In the early years of entrepreneurial education, business schools mainly sponsored business plan contests. These contests, however, had disadvantages. Business plans are long and take time to read, analyze, and judge – at the end of which no one can accurately predict venture success. It is never clear whether the award should go to the plan with the “best” writing, most optimistic financial projections, or real proof of potential.

Business schools then pivoted to pitch contests. Pitches are short and all judges have to do is listen to the pitch and pick award winners – deserving, or non-deserving, even if no one can predict success from a pitch.

And then we got Shark Tank – the TV show that seems to have mesmerized many into thinking that all a successful entrepreneur has to do is to:

· “Innovate” an idea based on the assumption that ideas and innovation are the foundation for great ventures

· Develop a pitch that sounds great – not sure what the criteria for great pitches are

· Deliver it with enthusiasm to show sales skills

· Win prizes because sponsors want to “promote” entrepreneurship as publicity for themselves. How many of the winners and losers actually start the venture they pitch, and how many succeed, is somewhat opaque.

Mark Cuban is a smart guy. He built his company at the start of the Internet age and sold it to Yahoo for gazillions. With this capital, he bought a basketball team and with his charm and smarts, got a seat on Shark Tank – perhaps the most successful of the investors.

Thankfully, he now spills the beans by admitting that he has invested about $20 million in 85 ventures on Shark Tank – and is underwater.

Why is this admission important? Because it points out that the emperor is naked – that no one can forecast potential from a pitch.

Hopefully, this admission can spur business schools to add to entrepreneurial education by shifting their focus from the idea to the entrepreneur. Here’s why?

#1. Idea (or “Innovation”) is not the key. Strategy and skills are. Business schools emphasize innovation as a cornerstone of entrepreneurship. Cuban’s admission clearly suggests that the idea is not the key. Among more than 120 unicorn-entrepreneurs, only 1% relied on the innovation. Most succeeded due to the entrepreneur’s skills and strategy:

· Many launched big-box stores. Sam Walton imitated the idea and dominated due to his strategy of focusing on small towns

· Many got into PCs. Bill Gates bought the operating system and succeeded in making it the standard due to his alliance with IBM

· Many got into connecting people online. Mark Zuckerberg imitated the idea and beat Rupert Murdoch due to his strategic focus on university students, starting with Harvard and Stanford.

It is difficult to predict the strategy that can dominate emerging trends because it requires the right combination of product, customer segment, and competitive edge. That’s why many unicorn-entrepreneurs pivot as did Travis Kalanick (Uber) from limos to cars. And why it is important to teach entrepreneurs the process to stay flexible and pivot.

#2. Pitch contests cannot forecast success. Shark Tank is built on the pitch – if one is to believe the format and the hype. But Cuban’s admission shows that even one of the smartest people in the planet cannot forecast accurately. Should business schools stop promoting pitch contests?

#3. Business schools can do more to promote entrepreneurial success by teaching skills and smart strategies and by promoting skills competitions. Instead of a “fast” pitch competition, Business schools should promote a “slow” skills competition. Teach skills and the smart strategies to succeed and then evaluate real performance – without having to guess. Offer resources to those who prove their skills.

#4. Venture capital does not buy success. VC, and the VC method of Idea-Pitch-Incubator/ Accelerator-Angels-VC, works for about 20 out of 100,000 (see Truth About VC) and mainly in Silicon Valley. And most of these entrepreneurs are diluted heavily because they often get VC early and lose control of their ventures. Business schools can teach the Skills-Strategies-Reverse VC method to takeoff without VC and grow with control as was done by about 94% of unicorn-entrepreneurs.

It would be great to see business schools focus on teaching what they were designed to do –skills. And avoid theatrics in entrepreneurial education.

MY TAKE: How much proof do business schools need to switch from pitch contests to skills contests? Maybe Cuban should talk directly to them.

CNBCMark Cuban says this was his worst ‘Shark Tank’ investment ever: ‘Next thing you know, all of the money’s gone’