People love a good Shark Tank fairytale—the bold founders, bright lights, and a handshake launching a million-dollar empire. But if you think every pitch that makes it to TV is destined for glory, you’re not paying attention. Take Validated. They hit that stage, made tech look sexy, and walked out empty-handed. Two years later, they were out of business. This isn’t just another what happened after Shark Tank? story. It’s the hard reality, with every bruise and lesson exposed—just like any founder who’s gone rounds in the trenches.
Validated’s Big Promise: Free Rides for Shopping Local
Validated’s pitch had the kind of hook that would grab any city dweller’s attention. You shop at partnered local stores and restaurants, spend your hard-earned cash, and—boom—get credits to cover your Uber, parking meter, or transit fare. Shop, scan, ride for free. The dream? Everyone wins: customers save on transport, merchants get foot traffic, and Validated takes a slice from both ends.
It sounded slick. I’ll give them that. The founders positioned it like the next evolution of loyalty programs—cashback, but with wheels. For anyone sick of shelling out for parking on a night out or eating delivery fees, Validated had that buzzy promise to move people.
Meet the Founders: Scrappy, Hungry, and Ready to Risk It
Validated was built by a trio of Seattle hustlers: Ian Lyman, Tov Arneson, and Alex Wilhelm. These weren’t Silicon Valley superstars, but that’s what I like—real operators with skin in the game. They had product chops and design instincts, and knew how to get in front of decision makers. You can say what you want about their odds, but these guys were classic startup warriors—the sort who understand that if you wait to be ready, you’ll never launch.
They’d already been through Techstars, landing some validation (no pun intended) and a few angel checks. So when they walked onto Shark Tank, you could see the nerves, the passion, and the kind of hunger only found in founders still living off ramen.
The Shark Tank Pitch: Stakes, Nerves, and Hard Math
They asked for $250,000 for 8% equity—coming in hot with a $3.125 million valuation. That’s steep for two cities and 50 merchants, but remember: SaaS and app startups always pitch the future, not the present.
Most founders walk into Shark Tank thinking they’re playing chess, but the Sharks play their own game. Mark Cuban, Barbara Corcoran, Kevin O’Leary, Lori Greiner, and guest Chris Sacca—they’ve heard every pitch and seen more pretty decks than a Vegas card dealer. The Validated team held their ground, explained their numbers, and tried to paint a world where every Main Street would be their oyster.
But it was a tall ask for a business running in two Northwest cities, low transaction volume, and a whiff of high burn-rate.
How Validated Was Supposed to Work (And What Actually Happened)
Time for real talk. Here’s how the Validated app worked:
- You spend money at a partner store or eatery.
- After you pay, you scan a QR code or upload your receipt with the app.
- Once you hit a merchant’s spend threshold—say, $30 at a cafe—you unlock credits.
- Credits pull cash value, which you spend back on Uber, parking, or public transit.
Merchants figured: Drop $10 to get a customer to spend $60, and they might come back. For customers, it was a no-brainer—something for nothing, right?
But for platforms like these, balancing both sides of the marketplace is brutal. You need lots of merchants to draw users and plenty of users to excite merchants. Chicken. Egg. Repeat. Every founder who’s tried to build a two-sided platform knows the pain. The app and idea were clean. Execution, though? That’s another beast.
Did Any Shark Bite? Here’s the Reel
Let’s not sugarcoat it. Validated got grilled from all sides:
- Mark Cuban: Had doubts about technical scalability and integration. He was out first.
- Barbara Corcoran: Couldn’t see the value prop or why customers would care. She passed.
- Kevin O’Leary: Wasted no time predicting a crash—This will go to zero, he snapped. Ouch.
- Lori Greiner: Thought the masses wouldn’t latch onto it.
- Chris Sacca: Liked the hustle but called the idea too complicated.
Not a dime left on the table. Five Sharks, five passes.
I’ve seen pitches tank for less. Sometimes your numbers are too green, or your market just isn’t loud enough. Here, the biggest hit? Nobody on the panel could see how this scales. No global vision, no clear mass user demand. A death sentence on national TV.
