0:00:02 > 0:00:04Tonight on Dragons' Den...
0:00:07 > 0:00:10Do you want to be a niche player for the rest of your life
0:00:10 > 0:00:12or do you want to make money?
0:00:12 > 0:00:13Clearly, you want Sarah.
0:00:14 > 0:00:16I'm out.
0:00:16 > 0:00:22I can absolutely see tens of thousands of these being sold.
0:00:22 > 0:00:26Do you know what? I can't work out if this is completely bonkers
0:00:26 > 0:00:29or there's a moment of brilliance.
0:00:29 > 0:00:32You have done an appalling job of selling them online.
0:00:32 > 0:00:33Really appalling.
0:00:34 > 0:00:38I'm willing to give you all the money, but I want 35%.
0:00:38 > 0:00:41Your valuation is absolutely ludicrous.
0:01:14 > 0:01:19Welcome to Dragons' Den, open for business once more.
0:01:19 > 0:01:22And first to face the fire of the Dragons are a transatlantic duo,
0:01:22 > 0:01:24John Burke and Jon Hulme.
0:01:24 > 0:01:27They've combined business with pleasure and, in doing so,
0:01:27 > 0:01:31think they've spotted a gap in the lucrative home drinks market.
0:01:31 > 0:01:35So will they be raising a glass, or drowning their sorrows
0:01:35 > 0:01:37after their encounter with the Dragons?
0:01:44 > 0:01:46- Good luck, buddy.- Let's do it.
0:01:46 > 0:01:50We met in Spain, in business school, where we spent
0:01:50 > 0:01:54a lot more time in the gin and tonic bars than we did in class.
0:01:54 > 0:01:57And, ever since, we've wanted to start a business together.
0:02:01 > 0:02:03We really like Sarah Willingham,
0:02:03 > 0:02:05because of her background in cocktails.
0:02:05 > 0:02:08I could use one of those after this.
0:02:08 > 0:02:09I could use one right now!
0:02:30 > 0:02:32Hello.
0:02:32 > 0:02:35Our names are John and Jon, and we are here today to ask you for
0:02:35 > 0:02:43£75,000 in return for a 3% stake in our business, Craft Clubs Limited.
0:02:43 > 0:02:46Our mission is to reinvent the way that drinks lovers
0:02:46 > 0:02:47discover and enjoy new drinks.
0:02:47 > 0:02:51The drinks industry is changing. More people are drinking at home,
0:02:51 > 0:02:54and they're choosing quality over quantity.
0:02:54 > 0:02:56They're seeking out new products from craft producers and are
0:02:56 > 0:02:58left underwhelmed by what's in the supermarket.
0:02:58 > 0:03:02At the same time, the number of craft producers is booming,
0:03:02 > 0:03:04but they have limited marketing budgets
0:03:04 > 0:03:06and are often left undiscovered.
0:03:06 > 0:03:10Craft Clubs is launching alcohol subscription clubs to connect
0:03:10 > 0:03:13these craft producers with the home market.
0:03:13 > 0:03:16Every month, we partner with one distillery and we send their gins
0:03:16 > 0:03:20to our club members, along with our monthly magazine,
0:03:20 > 0:03:23and special treats that go in the box that tell the story of the gin.
0:03:23 > 0:03:26Sounds fantastic, John, but how does all of that translate into numbers?
0:03:26 > 0:03:29Well, our business has been cash flow positive since day one.
0:03:29 > 0:03:37In our first year, we acquired 3,225 members and turned over £481,000.
0:03:37 > 0:03:38We're growing quickly.
0:03:38 > 0:03:42Our current revenue run rate stands at £1.2 million
0:03:42 > 0:03:45and will reach £2.7 million at the end of this year.
0:03:45 > 0:03:49Our goal is to deliver a ten times return on your investment.
0:03:49 > 0:03:52We've got some really delicious craft gin and tonics for you to try
0:03:52 > 0:03:55and some surprise Gin of the Month boxes for you to open,
0:03:55 > 0:03:57so let's get those served.
0:03:57 > 0:04:01Confident talk from London-based business partners John Burke and
0:04:01 > 0:04:05Jon Hulme, who are looking for an investment of £75,000
0:04:05 > 0:04:08in their craft gin subscription business.
0:04:08 > 0:04:10You've all got a different month's gin with a different
0:04:10 > 0:04:13month's magazine, and a few extra treats we've thrown in, too.
0:04:13 > 0:04:16But as they're only prepared to give 3% of their business away,
0:04:16 > 0:04:20to secure investment, they'll need the Dragons to subscribe
0:04:20 > 0:04:23to their hefty £2.5 million company valuation.
0:04:26 > 0:04:28(It's really good.)
0:04:28 > 0:04:31But the gin isn't proving much of a tonic for Touker Suleyman.
0:04:33 > 0:04:39- Jon, John.- Yes?- I'm not a big drinker of gin, actually. Erm...
0:04:39 > 0:04:41It gives me a headache.
0:04:41 > 0:04:46- Just to get my head around it, I join for £40 a month...- Mm-hm.
0:04:46 > 0:04:48..and I get one of those boxes for free?
0:04:48 > 0:04:50You could look at it that way,
0:04:50 > 0:04:54but it's essentially every time you get a gin box, you're charged £40.
0:04:54 > 0:04:58- So if I'm a 12-month member, I'll get 12 boxes from you.- Correct.
0:04:58 > 0:05:01Why alcohol? How did you get to alcohol?
0:05:01 > 0:05:04Why wasn't it a chocolate club or a whatever club?
0:05:04 > 0:05:06Well, we met in Madrid,
0:05:06 > 0:05:08- which is the home of the great gin and tonic...- Right.
