Shark Tank Case Study: The online course that’s grown to a $20M Prep Expert

Shaan Patel is the founder of Prep Expert, an ed-tech company that specializes in online SAT & ACT preparation.

I’m going to ask him what it was like to shake hands with Mark Cuban for the first time on national television.

I also want to find out what being on Shark Tank meant for his business and how it has exploded since.

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Shaan Patel

Shaan Patel

Prep Expert

Shaan Patel is the founder of Prep Expert, an ed-tech company that specializes in online SAT & ACT preparation.

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Full Interview Transcript

Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview entrepreneurs about . . . Hey . . . about how they built their business. Shaan, before I even go into full intro, do you remember the first time that you like shook hands with Mark Cuban after he invested with you?

Shaan: Oh, yeah. It was on television. It was the most amazing moment in my life. Like, I had visualized it for almost a year at that point. And for it to actually happen was just like mind-blowing to me. I thought I was in a dream. Yeah.

Andrew: Did you used to, like, read about Mark Cuban as a kid? You’re an ambitious guy.

Shaan: You know what? Yeah, I definitely read a lot about entrepreneurship, was listening about it, watching videos. Mark Cuban is, obviously, one of the business luminaries in the world, billionaires and I just . . . I had some kind of attraction or affinity for him for a long time and it was so crazy to shake his head. He’s a lot taller than I expected.

Andrew: And he invested how much in the business and what did he get?

Shaan: He invested $250,000 in exchange for 20% equity in my company Prep Expert valuing it at about $1.25 million. That was back in 2015. And since then we’ve done over $20 million in revenue. So it was a worthwhile investment for both me and him. So it’s been a win-win.

Andrew: For you because it’s clearly a great one for . . . Let me introduce who you are. Guys, the voice you just heard is . . . I intentionally wanted the audience to feel a little bit of discomfort as they were curious about you, but also to draw them in with, like, this whole Mark Cuban experience. Shaan Patel is the person whose voice you’re hearing. He’s the guy who created a company called Prep Expert. Were they call like 2400 Prep or something at the time when he invested?

Shaan: Yeah. On the show when your listeners go back to actually watch the episode again, it’s called 2400 Expert. So I’m the same guy, nothing different there, but the company its name changed because they went back from 2400 version of the test to a 1600 version. So I decided just to drop the number from name of the company.

Andrew: Good.

Shaan: And so we’ve actually expanded into ACT and GMAT and other exams as well now whereas on Shark Tank, we were just SAT the 2400 version back then.

Andrew: And that’s what Prep Expert does. It helps people prepare for those standardized tests that get them into college and so on. We’re going to [inaudible 00:02:25] this company, what happened that allowed him to, first of all, raise money on Shark Tank, and then what happened after he raised money. And we can do it thanks to two phenomenal companies. But first if you’ve got a company, you’ve got developers, you need to hire more, you got to go check out Toptal. And the second if you’re at a place where you say, “You know what? I don’t want even start coding. Is there a way for me to actually develop my app by myself without any coding experience?” Well, you got to find out about Bubble. I’m going to tell you about both of those later. But first, Shaan, you talked about numbers. Before Shark Tank, your revenue was from what I understand $600,000.

Shaan: Yeah, it was about $600,000 annually.

Andrew: Wow.

Shaan: Yeah. I mean, it wasn’t a bad company. We had done about $1 million in total in the few years we were in business before Shark Tank. But like I said, since then we’ve been doing about 6 million in revenue annually with 20 million coming in since [I heard 00:03:22] in 2016. So it’s been a nice happy . . .

Andrew: Six million annual. That’s like a 10X growth. And a big chunk of that you attribute to Shark Tank. Why? But why don’t we take a moment and just go back and get to know who you are and how you built this up because what you had before, it seems like a nice little business. Right? Six hundred thousand. There’s a lot of people with online courses doing $600,000. Let’s go find out where you were before, how you got to the $600,000 mark, what happened that allowed you to grow beyond. And you’ve done some really interesting key things here that have allowed you to grow. But you grew up in Vegas. Your parents did what?

Shaan: Yeah. So my parents they actually owned a little motel in Vegas.

Andrew: How small?

Shaan: It was 23 rooms and we basically lived in the front office or like a little living space attached to the front office. And it was a crazy upbringing because if you think about, like, you know, the not-so-glamorous side of Vegas, I mean, it was pretty rundown, I mean, with police, prostitutes, gangs, etc. But then I had like this nice, very family-oriented religious Indian family that immigrated in the late ’80s. And I was growing up with these traditional parents in this neighborhood, and we had so much family that was immigrating from India. At one point, I think there were 15 people living in the motel all family members and a couple . . . We had two or three rooms that we would just live out of. And it was a pretty crazy upbringing, to say the least, a little bit different than suburban life.

Andrew: Your parents weren’t worried about their kids growing up around hookers and drug dealers?

Shaan: Oh, they definitely were. Yeah, they definitely were.

Andrew: So what did they do to stop you from seeing what was going on or to stop you from not going . . . ?

Shaan: I don’t think there was much they could stop. I think all they could do was really trying to drill in those cultural values, those religious values, try to take us to as many Indian cultural events.

Andrew: Like what? What’s an Indian cultural event that you went to growing up?

Shaan: Like Diwali and, like, holy . . . There’s all these like celebrations. There are like a small Indian community in Vegas that they would like try to make sure that we were a part of, so we didn’t get drawn into sort of the community we were actually around.

Andrew: What’s the craziest thing that you saw in the motel?

Shaan: Oh. The craziest thing that I saw in the motel. I’ve seen some pretty crazy things, man. I’ve seen people on drugs do crazy things. One guy was on PCP and he, like, through a brick through our motel front office window. I saw that happen with my eyes. I’ve seen a lot . . . I mean, most of it usually involves like people going crazy on drugs similar to that, I’d say. And so, you know, that kept me I’d say away from drugs very early.

Andrew: Because you know what it could do?

Shaan: It’s much better than DARE. Yeah. I definitely stayed away from a lot of that because of the alcoholism and the drug abuse that I saw growing up.

Andrew: You scored a perfect score on the SAT. What did you have to do to get a perfect score?

