Shark Tank Contestant Visits SDSU's Lavin Center
Stephan Aarstol learned to swim with the sharks – both literally and figuratively – when he presented his retail stand-up paddleboard business to potential investors on the ABC television program, Shark Tank.
He spoke to the students from SDSU's Lavin Entrepreneur Scholars program about both his experience on the show as well as his path to entrepreneurship on Friday, April 12, 2013. His story provided a good deal of food for thought for the students, all of whom hope to launch their own businesses in the near future.
Cashing in the Chips…
Aarstol, a San Diego-based entrepreneur, lived the dream of many of SDSU's student entrepreneurs when he started a business based on a perceived need and made it into a success. This business, BayPokerChips.com was founded when he couldn't find high-end poker chips. He then used $30,000 from the poker chip business to start his stand-up paddleboard company, Tower Paddle Boards, which he started when he took up the sport in 2010.
One of the concepts being taught to the Lavin Scholars is "crowd sourcing" which is precisely the method used by Aarstol to create his paddleboard design. In Aarstol's case, he created the board based on the feedback he got through a design contest. He registered his URL in June 2010 and began selling product later that year.
Opportunity Knocks (or in this case, calls)
In early 2011, Aarstol got an unexpected call from Shark Tank, asking if he'd like to pitch Tower Paddle Boards to their resident panel of successful business people and investors. This was unusual in that most entrepreneurs have to contact the show's producers in order to be considered.
Though he had never heard of the show, Aarstol realized that this was an opportunity that was too good to pass up and the taping was held in June of 2011.
Pitching to Investors
In order for any business to be successful, they need capital and, often, this comes by way of investors. And one of the most important things for SDSU's student entrepreneurs to learn is how to make a pitch to those investors, because as many young business people have found – Aarstol among them – is that banks are reluctant to lend money to new and unproven businesses.
Although he spent about an hour in front of the five Shark Tank investors, only about 10 minutes of his session actually made it to air. In the end, Aarstol accepted an offer from Mark Cuban for $150,000 cash, 30 percent of the business and the right of first refusal to invest in all future businesses in which Aarstol raises money.
But Cuban didn't write out a check immediately after the taping. In fact, it took approximately five months to work out all of the legal details between Cuban's team and Tower Paddle Boards. Within months of receiving the investment money, it was used to launch a line of inflatable paddle boards.
A PR Media Blitz
Once the show aired in March 2012, Tower Paddle Board's order numbers soared. Aarstol shared how he used his marketing savvy to take advantage of the exposure from Shark Tank with the Lavin Scholars and, now, the company sells their boards on Amazon.com. It also helps that they have been mentioned by Mark Cuban in both print and broadcast media as one of his most successful investments.
While the investment by Mark Cuban was great, Aastol told the students about an added benefit he got from the show: "The most important thing that came out of appearing on Shark Tank was the amount of public relations and product buzz that it generated for Tower Paddle Boards."