CNBC is “The Fastest Growing Network On Cable In Prime Time.” I know this because they tell you every five minutes if you’re watching, and I am for the first time in my life, so I guess they’re just letting me know that indeed I’m not the only sucker who is now watching CNBC.
I imagine my path to becoming somewhat of a regular viewer is similar to the others who suddenly know what channel number CNBC is. Basically CNBC realized “normal” people (and by “normal”, I mean people with actual souls, character, and depth of personality) really didn’t want to watch anything having to do with the stock market.
So CNBC started airing Shark Tank reruns, as well as repackaged business themed 60 Minutes segments. Syndicating content from established brands is how they got me in the door and airing great documentaries like The Queen of Versailles and Cocaine Cowboys was also a nice touch.
Over time, I was pounded with ads for The Profit — and given my affinity for confident business people; loudly humbling, ambitious entrepreneurs facing financial ruin and total loss of personal pride — I tuned in and quickly became addicted.
For those who haven’t seen it, the pretense is simple and familiar. Successful businessman Marcus Lemonis (CEO of Camping World and Good Sam) comes into failing small to mid-size businesses, gets a lay of the land, and usually rolls his eyes to the camera at “obvious” issues.
It’s basically the equivalent of Jon Taffer in the car getting angry because — surprise, surprise — the bar in question has food that is not cooked properly, and the bar and kitchen are dirty. Not to go on a tangent, but out of like 100 Bar Rescue episodes, can’t one place just have good food that doesn’t incite Taffer’s fury?
Lemonis than sits down with the owners, tells them their business sucks, makes them a somewhat vague vulture-like offer, and then asserts he needs total control on decision making. After reaching an ambiguous handshake deal, Lemonis than gathers all of the employees and proclaims a) today is a new day, b) we’re going to make money, c) previous management was totally moronic and he’s going to fix everything, d) he’s totally in charge and is putting in significant money into the company, promising reforms and a new vision that the employees embrace. It’s pretty common for him to do this in a disrespectful manner, as Lemonis throws the previous management team/partners/founders there under the bus with glee. It would be great if the the inauguration of our President followed this protocol.
This all usually happens in the first 15 minutes. The next 45 minutes from there are anyone’s guess and that’s part of why I like the show. It’s not boilerplate like other business turnaround shows. And while I like The Profit and will certainly be back for season 3 when it debuts in October (season 2 just concluded this week), the show can be all over the place and at times a total head-scratcher.
Below are some random thoughts on The Profit, in no particular order:
Are The Deals Prearranged?
The scenes in which deals are made seem legitimate and have a spectrum of reactions. Lemonis always values the business at a very low number based on some metrics, then asks for a very large percentage of the company and often a controlling interest. While the deal negotiations are interesting, the thing is that nobody has ever said no thanks — at least on an aired episode.
So are there like a handful or dozen aborted episodes because the business in question said no? Perhaps Lemonis goes to a city with two to three businesses in mind, then sees who he can get a deal with locally so there are options for smooth production?
Shark Tank shows companies who come into “The Tank” and don’t get offers, as well as businesses that just refuse the offers they receive. Those refusals are shown (although deals that don’t close and companies that have gone under are never shown on updates). But when it comes to The Profit, we’re led to believe that Lemonis bats 1.000 in his negotiations.
The Deals Themselves are Really Loose and Vague
One thing I’ll give Shark Tank some credit for is that they start with the entrepreneur’s asking price and use a lot of graphics to help guide viewers in terms of where the negotiation process is. On a handful of The Profit‘s 14 episodes, it’s really unclear what the hell is going on and that’s been a common criticism.
Lemonis will offer some capital to grow the company, often offering to pay down debts or tendering money to the founders personally for them to pocket. It’s never “$500,000 for 25 percent of the company.” Rather, it’s “I’ll pay down your debt and put in 500k for a new facility for 25 percent of the business and 20 percent on all online sales going forward.”
A handshake and check writing always occurs, followed by Lemonis having this devilish grin which says “But I’m 100 percent in charge now,” which is also odd. What does that even mean if he’s not the majority owner? Does the check he write cover renovations or is that just buying out a percentage of the company from the owners? We’ll get to some of the larger issues about these verbal deals that often fall apart, but it’s just totally vague at times and leads to questions later in the episode.
For instance, if Lemonis says he’ll put 500k in for some new facility or an expansion/renovation, but it ends up costing 700k (which often happens), does he get more stake in the company or is he just splurging on his own dime? Are these expenses coming out of the company’s banking account that just got his cash infusion, or is he putting it on his personal credit card (which is often seen)?
One example that sticks out: After buying into an organic ice cream company under the pretense that a new facility to increase production would cost 500k, Lemonis finds out the total cost is actually going to be 800k. He calls a meeting with the son of the owner who pushed for the expansion, gives him some polite shit (one of the few times he’s had mercy) and then basically ends the meeting with “Don’t let this happen again.” Just your normal “You fucked me out of 300k under false pretenses, but you’re really likable and cannot be the antagonist of this episode, so you’re off the hook for this massive fuckup.”
If you’re unfamiliar with this term, it basically refers to the quality of the investment opportunities put in front of you as an investor. A lot of venture capitalists and investors are revered and hence get “hot” companies, while second-tier VCs have to fight to get in the door with a company deemed to be in demand.
The Profit is all about established companies which just need a second wind and that spans a wide spectrum of businesses. That said, some of these companies seem like long shots for Lemonis to develop into major national brands. It’s basically a a grab bag of struggling businesses, many of which appear to make little sense as a capital-intensive investment.