Shaan: Yeah. You know, a lot of people hear that and actually in the Shark Tank promo ad, they even use the clip where it said, like, I think they add like, “I am a genius,” but the actual clip was, “I’m not a genius. I’m no genius.” But anyway, my point being is that I wasn’t like this genius that automatic aced the SAT, obviously, the most famous standardized exam.

Andrew: So what did you do that allowed you even though you’re not a genius to get a perfect score on the SAT, the college entrance test?

Shaan: Yeah, yeah. So when I was like a sophomore in high school, I got around an average score and that really hit my ego big, it hit my college dreams big. I mean, I was pretty down and out of that. So what I decided was, I was going to ace this test. And the way that I was going to do that is I basically locked myself in the library for an entire summer. And I would go to the library from when it opened at 9:00 a.m. and I wouldn’t leave until 8:00 p.m. the entire summer. And I would go . . . I must have gone through 20 to 30 practice exams and I created strategies. I read every book that I could. I kept a notebook and eventually I was able to get a perfect score which the chances of that happening are point 0.02 percent. So it was pretty low of that to happen, but it happened for me and it totally changed my life

Andrew: I get the disappearing on the world and doing it. Did you disappear? Did you feel like you left other stuff behind? Did you feel like maybe everyone else was having a good time and not you?

Shaan: Yeah. Oh, for sure. I was having FOMO before I knew what FOMO.

Andrew: What did you feel like you missed out on because you were this guy who was studying so deeply?

Shaan: You know, normal high school teenage stuff whether it was just going out with friends to parties or it was playing sports or video games or whatever it was. But I don’t know. I think my parents built this sort of discipline into me very early on that I was willing to do it and I knew that it would be temporary. It was like June, July, August, your summer. It wasn’t going to be something that I was . . .

Andrew: Wait. So, you just spent three months going into hibernation and working this hard. It wasn’t even more than that?

Shaan: I wouldn’t say so. I mean, I worked a little bit during the school year, but it was really the hibernation, the turning off the rest of the world. I would it say was one summer of just like forced studying thousand vocabulary words, putting together, you know, thousands of practice exams.

Andrew: That’s a big thing that I . . . I saw you on some local Fox Vegas TV show where you said what you need to do is just keep taking the actual tests or the people who put together the actual test-taking their sample test over and over and over until you get to understand their rhythm until you understand the question until they start to seem repetitive. Am I right?

Shaan: One-hundred percent, yeah. I say perfect strategies plus perfect practice means perfect score. So what that means is the perfect strategies obviously I’m going to plug my company, the strategies I’ve created Prep Expert. The perfect questions come from the College Board, the company that publishes the SAT. I highly recommend every student whether you’re studying for the LSAT or any standardized exam, like, whether it’s the LSAT, GMAT, MCAT, every standardized exam, go to the test maker, they create the most accurate questions. They spend millions of dollars creating these highly standardized, highly reproducible, highly accurate question, those questions. And if you do it enough, I mean, perfect practice makes for a perfect score eventually.

Andrew: Just keep doing it. Okay. And so you did this. You did well. You decided I’m going to write a book. And this is where the whole thing started. You want to write a book. What did you have to offer that was so much different. I’m even asking you about your strategy right now and you’re saying basically all I did was take the test over and over again. I had a notebook. I locked myself. What was going to go in the book considering that what you told me sounds pretty normal, average?

Shaan: Yeah, absolutely. I would say there was one big thing is that, you know, I was an average student that went to a perfect score. I wasn’t a student that either started out super high and I wasn’t like a PhD in mathematics and I wasn’t a PhD in English like many of these other companies that create strategies have. So, what that did is I was able to write strategies and write a book that was very easy to relate to. So, for example . . .

Andrew: Like what? Yeah, give me an example.

Shaan: . . . one of the simple strategies that I gave for the English section is avoid the word “being.” And so what that does for all of my students immediately is they cross out any answer choice with the word “being” on the English section. It’s a very simple strategy that no one else really teaches . . .

Andrew: Why? Why is “being” a wrong answer every time? Why?

Shaan: Yeah. Exactly. The reason is, is because it creates passive voice, and passive voice is not preferred compared to active voice. But instead of explaining passive versus active in every single version of that, I give students easy, simple to use strategies that made sense to me because I was an average student too. And that helps them hook on to the strategies.

Andrew: And the original book as you were thinking about writing it, it was going to be full of that, a little observations that you made that are easy wins, anything that’s passive voice and here’s a way of knowing passive voice, cross off, it’s not going to be the answer. That’s all. Got it. Okay. So you were going to write this book and you had a perfect SAT score. So when you went to publishers, they said what?

Shaan: Oh, man, I went to 100 literary agents and publishers and I was like, “You know what?” I was so excited. I was like, “This is going to be the first book that’s ever written by a perfect score student. It’s going to sell thousands of copies. It’s going to be amazing.” And every single one came back to me and was like, “Dude, the SAT prep market is too competitive.” They said I didn’t have a platform to write the book. One, who was super disconcerting which was wrote something like I didn’t find your persona or writing particularly engaging. And so that was like a blow to my ego and I was just getting knocked down left and right by all those people that are supposed to be experts at what sells in terms of the literary market.

Andrew: I get the part about how you don’t have a following essentially is what they’re saying. We’re only publishing people who have built-in customer base. The rest I could understand being really painful. And so you said, “You know what? I can’t get this book published. I tried really hard. I’m just going to move on.” You got $900 and then you moved down $900 from where?

Shaan: From my scholarship money. So I don’t know . . .

Andrew: From your college scholarship money.

Shaan: Yeah. I don’t know if my college knows about that, but that’s okay. Yeah. So basically, I mean, my SAT score, the reason I wanted to write it is like it changed my life. I got a quarter-million dollars in college scholarships. I mean, we talk about how expensive college is. I got to go for a completely free, no tuition. I didn’t pay for books, I didn’t pay for housing, I didn’t pay for food. I was getting paid to go to college. I got checks.

