A detailed study of the top 16 "Shark Tank" business pitches analyzing the communication design between business pitchers and investors.

1. King’s College London School of Management& Business
(Undergraduate)
SHARK TANK
The Design of Rejection in Negotiations
Module Title: Communication in Organization
Module Code:
(e.g. 4SSMN134)
6SSMN350
Module Leader: Jon Hindmarsh
Deadline: 19 January 2016
Word Count: 1994 / 2000 words

2. Negotiations are a form of strategic social interaction in which parties of differing interests
seek to achieve a common goal (Arminen, 2005). Bargaining is a form of negotiation and
both terms are used interchangeably. Goffman (1955) defines institutional talk as
interactions that embody an institutional order in which institutional rights and obligations are
linked to face, identity and macro-social institutions (Heritage, 1998). In the context of
institutional talk, negotiation activities differ from ordinary conversations as they are formally
organized through sequences whereby a party formulates a position and a recipient aligns or
misaligns with it.
While negotiation has gained wide attention in the business and communication research,
most tend to focus on the strategies employed and message contents that influence
bargaining activity (see Pennington, 1986 and Schurr and Ozanne, 1985); omitting the
consideration of social interaction and the sequential organization of talk. Additionally, while
some studies have focused on this subject area, most are grounded in institutional contexts
of sales, telemarketing calls or meetings. This report takes a unique view of examining the
development of negotiation in a live investment-pitching environment. It aims to illustrate (1)
how investment offers are responded to, (2) how responses are designed to express
reservations toward offers and (3) its implications on negotiation outcomes. The paper will
first discuss the methodology followed by a detailed analysis and provide an overview on the
broader implications of findings.
Negotiation patterns in the Shark Tank reality television series were analyzed where
entrepreneur-contestants conduct business pitches to a panel of ‘shark’-investors seeking
investment capital for a portion of their business equity. Data of the 12 most successful
Shark Tank pitches across all five seasons were collected based on the recommendations of
various news sources (Business Insider and Inc) and was analyzed in the form of recordings
provided by ‘Watch Series’. The report adopts Sacks and Schelgoff’s Conversation Analysis
(CA) and is unpacked using Heritage and Atkinson’s sequential organization of talk that
focuses on adjacency pairs and the preference organization. Both literatures helped
scrutinize the systematic patterns that occurred within negotiation and revealed structural
preferences in conversation for some actions over others.
Sequential organization is the ordering and positioning of actions or utterances that produce
context for subsequent turns. Its principles are centered on the notion of adjacency pairs
(Schegloff, 2007) and are fundamental units of conversational organization (Schegloff and
Sacks, 1973). An adjacency pair typically consists of two parts that are ordered, adjacent
and produced by different speakers and can come in forms of Offer-Acceptance/Rejection,

3. Question-Answer and Compliment-Response where the first-pair part (FPP) orientates the
second-pair part’s (SPP) behavior. This two-part structure is present in bargaining
sequences where a speaker proposes a position (offer) and is responded by the recipient in
the next turn displaying alignment (acceptance) or nonalignment (rejection) (Maynard,
1984). For example, a two-part sequential pattern of an investment offer nonalignment is
observed in (Extract-1); (1) Proposal (line 1) and (2) Silence (line 3) and Non-acceptance
(line 5).
Sacks, Schegloff and Jefferson’s (1974) notion of preference further categorizes these SPP
responses as ‘preferred’ and ‘dispreferred’. ‘Dispreferreds’ are often characterized by delays
(silences), prefaces (“erm” and “uh”, token agreements, appreciations and apologies) and
mitigated disagreement (minimal utterance and/or acknowledgement) (Clark and Pinch,
2001; Pomerantz, 1984; Clayman, 2002). Dispreferred responses are done ‘weakly’ with
delay markers of a 0.8 ‘gap’ and “erms” and a minimal utterance of “okay” in (Extract-1 line
3). The utterance “okay” makes no available grounds of agreement but depicts ‘basic’
agreements (Pomerantz, 1984) or ‘working acceptance’ (Goffman, 1967) that implies weak
agreement or even disagreement. Additionally, disagreements can be implied through the
conscious or unconscious act of disregarding the offer and directing of turn to a third
negotiator. However, this defies the moral obligation of a SPP response and therefore
generates a redirecting of turn back to the recipient furnishing a warrant to do so (Line 4).
Contrastingly, Firth (1995) posits that preferred responses are performed differently,
commonly without delays or intervening talk. In (Extract-1 line 8), acceptance is contiguous
with the preceding turn and this occurs when a third party intervenes to snatch and close the
previous offer. Similarly in (Extract-2 line 7), utterance was framed in a ‘hypothetical reported
sequence’ (HRS) by a third party to nudge the other party toward agreement (Koester, 2014;
Myers, 1999). The use of conditional agreement skillfully shaped a preference for
accommodation (Firth, 1995) to ‘make-a-deal-here-and-now’ that provoked urgency,
prompting preferred response and conforming Firth’s statement.
However, delays preceding acceptance utterances can also occur and this is common in the
absence of a third party. In (Extract-3 lines 1, 3, 5, 7 and 8), tactical summaries were utilized
to ‘force’ the unwilling party to take its preferred position. By summarizing offers and
presenting the speaker’s position desirably, the speaker asserts own position rather than
provide a mere summary, and successfully converts a probable dispreferred response to a
hesitant (0.2 ‘gap’ – Line 9) but eventual agreement (Charles and Charles, 1999). This

