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Dragons' Den digest - Week 7
If you missed last week's, catch up here and below you will find the highlights of episode seven.
Quote of the Episode: "Not all good ideas are money-making ideas." Theo Paphitis
Idea 1
Product: Gift Card Converter – online marketplace for buying/selling gift cards.
Investment sought: £50,000 for 25 per cent equity.
Handling: Confident pitch. They want investment to increase their marketing efforts and develop the business further. Duncan Bannatyne doesn't think it will make any money while Theo Paphitis and Deborah Meaden questioned the legalities of the business.
Outcome: No investment.
Verdict: Confident pitch and confident at answering questions, but the Dragons were concerned about whether the business was actually legal. No deal.
Idea 2
Product: Surviva Jak – foil jacket for walkers to help prevent hypothermia.
Investment sought: £75,000 for 30 per cent equity.
Handling: Good initial pitch but lost their confidence when Duncan Bannatyne questioned their financial calculations. The male Dragons interrogated them over their market research but Deborah defended them, saying she could see they had made mistakes but didn't understand why they were coming in for such harsh criticism.
Outcome: Deborah Meaden offers them £75,000 for 45 per cent equity, they try to barter it down to 40 per cent but she won't budge. They accept 45 per cent.
Verdict: A rocky pitch, they struggled under questioning, but received a good investment.
Idea 3
Product: Citidogs – Dog Crèche.
Investment sought: £75,000 for 20 per cent.
Handling: Starts out seeming like an investable idea. Duncan Bannatyne suggests they go away and work out their financial projections – they haven't evaluated the true cost of their business as they're not taking a salary and haven't registered for VAT.
Outcome: No investment.
Verdict: Started well but need to think through their finances in more detail.
Idea 4
Product: The Wand Company – buttonless remote control that works on movement.
Investment sought: £200,000 for 10 per cent.
Handling: Theo Paphitis looked impressed by the demonstration of the magic wands – a special take on remote controls. Product cost £50 when sold directly to customers but just £10 to make. Confident with their figures even under questioning. They received offers from all the Dragons.
Outcome: Accepted Duncan Bannatyne's offer of £200,000 on a sliding scale starting with 30 per cent share and going down to 10 per cent if they make £1.2 million.
Verdict: Strong pitch and product demonstration. Interesting to see all five Dragons make offers.
- You can replay the episode on the BBC's Dragons' Den website
What did you think of the episode?
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Comments
As always a mixture of good & not so good, but overall a reasonably good week.
Can't believe that the BBC allowed a possibly illegal business proposition onto the airwaves, unless they wanted to make a point. Never going to get off the ground, and he gave up a £100k job as well!!
Either Deborah has lost the plot, or she can see something that rest of us can't. I was using foil blankets perfectly well with Scouts over 20 years ago. Just 'cos it is a jacket doesn't mean I am going to rush out and change the habit of a lifetime. Will be interesting to see how this one pans out.
Citidogs was clearly designed for 'hooray henry's' with more money than sense! The failure to understand their financials was a lesson for everyone going into business.
And so to the 'magic wand'!! I really couldn't get excitied about this, and was surprised at the interest from the Dragon's. For me the obvious match was with Peter Jones, with his 'techie' background and contacts. So why you would go with someone whose 'forte' is leisure clubs & hotels baffles me. Of all the Dragons, Duncan would have been the last on my list, but then he usually is!!
Roll on next week!
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