So I had 900 bucks left at the end of my senior year just laying around for my scholarship money and I was like, “I can use this money to launch a website.” And so I paid some developers $900 to start a website about, you know, I had written all these hundreds of pages of material, so I wanted to start a course. And that’s really where 2400 Expert was born. I was like, “Forget the publishing of the book thing. I’m just going to use the material I wrote and I’m going to teach SAT prep courses.” And I used the 900 bucks to launch the website, which was probably the best investment I ever made. It was the only capital I really sunk into the business. After that it just ran on revenue and basically that $900 is now turned into 20 million and so it’s definitely a good return on investment.

Andrew: And it was just a website that the developer you found built for you and a payment process and you were going to what? Teach using video or teach using live sessions?

Shaan: Live sessions. So, this was . . .

Andrew: In-person.

Shaan: In-person, yeah.

Andrew: Got it.

Shaan: So, this was back in my hometown of Las Vegas. Like you were saying at the beginning, I had a nice little small business coming up and that was really this in-person business that I was building in Vegas originally. Two things that prevented me from doing online to start with which is now we do mainly online classes, but in the beginning, this was 2010, 2011, I don’t think the technology was that great with internet and online delivery platforms. And then two, was the demographic. So parents are the primary customer of test prep classes. They weren’t used to online learning. And they didn’t like it. They all wanted in-person classes. Now with Generation Z coming up, they are all taking online classes, and so it’s much more of a common thing for your kid to have an online class than it was back in 2010, 2011.

Andrew: And that’s when you started. I heard you were going to get started in Los Angeles, not Las Vegas.

Shaan: Yeah, yeah.

Andrew: You were.

Shaan: So I was trying. I was trying. So I had . . . You know, I have a biology bachelor’s. I didn’t have the slightest clue on how to start a business or anything about marketing. And so, you know, when I was trying to decide what city to start my company and I was like, “Well, LA is a bigger city. It’s probably got more money there for a test preparation course.” What I didn’t really understand was competition. LA also has a ton more test prep companies and competition. And so it was really hard for me to get students to sign up in Los Angeles, whereas . . .

Andrew: What did you do to get students to come to you in Los Angeles?

Shaan: Yeah. So, originally, I mean, I was trying everything. I was visiting high schools, I was flyering different events. None of that worked because, I mean . . .

Andrew: Just walking around putting flyers on people’s cars outside of events?

Shaan: Literally myself. Yeah. I would find out that, you know, there was this high school event going on and I was like, “Okay. I’m going to go fly every car.” And that’s what I thought good marketing was back then. I didn’t have the slightest clue.

Andrew: And where were you going to do this? In what office?

Shaan: All around LA. I mean, Beverly Hills . . .

Andrew: I mean, where were you planning on teaching?

Shaan: Oh, yeah. So that was one of the better things that . . . WeWork is such a huge thing now, co-working spaces, but back in 2010, 2011, I was learning about co-working spaces, and it was the perfect setup for teaching because for my tutoring and test prep company, I didn’t need an office space with a lease, you know, 24/7 because I would only have students coming in basically for classes a few hours a week. So there was a place called Blankspaces, I believe.

Andrew: Yeah, I know it.

Shaan: Oh, really?

Andrew: Yeah. Yeah, yeah, yeah. I know the founder from online. Yeah.

Shaan: Yeah, yeah, yeah. So Blankspaces was the first spot that I had found over . . . I think they had his place near Wilshire in Santa Monica area. And yeah, that’s basically where I was going to rent the classroom out in LA. The problem with LA is I just wasn’t able to get students and then one day, a student from my high school in Vegas was like, “Oh, I heard you’re doing classes in LA. If you bring it to Vegas, I’m ready to sign up.” And I was . . . He didn’t know I didn’t have any students in LA, so I was like, “Well, I’ve got one student in Vegas and I know from my high school, etc. So why don’t I just pivot the business?” And that ended up working out really well.

And the big lesson I learned from that for entrepreneurs is to be a big fish in a small pond. Everyone wants to go after the bigger market first. Same. I had that same idea. I wanted to go after LA because of the bigger market. But it was way better and I became much more successful in a smaller pond like Vegas where I could really own it and become the biggest test prep provider quickly because there was not as much competition.

Andrew: I get that. All right. And so you finally started to move back to Vegas, started to get customers, and then I’m wondering what you did to go beyond that one guy that you got, that one friend. What did you do once you came back?

Shaan: Yeah. I’d say there were two or three major things. So the first one was back in 2010, I made another good decision. The first couple of students I got to sign up, I used that money to then hire a search engine optimization firm. And in 2010, it was way easier to game Google and game the SEO sort of battle than it is now in 2020. You know, if you think about Google SEO, it’s so hard now, but back then they were able to get me as the number one result for Las Vegas SAT prep within a matter of a few weeks or maybe a month. And so that changed the game. I was getting all kinds of parents calling me because they were . . . I was showing up number one on Google because this firm had done it. So that was a big game-changer.

The second thing I’d say was, I basically was, like, I don’t really have a lot of money to spend on marketing, so I’m going to try to get free marketing. And the way that I did that was I [inaudible 00:20:53] every local news station in Vegas like top tips for the SAT as a segment to come on programs. And while I only had a few students sign up for my course of the fact that I had a perfect SAT score, I was from Vegas in the news station, so almost every single once said yes.

Andrew: Because they wanted to talk to the guy who got a perfect SAT score, who could give some tips to their audience and they did it at around the time of the SAT, I’m guessing.

Shaan: Exactly.

Andrew: Got it. And so this was topical.

Shaan: And the big thing about that is, like, I wasn’t pitching them on my business. I was like, I don’t want to go on and, like, promote my business. But I got a perfect SAT score, would love to share some tips for your audience. And I think that’s how you should always pitch PR in media. It’s like PR media doesn’t care about your business. They care about what’s good for their audience. And so that’s a big tip I have for entrepreneurs who are looking to leverage media and PR exposure. And I mean, even Shark Tank was that. And so yeah. I’d say PR and media by basically pitching the news stations, and then, obviously, just leveraging my contacts that I’ve had from when I was in high school in Vegas.

Andrew: And that was you getting PR, you contacting the local station saying, “Here’s who I am.”

