First, please read this article on possible conversations that some of the brightest minds and startups would have had being on Shark Tank. It is humorous and probably isn’t that far off in many cases.
However, it only goes so deep. In the real world, startups aren’t jostling for funding like the show portrays (most of the time). How the show is structured is more like what happens at pitch events, which isn’t the traditional means of securing funding (for a some companies its there first start). Also, you better believe there is either beforehand due diligence or after the funds are “committed” that the investor digs deeper into the business. There is no way that the sharks are giving out money willy nilly without really understanding what they are investing their money into.
This isn’t all roses for the startups. I’m betting ABC is getting a cut. I don’t know how that is structured, but they aren’t doing this because of good grace. And at times the sharks give weak excuses to say no. I wish they would just say, “I don’t like you.”