4. suggests that delays can be found in both preferred and dispreferred responses, though
more prominent in the latter.
How an offer is rejected is informative and consequential for the following negotiating turn.
Clark and Pinch (2001) distinguishes between implicit rejections (thereafter IR) and explicit
rejections (thereafter ER) and expresses that IRs in the form of pre-ERs appear to have a
significant influence on the ensuing course of negotiations compared to counterarguments or
ERs. Firth (1993) identifies five components on how messages can be designed to imply
‘dispreferred’ status; (1) Retrospectively ‘tie’ the communication to a particular preceding
message, (2) Apologize for current actions, (3) Propose accounts for that action, (4) Propose
substantive resolutions and (5) Prospectively ‘tie’ the message to upcoming messages. As
negotiation is fluid and is shaped according to preceding turns, the sequence of components
differs accordingly.
In (Extract-4 line 3), the response is again injected with delays, foreshadowing an implied
disagreement. Contrastingly, it is expanded with the utterance “I love you” that act as both a
‘cushioned rejection’ and a form of an apology, and is ensued with an ‘account’ (lines 5-6)
(Firth, 1993). ‘Accounts’ are “statements made to explain unanticipated or untoward
behavior when rejections occur ” (Scott and Lyman, 1968). Notice that disagreements are
not explicitly made. The design and ordering of the ‘cushioned rejection’ and ‘account’ is not
random, it systematically reduces the rejection impact. By pushing the ‘account’ down within
the disagreeing turn, the entrepreneur first displays non-acceptance (cushioned rejection)
then identifies a problem (account) that is preventing acceptance and ties the message to an
upcoming action to elicit offers from other ‘sharks’. Effectively, the offer rejection does not
necessarily close the offer sequence, but implicitly yet transparently demands a higher offer
and elicits new proposals from other sharks while still allowing re-entry for counter-offers
from the first. Therefore, IRs are tricky, as it requires a competent interactant to recognize
the speaker’s misgivings, affirm the validity of the speaker’s position and address the
reservations without them expressing it explicitly (Clark & Pinch, 2001). In this case, the
message was well received by a second shark who revised subsequent offers favouring the
entrepreneur (line 7).
According to Clark and Pinch (2001), ERs are harder to overturn into acceptance compared
to IRs as they signal minimal possibilities of obtaining acceptance to the sale/offer initially
proposed. Therefore, “explicit objections are not as important as is currently assumed” and
occur infrequently as it can induce face-threatening confrontation. The ‘facework’ concept
can be defined into (1) negative face – desire to be free from imposition and have one’s

