AmSight 5/12: So Who is This “Profit” Guy Anyway
I tend to steer clear of reality shows that claim to be helping business owners, but this headline caught my attention: “CNBC’s ‘The Profit’ and host Marcus Lemonis at the center of a $30-million fraud claim.”
The show “helps” struggling businesses by offering cash and guidance for a stake in the company. A company that was previously featured on the show is now bankrupt and suing, alleging fraud and breach of contract. The company is claiming $30M in damages from the show. Lemonis had received 1/3 of the company shares, not for an initial investment, but for providing 2 contracted projects for one of Lemonis’ other businesses. Allegedly, this and other projects were done for Lemonis at a loss. Since the show’s inception, there have been many complaints, lawsuits, and counter-lawsuits filed.
While many TV shows glamorize equity, this is oftentimes the reality we see. Before ever taking on a partner, I always recommend you speak to a trusted business advisor who can present all of your other options. If you can’t afford an advisor, the SBA has local resources to help: https://www.sba.gov/local-assistance/resource-partners/small-business-development-centers-sbdc