0:00:26 > 0:00:28These are the Dragons.
0:00:28 > 0:00:32Five of Britain's wealthiest and most enterprising business leaders.
0:00:32 > 0:00:33Over the coming weeks,
0:00:33 > 0:00:39they'll make or break the dreams of dozens of budding entrepreneurs.
0:00:40 > 0:00:42If I've been harsh
0:00:42 > 0:00:45and you HAVE been listening then it's been a great exercise.
0:00:45 > 0:00:49- It's absolutely stupid.- I'm not going to waste my words any more.
0:00:49 > 0:00:52You are entirely investable.
0:00:52 > 0:00:54- DEBORAH:- What is going on?
0:00:54 > 0:00:57I've never, ever, ever seen... What have you done?
0:01:04 > 0:01:06The multimillionaire investors
0:01:06 > 0:01:09have each built up their fortunes from scratch.
0:01:13 > 0:01:17Retail magnate Theo Paphitis,
0:01:17 > 0:01:20hotel and health-club owner Duncan Bannatyne,
0:01:20 > 0:01:24leisure industry expert Deborah Meaden,
0:01:24 > 0:01:26queen of logistics Hilary Devey,
0:01:26 > 0:01:29and telecoms giant Peter Jones.
0:01:30 > 0:01:34The Dragons have the credentials, the contacts, the commitment
0:01:34 > 0:01:37and the cash ready to invest.
0:01:37 > 0:01:39But only in the right business.
0:01:39 > 0:01:42Will any of these hopeful entrepreneurs
0:01:42 > 0:01:44walk away with their money?
0:01:51 > 0:01:54Welcome to Dragons' Den.
0:01:54 > 0:01:57Entrepreneurs are optimistic by nature.
0:01:57 > 0:02:00And those who come here are no exception.
0:02:00 > 0:02:04They're all convinced their idea or invention can make them rich.
0:02:04 > 0:02:07But the challenge, of course, is to persuade our five Dragons
0:02:07 > 0:02:11to share that view and invest in their business.
0:02:11 > 0:02:14A few who come here today will succeed but most can expect
0:02:14 > 0:02:18to find their optimism taking a knock or two along the way.
0:02:18 > 0:02:21It takes a good pitch, a great product
0:02:21 > 0:02:25and a persuasive personality to convince the Dragons to invest.
0:02:25 > 0:02:27Will our first entrepreneur have all three?
0:02:50 > 0:02:53Hi, Dragons. My name is Andrew Hannon.
0:02:53 > 0:02:57I'm here today, I'm looking for £50,000 investment.
0:02:58 > 0:03:03Now, it's happened to all of us. You get a nice package through the post.
0:03:03 > 0:03:06What happens? It comes through and it's all ripped.
0:03:06 > 0:03:09I mean, just a quick show of hands, Dragons,
0:03:09 > 0:03:11has it happened here to anyone?
0:03:14 > 0:03:18Just a quick show of hands. Come on, don't be scared, Dragons.
0:03:18 > 0:03:20Rrrarrgh!
0:03:20 > 0:03:22Aaargh!
0:03:22 > 0:03:24Rrraaarrrgh!
0:03:24 > 0:03:26Rrarrgh!
0:03:38 > 0:03:42Hello, my name is Andrew Hannon.
0:03:42 > 0:03:46I'm here today asking for £50,000 in return for a 20% equity
0:03:46 > 0:03:49of my company Thirteen Horror Ltd.
0:03:50 > 0:03:54My business, as I've tried to show, is fear.
0:03:54 > 0:03:56I make fear available for people
0:03:56 > 0:04:01in the form of two interactive online experiences.
0:04:01 > 0:04:05Experiences which started off as short stories
0:04:05 > 0:04:08in two self-published books.
0:04:08 > 0:04:10The first of these experiences is called The Magic.
0:04:10 > 0:04:14It takes approximately five to ten minutes to complete
0:04:14 > 0:04:15and it is terrifying.
0:04:15 > 0:04:18The second experience is called The Dare.
0:04:18 > 0:04:21It's done as a group because it's too scary to try by yourself.
0:04:21 > 0:04:23It takes about one hour to complete.
0:04:23 > 0:04:25It'll scare your socks off.
0:04:25 > 0:04:28Both experiences have been extremely well received.
0:04:28 > 0:04:32They have topped the iTunes horror chart in England,
0:04:32 > 0:04:34America, Canada, Australia and even made it
0:04:34 > 0:04:38into the top 100 charts for fiction in America and the UK.
0:04:38 > 0:04:40I'm happy to take questions,
0:04:40 > 0:04:43and apologies for the unorthodox beginning but I thought
0:04:43 > 0:04:46I'd try something a bit different to, hopefully, get your attention.
0:04:46 > 0:04:48- DUNCAN:- Give us a look at one? - Certainly.
0:04:52 > 0:04:56In an attempt to scare the Dragons into a supernatural investment,
0:04:56 > 0:05:01North Londoner Andrew Hannon has certainly caused a stir in the Den.
0:05:01 > 0:05:07He needs £50,000 to market his horror experiences to the masses.
0:05:07 > 0:05:09But Peter Jones just looks confused.
0:05:12 > 0:05:15I'm sitting here thinking, "What on earth are you on about?"
0:05:15 > 0:05:18You've come out from under a table with a mask on.
0:05:18 > 0:05:21Effectively, they're both dares. They dare you to do things.
0:05:21 > 0:05:25I don't get it. Give me an idea. A very quick snapshot of the story.
0:05:25 > 0:05:28OK, for the first one which you do by yourself, you need...
0:05:28 > 0:05:30It gives you a set of specific instructions at the beginning.
0:05:30 > 0:05:33- I do this on my own? - For the first one, you would.
0:05:33 > 0:05:37You need to be alone in your room and dim the lights as much as possible.
0:05:37 > 0:05:38- OK, I'll imagine that now.- OK.
0:05:38 > 0:05:40It then asks you to speak out loud a couple of times,
0:05:40 > 0:05:44- given certain prompts. - Hello? Anybody there?- Exactly that.
0:05:44 > 0:05:47It then culminates - without giving too much away -
0:05:47 > 0:05:50it culminates in a decision you have to make at the end,
0:05:50 > 0:05:54whether you want to invite something from the other side of the door in. That's what it boils down to.
0:05:54 > 0:05:56OK, whoever is on the other side of my bedroom door,
0:05:56 > 0:05:59can you come in now, please?
0:06:00 > 0:06:03- And I'm now supposed to be scared? - Correct.
0:06:03 > 0:06:06But I know that it's in my imagination.
0:06:06 > 0:06:08You might know that it's in your imagination
0:06:08 > 0:06:11but that's only because we had a quick chat about it now.
0:06:11 > 0:06:15- That is the most ridiculous business idea I've ever heard. - I disagree. I disagree.
0:06:19 > 0:06:22A damning proclamation, perhaps.
0:06:22 > 0:06:26But the Dragons do, at least, seem entertained by Andrew's enthusiasm.
0:06:26 > 0:06:30Will Hilary Devey find any substance in the concept itself?
0:06:32 > 0:06:35Explain to me your business model.
0:06:35 > 0:06:39OK, there's various retail outlets via my website.
0:06:39 > 0:06:42People download online experiences, pay Amazon or iTunes,
0:06:42 > 0:06:45and the order's generated and I get my royalties.
0:06:45 > 0:06:51And it's generated £14,000 gross profit since September 2011.
0:06:51 > 0:06:53And what is the net profit?
0:06:53 > 0:06:57The net profit is a 13,500. I've put next to no money into it.
0:06:57 > 0:07:00There's no overheads, and everything I've done,
0:07:00 > 0:07:03I've done in my spare time from my bedroom, from internet cafes.
0:07:03 > 0:07:05It's gone from strength to strength.
0:07:05 > 0:07:09I've no doubt that there's millions of people out there who'd try this.
0:07:09 > 0:07:12I'll tell you what. Here is a worry for you.
0:07:12 > 0:07:15I'm going to give you £50,000.
0:07:15 > 0:07:19Being the sort of person I am, I expect a return.
0:07:19 > 0:07:21OK.
0:07:21 > 0:07:23So far, I can't see it.
0:07:23 > 0:07:27Compared to what I've put into it, it's made a substantial profit.
0:07:27 > 0:07:30Substantial? You're talking about 13 grand.
0:07:30 > 0:07:33That's without the marketing. That's without television marketing
0:07:33 > 0:07:37and what I want to do is step it up now and target
0:07:37 > 0:07:40very, very specific horror channels in the UK and the US.
0:07:40 > 0:07:43You're talking audiences of, you know, 9-10 million people.
0:07:43 > 0:07:47But once someone's done this and they know it,
0:07:47 > 0:07:51they tell their mate about it, everyone knows it, that's it.
0:07:51 > 0:07:55That's what I worried about as well. But if you went to see a good film,
0:07:55 > 0:07:57you wouldn't tell your friends and ruin it for them.