5. prerogatives and autonomy respected and (2) positive face – desire to posses favourable
self-image that is validated by others (Brown and Levinson, 1987). Fundamentally, preferred
responses affirm a speaker’s both face aspects while dispreferred responses
(rejections/disagreement) threaten both face aspects.
(Extract-5A) exemplifies this deviant case. Notice that an insert sequence of a polite-marker
“thank you” (line 3) is positioned before the explicit declaration of rejection and a following
account. This intends to create a positive face to counterbalance the impact of the following
rejection and to demonstrate reasons for rejection respectively. The entrepreneur initiates
the account that reveals a problem of both parties engendering differing goals; capital-for-
equity shark VS equity-for-expertise entrepreneur. However, the shark interrupts with a
‘formulation’ that provides a ‘gist’ of the entrepreneur’s account by employing an information-
gathering question which unpacks the account. He then swiftly decides to retract his offer.
The concept of ‘face’ has a direct consequence on persuasion in that the hearer must be
made to feel important (Brown and Levinson, 1987). Therefore, it can be argued that the ER
was an imposition of the entrepreneur’s own desires at the expense of the shark resulting in
face loss (negative face) and therefore prompted the offer cancellation as an act of face-
saving.
The use of ER in this scenario should not be concluded as absolutely disadvantageous or
avoided. Through the supplementing of account, negotiating parties are given ‘negotiable’
materials in facilitating problem resolution. For example, in (Extract-5B, lines 9-10), a joint
problem-solving activity is initiated when other sharks pursued the account, strategically
allowing for systematic account unpacking that re-engages the relevance of the projected
action. Such account questioning serves to seek a concession to the account’s hitherto
undisclosed contents and to challenge the legitimacy of the account-giver’s demand (Firth,
1995). The entrepreneur provides the ‘pursued’ account (line 13), inserts a compliment
(positive face) while shifting the negotiation power to the sharks (line 14-16). It can be
argued that this stance was taken to compensate for the previous face-threatening act. This
compliment does not warrant responses as a Question-Answer adjacency pair is presented
after. The question constrains the respondent to answer with a counter-offer that is
responded favourably in (lines 17-29) and the unpacked account evidently succeeds in
shaping more offers (lines 26-31). Therefore, contrary to Clark and Pinch’s (2001) argument,
here, ERs are important as it evokes the unambiguous position and account of one party,
providing negotiable materials that facilitate effortless problem-solving.

6. Overall, this report examined five types of negotiation outcomes depending on how
bargaining sequences are shaped: (1) straightforward preferred response, (2) delayed
preferred response, (3) simple dispreferred response, (4) complex implicit dispreferred
response and (5) explicit dispreferred response. There are further points worth investigating
but this exercise has been useful in revealing the design features of the speaker’s SPP
response to an offer in adjacency pairs. It contributes to Firth’s (1995) statement that
dispreferred responses are often delayed and more complex while preferred responses are
straightforward and promptly produced without delays. However, it also illustrates evidences
that delays do manifest in preferred responses, especially when pressured upon.
Additionally, the use of HRS aids as a persuasive device in negotiating towards
individualistic goals (Koester, 2014).
It is important to note that as the analysis is based on edited data materials, this limitation
may therefore affect findings on delayed responses. This study further illustrates that
dispreferred responses can be designed in implicit and explicit manners and contributes to
Clark et al (1994) statement that IRs act as hints that supply evidences of sales resistance.
While ERs are unambiguous, they are however vulnerable to face-threatening situations that
can undermine the relationship between parties during current and future encounters (Clark
et al, 2003). While Clark and Pinch (2001) suggest that ERs are not as important as
currently assumed, this report reveals otherwise as it drives negotiations forward by
providing direct opportunities for unpacking of accounts which render important problem-
solving resources. This discrepancy may arise from the contextual differences and the timing
of ER, whereby ERs arose only at the end of the bargaining sequence in Clark and Pinch’s
sales encounter while in this study it occurred in the early stages of negotiation.
The design of sequences is hence critical for informing and constraining the next preceding
action. IRs are common and influential for negotiations and negotiators need to learn to
recognize and understand objections and match proper communication techniques to
advance the negotiation process forward. They however should not neglect the significance
of ERs.
(1994 words)

