Here’s a challenge for all of CBC's Dragons' Den armchair investors. You have been riveted by these intelligently selective Dragons sifting over the business ventures brought into the Den. Now it’s time to swivel your armchairs away from the entrepreneurs, towards the Dragons.
First up, let’s do a little of our own “Due Diligence.”
If you pull up the CBC Dragons’ Den website and find Trent Kitsch’s record of past episodes, he helpfully lists the dollar value of the deals made and the Dragons who committed capital, making it easy to jot down the investment record of each Dragon. Since Trent’s blog only goes up to Episode 8, I may be missing a deal here or there, but I think there’s enough to chew on the interesting statistics.
I invite you to examine the Dragons’ Score Card (at the top of this blog) where next to each Dragon’s name, you will find the number of deals done and, as Robert Herjavec likes to say, “money put at risk”.
So chaps, how’s the investing going?
From my calculations, our Dragons from Alberta are demonstrating why they are the “have” province and Ontario is the “have not”. W. Brett Wilson and Arlene Dickinson committed to 18 deals and $3.2 million in investments.
And surprise, surprise – what do we have here? The lowest investor is the one with the most bluster. It’s dear old Mr. Kevin O’Leary. Well, well, well.
Jack Welsh, the leader who took General Electric (GE) to the top of the stock market, had a firm but simple rule: the bottom 10% performers of the work force got fired – every year!
Well, Kevin has been telling us all season that the market is cruel, so why shouldn’t the market bite down hard on a low investing Dragon? Why should it just be the presenters who have that unwanted feeling of hot adrenaline?
By the current rules, the Dragons are not under any obligation to spend a dime, but surely they should be under pressure? After all, in the real world, investors have their laws of the marketplace too. If they don’t invest, they obtain a low return on their capital, and if they are managing other people’s money and don’t have the ‘ovaries’ (or other body parts) to place it, that cash would be taken back rapidly.
If an investor does not commit dollars to companies, the only return they are making is on their original lump sum of capital and what’s the point of that? Kevin should know better than any as he runs a fund and, for sure, works within this rule. Right now, Kevin has the lowest record for investing capital and for that, to coin one of his favourite phrases, “he should be blowtorched out of existence.”
A common complaint by investors in the real world is that they don’t see good enough deals, and I suspect that the Dragons would say the same about the visitors to their Den, “They’re a little subprime, not likely to profit.”
Pardon me, but all sorts of idiotic things do well. The game Trivial Pursuit got turned down by hundreds of Angel investors who thought it was too dull. I still love mood rings, tiny troll dolls with pink hair, Billy Bee Honey but who would’ve invested in those things at their start? Even Barbie had its troubles getting launched.
That’s an excuse.
With the celebrity of the Dragons, many of the company products could gain some momentum. Surely, with several Dragons pitching in with their skills and rolodexes of global contacts, they could achieve something?
Ah…but Kevin would say he adds valuable entertainment which should be factored in to his score card.
Although, the Dragons’ Den is a display of Canadian entrepreneurship, it has to be watchable and it’s an added benefit that Kevin does an exceptional job of teaching. Our Canadian show is far superior to the British version because we are fortunate to have entrepreneurs with deep experience: Jim Treliving adds gravitas, Arlene Dickinson mixes in marketing sense, Brett Wilson brings formidable gunpowder, Robert Herjavec has spark and it is exciting to see Kevin grasp onto entrepreneurs and drag them flailing around the Den. People going on the show do realize there must be good ratings, but the fair swap is that there is a real cash opportunity too.
If it’s ratings the CBC needs, maybe one of the entrepreneurs could come back on the final show and say, “Kevin, you’re out!” push him shouting across a moat and as the draw bridge pulls up, a sofa-sized dragon could lunge at him.
Is it possible that he could even scream?
You have to admit, that would make great entertainment and since ratings are a factor in this materialistic, greedy, money-grubbing world of ours, a scene of a Dragon’s demise would be of enormous interest to more than a few viewers.
Which Dragon would you roast?
Right – so we are agreed then. Here are the new rules for the Dragons: lowest cash investor, you are the weakest Dragon. In Kevin’s words, “You’re a nothing burger”. You’re off the show!
Now, that’s entertainment.