0:07:57 > 0:07:58You might recommend the film.
0:07:58 > 0:08:01I think this works on the same sort of level
0:08:01 > 0:08:03where people dare friends to do it. Or they'd say,
0:08:03 > 0:08:06"I tried it. I couldn't make it to the end. You have a go."
0:08:08 > 0:08:11A spirited fight-back from the plucky entrepreneur.
0:08:11 > 0:08:14Duncan Bannatyne looks engrossed.
0:08:14 > 0:08:17Will Andrew's book be his key to gaining investment?
0:08:20 > 0:08:23- Andrew, how much is this book?- £15.
0:08:23 > 0:08:26- You've sold how many of these? - 500 hardcopy books.
0:08:26 > 0:08:30- How many have you sold in total? - 10,000 units.
0:08:30 > 0:08:3110,000?
0:08:31 > 0:08:33- Yeah.- That's a lot of books.
0:08:33 > 0:08:37OK, I've read the first three, I think.
0:08:37 > 0:08:39Have I read one that you've written?
0:08:39 > 0:08:40One Light In The Graveyard was me.
0:08:40 > 0:08:42You said they're scary
0:08:42 > 0:08:44but One Night In The Graveyard, for me, is funny.
0:08:44 > 0:08:47- Some might be funny, some romantic, some might be...- Yeah, fair enough.
0:08:47 > 0:08:50- I'm getting your style of writing. - Right, very good.
0:08:50 > 0:08:52Daytrip?
0:08:52 > 0:08:54Daytrip is my one.
0:08:54 > 0:08:56- I'm going to read Daytrip.- OK.
0:08:59 > 0:09:02Is this really...?
0:09:05 > 0:09:07So this is...
0:09:09 > 0:09:12Andrew, you are for real?
0:09:12 > 0:09:14I am entirely for real.
0:09:14 > 0:09:16I just want to understand.
0:09:16 > 0:09:19You created some short stories, and out of some short stories
0:09:19 > 0:09:23you created some dares that people can act out themselves
0:09:23 > 0:09:26which they, ultimately as a result of acting it out,
0:09:26 > 0:09:30get scared at the end. Is that, in essence, what this pitch is?
0:09:33 > 0:09:35- What the hell is...?- Like I said,
0:09:35 > 0:09:37some of them are comical as well as horrific.
0:09:37 > 0:09:41'Why did you stop? I was going to eat you.'
0:09:41 > 0:09:43Oh, dear.
0:09:46 > 0:09:49I love the book. It's fantastic. I love it.
0:09:57 > 0:10:00What is going on?
0:10:01 > 0:10:03A rare moment in the Den.
0:10:03 > 0:10:06For once, hysteria is reigning over reason.
0:10:06 > 0:10:10This I have never, ever, ever seen. What have you done?
0:10:12 > 0:10:15Can these multimillionaire Dragon investors put giggles aside
0:10:15 > 0:10:17and regain their composure?
0:10:17 > 0:10:20Hilary Devey is first to try.
0:10:22 > 0:10:25I think you should just carry on.
0:10:25 > 0:10:28- You're selling books. Just carry on. - It is going well. I just believe,
0:10:28 > 0:10:30if it were to take that next step up, it'd do even better.
0:10:30 > 0:10:34There's a limit to how many people you can reach, doing what I do with uploading videos.
0:10:34 > 0:10:37But I can't help you. I don't know this market.
0:10:37 > 0:10:40- Fair enough.- If I can't give something as an investor,
0:10:40 > 0:10:43there's little point me investing, and the only thing I could give you
0:10:43 > 0:10:47is money, and then I'm not in control of that investment
0:10:47 > 0:10:50cos I don't even understand what I'm investing in.
0:10:52 > 0:10:56- I've got to say, I'm very sorry but I'm out.- OK, thank you.
0:10:56 > 0:10:59Andrew, I think I've come to a conclusion
0:10:59 > 0:11:03and I've got to tell you I've found this whole experience quite scary.
0:11:03 > 0:11:08- OK.- It took a long time to understand what your pitch was
0:11:08 > 0:11:11and I'm struggling to see how this could be turned into a business.
0:11:13 > 0:11:17So, I'm sorry, I'm going to have to say, Andrew, I'm out.
0:11:21 > 0:11:26Rationality returns as two Dragons walk away from the deal.
0:11:26 > 0:11:29Will Deborah Meaden agree with her rivals' view?
0:11:31 > 0:11:36I think, to create a genre which, I guess, doesn't exist...
0:11:36 > 0:11:39- Spot on.- To your knowledge, is there anyone else doing this?
0:11:39 > 0:11:42I tried to find similar things online and found absolutely nothing.
0:11:42 > 0:11:45Actually, to create £14,000 worth of sales from a standing start,
0:11:45 > 0:11:48I think you should be pleased with yourself.
0:11:48 > 0:11:51- I think that's quite amazing. - Thank you very much.
0:11:51 > 0:11:53The trouble is,
0:11:53 > 0:11:58- I just don't see I'll get a return on my investment so I'm out.- Cheers.
0:11:58 > 0:12:00I'll tell you where I am. I've been sitting here.
0:12:00 > 0:12:03You know, you've sold 10,000 books, which I think
0:12:03 > 0:12:06is amazing for a self-published... You know, it's brilliant.
0:12:06 > 0:12:10And you've done it in exactly the right way - in your back bedroom.
0:12:10 > 0:12:16You've done all the right things but you don't need £50,000.
0:12:16 > 0:12:18Your market that you've attracted so far,
0:12:18 > 0:12:21is exactly the market you should be staying in.
0:12:21 > 0:12:24Stick to the sector and the niche that you are successful in
0:12:24 > 0:12:25and you could go from there.
0:12:25 > 0:12:28- OK.- I can't invest in it so, Andrew, I'm going to say I'm out.
0:12:28 > 0:12:30Thank you, Theo.
0:12:30 > 0:12:34Andrew, I have to take my hat off to you. I think you've done fantastic.
0:12:34 > 0:12:36Thank you.
0:12:39 > 0:12:41It's a very, very enjoyable read.
0:12:43 > 0:12:45You're making some money.
0:12:45 > 0:12:48When you're not working full-time, you come back in the evenings,
0:12:48 > 0:12:51you write a story and you put them together and that's great.
0:12:51 > 0:12:54But it's not a business that's ready for investment at the moment.
0:12:54 > 0:12:55It might be one day.
0:12:55 > 0:12:59You might be one of the premier writers of horror stories
0:12:59 > 0:13:01and I wish you the best of luck
0:13:01 > 0:13:03but I've got to say that I can't invest in this.
0:13:03 > 0:13:05Thank you for the book, I'm out.
0:13:05 > 0:13:07- Thank you for enjoying it. - Good luck, Andrew.
0:13:07 > 0:13:08Thank you, all. I appreciate it.
0:13:08 > 0:13:10- DUNCAN:- I'm going to write one and send it to you.
0:13:10 > 0:13:12So, no investment for Andrew.
0:13:12 > 0:13:16But his peculiar tales did have a peculiar effect on the Dragons.
0:13:16 > 0:13:19He leaves with nothing.
0:13:21 > 0:13:24I don't see what's scary about that at all.
0:13:32 > 0:13:36Budding entrepreneurs often come up with solutions
0:13:36 > 0:13:38to awkward lifestyle problems.
0:13:38 > 0:13:40Dubliner John Power was the latest.
0:13:40 > 0:13:42He wanted £100,000
0:13:42 > 0:13:46to help us all avoid those annoying excess-baggage charges.
0:13:46 > 0:13:48Travelling airlines frequently,
0:13:48 > 0:13:51I was confronted with the restrictions they have.
0:13:51 > 0:13:54You're only allowed one case that you carry on board.
0:13:54 > 0:13:58So I tried to solve this and I come up with the idea of the Jaktogo.
0:13:58 > 0:14:01I have it as a bag and what I do then is I translate it into a coat.
0:14:05 > 0:14:07It's wearable luggage.
0:14:10 > 0:14:12Hardly High Street fashion but everyone wanted to talk
0:14:12 > 0:14:14about John's new clothing line.
0:14:14 > 0:14:16I'm not convinced.
0:14:17 > 0:14:21How far do you take it? I could cut two holes in the bottom of my suit carrier
0:14:21 > 0:14:23and put my arms in it and my legs through it.
0:14:23 > 0:14:25That would be ridiculous.
0:14:29 > 0:14:31I just think it's brilliant.
0:14:31 > 0:14:35- Have you sold any?- 1,700.
0:14:35 > 0:14:38- 1,700?- Yeah.- Right, OK.
0:14:40 > 0:14:44Despite being momentarily sidetracked by the sales figures,
0:14:44 > 0:14:47the Dragons soon found fault with John's business model.
0:14:47 > 0:14:51You really think that no airline's going to challenge you on this?