Shaan: I was a one-man show. I was the teacher, the marketer, the salesperson.

Andrew: And the only thing you weren’t doing was the SEO for your site, search engine optimization you hired out.

Shaan: Yes, yes. At that time, I didn’t know anything about it, but I knew that it was a good thing to invest in. All I knew about internet marketing back then was, it’s probably a good idea if you show up high on Google.

Andrew: Okay. All right. Let me talk about my second sponsor and then we’ll get back into the story. You probably don’t know about these guys. It’s a company called Bubble. Do code, by the way, Shaan? Are you a developer?

Shaan: I don’t personally code. No. I’ve tried it. I’m bad at it.

Andrew: Yeah. And you know what? I think a lot of us want to develop but we don’t want to learn code or just aren’t good at it at this point. Bubble says, “You don’t have to code. You can create whole apps without coding. All you have to do is go to try Bubble.” And I know this seems so weird, but I’ll tell you, Shaan, when I starting Mixergy, the idea of using WordPress to publish my site felt like a weirdo thing to do. Why would use WordPress? That clearly is not going to be flexible enough, it’s not robust enough. It’s for people who just look to publish a blog post or two.

And so what I wanted to do is create my own publishing platform. I was going to actually have like an HTML-based thing, and then said, “Let’s just try WordPress.” And I did and it worked. And now it makes sense. Most . . . Actually not most sites. It’s, I think 35% of the websites online now are published on WordPress. Right?

Shaan: Oh, yeah. Our website is published on WordPress.

Andrew: Perfect. Look at this. Right? A lot of sites are. I think what’s happening now is a similar revolution in development. Bubble is saying, “Hey, look, maybe we won’t be 35% of all development will be done on Bubble, but some percentage does not need to be written especially the earlier parts of a business, and probably even the latter parts too.” If you want to, Shaan, create an app, if you, my listener, wants to create an app, if you want to create an experience, you don’t have to code it up yourself. You can go check out Bubble.

In fact, I’m going to let you try it and give you a nice big offer to get going with it. If you go to bubble.io/mixergy, you’re going to get to first of all, try it out, and then you’re going to get 40% off for three months. See it. See it for yourself. In fact, as soon as you go to bubble.io/mixergy, what you’re going to see is all these things that you can understand as coding concepts laid out in a visual editor that makes it way easier to see and to use and interact with and to build with.

All right. All you have to do, guys, if you’re listening to me, go check out bubble.io/mixergy. You’ll get that 40% off discount for the first three months. You’ll also get to see different apps that are being built and have been built already on Bubble. It’s bubble.io. Get it, io like input-output. They’re even using the geek developer top-level domain, bubble.io/mixergy.

Shaan: I love that. I’ll probably check it out myself. Yeah.

Andrew: I like that they’re being a little heretical. Like, they’re saying, “No, you don’t have to code. Everyone is going to tell you to code. We’re going to tell you not to.” All right. I get how you started getting your first set of people. You were still in school at the time. You were doing this as a side thing. How did you go from that to suddenly $600,000? Take me to just before Shark Tank?

Shaan: Yeah, yeah. So, you know, after I taught my first set of co . . . It was really hard to get that first set of courses. I know we kind of made it sound easy like, I hired an SEO firm, I got PR and media, but I was trying a million different paper ads, all these and I didn’t know what worked, what didn’t. Anyway, I ended up getting about 18 kids into the first class. Those kids, they improved their SAT scores 376 points over the course of six weeks from that class that I taught. And that’s equivalent to taking a student who’s in the 50th percentile who’s just average to the 90th percentile. So I was really changing people’s college, outlook, their scholarship opportunities.

And so while it was hard to get those first batch of customers as it is for any business, it became very easy to start getting the next round of customers because I had parents knocking down the door for more courses because, you know, they had heard about the score improvements. And you know, word of mouth, I believe is the most powerful marketing machine in the world. And so if you build a great product or service, your customers, your first ones are going to start telling other people about it.

And so I started getting more buzz around Vegas. And as you mentioned, I was in school, so I couldn’t teach all the courses anymore. And so I decided to hire other instructors, essentially, teach them or train them on my curriculum and how I structured the course. And what was amazing was the score improvements were reproducible even without me being the instructor just the curriculum and having a great instructor, another one and another few, it ended up being, teach the same coursework. We were still getting students improving hundreds and hundreds of points. And the business really kind of took off from there in Vegas.

Andrew: Why did you decide to go to Shark Tank? You wanted to level up your business you said earlier, but how? What were you planning on doing?

Shaan: Yeah. So at the point that I was on Shark Tank, I was really kind of maxed out in Las Vegas, like, there was about 600,000 in revenue coming in from that one location or we had two locations at that point in Vegas in person. I hadn’t really launched online yet. I hadn’t launched in other cities yet. And so, you know, I went on Shark Tank for two reasons. One is obviously the investment. I wanted to hire more people, open in more cities, expand online. And so that’s what the investment was for.

And then two is actually the primary reason, which is the free marketing exposure. I mean, Shark Tank gets you basically a free $10 million advertisement. I mean, you’re on there for 15 minutes talking about your business on primetime television to 10 million Americans. There’s nothing like it. And I was . . . And Shark Tank was the perfect show for my business because if you think about Shark Tank, it’s a family show, like parents and their kids are watching Shark Tank together on Friday nights that are now it’s Sunday nights. But it was perfect for an SAT company. So it was just like the perfect company to go on Shark Tank because we had all of these parents and students signing up for our courses after they saw us on the show. And so I’d say that the marketing and the investment was just like, the perfect mix of things for us.

Andrew: And so waited in line. How many people were ahead of you on Shark Tank that day when you applied?

Shaan: Oh, dude, I am always late to everything. And so of course, I was late to the audition. And so I was like, person 500 and something in line in New York City. Just to give the listeners an idea of like how popular Shark Tank is. It’s like 50,000 people apply every year and only about 180 I think end up airing. So the chances of getting on and airing on Shark Tank are like point 0.02%. So I was at the New York City audition, 500 people in line, waiting around for nine hours and I was like, “This . . . ” And the whole time I was thinking like, “I can’t believe I’m going to wait here for nine hours to talk to a producer or pitch a producer for one minute. Who do I think I am that I’m going to make it on this show?”

