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News & Information: Fundraising

Shark Tanks and Cat Drawings

Wednesday, November 9, 2016   (0 Comments)
Posted by: Kristen Merrifield
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Kristen Merrifield, CAE
Chief Executive Officer
Alliance of Arizona Nonprofits

A favorite pastime at our house is watching the popular television show “Shark Tank, where real-life entrepreneurs have the opportunity to receive investments from billionaire investors, called “The Sharks.” At first our two boys, aged 12 and 13, were bored to tears and begged us to switch back to their adored anime cartoons. However, over time, they started getting into the show and would even shout advice to the entrepreneurs on what deals to take. This, of course, warmed my heart as a long-time supporter of small business and entrepreneurs.

Anyone who watches the show knows, though, that the deals that are made are often more about the data than the dazzle. Case in point: On a recent show, I watched Mark Cuban make a deal with a man who made cat drawings for customers, and his pitch included an extremely dorky (but nonetheless catchy) dance and song. $25,000 for a 40-percent share … in a cat drawing business? Why in the world would this investment make sense? It came down to two data points: the profit margin and the ability to scale. On every show you can sense the moment when Mr. Wonderful (Kevin O’Leary) is about to ask the question every entrepreneur dreads, “So what?” You have a great product or service, and you are doing great things for your communities and your customers, but why would a billionaire investor want to invest their money with you? It comes down to the data: the ROI, the profit margin, the ability to scale, the potential demand, and the list goes on.

As a nonprofit leader, development director, board member, or volunteer, how would we get the “sharks” of our communities to bite on an investment opportunity in our mission? Do you have the data to make your case on how you are positively impacting your community? We can no longer rely simply on the fact that we are doing “good” and that investing in us is the right thing to do. We must make the strong case for investment in our causes by businesses, funders, individuals and philanthropists. The good news? We have already done some of the work for you. This was one of the critical reasons the Alliance joined forces with several community partners and sponsors to publish the Arizona Nonprofits: Economic Power, Positive Impact report earlier this year. Check out the report. Allow the Alliance to help you make your case as we continue to find new ways to constantly position the nonprofit sector as a powerful, trusted and invaluable contributor to our Arizona communities.

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