0:14:51 > 0:14:55If there's a queue of 50 people all wearing one of those coats, they won't challenge you?
0:14:55 > 0:14:58That'll never happen.
0:14:58 > 0:14:59It's a coat.
0:14:59 > 0:15:05John, any bulky items will be taken off you and put in the hold.
0:15:05 > 0:15:09That is a bulky item, so you are back to where you started from.
0:15:09 > 0:15:11- I'm out.- Cheers.
0:15:16 > 0:15:18Will it be a case of second time lucky
0:15:18 > 0:15:22for Manchester-based twins Lisa and Helen Tse
0:15:22 > 0:15:25who first came into the Den back in the early days, 2005,
0:15:25 > 0:15:28with a new line in ready meals.
0:15:28 > 0:15:31Having walked away empty-handed once before,
0:15:31 > 0:15:33will their new product be more appealing?
0:15:59 > 0:16:00Hello, Dragons.
0:16:00 > 0:16:03My name is Lisa Tse and this is my twin Helen Tse
0:16:03 > 0:16:07and we are from the award-winning restaurant and cookery school
0:16:07 > 0:16:09Sweet Mandarin in Manchester.
0:16:09 > 0:16:16We seek an investment of £50,000 for 20% equity in our sauce business.
0:16:16 > 0:16:18Look at these sauces, Dragons.
0:16:18 > 0:16:21Don't they look exciting, new and different?
0:16:21 > 0:16:26Our sauces have no MSG, no artificial colourings and no wheat
0:16:26 > 0:16:29and they're perfect for the gluten-free market.
0:16:29 > 0:16:33Now, who better to tell our family story than my sister Helen?
0:16:33 > 0:16:34HELEN: Thanks, Lisa.
0:16:34 > 0:16:38Dragons, let me introduce you to my grandmother Lily Kwok.
0:16:38 > 0:16:42She set up one of the first Chinese restaurants in Manchester
0:16:42 > 0:16:44where she served these wonderful sauces
0:16:44 > 0:16:47and we still serve them today at Sweet Mandarin.
0:16:47 > 0:16:50Lisa is so proud of these sauces, as the head chef,
0:16:50 > 0:16:52that she even put her face on them.
0:16:52 > 0:16:55Dragons, did you know that the dipping and condiments market
0:16:55 > 0:16:58was worth approximately £600 million,
0:16:58 > 0:17:00growing at a rate of 16% year-on-year?
0:17:00 > 0:17:04And did you know that the free-from market is worth around £200 million?
0:17:04 > 0:17:07HELEN: There are many things in this world that divide us
0:17:07 > 0:17:12but one thing that unites us is food. So, without further ado,
0:17:12 > 0:17:14I would love to invite you to our family table
0:17:14 > 0:17:17to try our sauces. Thank you.
0:17:22 > 0:17:23A pitch to get taste buds tingling
0:17:23 > 0:17:27from Mancunian twin sisters Lisa and Helen Tse.
0:17:27 > 0:17:31- That's the chilli, that's quite hot. - Sweet chilli.- What's this one?
0:17:31 > 0:17:35Barbecue. Help yourself. Feel free to dig in.
0:17:35 > 0:17:38To expand their gluten-free dipping sauce business...
0:17:38 > 0:17:41- Thank you, ladies. - ..they need £50,000.
0:17:41 > 0:17:44On offer in return is a 20% stake.
0:17:44 > 0:17:46It's very versatile.
0:17:47 > 0:17:50- All different types. - Yeah. It's your turn.
0:17:51 > 0:17:53One Dragon has certainly been thorough in the testing.
0:17:53 > 0:17:57Will Hilary Devey be the same in the questioning?
0:17:57 > 0:18:00- I'm Hilary. Hi.- Hello.
0:18:00 > 0:18:03Your sauces are beautiful. Absolutely beautiful.
0:18:03 > 0:18:06Tell me about the company to date.
0:18:06 > 0:18:10Well, to date, Hillary, we've sold over 2,000 bottles.
0:18:10 > 0:18:15We've made about £6,000 and the gross profit is £5,000.
0:18:15 > 0:18:19Have you got any projections going forward?
0:18:19 > 0:18:23For year one, we are projecting £300,000
0:18:23 > 0:18:25with a net profit of £100,000.
0:18:25 > 0:18:30Year two, £600,000 with a net profit of £300,000.
0:18:30 > 0:18:33And where do you plan on going with the business?
0:18:33 > 0:18:37We just finished the SALSA accreditation
0:18:37 > 0:18:41which all the main supermarkets need
0:18:41 > 0:18:44but we've already had interest from a multiple.
0:18:44 > 0:18:46Which store?
0:18:46 > 0:18:48- Morrisons.- Ah, right.
0:18:48 > 0:18:52They've agreed to terms once we've passed it and we've passed this week.
0:18:52 > 0:18:56- Excellent. Well done.- Thank you.
0:18:59 > 0:19:03Tasty product and interest from a supermarket. It's good start.
0:19:03 > 0:19:07Theo Paphitis wants to know more about the likeable entrepreneurs.
0:19:09 > 0:19:14- Girls, can I ask you, have you got a successful restaurant?- Yes.
0:19:14 > 0:19:15Do you own the restaurant?
0:19:15 > 0:19:19It's owned by me, Helen and Janet. Three sisters.
0:19:19 > 0:19:20OK. Turnover?
0:19:20 > 0:19:23Last year we made about £480,000.
0:19:23 > 0:19:25- So, half a million quid.- Yeah.
0:19:25 > 0:19:28- Did you make a profit?- We did.
0:19:28 > 0:19:30Last year, in profit we made about £150,000.
0:19:30 > 0:19:32Right.
0:19:32 > 0:19:34We actually competed in a competition
0:19:34 > 0:19:38and in 2009 we beat 10,000 restaurants in the UK
0:19:38 > 0:19:44to win best local Chinese restaurant, which was with Gordon Ramsay.
0:19:44 > 0:19:47So, just to clarify, are you offering investment in everything
0:19:47 > 0:19:50or are you just getting investment in the sauce?
0:19:50 > 0:19:53- We're asking for investment in the sauce.- In the sauce.
0:19:53 > 0:19:57- So, literally, new company, that sauce.- Yes.
0:19:57 > 0:19:58So, what roles do you play?
0:19:58 > 0:20:02So, there's three sisters. All involved in the business?
0:20:02 > 0:20:05- Well, I'm mainly the chef. - You're chef.- I'm front of house.
0:20:05 > 0:20:07And Janet is a full-time mum at the moment.
0:20:07 > 0:20:11And have you put any cash in to start the business?
0:20:11 > 0:20:14We did, we put about £10,000 in.
0:20:14 > 0:20:1610,000 each or 10,000 as a group?
0:20:16 > 0:20:18Just my life savings.
0:20:18 > 0:20:19OK. Just your life savings.
0:20:19 > 0:20:21JUST my life savings(!)
0:20:21 > 0:20:24So, £10,000.
0:20:27 > 0:20:31It's a confident performance so far from Lisa and Helen.
0:20:31 > 0:20:34Peter Jones famously invested in a similar product.
0:20:34 > 0:20:38Will he be tempted to add this one to his sauce portfolio?
0:20:39 > 0:20:42- Lisa, Helen, hello.- Hello.
0:20:42 > 0:20:44I think you've done an amazing job.
0:20:44 > 0:20:47You've got a business. It's fantastic.
0:20:47 > 0:20:51But I think there is a lot of confusion over the brand.
0:20:51 > 0:20:55Are you Sweet Mandarin the sauce or are you the famous restaurant?
0:20:58 > 0:21:02I also think that your level of uniqueness, at the moment,
0:21:02 > 0:21:04is not good enough.
0:21:04 > 0:21:07And when you go to have negotiations with the suppliers
0:21:07 > 0:21:09that are going to take this product to market,
0:21:09 > 0:21:12that's going to be a very key consideration to them.
0:21:13 > 0:21:16It's not good enough to make money.
0:21:16 > 0:21:18It won't cut it.
0:21:19 > 0:21:21So I'm going to say that I'm out.
0:21:24 > 0:21:25A damning assessment
0:21:25 > 0:21:28and an early setback for the forlorn-looking sisters.
0:21:28 > 0:21:34Now, will Duncan Bannatyne be able to ignore his rival's concerns?
0:21:35 > 0:21:39Lisa, Helen, you said you've sold 2,000 bottles to date?
0:21:39 > 0:21:40Yes.
0:21:40 > 0:21:43About 2,400 and something.
0:21:43 > 0:21:45Right.
0:21:46 > 0:21:49Anything else?
0:21:50 > 0:21:55Well, we also have the leading...
0:21:55 > 0:21:57Chinese grocers to all the restaurants
0:21:57 > 0:21:59which is Wing Yip.
0:21:59 > 0:22:00They have ordered with us
0:22:00 > 0:22:0750 cases per sauce per week, starting off.