Businesses Lemonis has helped include a carnival and event popcorn company, a car dealership, a candy store, a pie shop, and a gym. I imagine some of these have gone well for him. But still, I’m not really chomping at the bit to put large amounts of money into any of those companies.
Lemonis Passive Aggressively Tries to Cause Partner/Owner Breakdowns
I initially liked Lemonis more than Taffer and a lot of the Sharks. He never really cared about your personal life and life story. It was all about the business. Lemonis also never really goes berserk yelling — which is a somewhat tired, yet entertaining element of Bar Rescue.
Taffer does make quite the entrance, scene, and walk-off exit. But in between, he is often portrayed as a caring individual interested in resolving issues, hurt feelings and workplace dysfunction. At a very least, the illusion of empathy is there.
In addition to Lemonis’ routine of shitting all over his new partners in front of employees, a common move for him is making huge decisions and changes without any warning to the owners and new associates. That’s not to say some of these changes are not good ideas (more than not they seem wise). But it’s usually a total shock to his partners who bring up some misgivings and want to be consulted a bit or at least looped in before seeing a drastic business pivot being implemented.
New logo, new brand, new location, new product, new employees, new layout, or new pricing — all of these are things to consider. But it’s usually Lemonis acting unilaterally. And when mild resistance or shock arises, he basically tells them “Your way failed. I’M IN CONTROL now, you idiot.”
Often I find myself agreeing with the misgivings of the owners. At the very least, I feel their operating experience in this industry, general knowledge and feelings are being disrespected. A common area of friction is Lemonis selling off inventory for cheap to help make more room and get capital into the company. But often, his partners would prefer to sell the inventory at a less discounted rate — which seems totally reasonable, but typically elicits an indignant response.
These confrontations typically devolve into arguments or tantrums in which Lemonis remains cool while the other person blows a gasket wondering why this guy is such a damn dick. While many of these changes are necessary, if you’re trying to sell me on Lemonis being a likable protagonist, these frequent scenes are always a challenge to get through.
The Vague Deals Strangely Fall Apart with Alarming Frequency and Unclear Repercussions
At first, I liked this component of The Profit. It meant the show wasn’t selling me bullshit all the time — and indeed, unusual things happen in business at times. But after 14 total episodes, five deals completely imploded and three were dramatically altered to the point where you’re not even really sure what the new relationship structure is exactly. These developments usually happen with five to 10 minutes left in the episode — right when you think you’re about to see the big unveiling — but instead you get some waffling and arguing,then a hurried explanation of why it’s okay. These include:
— Lemonis walking away from a popcorn company and meat supplier after finding financial discrepancies.
— A toy company and a florist business both basically just saying “we’re not going to honor the deal we agreed to.” Lemonis is told he’ll get his money back from the florist. But the toy company is shown making lots of big investments, including buying a 3D printer that I believe was valued over $250k. When the two brothers running the company bring in their father to get out of the deal, Lemonis basically says “Well, that sucks for me. It’s the cost of doing business.”
— Walking away from owners and deals portrayed as total nutjobs. One was a dog care business, the other a food trailer production company owned by a former couple, resulting in this epic scene.
— There are also deals that get changed at the end which are really confusing, including the candy store, the gym, and again the meat supplier. In that instance, Lemonis gets his money back by buying the rights to their “Brooklyn burger” line. The candy episode, in particular, is the most confusing. Lemonis says he’ll loan money to the owners he likes, in order to dilute the equity held by the other owner he dislikes. Naturally, this is after he tried to plan a mutiny in which he would start a new company with the owners he preferred. But they quickly shot it down as being a half-baked idea.
However, the reality is that despite the production of a television show, brash announcements, pivots in strategy, and tons of new capital being spent to upgrade facilities and processes, both sides don’t really view the initial deals as firm and enforceable. Business owners have pulled out late in the game, as has Lemonis. This happens with such regularity you wonder why the two sides have such a loose relationship that requires so much capital and commitment upfront, when it often leads to a huge clusterfuck in the end.
Lemonis Incorrectly Characterizes Employees/Owners and Often Asks for Ridiculous Things
One thing Bar Rescue does well is identify which characters to rally behind/root for, and those who need to be forced out for incompetence. The Profit has an element of this as well, and is usually accurate. But in many instances, demoted employees believed to be the problem are often promoted back to their original positions later in the episode, essentially admitting that the intended inept scapegoat is actually not really the problem.
The thing that really cracks me up is when a business has multiple owners, Lemonis embraces some of the individuals while often passive-aggressively bullying the others. In particular, Lemonis often demands that his new partners get out of leases or contracts or cut out necessary middleman and such, then flips out when it’s deemed to be impossible.
He’s totally indignant to people saying “Well, myself and a lawyer reviewed the lease (or partnership) and it’s pretty iron-clad. I don’t think we can find an out for that agreement. I tried and I’m sorry.” This usually results in that person being deemed not really into the new direction of the company — which often is not the case — and often forced out. This, despite whatever their intentions were in supporting the new business and partnership.
All that Said
Don’t you worry, CNBC — I’ll be a loyal viewer regardless. In the end, I like learning about various businesses and industries, while seeing turnarounds take place in struggling companies. I know The Profit isn’t even close to being reality, but not much on television really is. The show could be a lot better on many fronts, but given the slim pickings for original content of this ilk, I’m resolved to watch this hot mess despite how little sense it makes at times. Perhaps I can get a reality show in which I turnaround struggling reality shows?