Veggie Mama Gets Deal on Shark Tank
If you follow the Shark Tank Success Blog you already know how I feel about offers on the Show involving royalty fees in perpetuity or for the life of that product. For the Sharks or any Angel Investor making a deal with this little addition to the terms of the contract, they now has you by the balls for the "life of that business'" and there's nothing you can ever do about it. A royalty fee in perpetuity basically guarantees the investor will be paid back in record time and continue to suck profits right off the top for the life of that businesses existence.
Kevin O'Leary is now starting to get famous for making such ridiculous offers that no entrepreneur in their right mind would ever except if they understood what they were getting themselves into. Once you see O'Leary make a royalty offer involving no equity now almost on a weekly basis, it's clear He's not necessarily trying to screw the business, but testing the business owners judgment for making correct decisions while under pressure of the Shark Tank Show. If any contestant ever does decide to take Kevin up on basically a Business "Shark Loan" that never ends like the Wicked Good Cupcakes did in Season 4, it's still possible for the entrepreneur to make a lot of money while adding to O'Leary's Fortune.
I have almost come to expect an offer from O'Leary like this when he's on the fence about investing in certain products, but still wants to throw some sort of offer on the table. But Lori Greiner and Robert Herjevic on the other hand, I would of never expected to make such an offer.
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