0:22:07 > 0:22:12That contract alone is worth 250,000.
0:22:14 > 0:22:17- DUNCAN:- This is interesting.
0:22:19 > 0:22:23And then we've also got the multiple who we've talked to.
0:22:23 > 0:22:26Straight away, the senior buyers picked it up and, like I said,
0:22:26 > 0:22:29they've been in talks with us as well. You're getting it,
0:22:29 > 0:22:31literally, hot off the press.
0:22:33 > 0:22:35Right.
0:22:35 > 0:22:37Based on the fact that you've done so much
0:22:37 > 0:22:40and have had so much success,
0:22:40 > 0:22:43I just feel that I've got to make you an offer.
0:22:47 > 0:22:50So let me suggest I offer you £50,000
0:22:50 > 0:22:53for 40% of the company.
0:22:54 > 0:22:57How do you feel about that?
0:22:57 > 0:23:01We are delighted to get an offer.
0:23:05 > 0:23:07Lisa and Helen's emotions take a U-turn
0:23:07 > 0:23:10as the revelations rescue their investment dreams.
0:23:10 > 0:23:15But at a cost - twice the level of equity they wanted to give away.
0:23:15 > 0:23:18Can they draw out a better offer from Hilary Devey?
0:23:20 > 0:23:22How did you get in with Wing Yip?
0:23:22 > 0:23:25They've had lots of customers asking for it
0:23:25 > 0:23:28and we booked an appointment to meet with the directors
0:23:28 > 0:23:30and we pitched to them as well.
0:23:30 > 0:23:33They tried our sauces.
0:23:33 > 0:23:36They were won over by the product, the quality of the taste
0:23:36 > 0:23:39and they know that we can deliver.
0:23:42 > 0:23:44I think you've got something.
0:23:46 > 0:23:49I like you, I like your enthusiasm...
0:23:49 > 0:23:52- Thank you very much.- ..and I think I could add value to you.
0:23:53 > 0:23:56I will match Duncan's offer
0:23:56 > 0:23:59cos I'd like to work with you
0:23:59 > 0:24:03and I think we'd have a bit of fun along the way.
0:24:06 > 0:24:09- THEO:- Hmm, that's two offers.
0:24:12 > 0:24:14You're definitely investable.
0:24:16 > 0:24:21So, what I need to think about is can I better their offers?
0:24:24 > 0:24:27On the basis that you've got two offers at 40%...
0:24:30 > 0:24:33..I'm just not going to be able to put a counter offer to you.
0:24:36 > 0:24:37I'm out.
0:24:42 > 0:24:46Two offers. But both are for nearly half their company
0:24:46 > 0:24:49and the twins have just one Dragon left.
0:24:50 > 0:24:54I actually think this is a market where you have got to sell
0:24:54 > 0:25:00huge amounts to get any sensible return on your investment.
0:25:00 > 0:25:03At the moment you're saying you're going to sell to somebody like
0:25:03 > 0:25:05Morrisons and, I guess, any of the big multiples.
0:25:05 > 0:25:08How much does it sell for?
0:25:08 > 0:25:13We make them for 50p. We would sell it in for about 80p to 90p.
0:25:13 > 0:25:16OK, my worry is, I don't think you're going to get
0:25:16 > 0:25:19anything like the margins you think you're going to get
0:25:19 > 0:25:21because as you get into the big multiples,
0:25:21 > 0:25:24they're going to squeeze and squeeze and squeeze and squeeze
0:25:24 > 0:25:26until you're left with very small percentages.
0:25:26 > 0:25:31Therefore I don't get return on my investment.
0:25:31 > 0:25:33So I'm out.
0:25:49 > 0:25:50Could we ask you...
0:25:54 > 0:25:56..would you be prepared to work together?
0:26:07 > 0:26:09- Have we got a deal?- Yes.
0:26:09 > 0:26:13- Well done. Well done.- Thank you.
0:26:13 > 0:26:16Helen and Lisa have done it.
0:26:16 > 0:26:19They've agreed to part with more of their business
0:26:19 > 0:26:22but they do have two influential Dragon investors onboard.
0:26:28 > 0:26:31The Den is a meeting place where entrepreneurs hope to first set eyes
0:26:31 > 0:26:34upon their future Dragon business partner.
0:26:34 > 0:26:35But Falmouth-based Sam Lanyon
0:26:35 > 0:26:37had a different kind of relationship in mind
0:26:37 > 0:26:41as he popped the question of whether his invention was worth £100,000.
0:26:44 > 0:26:46Auto Wed allows happy couples
0:26:46 > 0:26:48to select a short wedding ceremony.
0:26:48 > 0:26:50It then vends two rings
0:26:50 > 0:26:54and a personalised wedding certificate. It's only a pound to get married today.
0:26:54 > 0:26:56Deborah.
0:26:56 > 0:26:57Will you take my hand in marriage?
0:26:57 > 0:27:00Of course I will!
0:27:00 > 0:27:02Best man?
0:27:05 > 0:27:09MACHINE: Do you take this person, to have and to cherish?
0:27:09 > 0:27:11I do.
0:27:12 > 0:27:15MACHINE: Congratulations, you may now kiss.
0:27:15 > 0:27:17No time for sweet talk from Duncan Bannatyne
0:27:17 > 0:27:20as he got straight down to business.
0:27:20 > 0:27:23- Sam.- Yeah. - Have you sold any of these machines?
0:27:23 > 0:27:26The first one we sold to a museum in the States,
0:27:26 > 0:27:29this one was going to the Camera Obscura in Edinburgh.
0:27:29 > 0:27:32They enquired about another one, cos they're worried about the queues.
0:27:32 > 0:27:35I don't think they should worry about the queues.
0:27:35 > 0:27:39However, a smitten Peter Jones
0:27:39 > 0:27:41was keen to know more about the young inventor.
0:27:41 > 0:27:43Sam, what's your background?
0:27:43 > 0:27:45I grew up in the wilds of Cornwall, didn't go to school,
0:27:45 > 0:27:49just pulled apart radios and wired things up.
0:27:49 > 0:27:51- Seriously, you didn't go to school? - No.
0:27:51 > 0:27:53- Did your parents teach you? - Yeah, it took awhile,
0:27:53 > 0:27:57but three As at A-level and a Masters degree in electronic engineering.
0:27:57 > 0:28:00The motivation comes from yourself.
0:28:00 > 0:28:03In the end, the Dragons thought the product was just a gimmick.
0:28:03 > 0:28:05It's great fun and I can see that
0:28:05 > 0:28:08on the pier at Weston-super-Mare.
0:28:08 > 0:28:11But they did think Sam himself was worth a second date.
0:28:11 > 0:28:13I just think it is so sad
0:28:13 > 0:28:16that you've come into the Den with that product,
0:28:16 > 0:28:20- because you are entirely investable. - Well, thank you.
0:28:20 > 0:28:23But I won't invest £100,000 in that.
0:28:23 > 0:28:25I'm out.
0:28:25 > 0:28:27So far tonight, only one business
0:28:27 > 0:28:30has received the backing of the Dragons.
0:28:31 > 0:28:33To find out why Hilary Devey
0:28:33 > 0:28:37and Duncan Bannatyne chose to back Ellen and Lisa's dipping sauce,
0:28:37 > 0:28:39press the red button at the end of the programme.
0:28:42 > 0:28:46Steve Jobs started Apple from his garage, and that turned out well,
0:28:46 > 0:28:49so time to see how 27-year-old Matthew Conridge gets on
0:28:49 > 0:28:52with the venture he began in his bedroom.
0:28:52 > 0:28:56If he could just create a company worth 0.001% of Apple,
0:28:56 > 0:28:59he'd be doing extremely well.
0:29:08 > 0:29:10Hello.
0:29:16 > 0:29:19Hello, my name is Matthew Conridge. I'm here today to ask
0:29:19 > 0:29:22for an investment of £200,000
0:29:22 > 0:29:25in exchange for 10% of my company.
0:29:26 > 0:29:28Mamka is an online retailer.
0:29:28 > 0:29:32We currently have a range of products,
0:29:32 > 0:29:36which quite varies. They go from inflatable boats
0:29:36 > 0:29:38to camping accessories,
0:29:38 > 0:29:41pools, toys, games and gifts.
0:29:43 > 0:29:47I started back in January 2007.
0:29:47 > 0:29:51I had £600 in cash in my pocket
0:29:51 > 0:29:55We've just completed our fifth year of trade, and achieved a turnover just shy of £2 million
0:29:55 > 0:29:59with a net profit of around £110,000.
0:29:59 > 0:30:01We've also just completed relocation
0:30:01 > 0:30:05into a new 42,000 square foot distribution centre
0:30:05 > 0:30:07and we've been lucky enough to win a raft of awards
0:30:07 > 0:30:10and recognition for what we've done.
0:30:10 > 0:30:12I thank you for your time today
0:30:12 > 0:30:15and look forward to answering any questions you may have.
