Last night the BBC showed their online version of the Dragons Den which has been running for the last few months. The Online Den has a couple of twists on the standard BBC show that we all know and love…
Firstly there are only 2 dragons – one of our extraordinary entrepreneurs, Julie Meyer who made her fortune by launching and selling one of the most successful networking organisations, First Tuesday and then subsequently launching and creating Ariadne Capital and Shaf Rasul, the entrepreneur behind E-Net Computing, the largest storage media distributor in the world and portfolio investor in property and digital media.
How does it work?
The inventors and entrepreneurs upload raw video pitches for their business onto the BBC website and viewers can vote on which pitches are the most interesting or have the most potential. A select number of entrepreneurs then get to pitch in front of the Dragons. Julie and Sharif are not allowed to see the original raw pitches and have to base their decisions on what they see in front of them.
The show is only 30 minutes long and does have some similarities to it’s bigger brother however in many respects the business aspect of it is much more real world rather than the pure entertainment focus of the original.
We get to see some really amusing products… the mpod a roadside koogul to protect your dignity(!), the hairbrush for men (?!) and the bicycle that folds into a suitcase (with no room for anything else).
Pitch 1: Chinese in Primary Schools
Julie is definitely the star of the show and her ability to drive down to the core elements of the business is impressive. But woe betide anyone who doesn’t take her seriously! The opening pitch was from Marcus Reoch pitching his Primary School Teaching Chinese after school club. But oops – he directed most of his pitch towards Shaf, barely looking a Julie and she didn’t hold back on calling him on it – not a great start!
His profit margin was small with very little growth over his 3 year projections with an overall profit of £68,000 after 6 years of trading. This is great for a sole trader, particularly if you factor in paying yourself a salary, but as an investable vehicle there is not much to attract an investor. His biggest sin was a lack of business ambition – therefore no deal was there to be done.
What we learned from Julie… Investors are looking for a business that has a sharp acceleration over the first few years. Investment is not about building a small business.
Pitch 2: The Cosy Shopper
Lisa and Matthew Penn have created a great product called the cosy shopper. A snug for your baby when you take them shopping and have to put them on those hard (and let’s face it, often dirty) reclining baby seats in shopping trolley’s. It was all looking good for them until they revealed that they only work 2-3 hours a day on their business and are planning to increase that to 30 hours a week! I could only dream of only putting in 30hours a week in my business!
What we learned from Julie… To build a successful business you need to be investing at least 45 hours a week
Pitch 3: Family Fridge
The third and final pitch was from a young entrepreneur Alexi Deak who has created an impressive website called Family Fridge. It’s an online family organiser and a great concept. It’s business model is advertising revenue and sponsorship and Alexi is hoping to get 50,000 users resulting in a projected advertising revenue of £300,000. His pitch was competent and his idea is quite a good one (though I suspect it’s going to be harder than he thinks to get that £300k of online advertising revenues!). The result was Julie and Shaf both offering to put up the money… with Alexi deciding to go with Julie
What we learned from Julie… Watching the way that Julie disseminates the business was really interesting. She had a few questions that we think every business should ask themselves whether they are looking for investment or not.
Q1. What is the piece of your business that is going to draw people in
Q2. Why do people want to use your business …
Q3. How are you going to deliver that
Q4. Tell me what the business model is
Click here to watch the whole pitch and let us know what you think!
If you are looking for funding, check out our Extraordinary Entrepreneurs Dinner on November 18th where you could have a chance to dine at Julie’s table.
About the Author: Julie Hall is the founder of Women Unlimited and also the owner of Springmedia, a London based digital media agency.