Andrew: And still you did. Why do you think you made it on the show? What was it about you?

Shaan: You know, what’s really funny about my audition is I thought I blew it. I thought I had one of the worst auditions because when I was talking to the producer, the producer’s face was stone cold. Like, I was like, “Oh yeah, we’ve done $1 million in revenue over the past few years. I’ve been in ‘The New York Times.’ I’ve mentioned media. And I got a perfect score in SAT.” And he was like, stone-cold, not interested.

And then it was funny because at the very end of my pitch, out from behind me, I was holding my SAT prep book which I actually ended up publishing an SAT prep book with McGraw Hill, the world’s largest education publisher. They didn’t give me the book deal until after I had started Prep Expert and they saw that I had built a platform, etc. But I pulled that book out and I saw his eyes totally light up and his facial expression totally changed. He started asking me about the book. He couldn’t believe I was a published author. He couldn’t believe my face was on the cover of the book. He started . . . I . . . He started talking about his nephew who could use the book. I obviously gave him the book.

And it was like . . . And it was incredible and I think it’s a great lesson for entrepreneurs, actually, which is something like publishing a book, starting a blog or podcast, etc. Creating a platform or creating some type of authority can go so far for you. The thing that I originally wanted, which was publishing a book, probably was the thing that ended up getting me on Shark Tank. And I had no idea that that was going to happen when I first wanted the book. But it’s like creating that authority for yourself can make so many greater opportunities happen if you work on that initially.

Andrew: You got on. Why did most of the Sharks say no to you?

Shaan: Oh, yeah. So I have a fun episode because I am what you would call a side hustler or a part-time entrepreneur, meaning I was in school when I was on Shark Tank. I was in Business School, I’ve been through med school, I’ve been through college and through all of that I’ve had this business that I’ve been running. And so while they all loved the business, that the numbers were good, it’s profitable, it’s growing, they all hated that I wasn’t 100% entrepreneur.

And so I remember, you know, all of the Sharks were like, “You can’t play it entrepreneurship. You have to be 100% all in. You can’t be a student too. You have to give up school, etc.” And I was getting crushed. I thought going into the tank, I was going to have multiple offers. I was like, “Oh, maybe Damon will give me an offer. Maybe Kevin will give me an offer. Like, they’ll all give me offers.” I was so cocky going in. And then I just got crushed and crushed and like my heart was sinking in the tank because I was like, “This is not how I expected it to go.”

Andrew: What did Mark Cuban see in it?

Shaan: It was interesting, you know, because when I first walked in the tank and I started giving my pitch, Mark Cuban did what a lot of people do when I tell them about my business, which is he rolled his eyes. He’s like, “Oh, yeah, a perfect SAT score. Sure. Yeah, yeah. Sure, man.” But you know what? And then he kind of stayed silent. Like, he kind of ripped me in the beginning. It was like, “If you’re not 100% in the business, there’s going to be someone who is going to outwork you eventually.” But then I think, you know, over the course of an hour and a half that I was in the tank, you know, America only sees 15 minutes on TV, but that’s edited from the hour and a half that I’ve been in the tank.

Andrew: So, an hour and a half you’re standing there talking to them, trying to persuade them to invest in your company on your terms for the majority of it, they’re skeptical and more. They’re pushing back on you aggressively telling you your decision to run a company and be in school is horrible. And then what happens with him?

Shaan: So he’s funny, and I heard he does this a lot, which is he just stays silent after ripping me. And I’m like, “Okay. I’ve already lost Mark Cuban, which is the one that I wanted, so like, I’m totally obviously jarred and thrown off at this point, but he stays silent throughout and he lets everyone else talk and rip me as well.

And throughout the hour and a half, though, I’m talking a lot about my work ethic, about how I’m willing to work or I do work often 80 to 100 hour weeks and I have done that to write books to put together a business. I talked about my dad’s work ethic, about how my dad used to wake up from 5:00 a.m. to 2:00 p.m. he’d be a pharmacist, then he worked at the motel, then he’d work at the gas station he eventually bought, and like how I modeled myself after that.

And then at the end once everyone goes out, Mark Cuban he turns to them and he says, “Is everyone out?” And then they’re all like, “Yes.” And he’s like, “Perfect.” And that’s when I knew he kind of had me too to negotiate it because like, you know, he’s the only Shark left. But then he starts talking about his own work ethic, he starts talking about how his dad worked so hard and how he had modeled that.

And so I think what really spoke to him was what Mark respects out of every entrepreneur, which is, I think he has a saying that says, “Work like there’s someone working 24 hours a day to take it all away from you.” And I think he saw that I wasn’t just going to let the business die because I’m in school, I wasn’t going to make it a second thing. Like, I was just going to do school really well and I was going to do the business really well. And he eventually made me an offer for $250,000 in exchange for 20% equity. I went in asking for 10% but my strategy was I would go up to 20% and he got me exactly at my maximum. I don’t know how he figured that out, but it ended up working out really well for the both of us.

Andrew: That’s fantastic. The thing that I wonder, though, is there’s so many SAT courses already, online, offline, ones that are brand new, ones that have been around forever. What were you bringing in that was new? What did he see that was new? Why didn’t he do what I’ve seen him do for others, which is to say, “Look. This has been done. It’s over”?

Shaan: That’s a good question. I think that a lot of it was he was investing in me and he really believed that, you know, I’d be able to continue to grow the business. He saw the results, obviously, speak for themselves in terms of the score improvements. And it continued to . . . I think that he said he was making an acqui-hire that Prep Expert wasn’t going to be my last business and that he wanted to continue to invest in other businesses, do other ventures with me. And we actually wrote a book together about kid entrepreneurship called “Kids Startup.” And that was a really cool opportunity. So he’s kept that promise and continuing to do things with me.

Andrew: All right. What changed after you got investment from him?

Shaan: Oh, man. Everything. Yeah, between Shark Tank and the Mark Cuban investment. I mean, we went from . . .

Andrew: And so I imagine what . . . I know you went very quickly to a couple of million dollars after being off the show, right?