0:30:19 > 0:30:23A slightly nervy delivery from the young entrepreneur Matthew Conridge.
0:30:23 > 0:30:27To fulfil his grand plans for the Devon-based business,
0:30:27 > 0:30:29he needs a £200,000 investment
0:30:29 > 0:30:33and is willing to part with just 10% in exchange.
0:30:33 > 0:30:38Peter Jones looks to have something on his mind...
0:30:39 > 0:30:42- Matthew.- Hi.- Hello.
0:30:43 > 0:30:48You said something which worried me when you described your net profit.
0:30:48 > 0:30:52- I think you said something like "around" or "approximately" £110,000?- Yes.
0:30:52 > 0:30:55We haven't quite finished the financial year yet.
0:30:55 > 0:30:57OK, so to get a true valuation of this business, then,
0:30:57 > 0:30:59what did you do last year?
0:30:59 > 0:31:02OK, last year we turned over £1.31 million
0:31:02 > 0:31:04with a net profit of £89,000.
0:31:04 > 0:31:08Gross profit was around about 26%.
0:31:08 > 0:31:09OK.
0:31:09 > 0:31:11We hold a high level of stock.
0:31:11 > 0:31:16At the moment, for example, we're holding around £550,000 of stock
0:31:16 > 0:31:18but the stock turnover is quick
0:31:18 > 0:31:21and there's no deadlines within that amount.
0:31:21 > 0:31:25OK, so, I'd like you to just explain to me why...
0:31:25 > 0:31:31you've gone for such a crazy valuation
0:31:31 > 0:31:34- with...so little profit.- Mm-hm.
0:31:34 > 0:31:36What makes you think that's a good deal for me?
0:31:36 > 0:31:39First off, it's a starting point for negotiation.
0:31:39 > 0:31:41No, you normally come to the table of negotiation
0:31:41 > 0:31:44- where it looks and seems fairly reasonable and then you get into a debate.- Yep.
0:31:44 > 0:31:48At the moment this...is quite a long way from being reasonable.
0:31:48 > 0:31:52What I would say to counterbalance that is we have a solid five-year plan in place,
0:31:52 > 0:31:57which shows growth to around about £10 million in five years.
0:31:58 > 0:32:01Fluent responses to some tough questions.
0:32:01 > 0:32:04Matthew seems to have set aside his early nerves
0:32:04 > 0:32:08but will his composure be put to the test by Deborah Meaden?
0:32:10 > 0:32:13Erm, I'm a little worried about the stock
0:32:13 > 0:32:17cos you're carrying a run rate of around about half a million.
0:32:17 > 0:32:20How much of that is carried over from last year?
0:32:20 > 0:32:22About £240,000 to £250,000.
0:32:22 > 0:32:24What do YOU think about that?
0:32:24 > 0:32:27I think it's slightly higher than we would have liked
0:32:27 > 0:32:30and that was mainly due to the fact that we were in warehousing,
0:32:30 > 0:32:32which became too full.
0:32:32 > 0:32:35- We didn't have enough... - No, that isn't the answer to stock.
0:32:35 > 0:32:38The truth of the matter is if you buy the right product,
0:32:38 > 0:32:40you guess your market well enough,
0:32:40 > 0:32:43- you end up with low levels of stock at the end of the year.- Hmm.
0:32:43 > 0:32:45What I'm trying to understand,
0:32:45 > 0:32:47I think there's an issue within your stock.
0:32:47 > 0:32:48I don't think there is an issue.
0:32:48 > 0:32:51Last summer was pretty horrendous in terms of weather
0:32:51 > 0:32:53and we still managed our stock very well.
0:32:53 > 0:32:55But you were left at the end of last year
0:32:55 > 0:32:57- with £250,000 worth of stock. - Hmm-mm.
0:32:57 > 0:32:59That's half of your stock.
0:33:00 > 0:33:04- Matthew, you're going to have to try and help me here.- Yep, mm-hm.
0:33:04 > 0:33:06£500,000 of stock holding
0:33:06 > 0:33:11- for a business on that sort of turnover, it doesn't make sense.- OK.
0:33:11 > 0:33:15- Let's go through a few numbers back again.- Mm-hm.
0:33:15 > 0:33:17Debtors and creditors at this year end.
0:33:17 > 0:33:21Er, the bank is around about 198.
0:33:21 > 0:33:24OK, debtors. What are your debtors?
0:33:24 > 0:33:28We would probably be owed only a small amount, £6,000 or £7,000,
0:33:28 > 0:33:30because the money continuously comes in to the business.
0:33:30 > 0:33:35- All right. So, who owns the company? - I own 75%.- OK.
0:33:35 > 0:33:37My mother owns 5%
0:33:37 > 0:33:40and an outside investor owns 20% of the company.
0:33:40 > 0:33:43- For nothing? Or for money or...? - The amount of cash was zero.
0:33:44 > 0:33:48What benefits does he or she bring?
0:33:48 > 0:33:52It's a complicated deal involving contribution from an outside company.
0:33:52 > 0:33:56What's the best way to put this...? Erm...
0:33:57 > 0:34:00..a discount we receive.
0:34:01 > 0:34:03OK, "a discount we receive,"
0:34:03 > 0:34:07is an answer I'd expect from my 16-year-old girls
0:34:07 > 0:34:11- that are doing GCSE business.- Yeah, I can understand that, absolutely.
0:34:11 > 0:34:16Erm, we receive a discount, we receive a rebate, erm, on...
0:34:16 > 0:34:19- ..Products you sell.- Exactly that.
0:34:21 > 0:34:24So somebody gives you discount on something he sells
0:34:24 > 0:34:26and he gets 20% of the business?
0:34:26 > 0:34:30- Mm-hm.- What happens when you say you don't want to trade with him any more?
0:34:30 > 0:34:33- That wouldn't be the case.- Let me just say, that does not make sense.
0:34:37 > 0:34:40A tetchy exchange, but the confident young businessman
0:34:40 > 0:34:44is not buckling under the pressure.
0:34:44 > 0:34:47Will Hilary Devey offer any respite?
0:34:49 > 0:34:52Matthew, hi. Erm...
0:34:52 > 0:34:55- are you writing your own software? - No.
0:34:55 > 0:34:57- Do you own the source key?- No.
0:34:57 > 0:35:00It's a system which was initially created
0:35:00 > 0:35:04for multi-channel retailers facing the consumer
0:35:04 > 0:35:06and it's had the back office software, and the locations,
0:35:06 > 0:35:08and the dispatch tagged on to the back of it.
0:35:08 > 0:35:11So, basically, you've no USP.
0:35:12 > 0:35:15- I would disagree with that... - There's no intellectual property with your IT,
0:35:15 > 0:35:18which is a must to grow that business.
0:35:18 > 0:35:21We have open access to the software to allow us to do this.
0:35:21 > 0:35:23But then they will charge you.
0:35:23 > 0:35:25No, not if they... If WE develop it,
0:35:25 > 0:35:28all they will charge us is to tag it on
0:35:28 > 0:35:30and so it's not a huge amount...
0:35:30 > 0:35:32Erm, I disagree with you emphatically.
0:35:32 > 0:35:35I've been there, done that and it doesn't work.
0:35:35 > 0:35:38We have done this three or four times in the last year-and-a-half.
0:35:38 > 0:35:43Erm, I'm at a loss. What have you got that is unique here?
0:35:43 > 0:35:45- You're an importer of a product. - Mm-hm.
0:35:45 > 0:35:48- You've set up a website.- Mm-hm. - Am I missing something?
0:35:48 > 0:35:50There's nothing specifically which is different to us
0:35:50 > 0:35:53than a lot of other people out there,
0:35:53 > 0:35:55but what WE are is better than everybody else out there.
0:35:55 > 0:35:59OK, I'm going to tell you, in terms of running an online business,
0:35:59 > 0:36:02actually, you do things pretty badly
0:36:02 > 0:36:04and the sad thing is I don't think you realise it.
0:36:04 > 0:36:07OK, I appreciate what you're saying and your opinions.
0:36:07 > 0:36:10I would disagree that we're a poor online business.
0:36:10 > 0:36:11We've got five different brands
0:36:11 > 0:36:15and each website has a 365-day returns policy.
0:36:15 > 0:36:19Each order can be purchased before seven o'clock in the evening
0:36:19 > 0:36:21and with the customer the next day.
0:36:21 > 0:36:24But this type of business is supposedly low overhead,
0:36:24 > 0:36:26low infrastructure cost,
0:36:26 > 0:36:29- seriously good control of stock management.- Mm-hm.
0:36:29 > 0:36:33You've not talked about things like, "I'm going to increase my stock turn. How am I going to do that?
0:36:33 > 0:36:36"I'm actually going to do deals with my suppliers
0:36:36 > 0:36:39"and I'm going to use my supplier to deliver direct to my customer."
