Scott Jordan's Appearance on Shark Tank: All the Dirt
In what is considered one of the most controversial episodes in the history of the show, Scott was unwilling to give The Sharks a piece of SCOTTeVEST, only the licensing of TEC-Technology Enabled Clothing®, and what ensued was a battle with Mark Cuban, a call to Apple co-founder Steve Wozniak, and Scott walking out of the room with $1 million still on the table. If you just watched the episode as it aired on ABC, you may have thought Scott was an arrogant jerk just looking for free publicity. Perhaps you thought Scott was a brilliant businessman who just would not let The Sharks push him around. Well, there are two sides to every story and this page contains the whole truth. To understand what really happened, please read the following four points.
“Sony Pictures Television, a Designee of Mark Burnett, and ABC may receive equity in or a share of revenues generated by the businesses included in this program.” Specifically, there was some fine print buried deep in the agreement, that stated Scott had to give 5% of his business or 2% of the lifetime profits of his company for merely appearing on the show, whether a deal is made or not. So, his appearance was not free. Since the business he was presenting was TEC-Technology Enabled Clothing®, he now have partners in that business, even though a deal was not made with The Sharks. They make money out of every deal Scott makes from here forward so there is no “free publicity” in this game.
Scott believes that The Sharks were intentionally 'baiting' him the entire time he was being filmed, since just one mention of the brand SCOTTeVEST would trigger a clause in the contract he signed that would force him to give The Sharks 5% equity or 2% of the profits of SCOTTeVEST. He went into The Tank pitching TEC, and he had to carefully tiptoe around the SCOTTeVEST brand name that he spent years successfully building. If he slipped once and either mentioned SCOTTeVEST or countered their offer for SCOTTeVEST, part of SCOTTeVEST would automatically be theirs forever. Given the value of SCOTTeVEST, he could not risk it, especially since it appeared likely The Sharks would not agree on a fair valuation for SCOTTeVEST. Imagine how hard it is to talk about a brand you have built without mentioning the name of the company. If he had, that “free publicity” would have cost him millions of dollars for no good reason.
On a podcast (you can listen to it here), it was blatantly stated by Mark Cuban that his only goal was to make Scott cry on air, and he is not one to back down from a challenge. Imagine how you might have done in a similar situation knowing that a powerful billionaire's goal was to make you cry on national TV. Scott thinks he gave it a pretty good shot, though unsuccessful.
Scott walked away from a deal with The Sharks when it became apparent they were only interested in SCOTTeVEST. As he went to shake hands with them, all of The Sharks, other than Robert Herjavec, told him what an amazing job he did, including Mark Cuban. Robert Herjavec, however, refused to shake Scott's hand, which has NEVER happened to him in all his years as a professional. After Scott told him as much, he turned and walked away. That is when you hear Robert telling him to "show some respect" as he was walking out the door. Scott found this statement highly ironic considering Robert was the one being disrespectful to him, while his peers, the other Sharks, showed enough common decency to follow through with the standard business etiquette of shaking hands after a meeting.
With all this background behind the story, combined with Scott's incredible passion for his companies, you can see why things got heated in the Shark Tank. Just remember, there are ALWAYS two sides to every story and if you want to hear more from my company and me, signup for our newsletter here.
Some people lauded Scott for standing up to the Sharks and for keeping his head on his shoulders. Others scorned him, saying that it was all a publicity stunt, that he was disrespectful, and that he was a "patent troll." Several major blogs reported on Scott's performance, including Tech Crunch, Gear Dairy, and the "official" Shark Tank Blog. All of this chatter made Scott want to tell his side of the story to set the record straight. The end result is his official statement, which can be read HERE.