Shaan: Mm-hmm.

Andrew: The thing that I wonder is, how much of it came because you were on the show? That’s measurable. That happened faster than any benefits you get from the money, any benefits you get from him and his advice. Right? How big did it get because of that?

Shaan: Because of the show or because of the . . .

Andrew: Yeah, because of the show you saw getting off the show. How much extra revenue? How many extra customers did you get?

Shaan: Oh, absolutely. Yeah. I’d say the weekend that we aired, we did about $300,000 in sales, just that weekend.

Andrew: Whoa. So the weekend afterwards did about half as much as you did . . .

Shaan: The entire year.

Andrew: A year. That is unreal. Just because more people discovered you. Now, you also started to go at that point, tell me if I’m wrong, from offline where you were meeting people in-person to online. Am I right? When did that happen?

Shaan: Exactly. Exactly.

Andrew: You already started doing it before you went on the show.

Shaan: We did it a little bit before but we didn’t do it at the scale. We weren’t doing it well. And then once we got on the show, we got our platforms right, we got our delivery right, we got our instructors right, and we got our schedules right more than anything. We knew we had to offer a ton of course schedules to be able to handle the demand that was about to come in.

And so, yeah, it was incredible after to see the demand with online . . . And online was perfect, obviously, for Shark Tank because we couldn’t be in every . . . I mean, we launched in a bunch of different cities whether it was Orange County, San Francisco, New York, etc. But we can’t be in every single city. And so with online, we were able to reach every single student, not only in the United States, but we had students from China, Japan, the UK, Australia taking our classes. And that was really huge because it helped us scale very quickly at a very low cost.

Andrew: Okay. And still that wasn’t easy. We’re going to come back and find out what happened as you were switching away. I know you told our producer, Brian Benson, about that. But first, I’ll tell everyone my second sponsor is a company called Toptal if you’re looking to hire developers. One of the things that you noticed that Mark Cuban was looking for in Shaan was, how good is this guy? What’s his work ethic? Forget about the actual product that I’m investing in. I’m investing in the person and if I invest in the right person, the outcome will be right, the outcome will be great.

That’s what happens at Toptal. They do these series of tests to make sure that only the best of the best people make it through. We’re talking about . . . What was . . . Yeah. I’m going to use the word elitist. Ninety-seven percent of the people who want to be Toptal developers in their network just get excluded completely. And I see it. I read the blog post, I see the tweets of people who got rejected. And many of them say, “Yeah, I guess I’m not that good.” They want to be better and keep studying. And all because, Shaan, you tried to hire from Toptal. You considered it? Right? What kind of position are you hiring for?

Shaan: Yeah, absolutely. So I mean, we were looking for some development and design work at Prep Expert. So my VP and I were discussing that we should outsource to Toptal or hire full-time. We ended up hiring full-time for our needs, but we’re going to supplement with some Toptal developers in the future.

Andrew: By the way, you can always hire full-time developers or part-time developers from Toptal. All they do that’s different from other places is, other places won’t make it easy for you to put your ads online or to cull through all the different resumes you get. What Toptal does is they say, “We’re going to do it differently. These people are going to be in our network first. When Shaan is looking to hire he will talk to a matcher first. After having a conversation with the matcher where the matcher understands Shaan’s development needs, the way that Shaan’s company works, they go into their network and they find actual developers from their network and then introduce them to Shaan and then Shaan gets to talk to them or have his people interview them. Wherever they want, you could often, I’ll tell you, Shaan. Start hiring them almost immediately. I’ve gotten started within a couple of days.

All right. Anyone who wants to get started including you, you can get 80 hours of Toptal developer credit when you pay for your first 80 hours. You get it for free. All you have to do is go to top as in top of your head, tal as in talent, toptal.com, that’s toptal.com/mixergy. Hey, who’s Ian McCue? Why is he one of the co-authors on your book with Mark Cuban?

Shaan: Yeah. Ian McCue is an amazing entrepreneur that I met in Vegas, actually. And it’s kind of a funny story. His mom and Mark Cuban were like best buddies back in Dallas way before Mark Cuban became a millionaire or a billionaire. And so, you know, I knew Ian because he is in the education space, he’s in the entrepreneurship space in Vegas, which is a pretty small space in Vegas as you can imagine. And he’s a young kid with amazing entrepreneurial skills, a lot of great development skills as well.

And, you know, he ended up actually bringing the initial book deal to me about this entrepreneurship book, and so I had mentioned it to Mark because I was like, “Oh, Mark might want to know about it,” because he knows Ian as well. And Mark was not only interested to know about it. Mark is like, “I’ll help you write the book too.” And I was like, “Oh, that’s awesome. That’s really amazing.” We can co-author a book with Mark Cuban and sell 10 times the amount. And that’s exactly what happened. And it was pretty cool of Mark to be willing to put his name on the book with us and help us for the chapters.

Andrew: And I guess it makes sense then to have a really young entrepreneur in with you guys here writing the book for really young entrepreneurs. Am I right? That was the mission.

Shaan: Exactly. I mean, Ian is like one of the most impressive teenage entrepreneurs I’ve ever met. Super talented guy. And yeah, he was able to relate a little bit better to Generation Z than me or Mark Cuban.

Andrew: So tell me about the issues you had going from offline to online.

Shaan: Yeah, yeah. So anytime I think a business tries to make this transition where your service is delivered offline originally, and then you’re trying to reproduce that offline service in an online environment, there are some important considerations, right? So one of the biggest ones is product quality. Can people learn in a . . . For my purposes, can they learn in a digital environment, in an online classroom, as well as they can in an in-person classroom?

And what we found through all of the data and analytics we’ve done is yes. And the reason for that, I think is if you put an engaging instructor who really knows the material well, who’s not only a 99th percentile scorer themselves, but is able to really engage with students, those students are less likely to go on Facebook or Snapchat or Instagram during the class. Certainly, I’m sure some percentage of students are doing that, but what we do now is with our online classes, we make sure that we’re polling every 10, 15 minutes and making sure that students are engaged so that they don’t just min [inaudible 00:44:44] our classroom environment and go do what they want to, but they actually stay engaged with the classroom. And when they do that, we’ve found that the score improvements are just like the in-person classes.