7. References
Arminen, I., 2005. Institutional interaction. Studies of talk at work. Burlington S, 115.
Brown, P. and Levinson, S.C., 1987. Politeness: Some universals in language usage (Vol.
4). Cambridge University Press.
Charles, M. and Charles, D., 1999. Sales negotiations: Bargaining through tactical
summaries. Business English: research into practice, pp.71-82.
Clark, C. and Pinch, T., 2001. Recontextualising Sales Resistance: A Response to Hunt and
Bashaw. Industrial Marketing Management, 30(8), pp.637-643.
Clark, C., Drew, P. and Pinch, T., 2003. Managing prospect affiliation and rapport in real-life
sales encounters. Discourse Studies, 5(1), pp.5-31.
Clark, C., Drew, P. and Pinch, T., 1994. Managing CustomerObjections' during Real-Life
Sales Negotiations. Discourse & Society, 5(4), pp.437-462.
Clayman, S., 2002. Sequence and solidarity. Group cohesion, trust and solidarity, 19,
pp.229-253.
Firth, A., 1995. ‘Accounts’ in negotiation discourse: A single-case analysis.Journal of
Pragmatics, 23(2), pp.199-226.
Goffman, E., 1955. On face-work: An analysis of ritual elements in social
interaction. Psychiatry, 18(3), pp.213-231.
Goffman, E., 1967. On face-work. Interaction ritual, pp.5-45.
Heritage, J., 1998. Conversation analysis and institutional talk: Analyzing distinctive turn-
taking systems. na.
Koester, A., 2014. “We'd be prepared to do something, like if you say…” hypothetical
reported speech in business negotiations. English for Specific Purposes, 36, pp.35-46.
Maynard, D.W., 1984. Inside plea bargaining (pp. 201-208). Springer US.

8. Myers, G., 1999. Unspoken speech: Hypothetical reported discourse and the rhetoric of
everyday talk. Text-Interdisciplinary Journal for the Study of Discourse, 19(4), pp.571-590.
Pennington, A.L, 1968. Customer-salesman bargaining behaviour in retail transactions.
Journal of Marketing Research, pp.255-262
Pomerantz, A., 1984. Agreeing and disagreeing with assessments: Some features of
preferred/dispreferred turn shaped. Structures of Social Action, pp.57-101
Sacks, H., Schegloff, E.A. and Jefferson, G., 1974. A simplest systematics for the
organization of turn-taking for conversation. language, pp.696-735.
Schegloff, E.A., 2007. Sequence organization in interaction: Volume 1: A primer in
conversation analysis (Vol. 1). Cambridge University Press.
Schegloff, E.A. and Sacks, H., 1973. Opening up closings. Semiotica, 8(4), pp.289-327.
Scott, M.B. and Lyman, S.M., 1968. Accounts. American sociological review, pp.46-62.
Schurr, P.H. and Ozanne, J.L., 1985. Influences on exchange processes: Buyers'
preconceptions of a seller's trustworthiness and bargaining toughness. Journal of consumer
research, pp.939-953.

9. Appendix
S = Shark
E = Entrepreneur
Extract 1: Ten Thirty One Productions
1 S1: Okay well then. I’ll give you two million dollars for forty percent=
2 S2: =T:skk
3 E: (0.8) Oka:y. (0.3) Mark? (.) Come on Mark.
4 S3: Hhhh. Is that a yes^ or no to him^?
5 E: Ermm hhhhh. Can I counter?
6 S1: Of course^ you can counter
7 E: (0.2) Erm. Two million for twenty percent
8 S3: I’ll take that offer. Done.
9 E: Really?
10 S3: Yup.
Extract 2: Bantam Bagels
1 S2: In all that time that we just sat here, and I’ve had my offer [out there,
2 S1: [Would you mind^ I’m doing an off=
3 S2: =[I’m thinking to myself ] you could have just sold a hundred dollars in QVC!=
4 E1: [Lori, I wanna, hhh I wanna]
5 E1: =Would you? Would you. (0.1) Would you be interested in tha:t 25%?=
6 S1: =I’ll give you a [thir:d
7 S2: [I WOULD (0.1) if you decide right now with me
8 E2: [Yup
9 E1: [You have a deal
Extract 3: Breathometer
1 S: You have an opportunity to get a:ll five sharks and the power of all 5 sharks behind you.
2 E: Right
3 S: Here’s the deal. One million dollars. Five hundred thousand from Ma:rk Cubin for fifteen percent.
4 E: [Hhhehhh hehhh
5 S: An[d five hundred thousand from the rest of the sharks, we are going to split it
6 E: Right=
7 S: =For a total of thirty percent (0.1) for one million dollars. In the power of Shark Tank, what are
8 you going to do?
9 E: (0.3) Hhhh I accept