0:36:39 > 0:36:43In my own opinion - and it's my own opinion - I think that's a terrible business model
0:36:43 > 0:36:46because it relies on the supplier and the deliverer
0:36:46 > 0:36:48to act as your customer service,
0:36:48 > 0:36:50your physical communication with that customer.
0:36:50 > 0:36:53- Matthew, do you know what, I am totally shocked.- Right.
0:36:53 > 0:36:57I'm totally shocked that you're not even slightly open-minded.
0:36:57 > 0:36:59What you told me today is, "You know what,
0:36:59 > 0:37:02"I don't need you because I'm doing it better than anybody else."
0:37:02 > 0:37:04Just to say, I think if, instantly, I said,
0:37:04 > 0:37:06"That model sounds a lot better than mine,"
0:37:06 > 0:37:08I would have looked pretty spineless.
0:37:08 > 0:37:11- I think I need to speak up for what- I- think is right and...
0:37:11 > 0:37:13I think, when you're looking for an investor,
0:37:13 > 0:37:17- sometimes you've got to pick your moments when you want to be disagreeable.- Mm-hm.
0:37:17 > 0:37:19- Matthew, I'm out.- OK.
0:37:21 > 0:37:26No let-up for Matthew as Peter Jones refuses to do business with him.
0:37:26 > 0:37:30And retail expert Theo Paphitis looks to have made up his mind too.
0:37:33 > 0:37:39Matthew, you came in the Den with a ridiculous valuation.
0:37:40 > 0:37:44You've valued people here at nothing.
0:37:46 > 0:37:48You have started something, which is...
0:37:48 > 0:37:51It is pretty good, with no money, starting that,
0:37:51 > 0:37:53but you're not investable at the moment.
0:37:55 > 0:37:56OK, I appreciate your comments.
0:37:56 > 0:37:58- I think some of them were incredibly harsh.- Yes.
0:37:58 > 0:38:00I started a business with 600 quid
0:38:00 > 0:38:02and it reached a turnover of £2 million profit
0:38:02 > 0:38:04and it employed people in the local area...
0:38:04 > 0:38:06But it's not going to continue to grow
0:38:06 > 0:38:09unless you start to reconsider your business plan.
0:38:09 > 0:38:11I've got numerous e-commerce businesses
0:38:11 > 0:38:14that don't have to hold anywhere NEAR your stock holding.
0:38:14 > 0:38:17- Right.- So there's a lesson to be learned there.
0:38:17 > 0:38:21Yeah, I appreciate every single point that you've laid out.
0:38:21 > 0:38:24I still stand by the fact that I think you were incredibly harsh
0:38:24 > 0:38:27and I've worked so incredibly hard, put a plan in place...
0:38:27 > 0:38:29- You're not listening! - No, I most certainly am...
0:38:29 > 0:38:32Well, if I've been harsh and you HAVE been listening
0:38:32 > 0:38:35- then it's been a great exercise. - Mm-hm.
0:38:35 > 0:38:37Yeah, I'd agree with that.
0:38:37 > 0:38:39- I think there's a certain way... - Matthew, I'm out.
0:38:39 > 0:38:41Thank you for your time.
0:38:43 > 0:38:46Well, Matthew, I think the whole model is wrong.
0:38:46 > 0:38:47Right.
0:38:47 > 0:38:50And I think you need to go back to the drawing board
0:38:50 > 0:38:52and think again and redo your five-year plan.
0:38:52 > 0:38:58- OK.- And for that reason, I'm out.- I appreciate your comments. Thank you.
0:39:00 > 0:39:03Two more Dragons walk away from the deal.
0:39:03 > 0:39:06Now, only Duncan Bannatyne and Deborah Meaden
0:39:06 > 0:39:10stand between Matthew and complete failure in the Den.
0:39:12 > 0:39:16Matthew, even if I persuaded you to change the business plan
0:39:16 > 0:39:20the business cannot be worth £200,000 for 10%.
0:39:20 > 0:39:24To negotiate, I think I would have to offer you £200,000
0:39:24 > 0:39:25for 105% of the business.
0:39:27 > 0:39:32- OK.- So, you're miles off on value and you're miles off on the percentage.
0:39:32 > 0:39:33I've got to say now that I'm out.
0:39:33 > 0:39:36- OK, well, I thank you for your time.- Thank you.
0:39:36 > 0:39:41Erm, I have a suspicion that the more warehousing you've got,
0:39:41 > 0:39:43you are going to fill it...
0:39:43 > 0:39:46- Mm-hm.- ..and your stock holding is about to get worse.
0:39:46 > 0:39:50The point is, we've rented this place with the, er,
0:39:50 > 0:39:52- to match our five-year busin... - Matthew...
0:39:52 > 0:39:54- No, I can...- What I don't get,
0:39:54 > 0:39:56how you could have an opportunity like this
0:39:56 > 0:39:59and every time somebody raises an issue
0:39:59 > 0:40:02you're, "Yep, got it, back at you!"
0:40:02 > 0:40:05- I don't get it.- That's not the case. What I...- But it feels like that.
0:40:05 > 0:40:08- The thing I've...- It doesn't... You see, you're not even...- Sorry, OK.
0:40:08 > 0:40:11- Please, carry on. The key... - I've got...
0:40:11 > 0:40:15Do you know? I'm not going to waste my words any more.
0:40:15 > 0:40:16You're not listening,
0:40:16 > 0:40:19I'm not going to make any difference to you whatsoever so I'm out.
0:40:19 > 0:40:22OK, well, I thank you for your time.
0:40:22 > 0:40:24Thank you, Matthew.
0:40:24 > 0:40:28An unusually irritable end to proceedings.
0:40:28 > 0:40:31Matthew may have stood his ground but to no avail.
0:40:31 > 0:40:33He leaves with nothing.
0:40:37 > 0:40:39I feel I received a lot of advice from the Dragons.
0:40:39 > 0:40:43I feel that I also got a bit of a pasting quite early on,
0:40:43 > 0:40:45which made me become defensive.
0:40:45 > 0:40:47They picked up on a stock issue,
0:40:47 > 0:40:49which I need to investigate and I most certainly will do,
0:40:49 > 0:40:53but I had to defend my business because I think it's got a lot of potential.
0:41:00 > 0:41:02Other entrepreneurs who tried and failed in the Den
0:41:02 > 0:41:05included retired policeman Trevor Joy from Kent,
0:41:05 > 0:41:08whose product was inspired by a nasty accident.
0:41:09 > 0:41:11There are millions of DIY enthusiasts
0:41:11 > 0:41:16and I would think most of them have got one of those in their toolbox.
0:41:16 > 0:41:17I believe, for safety's sake,
0:41:17 > 0:41:21they should have one of those - a Sawsafe -
0:41:21 > 0:41:24to prevent them having... one of those.
0:41:25 > 0:41:27Trevor was hoping to walk away with £80,000,
0:41:27 > 0:41:31but it wasn't his invention that caught the Dragons' attention.
0:41:31 > 0:41:35The product looks great - your thumb doesn't. Tell me about your thumb.
0:41:35 > 0:41:37Sawed it off, basically.
0:41:37 > 0:41:40There are thousands of accidents like this.
0:41:40 > 0:41:42Did that drive you to come up with this innovation?
0:41:42 > 0:41:44I'd been thinking of ways,
0:41:44 > 0:41:46but this was actually a eureka moment in the middle of the night.
0:41:48 > 0:41:52I can't really say I've stood over anybody and watched them saw wood.
0:41:52 > 0:41:54How does it help you?
0:41:56 > 0:41:58Holding on to there...
0:42:00 > 0:42:03Perfect cut and perfectly safe.
0:42:03 > 0:42:05While all in the Den saw merit in the product...
0:42:05 > 0:42:10It's an innovative little idea and I can see it works.
0:42:10 > 0:42:14..it was Theo Paphitis who summed up the investment mood of the Dragons.
0:42:14 > 0:42:17You've been to see all the DIY stores?
0:42:17 > 0:42:19No, I've contacted a couple and the door's been shut.
0:42:19 > 0:42:23Put your best suit on, turn up at their office -
0:42:23 > 0:42:25you're going to find out very, very quickly
0:42:25 > 0:42:28whether you have a product that has a demand.
0:42:28 > 0:42:33But this is not an investable business for me.
0:42:33 > 0:42:34I'm afraid I'm out.
0:42:36 > 0:42:40Next in the Den were Polish-born sisters Malgorzata and Dorota,
0:42:40 > 0:42:43who wanted to transform the nation's bums and tums
0:42:43 > 0:42:47and needed a precise £77,000 to do it.
0:42:47 > 0:42:52This is Aqua Miracle exercising pool.
0:42:52 > 0:42:58This product helps to get rid of cellulite and helps to lose weight.
0:42:58 > 0:43:01Duncan Bannatyne knows a thing or two about this sector
0:43:01 > 0:43:04and seemed eager to see the product in action.
