Guest Post on Dragon’s Den by J. B. Loewen
Imagine, if you would, that you are about to pitch your business to the Dragons and are being shown toward the Den. (I presume the CBC producers use long, pointy sticks to prod entrepreneurs forward). Ahead of you lie the huge vault doors which remind you no one escapes the lair of the Dragons. There they wait in the gloom, seated up high (increasing the drama) and TV cameras glint menacingly, waiting to capture the moment you are flayed to the bones. You are tethered to a pole and the Dragons rise up shrieking and set upon you.
But reading through the blogs and Fan Forums, there are many comments from viewers who find the rough & tumble of the Dragon discussions distasteful – as if CBC has brought back Elizabethan Bear Baiting for our viewing pleasure.
Yet, gentle viewer, I believe this week’s session of Dragons’ Den awarded more to the entrepreneurs than the Dragons. First to enter the Dragons’ lair was Larry Destiny, his stage name from days as a fearsome pro-wrestler. Still carrying a glimmer of his wrestling ring stage presence, Larry rolled out his product called Attitubes – water filled weights.
As Arlene Dickinson said, “If someone had come to me with the idea of a ball in every gym, I would not have believed it.”
Larry quickly lured all the Dragons down to his pit and had them doing deep knee bends and even got Big Jim Treliving hoisting his watery weights above his head.
Now who’s being tortured here, folks?
With the Dragons suitably subdued and keen to learn more, Mr. Destiny let loose his own bit of torture, “I do not have a single sale.” Attitubes is still just an idea – patented – but a concept only. The Dragons fell into a heated discussion over whether it could be licensed or sold. Robert Herjovac informed Larry he had been drinking some wicked Kool-Aid to offer 20% of his company for $200,000 (making it an $800,000 valuation). If Larry had some sales to prove the concept, it would have been different. One by one, the Dragons backed away and Big Jim suggested Larry take charge of his own destiny. Last to speak was Arlene. She said, “$200,000 cash but for 60% of the company.”
With Larry off to call a partner, I waited for one of Kevin O’Leary’s intemperate jokes but this time it was Robert hurling words like ‘ludicrous’ and accusing Arlene of sitting too close to Kevin, picking up his evil aura, and stealing a naïve entrepreneur’s business – yet again!
Kevin, normally the hot head, calmly agreed with Robert, telling Arlene she was taking over his role of Chief Incubus of Venture Capital. She just gave them her Mona Lisa smile but W. Brett Wilson stepped into the frey and told the others to back off, “Arlene’s in and you’re not – so stop badgering her.”
I was hoping for a fight, swords drawn, maybe a fatal blow struck but no such luck because of Destiny. That’s right, Larry returned. Guess I’ll stick to Hockey Night in Canada for the gloves-off fights.
Here’s where the cruelty to Dragons begins. Larry negotiated the same cash deal but lowered the offer to 50% ownership. People, please, this is a lot of cash for just an idea. Yet when Brett stepped back into the deal, bringing his sports teams and gym to use the product, Larry was soooooo mean. No way was he changing his power play – boom, boom, boom. His brutality shocked me. Even Brett said, “When we shake, don’t crush my hand.”
Note to Larry: May I suggest a brand name switch? What about Aquatubes? It gives the water concept and Attitubes is little too close to ‘tubby’ for my liking. Oh, if you do go with my idea – how about $200,000?
This deal of Brett and Arlene’s was a bone crunching triumph for Larry Destiny. Here we get a glimpse of Venture Capital at its best. Research out of Harvard Business School says that money from outsiders is more likely to spur on success than cash from your favourite auntie or your mum. There you go – Larry Destiny and all you entrepreneurs out there, Dragons’ Den offers you a great chance to get the wealth you deserve. For all those who withstand the Dragons’ fire, enduring their scorn, you will be stronger. Otherwise, there is the long standing tradition where outside the CBC building, the heads of entrepreneurs are displayed on spikes as grisly reminders of those who spurned the advice of the Dragons.
J.B. Loewen raises capital for growth companies and is the author of Money Magnet: Attract Investors to Your Business.