10. Extract 4: Lumio
1 S: I share your vision (0.1) I.. I.. I think you are on the right path. I think your valuation is
2 pretty fair^ (0.1) Two hundred and fifty thousand (0.1) for ten percent.
3 E: (0.2) So (0.1) Robert, (0.1) I love you?=
4 S: =Thank^ you hhahh ahh. I don’t know what to say^ hehh=
5 E: =uhmm (0.1) would you mi:nd if I asked the other sharks to see if: they are interested
6 (0.1) just to see what their offers are?
7 S2: (0.2) I’m^ interested. And uhmm (0.1) I’m going to structure it a little differently: oka:y?
Extract 5A: Emazing Lights
1 S1: (…) I’m going to lo:an you six hundred fifty thousand dollars. I’m going to ask
2 three percent equity. That will (0.1) give you the funds you ne:ed to gro:w=
3 E: =Kevin (0.1) tha:nk you so much for the offer. But I would have to decline (0.2) That is
4 absolutely not wh:y I’m here today. I am looking to get one of you
5 sha:rks (0.1) on my team (0.1) to help us with the day to day=
6 S1: =So you don’t want to do with any debts (0.1) that’s what you’re saying?=
7 E: =I have never (.) gone out to look for a loan for this company^
8 S1: (0.1) OKAY (0.2) I’m out.
Extract 5B: Emazing Lights
9 S2: So: (0.1) why is the offer s:o hhh SSSMA:LL? Because if you wa:nt hhh one of us to: get
10 out of bed in the morning to come: work with^ you=
11 E: =Mmm hmm..
12 S2: why would we: (0.1) do that for five percent?
13 E: The five percent was because: I’m not really looking for the money^. I think you
14 guys are: the: hhh smartest business:s people on the planet^, you know.
15 Why don’t you guys tell m:e what percentage: make sense for yo:u to jump into bed with
16 us and grow this business into a billion dollar industry?
17 S2: I’:m gonna give you an offer (0.2). I wanna help you with all of the licensing:^ and give
18 you the marbles of the wo:rld and get you into the ( ) of the cities (0.1) if th:at’s what your
19 objective^ and all the brand extensions^ .hhh I’ll give you six hundred and fifty thou;sand
20 dollars: fo:r (0.3) twenty percent of the licensing that I: bring to you.
21 S1: (0.1) So that’s not the company=
22 S3: =That’s not [the company
23 S2: [That’s not of your company^ (0.1) I will go out and get you the licenses (0.1)
24 S3: [( )
25 S2: [I take the twenty percent (0.1) I don’t want any equity.
26 S4: (0.3) Alright. Brian: loo:k you are the re:al deal man. Like you ar:e probably one of the: IF
27 not the best entrepreneur we’ve ever had here (0.1) a:nd I think you need some help:
28 with: with growth. Here’s the offer Lori and I want to make you (0.1) We wanna help
29 yo:u^ (0.1) its good to have two [people]
30 S3: [in the trenches, together]=
31 =Ai:te?

11. Transcription symbols
(.7) Length of a pause.
(.) Micro-pause.
[ ] Between adjacent lines of concurrent speech indicates overlap.
- Sharp cut-off.
: Stretching of a word.
( ) Unclear fragment.
^ Rising intonation.
Word underline indicates speaker emphasis.
Data of 12 Best Shark Tank videos:
Business: Episode: URL:
1. Emazing Lights Season 6: Episode 22 http://goo.gl/Z52KGD
2. Lumio Season 6: Episode 15 http://goo.gl/Kjpzx6
3. Bantam Bagels Season 6: Episode 13 http://goo.gl/VJTaWf
4. Zipz Wine Season 6: Episode 11 http://goo.gl/UgnhqD
5. Beatbox Beverage Season 6: Episode 6 http://goo.gl/3vUil0
6. Cycloramic Season 5: Episode 16 http://goo.gl/WHneZT
7. Bubba’s Boneless Ribs Season 5: Episode 11 http://goo.gl/UgnhqD
8. Tree T-PEE Season 5: Episode 7 http://goo.gl/Al9fv4
9. Ten Thirty One Productions Season 5: Episode 6 http://goo.gl/h1RfXv
10. Breathometer Season 5: Episode 2 http://goo.gl/qZSvu1
11. Simple Sugars Season 4: Episode 19 http://goo.gl/A85ca8
12. Cousin Maine Lobster Season 4: Episode 6 http://goo.gl/mxbPtn