular Zipadee-Zip swaddle transition product, we were thrilled to receive three different offers from the sharks. We ended up striking a deal on the show with Daymond John for $200,000 in exchange for a 20 percent stake in our company, Sleeping Baby. The last thing we could have imagined is walking away from such an exciting opportunity. Neither my husband or I had run a business before starting Sleeping Baby, and we felt we needed Daymond’s expertise to take us to the next level.
What we learned is that we already had everything we needed, we just didn’t know it yet.
There was about a six-week period between the time we filmed our episode and the time it aired. During that time, we were still in the due diligence process with Daymond. As a result, the responsibility fell on us to get our business ready for what they call “the Shark Tank effect.”
The pressure that simply being on the show puts on a business is unlike anything we had ever experienced. We ramped up manufacturing, beefed up our website and customer service, found a fulfillment center to help with shipping, sought wise council from other companies that had been on the show, along with a myriad of other processes and people we implemented.
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We felt like we were planning for the apocalypse! What we had done to prepare, however, didn’t cut the mustard when our show actually aired. We thought we would have enough product to last us 9 months (and that was our overestimation), but it lasted us a mere 7 weeks.
We thought we had a fulfillment company that was prepared to handle the volume, but they mis-shipped over 600 orders. We thought we had added and trained enough customer service people to handle the influx of emails we would get, but the emails exceeded our capabilities by hundreds a day.
Our business exploded overnight, and we were putting out fires in the wake of that explosion. And it was the best thing that could have ever happened to us.
They say that diamonds are formed under extreme pressure, and the same goes for businesses. When extreme pressure hits a business, it is either crushed or transformed into something much more brilliant and enduring. Through it all, we learned to never lose sight on why we started our business, to never stop changing and to stay humble.
Don’t ever lose sight of why you started: Keep the focus on people, not your pocket
When we began our talks with Daymond after verbally accepting his offer on the show, he initially wanted to pursue licensing our product. We would have lost control of our brand, our community and the people that made our brand what is.
After losing a child, I was overwhelmed by the customers who lifted me up, who encouraged and prayed for me during that time. They helped me heal, and I’m so grateful to God for those women. I genuinely felt that I owed it to them to keep this thing “in the family,” so to speak.
So, we chose to keep our community at the forefront of everything we do, even if it meant saying no to a deal with a shark.
It can be so easy to get caught up in the numbers as an entrepreneur; but when you allow your focus to shift away from people and toward profits, your business will only suffer.
Not only have we been intentional about valuing our customers, we also feel strongly about treating our employees like family. When the fulfillment company we were using after Shark Tank mis-shipped hundreds of orders, there was one woman from the fulfillment company who reached out to me personally saying she was going to work overtime to fix their mistake. Even though she didn’t work for us at the time, I remember being so thankful that someone cared so deeply. Eventually, that same woman came to work with us. She has been such an incredible asset to our Sleeping Baby family.
Another one of our team members is a military spouse who will go above and beyond with our customers, sharing her own personal experiences with other military spouses to make them feel less alone.
This focus on people has helped build that sense of community that is worth turning a deal down for. We have learned that valuing people who value people far exceeds any monetary investment we could have gotten. As a result of this focus, we have maintained full ownership of our company and our sales continue to climb.
Through the many ups and downs of launching a startup into a thriving business, investing in our customers and our employees has always proved to be the best investment we could make.
Our amazing employees and customers have become valuable members of the Sleeping Baby family, and they are integral to our ability to continue expanding and growing.
Never stop changing
Change is never easy. I actually became physically ill at the thought of switching to an entirely new email platform right before appearing on Shark Tank. If left to my own devices, I might still be sewing all the Zipadee-Zips on my sewing machine… which also means we would be out of business, as I am a terrible seamstress!
Early on in our business, however, my husband said to me, “Stephanie, this business will be over before it’s begun if you don’t learn to change.”
He was right. Change is the very thing that allowed us to turn down a deal on Shark Tank and still survive and thrive as a business. We are constantly trying to improve or streamline our processes because we have learned that change equals growth.
Owning a business has been one of the most rewarding things we’ve ever done, but also the most humbling!
It’s like a mirror that reflects all of your strengths and weaknesses back to you, forcing you to consider that (gasp) perhaps your way isn’t always the best way. It has taught us a valuable lesson about surrender and the importance of surrounding ourselves with wonderful, trustworthy people to surrender to.
It can be difficult to relinquish control as an entrepreneur because you might not believe anyone could possibly care as much or work as hard as you will to make the company a success. Your idea or product is much like your “baby,” and you wouldn’t trust your child with just anyone. However, at some point, business growth is impossible without delegation.
When the pressure was on after we appeared on Shark Tank, we literally had no choice but to trust others because we simply couldn’t do it all by ourselves. Learning to trust the rest to our team has been key for us. We have been blessed with amazing people that not only do things well, but do them better than we ever could. The beautiful part of business growth for us is getting to hire more great people to bring into our work family.
Another humbling aspect of growing our business has been the realization that leadership is about service. Not receiving recognition for your own achievements, not hitting sales goals, and certainly not task-mastering. As company leaders, we exist to serve our employees and customers, not the other way around.
Effective leaders maintain a humble servant’s heart, with the ultimate goal of empowering others to reach their full potential. After all, investing in people to grow your business only works if you ensure they have the proper tools and support to be successful in the first place.
Put simply, if you’re in business, you’re in the people business. Leading our company from a place of service has been a key aspect of our continued growth and success. Prioritizing the needs of your team and your customers above all will serve you and your business well in the long run.
So, if I had the chance to do it all over again, would I still turn down the deal?
Looking back, I can say with confidence that I wouldn’t have it any other way. This journey of owning a business and saying “no” to a shark has humbled us, changed us and united us. What an adventure!
Article feature image courtesy of Samantha Farris