Andrew: I saw that even on your YouTube channel and I know YouTube drives a bunch of traffic to your site. What you guys do is short tips for people who are taking standardized tests. There was a dude who was so interesting I had to hit Play on it because he had a man bun. I go, “Who’s teaching me about semi-colons with a freaking man bun?”

Shaan: Yeah.

Andrew: But it was interesting. And the first thing he says is because he’s got a good sense of, like, what he needs to get your attention. He says, “I scored a perfect score on the SAT and the ACT. Now let’s talk about semi-colons and not that hard, especially on this test.” And then he teaches that. Okay, but . . .

Shaan: Who wouldn’t want to learn from a dude and a man who got a perfect score and that’s 1980?

Andrew: Right. He’s definitely like your teacher. So it was that, but it was also like the software. I heard you guys had software issues. I heard just the actual mechanics of it were a problem. What are the problem that you had with the software?

Shaan: Oh, yeah, for sure. I mean, the thing, we were using a software platform called ClickMeeting, which I loved for one reason, which is it didn’t require students to download additional software onto their Mac or their PC. It was . . .

Andrew: But it’s a meeting software. Like I’m using Zoom to record with you. It’s like that.

Shaan: It’s like a meeting . . . Yeah. So they have a meeting software, they have like a webinar software. It’s like ClickWebinar and ClickMeeting. And so we used the webinar one because we want it to basically have one instructor for multiple students where there’s 20 students, 50 students, 100 students. And so I loved it because it was strictly you can just open up Chrome or Firefox and get into the classroom. The problem with that is that it often crashed and the internets weren’t as good four or five years ago as they are today and speed for everyone. And now, you know, I think most people are migrating to Zoom. We still love Adobe Connect because it’s actually built for education, and so there’s a lot more you can do around polling questions, using whiteboards, etc. And so yeah, I mean Zoom, I think is kind of the front runner now, though, with digital online meetings is my understanding.

Andrew: Yeah. How did he help . . . How did Mark Cuban help you grow?

Shaan: Yeah, absolutely. So, I think Mark Cuban is the best sharp partner with because you get really two aspects, one is you get access to the Mark Cuban companies, and then you get access to Mark Cuban himself. And so when you get access to the Mark Cuban companies, everything from the legal team, the business development team, the accounting team . . .

Andrew: So in addition to the money he gives you free accounting.

Shaan: Mm-hmm. And so . . .

Andrew: Wow.

Shaan: You know, what was really cool is our accounting book for that was just working my butt off to try to grow the business and revenue. I wasn’t doing a great job with running is they cleaned up our books, they made amazing statements for us whether it was just simply things like cash flow statements and profit and loss, balance sheets, etc. And that was all for free, but it helped me track where we were really spending or wasting our money. We were really making our money. And obviously, every business ownership should do that. And you don’t need Mark Cuban companies. You can go to QuickBooks or other platforms.

But I mean, it was important because I hadn’t taken the time to do that. And so they totally revamped our accounting. Mark Cuban himself. We email weekly updates about the company and he gives a lot of great advice. He’ll step in when needed. One of the big things he did for the company was he doubled our licensing fee with our biggest licenser. So we white label, our courses, our pre-recorded courses to some companies and with our largest licenser we doubled the . . . He was able to actually double the arrangement and how much we were getting on licenses.

Andrew: He went to them and he said, “Look, you’re paying Shaan’s company to license content and then you’re reselling it. You need to double the price. You’re going to pay as twice as much.” Because he personally negotiated that.

Shaan: Yep. He basically said, “We’re not going to work with you anymore unless you paid double. It was . . . And that has resulted in hundreds of thousands of dollars in net profit extra. I mean, like, that’s like he paid back his investment just with that.

Andrew: Wow. Okay.

Shaan: Not to mention the co-authoring of the book. Not to mention, I mean, so many other amazing things that he does, whether it’s tweeting, you know, to his 7 million followers, big promotions we’re having, etc. It’s just the best thing you can possibly have from a Shark.

Andrew: What else did you do to the business to help grow? Beyond him, what did you do that allowed you to keep growing?

Shaan: Oh, yeah. You know, I think one of the best things that the investment was able to do for me was bringing in top talent. We talked about Toptal, right? So I brought in some amazing developers, designers, and marketers with the 250 grand. I brought in a great team of people. And what that did was it helped take our digital marketing to the next level.

So, I mean, we started . . . Before Shark Tank, I didn’t really do any paid marketing. All I did was word of mouth and let the business grow organically. And that’s great, but that will stop at some point. You have to supercharge it. And so the way that we supercharged it was with Facebook ads, we’ve been able to sometimes get 15X returns with Facebook ads, Instagram advertising, Google AdWords, Pinterest, Quora, Snapchat. So search engine optimization has been . . . Search engine advertising has been amazing.

We started implementing things that a lot of digital marketers do into a test preparation company. To give you a great example, you know, digital marketers, they love webinars, they love free automated webinars, and to basically share their knowledge and content. And what I did is I basically launched a automated webinar that I teach at Prep Expert for parents. And no one does this in the test preparation space, but everyone does it in digital marketing. But what it did was, it helped me get in front of hundreds of thousands of parents for free to show them the strategies we offer, to show them the expertise we offer for free. And then what happens is I give them a great deal on the courses at the end of the webinar and it’s resulted in over $1 million in sales by basically taking something from the digital marketing world and applying it to the test preparation world.

Andrew: How did you learn about that?

Shaan: How did I learn . . . You know what? I was learn . . . You know how I learned about it is I was watching a webinar by Neil Patel, I’m sure you’re familiar.

Andrew: Yeah.

Shaan: He’s obviously one of the biggest marketing guys in the space. And then I realized I was like, “This doesn’t look like it’s live.” I was like, “I don’t think this is live.” And then I was like, “You know what? I need to research this a little bit more.” And then I started finding out about automated webinars. Now we use EverWebinar to deliver our automated webinar. And I was like, “Well, what if I just took what Neil Patel is doing, what all these digital marketers are doing?” And I was like, “No one’s ever seen this in the test prep space.” And that’s obviously a great way to innovate in a lot of industries, is it takes something from one industry and apply it to the next and we’ve had great success with that.