0:43:04 > 0:43:06Can Theo get in and show us?
0:43:06 > 0:43:10- Pretend it's full of water. - Yes, of course.
0:43:13 > 0:43:17And you can start doing exercises. You can do sit-ups, jogging.
0:43:20 > 0:43:22Can you do headstands?
0:43:22 > 0:43:27- It's for the lower part of your body. - How many have you sold?
0:43:27 > 0:43:28We haven't sold yet.
0:43:28 > 0:43:31Do you know, I really thought
0:43:31 > 0:43:33that was going to be the answer.
0:43:33 > 0:43:37We know lots of physios and they said it's a really good product.
0:43:37 > 0:43:41But the backing the sisters received from those health experts
0:43:41 > 0:43:44didn't influence the decision of these business experts.
0:43:44 > 0:43:47I will give you my constructive, honest feedback.
0:43:48 > 0:43:50It's absolutely stupid.
0:43:50 > 0:43:51It's three inflatable rings.
0:43:51 > 0:43:55It's just one of those things you got wrong.
0:43:55 > 0:43:56We still believe in this idea.
0:43:56 > 0:44:00It's not a business, so I'm going to say that I'm out.
0:44:05 > 0:44:07You can learn many things from children -
0:44:07 > 0:44:10how much patience you have, for instance.
0:44:10 > 0:44:11But for our next entrepreneurs,
0:44:11 > 0:44:14Gill Hayward and Kellie Forbes from Essex,
0:44:14 > 0:44:16it was their children that inspired their business.
0:44:16 > 0:44:20So, will the Dragons see an opportunity to invest in it?
0:44:45 > 0:44:46Hello, my name is Kellie Forbes,
0:44:46 > 0:44:49and this is my business partner, Gill Hayward,
0:44:49 > 0:44:52and we are here today to ask you for an investment of £60,000
0:44:52 > 0:44:57and in return we would like to give you 10% of our business.
0:44:57 > 0:45:00YUUbag is an exciting desk in a backpack,
0:45:00 > 0:45:05it's ergonomically designed, also has a chest strap with a whistle,
0:45:05 > 0:45:09and an outside water-bottle holder so there are no inside spills.
0:45:10 > 0:45:12It has a fold-down desk, and as we all know,
0:45:12 > 0:45:16children love pockets - YUUbag is full of them.
0:45:16 > 0:45:18It even has a secret compartment.
0:45:18 > 0:45:21GILL: Our strategy from day one was to "act big, be big".
0:45:21 > 0:45:25So, armed with a prototype, we approached Nickelodeon
0:45:25 > 0:45:28with a proposal that would allow a start-up company
0:45:28 > 0:45:30access to a TV advertising campaign.
0:45:30 > 0:45:33With the help of our children and a shoestring budget,
0:45:33 > 0:45:35we created a TV ad.
0:45:35 > 0:45:37The first spot aired at 6.55 in the morning,
0:45:37 > 0:45:41and amazingly, just minutes later, we'd made our first website sale.
0:45:41 > 0:45:43We sold out in seven weeks.
0:45:43 > 0:45:45In the 20 months since trading,
0:45:45 > 0:45:47we have sold 13,000 bags.
0:45:47 > 0:45:52We've attained a turnover of £525,000.
0:45:52 > 0:45:56Thank you very much. Would you like to see our bags?
0:46:00 > 0:46:01A highly professional pitch
0:46:01 > 0:46:05from "mum-preneurs" Kellie Forbes and Gill Hayward.
0:46:05 > 0:46:06They need a cash boost of £60,000
0:46:06 > 0:46:11to grow their fun-packed children's rucksacks into a global brand,
0:46:11 > 0:46:14and they're offering a 10% stake in return.
0:46:14 > 0:46:18Theo Paphitis is first to question the two friends.
0:46:20 > 0:46:21Right, ladies, hello.
0:46:21 > 0:46:24- I'm Theo.- Hi, Theo.- Wow.
0:46:24 > 0:46:28£500,000 turnover in...20 months?
0:46:28 > 0:46:32- BOTH: Yes. - Did you make any money out of it?
0:46:32 > 0:46:36We turned a small profit at the end of last year of £6,000.
0:46:36 > 0:46:41And the new year - let's assume you get no investment here - how much are you going to turn over?
0:46:41 > 0:46:43We're going to turn over £720,000.
0:46:43 > 0:46:45And you estimate you're going to make...
0:46:45 > 0:46:49£130,000. 129, yeah, 130,000.
0:46:49 > 0:46:51OK.
0:46:51 > 0:46:54- How much do you sell the big bag for?- £43.- That's retail.
0:46:54 > 0:46:59- That's including VAT. - OK, last question from me,
0:46:59 > 0:47:02- 60,000 quid... - What are we going to do with it?
0:47:02 > 0:47:05- Yes.- Well, we want to have enough stock in the UK or whatever country
0:47:05 > 0:47:09we're in so that we never have to have customers waiting for our bags.
0:47:09 > 0:47:14- How much is going into stock? - 50, 55,000.
0:47:14 > 0:47:16- So, all of it?- Yes.
0:47:16 > 0:47:18- Well, not all of it. - In effect, in effect.
0:47:18 > 0:47:21- It's all going into cash flow. - Yes.- OK, thank you.
0:47:23 > 0:47:26Confident answers from the assured entrepreneurs.
0:47:26 > 0:47:30Deborah Meaden wants to drill down into the business itself.
0:47:30 > 0:47:32Hello, I'm Deborah.
0:47:32 > 0:47:34Hello. Hi, Deborah.
0:47:34 > 0:47:37So what has changed in your model now
0:47:37 > 0:47:40that's going to drive profit going forward,
0:47:40 > 0:47:44when you weren't driving profit in the past?
0:47:44 > 0:47:47- Although you had a nice, healthy turnover.- A number of things.
0:47:47 > 0:47:49We've spent a long time in the last 20 months
0:47:49 > 0:47:51working out what makes our business tick,
0:47:51 > 0:47:56so we've reduced our fulfilment costs substantially, we brought out
0:47:56 > 0:48:00extra add-on accessories, which are higher margin.
0:48:00 > 0:48:04I mean, everywhere in the business, we have just worked out ways...
0:48:04 > 0:48:06So what has that now done to your margins?
0:48:06 > 0:48:10Well, the production of the bag will go down from £15.87
0:48:10 > 0:48:13to about...to £10.87.
0:48:13 > 0:48:17The shipping is around £1.20 and that will come down to about...
0:48:17 > 0:48:19- just over- £1. Yes.
0:48:19 > 0:48:21We agreed a revenue share with our designer,
0:48:21 > 0:48:25so he is on about £1, and that will go down to about 80p.
0:48:25 > 0:48:30So, compare your margins now to your margins previously.
0:48:30 > 0:48:33The margin is £11.90, currently.
0:48:33 > 0:48:38From the next orders, it will be £16.60.
0:48:38 > 0:48:39Thank you.
0:48:41 > 0:48:46The first-time entrepreneurs look remarkably composed in this forum.
0:48:46 > 0:48:48Peter Jones is intrigued.
0:48:50 > 0:48:54So, a little bit about your background.
0:48:54 > 0:48:55We both met when we were 21.
0:48:55 > 0:48:58We've both come from advertising backgrounds and I left
0:48:58 > 0:49:01and started up a firm and Gill continued her career in advertising.
0:49:01 > 0:49:04I've worked in TV advertising and sales and buying
0:49:04 > 0:49:05for Viacom for ten years
0:49:05 > 0:49:08and took redundancy when they closed part of the business.
0:49:08 > 0:49:11So, is this going to be a full-time thing for you both?
0:49:11 > 0:49:13Yes, that's our plan. Absolutely.
0:49:13 > 0:49:16We love what we do as well, we really are excited about it.
0:49:19 > 0:49:20Um....
0:49:21 > 0:49:24Well, Kellie and Gill...
0:49:24 > 0:49:25GENTLE LAUGHTER
0:49:25 > 0:49:28Um....
0:49:28 > 0:49:29PETER SIGHS
0:49:30 > 0:49:32I love the product.
0:49:32 > 0:49:36Seeing my kids every morning pick up their rucksack,
0:49:36 > 0:49:39I think yours is better. I love the quality of the product,
0:49:39 > 0:49:43- but I just think you've gone into such detail.- Thank you.
0:49:46 > 0:49:49I'm going to make you an offer.
0:49:49 > 0:49:52I think it's about how do we take this brand
0:49:52 > 0:49:56and really extend it and make it something far bigger?
0:49:56 > 0:49:59So, I'm going to offer you the full amount of money.
0:50:01 > 0:50:04But I want 30%.
0:50:04 > 0:50:06OK. Thanks Peter.
0:50:09 > 0:50:12The impressive businesswomen finally receive an offer,
0:50:12 > 0:50:17but for three times the amount they were initially willing to give away.