Net Worth: Let’s Talk Zeroes—There Aren’t Any
After Shark Tank, entrepreneurs either ride the wave—or get crushed by it. Validated’s founders hoped for a jolt, but after the cameras switched off, they ran into the same walls. Growth sputtered. Merchant adoption lagged. User numbers stayed tiny.
Validated burned cash faster than it brought in merchants. By June 2019, just two years after their TV moment, the company folded. No big buyout. No asset salvage. No under-the-radar acqui-hire. Today, the Validated brand and business are gone—net worth, you guessed it, a clean zero.
I’ve seen companies sell off patents or tech and survive for a few more years. Not here. You Google Validated app today, and you get a dead link or a couple of Shark Tank after-the-fact articles. That’s all that’s left.
Why Did Validated Fail? It’s Not Just Bad Luck
Let’s rip the Band-Aid off. Here’s why the whole model broke:
1. Market Fit Wasn’t There
Validated was trying to solve a problem some people didn’t know they had. Free rides sound great, but most customers would rather grab a promo code than jump through app hoops just to save $5 on parking.
2. Scaling Was a Nightmare
To get traction, they needed thousands of merchants across dozens of cities, all running unique promos. Getting merchants on board takes time. Keeping them is even harder.
3. Two-Sided Markets Burn Cash
Apps like this aren’t cheap to scale. You’re selling to merchants while also herding users—all while building tech that works without a hitch. Most platforms choke here unless they raise enormous rounds or go viral.
4. Not Enough Stickiness
Merchants didn’t see enough repeat customers. Users didn’t use it daily. Without stickiness, you’re just a nice-to-have, not a must-have.
5. No Shark Fuel
Sometimes, a Shark deal gives you more than cash—it gives you access. No deal means no Cuban email intros or Greiner Rolodex. If you came in weak, you left weaker.
As an operator, I’ve watched enough decks to know when the writing’s on the wall. When merchants don’t buy in, and users don’t care, you can’t keep the lights on.
Lessons for Founders: Don’t Fall for the Hype (But Respect the Hustle)
If you’re working on an app or two-sided play, read this twice. Validated’s failure wasn’t for lack of brains or hustle. Sometimes, the model just eats early founders alive.
What should you watch out for?
- Don’t chase cool tech without a pain point worth solving daily.
- If your business lives or dies by merchant signups, have a clear, scalable playbook.
- Remember: two-sided markets need massive cash or network hacks to reach critical mass.
- Validate every assumption—will real people actually use your tool, or will it rot on their phone?
- Get feedback from both sides of your marketplace before you pour everything into product.
Shark Tank lets you pitch to the world, but it’s just a start. The grind after the show is what makes or breaks you.
When the Cameras Turn Off: Win, Lose, but Never Quit
Validated tanked on national TV. The company died two years later. But here’s the thing—the founders still showed up, risked it, and played for real stakes. That’s worth more respect than any viral Kickstarter fluff.
Entrepreneurs dream big, fail hard, and get back up. It’s the only way. For every Scrub Daddy or Bombas, there are a dozen starts that just don’t click. Don’t get tricked by TV magic. Watch what happens after the lights fade. The real game is built in the aftermath.
Want to track who actually made it big and who’s worth zero? Keep your eye on the numbers, not just the soundbites. That’s what we do at SharkWorth.
No fairy tales here—just the honest grind.
FAQs
1. Is Validated from Shark Tank still in business?
No. Validated shutdown in June 2019.
2. Did Validated get a deal on Shark Tank?
No deal—all five Sharks opted out.
3. How did the Validated app work?
You shopped at partner merchants, scanned receipts, and earned ride credits for transportation services.
4. Why did Validated fail?
Not enough merchants, users, or daily use. Scaling costs outpaced growth.
5. What was Validated’s net worth after Shark Tank?
Zero. The business is defunct with no value left on the table.
6. Who were the founders of Validated?
Ian Lyman, Tov Arneson, and Alex Wilhelm.
7. Are the founders working on new projects now?
No public updates, but most founders keep moving in the startup ecosystem.
8. Where can I watch the Validated Shark Tank episode?
Season 8, Episode 21—find it on standard Shark Tank streaming platforms.
Want more real Shark Tank post-mortems and net worth breakdowns? Bookmark SharkWorth. We strip the hype, show the hustle, and call things as they are. That’s how entrepreneurs win.
