I have a big problem with the show “Shark Tank”

You’ve probably heard of Shark Tank. It’s the show on CNBC where five self-made billionaires (called “sharks”) hear pitches from entrepreneurs who are seeking investment in their companies, most of the time for an exchange of equity in their companies.

The sharks have capital, expertise, and connections to help these budding business owners grow their businesses beyond anything they could do on their own.

The premise is noble. The business owners have put their lives on the line to make the product they’ve come up with work and become something great…something that can change the world, or at least a small part of it, for the better.

The owners make their pitches and the sharks will either make an offer or say they’re “out” based on something they don’t like about the product, the business owner, the industry, etc.

Sometimes, business owners will get two or three competing offers. Most of the time, they only get an offer from one shark. Inevitably, the shark wants more equity than the person is offering.

“I’m asking for $100,000 for 10% of my company,” one says.”

The shark responds, “I’ll give you the $100,000, but I want 20%.”

The business owner will try to counter. “I’ll do 15%”

“Nope. I want 20% or we don’t have a deal.”

The business owner, desperate for help to grow the business into a sustainable model that can support their family, cedes and agrees to the 20%, double what they were initially asking for.

This might not seem a like a lot, and you’d be right, in a sense.

Going from owning 10% to 20% of a company means that for every $100 that comes in, only $80 is yours, rather than $90. For every $10,000, you get $8,000, instead of $9,000. For every $100,000, you get $80,000 instead of $90,000. And this is where it starts to add up.

If your business generates $1 million over 10 years, you’re out $100,000 more than you wanted to be. You’d only have $800,000, instead of the $900,000 you were hoping for. And that’s a significant portion: 11% less than you thought.

But what about from the shark’s perspective? They now have that $100,000 because of their increase in equity.

Several sources indicate Kevin O’Leary, a.k.a. Mr. Wonderful, is worth about $400 million. That additional $100,000 is equal to 0.025% of his overall net worth.

What about from your perspective? What is the equivalent percentage if you make $100,000 per year?

$25.

If you made $100,000 annually, how much would you think (or care) about giving someone $25? Probably not much at all, if any. In many urban areas, that’s the cost of a single exercise class. In rural areas, maybe that’s a dinner at the local diner.

You can do this exercise for the other sharks, too: Mark Cuban is worth more than $6 billion (with a “B”). Robert Herjavec's net worth is $200 million. Daymond John's is $250 million. Lori Greiner's is $50 million. Does $100,000 in 10 years really matter to these people? If Mr. Wonderful had all his $400 million invested and it returned 7% per year, he’d be making $27 million just in investment returns and growth.

The point is this: this show oozes corporate greed. It reinforces, in every aspect, the idea that the wealthiest of the wealthiest will take advantage of what and who they can to enrich themselves further. None of the sharks would sneeze at $100,000, but they’ll be damn sure they’re not going to give it to you for less than double of the equity you’re offering.