0:50:17 > 0:50:20Will Theo Paphitis now choose to undercut his rival investor?
0:50:23 > 0:50:27So, would I invest 60,000 quid in you two?
0:50:32 > 0:50:34And the answer is, yes, I would.
0:50:34 > 0:50:36BOTH: Thank you.
0:50:36 > 0:50:39- But, for me to make a difference to this business...- Mm-hm.
0:50:39 > 0:50:42..I'd need to put some effort in.
0:50:42 > 0:50:45- Right.- I'd need to look at the retail channel,
0:50:45 > 0:50:48where they would be in my own stores, or competitors' stores.
0:50:50 > 0:50:53- I've got to have a reasonable hold in it.- OK.
0:50:54 > 0:51:00So, I too will offer you £60,000 for 30% of the business.
0:51:00 > 0:51:02- Thank you.- OK, Thank you.
0:51:02 > 0:51:07- HILARY:- Um.... Kellie, Gill.
0:51:08 > 0:51:11If you could epitomise what you wanted from a Dragon,
0:51:11 > 0:51:14what would it be?
0:51:14 > 0:51:16We think this thing could go really big,
0:51:16 > 0:51:17we'd like to say go global.
0:51:17 > 0:51:21But we don't think we can do this on our own.
0:51:21 > 0:51:27- I think your hurdle is finding the distribution channels.- Mm-hm.
0:51:28 > 0:51:31And that, I believe, I could be of great assistance with.
0:51:34 > 0:51:38So, I would offer 60K...
0:51:40 > 0:51:42- ..for 30% as well. - OK. Thanks, Hilary.
0:51:46 > 0:51:49Unusually, the Dragons seem to be in agreement
0:51:49 > 0:51:52about the level of equity they require.
0:51:52 > 0:51:55Will Deborah Meaden get nearer to the 10% Kellie and Gill
0:51:55 > 0:51:58originally wanted to part with?
0:52:00 > 0:52:04I think it is fair to say that the product's good.
0:52:04 > 0:52:07You know what you're doing, you're very smart, perceptive, all of those things.
0:52:07 > 0:52:10But you haven't taken the UK yet
0:52:10 > 0:52:13and you're already looking international.
0:52:13 > 0:52:15I think what faces you
0:52:15 > 0:52:19is how you manage to get the penetration you want
0:52:19 > 0:52:23within your home market and manage that overseas piece.
0:52:23 > 0:52:28- Yes.- Yes.- And it's something I do in many of my businesses.
0:52:29 > 0:52:32So, I too am going to make you an offer.
0:52:32 > 0:52:35Um.... And I'm going to offer you the full amount,
0:52:35 > 0:52:39£60,000, for 30% of the business.
0:52:39 > 0:52:42- Thank you.- Thank you, Deborah.
0:52:42 > 0:52:43DUNCAN: OK.
0:52:45 > 0:52:49So, I think you're looking for other offers, then, at the moment.
0:52:50 > 0:52:55We'd like to receive all offers. If they were forthcoming, obviously.
0:52:55 > 0:52:56You're not bothered if they're better?
0:52:56 > 0:53:02I think, you know, we'd weigh them all up in context.
0:53:02 > 0:53:04Oh, right. I was going to make you a better offer,
0:53:04 > 0:53:07but, what you're saying is you want to hear worse offers?
0:53:07 > 0:53:10Oh, Duncan, that is a trap.
0:53:10 > 0:53:13- It's not...- You have no idea what they consider better or worse,
0:53:13 > 0:53:18because sometimes better can mean a better percentage or more input,
0:53:18 > 0:53:20so you are absolutely right.
0:53:20 > 0:53:25- Make your own minds up on YOUR value terms what is better.- Thank you.
0:53:25 > 0:53:28I think it's absolutely revolting and ridiculous
0:53:28 > 0:53:30that Deborah would suggest I was trapping you.
0:53:30 > 0:53:33Deborah's just trying to put her foot in the door,
0:53:33 > 0:53:35because she wants you to choose her.
0:53:35 > 0:53:37She thinks if she speaks louder, that's what you'll do.
0:53:39 > 0:53:42Do you know, this just looks such a great business.
0:53:45 > 0:53:48So, I'm going to offer you the full amount.
0:53:50 > 0:53:51For 25% of your company.
0:53:53 > 0:53:55OK. Thank you, thank you, Duncan.
0:53:55 > 0:53:57Terrible tactic that, Deborah.
0:54:01 > 0:54:04You've both now got a dilemma, haven't you?
0:54:05 > 0:54:07PETER: You can go to the back.
0:54:07 > 0:54:08Thank you. OK.
0:54:12 > 0:54:15The Dragons' true colours are exposed
0:54:15 > 0:54:18as the rivalry finally comes to the fore.
0:54:20 > 0:54:22It's rare for entrepreneurs to receive offers
0:54:22 > 0:54:24from all five investors,
0:54:24 > 0:54:28but will Kellie and Gill choose expertise,
0:54:28 > 0:54:30enthusiasm, or equity?
0:54:33 > 0:54:35THEY CONFER
0:54:43 > 0:54:46Um.... Thank you, all, very much indeed.
0:54:46 > 0:54:51To get your input and your offers, we're...
0:54:51 > 0:54:54blown away, actually, if the truth be known. Genuinely blown away.
0:54:54 > 0:54:56Um....
0:55:01 > 0:55:03Could we...could we ask whether Deborah and Peter
0:55:03 > 0:55:07would be willing to do something together?
0:55:18 > 0:55:20Um....
0:55:21 > 0:55:25KELLIE If you equally would rather not... It's an open question.
0:55:27 > 0:55:30I would instinctively turn round and say, no,
0:55:30 > 0:55:34I think for £60,000, it would be better to be all in.
0:55:34 > 0:55:36Why do you ask that?
0:55:36 > 0:55:39I'm interested to know what that combination offers you
0:55:39 > 0:55:40that you think one person doesn't.
0:55:40 > 0:55:42I think from your vision
0:55:42 > 0:55:46and your know-how of where we are as a company appealed to both of us.
0:55:53 > 0:55:57Could we, er...? Shall we go?
0:56:10 > 0:56:12THEY CONFER
0:56:14 > 0:56:17(If they want us to choose between one or t'other,
0:56:17 > 0:56:21(which one would you want to be with?)
0:56:21 > 0:56:23THEY CONTINUE TO CONFER
0:56:24 > 0:56:26(They're going to ask for more.)
0:56:26 > 0:56:29Do you think? I think so, yes.
0:56:39 > 0:56:41Wasn't an easy decision for us.
0:56:41 > 0:56:47But the reason you've given for two Dragons makes total sense to me,
0:56:47 > 0:56:52so, £60,000, the full amount of money...
0:56:54 > 0:56:57..for 15% each.
0:56:59 > 0:57:02APPLAUSE AND LAUGHTER
0:57:02 > 0:57:04Kellie and Gill have done it.
0:57:04 > 0:57:06High five!
0:57:06 > 0:57:08It was a tense and unusual negotiation,
0:57:08 > 0:57:12but their determination has secured them the finance needed
0:57:12 > 0:57:15and two well-connected multimillionaire investors.
0:57:19 > 0:57:23To get five offers from the Dragons, is just, it's overwhelming.
0:57:23 > 0:57:27It's very exhilarating. It was a better deal with better equity.
0:57:27 > 0:57:28But less about the equity.
0:57:28 > 0:57:32Yes, a slice of the pie might be slightly smaller for us,
0:57:32 > 0:57:35but hopefully the pie will be considerably bigger.
0:57:44 > 0:57:48I can remember many memorable Dragon versus Dragon battles
0:57:48 > 0:57:52in the den, but it's rare to have all five vying for a deal.
0:57:52 > 0:57:54The great news for Kellie and Gill
0:57:54 > 0:57:57is not just that they got the investment they wanted,
0:57:57 > 0:57:59but that five hard-headed Dragons
0:57:59 > 0:58:03all thought they were so impressive, they were worth fighting for.
0:58:03 > 0:58:07Now, if you want to find out more about how Kellie and Gill
0:58:07 > 0:58:10managed to get all five Dragons competing to invest,
0:58:10 > 0:58:13press the red button now.
0:58:13 > 0:58:15Goodbye.
0:58:15 > 0:58:17Next week in the Den...
0:58:17 > 0:58:19Do you want an investor?
0:58:21 > 0:58:24It doesn't matter if you're turning over £160,000
0:58:24 > 0:58:26if you're losing money at the end of it.
0:58:26 > 0:58:29Actually, if I'm honest with you, I think it's a bit boring.
0:58:29 > 0:58:32I think that would be the biggest lesson, is what you want
0:58:32 > 0:58:35from a business, not how much of it you control or own.
0:58:35 > 0:58:37I want to be there...
0:58:39 > 0:58:41..when you make it.
0:58:44 > 0:58:47Subtitles by Red Bee Media Ltd