Miso Media Turns to Shark Tank for PR (and some cash from Mark Cuban)
For the first time to my knowledge, a tech company with brand name Silicon Valley investors appeared on this week’s episode of the hit TV show, Shark Tank. Venice Beach based music education software company and 2010 TC Disrupt People's Choice Winner, Miso Media, shrewdly took full advantage of the 15 minutes of primetime airtime. Not only did they seek a possible investment from the show’s “filthy rich investors,” but more importantly the company’s CEO and founder, Aviv Grill, droped a few impressive names for America, including recent investor Google Ventures, as well as celebrity musician advisors Justin Timberlake and Ingrid Michaelson, the latter of whom performed live for the Sharks.
This is a new wrinkle on a popular trend of hybrid financing and PR events which seem to be gaining momentum. The most recent examples of this trend are the Kickstarter campaigns for the game titles Double Fine Adventure and Wasteland 2, each of which raised more than one million dollars. In both cases, a relatively established company utilized the public-facing platform to promote an upcoming product while simultaneously seeking funding for that project. While I don’t know enough about either company to suggest that they did not need to raise the money, I will go out on a limb to say that the opportunity to attract a following to the yet unfinished product was likely an equal or greater draw.
Illustrating the effect of their television appearance, shortly following the airing of the episode, Miso Media’s official twitter account sent the following tweets:
Taking this a trend step further, the Jumpstart Our Business Startups Act, a crowdfunding bill which recently passed the House by a 390-23 vote and received a presidential endorsement, will be like throwing rocket fuel on this trend if passed. If the Senate follows course and the SEC yields to the pleas of entrepreneurs nationwide (neither of which are sure bets), the next phase of early-stage fundraising by young companies could regularly include a heavy dose of marketing directly to their target customers.
This is a delicate area with a laundry list of possible challenges, but at the same time it offers some interesting advantages. For companies seeking customer validation, or the difficult feedback necessary to trigger a pivot, nothing beats the scoreboard of dollars collected directly from customers (either through sales or alternatively as investment).
To wrap up the Shark Tank appearance, Miso Media accepted $300,000 from Mark Cuban in exchange for 8% of the company. This round valued the company at $3.75 million, a slight uptick from the $3 million valuation at which Grill says it raised its $600,000 December 2010 seed round led by Google Ventures. Since the taping of the show, it was reported that the company raised an additional $2.4 million Series A round at an undisclosed valuation led by Hong Kong-based Mind Fund, with participation from Aria Ventures, Detroit Ventures Partners.
More importantly, and likely to the great pleasure of Grill, the show ushered the Miso Media and its iPad app, Plectrum, into the homes of the show’s more than five million weekly viewers (on the day the new iPad was released no less!). Based on Miso Media’s success and other similar examples, we have likely only seen the beginning of companies seeking to blur the line between fundraising events and PR.