Andrew: You know what? I saw that when I was looking at your traffic. I also saw Drop Ship Lifestyle sending you traffic. Why Drop Ship Lifestyle?

Shaan: Drop Ship Lifestyle. I’m actually not familiar with Drop Ship Lifestyle. You’d have to talk to my marketing team.

Andrew: Okay.

Shaan: I’m not sure. Who’s that?

Andrew: I have no idea. Just I was looking, I said, “All right, I get why he’s got this webinar link sending traffic, but what’s the Drop Ship Lifestyle?” They’re sending you a good amount of traffic.

Shaan: You know what? I’m not sure . . . . Hopefully, that’s not spam traffic. I have my marketing team look into it and take them out if it is. I’ll have to talk to them and see what’s going on there.

Andrew: You’re also going beyond college prep right now. What are you working on?

Shaan: Yeah. So next company that I launched as Mark Cuban had predicted that Prep Expert wouldn’t be my last company was, you know, one thing I learned as we were talking about is the power of digital marketing that it can have for entrepreneurs. You know, like, for the first four or five years I didn’t do any digital marketing. And then we got a Shark Tank investment, I brought marketers in. And so I learned a lot myself as well as with my digital marketing VP, Adam, at Prep Expert, we learned a ton about digital marketing, so whether it’s search engine optimization, search engine advertising, about automated webinars.

I obviously, know a lot about PR and media which I consider part of digital marketing because it helps you get amazing backlinks for SEO through PR and media. And we learned so much about this that I was like, the other thing we’re really good at, not only are we good at digital marketing, but we’re good at delivering courses. I was like, “What if we teach digital marketing courses like we teach Prep Expert courses using the different strategies, etc.?” And we start teaching digital marketing that’s been successful for us at Prep Expert.

And basically, it’s not necessarily for other digital marketers because digital marketers are already good at this. It’s for the average business owner and the average entrepreneur that wants to learn how they can implement this in their business because that was me. I was a just entrepreneur and business owner that didn’t know the first thing about digital marketing. And once I started to use digital marketing in the business, I mean, you know, as we’ve talked about . . .

Andrew: The business has grown. You also have a PR course once you started doing PR with a local TV shows talking about SAT. That helped you grow. What’s the name of the business?

Shaan: The business is called ClearHat Digital Marketing. So you can check that out at clearhatmarketing.com.

Andrew: And does Mark Cuban own a piece of that too?

Shaan: No, Mark does not.

Andrew: It’s a separate business.

Shaan: It’s a separate business. Yeah, Mark is . . . I’m not tied to that. Everyone thinks, “Oh, soon you have to give up. All your business is to Mark Cuban for the rest of your life.” And nope, that’s not true. There’s nothing in my contract like that.

Andrew: By the way, speaking of marketing, so I went to Ahrefs.com. Do you use that service?

Shaan: Yes.

Andrew: You do. Well, how do you use it? I see you got a bunch of links.

Shaan: Yeah. Yeah. So, I mean, we basically use it to help decide how we’re basically track and see how we’re doing with our search engine optimization.

Andrew: Got it. Yeah, I could see that. You know what? So, I was trying to get a sense of like, “What are you doing to get traffic?” It looks like one of the things that works for you is bond sites. So like, there’s something called couponsplusdeals.com. You guys are on there. So, you’re nodding, right? So as soon as you find one or two of those that work, you just go to all of them and you see if you can get linked to on there. You also seem to be on anything that’s SAT related, like “best piece of advice for taking the SAT is shockingly simple.” That’s from Business Insider in France, right? So you’re big on that looking for people who have . . . Right?

Shaan: I love content marketing. I mean, content marketing is huge. You have to be . . . As any business or entrepreneur, you have expertise or advice that you can give for free either to PR and media or write your blogs or create some type of content that’s valuable to others. And now you do so many things. You get customers, you create a brand, you create authority. And so yeah, a lot of our traffic comes from our blog and vice as well as a lot of those blog articles end up going to PR and media, but just by pitches, but . . .

Andrew: And so you just now have somebody who pitches and writes about SATs to see if you could contribute?

Shaan: We do a little bit of everything. So part of it is we have a PR team actually that we outsource. It’s called Pitch PR. They do really great work. For a long time, I used to do all the PR myself. I would literally find every reporters’ email using RocketReach is a great tool for entrepreneurs out there to find people’s emails and I would pitch them. But now we have a third-party firm. We also have a person on our team that does HARO pitches.

Andrew: Help a reporter out.

Shaan: That’s been very effective as well. And so, yeah, I mean, I think the power of PR and media is you get to leverage another platform’s audience, but on top of that, if they link back to your website, it helps increase your domain authority and help your search engine optimization through backlinks.

Andrew: Yeah, I see that on here. Speaking up, by the way, freezing. It looks like Zoom froze up yet again. Why don’t we end it by telling people again about . . . It’s prepexpert.com. And . . .

Shaan: Absolutely.

Andrew: There we go. The video just froze on us. Prepexpert.com. And I want to thank the two sponsors who made this interview happen. The first, if you need to hire developers go to toptal.com/mixergy. And the second if you want to do some, like, development without coding yourself, go check out bubble.is/mixergy. I think you’ll be really happy that you did. Thanks so much, Shaan. Thanks for being here.

Shaan: Yeah. Thanks so much, Andrew. It’s been a pleasure. I had a lot of fun chatting today. And I hope the listeners got a lot of value. Again, obviously, if there’s any parents . . .

Andrew: How do they tell you if they did? If they did, I feel like people should be reaching out to guests. There’s so much value in doing that. What’s a good way for them to connect with you?

Shaan: Oh, yeah, definitely. I would love if listeners emailed me at shaan@prepexpert.com. That’s my email. They can reach me directly. If you got any value today, I’d love to hear from you.

Andrew: Cool. Thanks, Shaan. Thanks, everybody.

Shaan: All right. Thanks, Andrew.

Andrew: Bye.

Shaan: Bye.

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