0:05:08 > 0:05:11..and we definitely shared a few of those there,
0:05:11 > 0:05:14and then we were in a pub in London.
0:05:14 > 0:05:18Behind the bar was about 40 craft gins. We knew it was a hot sector.
0:05:18 > 0:05:21I said, "Come on, John, no matter how bad a job we do of it,
0:05:21 > 0:05:23"we'll probably do OK, because gin's just going crazy",
0:05:23 > 0:05:25and I think we've done better than that.
0:05:25 > 0:05:26The life of a bottle of gin,
0:05:26 > 0:05:31depending on how much you drink, is about a month in a normal family?
0:05:31 > 0:05:32That's kind of the goal, yeah!
0:05:32 > 0:05:35- LAUGHTER - It depends. I mean...
0:05:35 > 0:05:36Touker, when you say "family",
0:05:36 > 0:05:38does that depend on how much your children drink?
0:05:38 > 0:05:40LAUGHTER
0:05:42 > 0:05:47So far, so convivial, but the Den is no place for bonhomie.
0:05:47 > 0:05:50Online greetings card pioneer Nick Jenkins
0:05:50 > 0:05:53now wants to get to the bottom of their mark-up.
0:05:55 > 0:05:58Tell me about the gross margins in the business.
0:05:58 > 0:06:01OK, well, we enjoy gross margins of 24% on our box,
0:06:01 > 0:06:04but that is the cost, that's the fully loaded cost,
0:06:04 > 0:06:06so that includes the gin and the extras that go into the box,
0:06:06 > 0:06:09the cardboard, the packaging, the shipping costs,
0:06:09 > 0:06:10the pick and pack costs.
0:06:10 > 0:06:14A box costs about £26 for us to put together and ship to
0:06:14 > 0:06:18a customer and we charge about £34.
0:06:18 > 0:06:20OK, so that's... It's pretty lean.
0:06:20 > 0:06:23After the end of year five, what do you reckon it's going to be making?
0:06:23 > 0:06:26Year five, we should make at least £2 million in net profit,
0:06:26 > 0:06:31so a few months into that, we should be getting towards £2.5 million.
0:06:31 > 0:06:34Impressive projections from the business school buddies,
0:06:34 > 0:06:38but it appears that a hangover is setting in
0:06:38 > 0:06:40in Peter Jones's corner of the Den.
0:06:43 > 0:06:47I just wonder how much alcohol you've been consuming recently.
0:06:47 > 0:06:51Your valuation is absolutely ludicrous.
0:06:53 > 0:06:57You know the market really, really well. You're seriously credible.
0:06:57 > 0:06:59I don't think you're delusional.
0:07:01 > 0:07:03Why are you cheeky enough to come in here and value
0:07:03 > 0:07:06a business like this at over £2 million?
0:07:09 > 0:07:11Yeah, I mean, I...
0:07:11 > 0:07:14W-We're very confident that, even at that valuation in five years' time,
0:07:14 > 0:07:17we'll find that exit that'll deliver a ten-times return
0:07:17 > 0:07:20- on your investment, uh... - I don't doubt that.
0:07:20 > 0:07:22If you produce a company
0:07:22 > 0:07:26- that's going to generate £2.5 million profit...- Mm-hm.
0:07:26 > 0:07:28..and it's got a subscription base,
0:07:28 > 0:07:30I think you could sell that for £25 million,
0:07:30 > 0:07:32- so...tick in the box.- OK.
0:07:32 > 0:07:35But it's not right that you come in and say your business
0:07:35 > 0:07:36is worth what it is.
0:07:37 > 0:07:40I actually think it's pretty unfair.
0:07:42 > 0:07:45So, the number that you've come in here is non-negotiable?
0:07:47 > 0:07:48We didn't say that.
0:07:50 > 0:07:53Our absolute preference would be walk out of here with a deal today.
0:07:56 > 0:08:00Crisis averted - as the entrepreneurs hint at wiggle room
0:08:00 > 0:08:03in the 3% equity they're prepared to part with,
0:08:03 > 0:08:07but have they done enough to keep Touker Suleyman circling?
0:08:10 > 0:08:13Guys, where is your offices, by the way?
0:08:13 > 0:08:14It's at Tottenham Court Road.
0:08:14 > 0:08:17- And what are you paying there for a space?- 420 a desk, fully loaded.
0:08:17 > 0:08:20So if I gave you free desks in my office, you'd be happy, would you?
0:08:20 > 0:08:23- In Edgware Road?- Yeah. - No charge.- That'd be very nice.
0:08:23 > 0:08:25I'm going to make you an offer, guys.
0:08:27 > 0:08:30- I'm going to give you all the money for 35%.- Brilliant. Thank you.
0:08:30 > 0:08:32Let's start the ball rolling.
0:08:33 > 0:08:3435%.
0:08:36 > 0:08:39An unexpected and audacious bid for the business
0:08:39 > 0:08:42from Touker Suleyman, who, despite throwing in the use of his office
0:08:42 > 0:08:45for free, is asking for almost 12 times
0:08:45 > 0:08:48what the entrepreneurs want to part with.
0:08:48 > 0:08:50But how serious are they to cut a deal?
0:08:53 > 0:08:55Peter Jones wants to cut to the chase.
0:08:57 > 0:09:00What's the most you'll give away today, equity?
0:09:02 > 0:09:05To be honest with you, just to be transparent, I mean, we discussed
0:09:05 > 0:09:09that we would, erm, want to give up 5% of the company for that.
0:09:12 > 0:09:16Thanks for flushing that out, Peter, because, erm... You're great.
0:09:16 > 0:09:19You couldn't fault you two,
0:09:19 > 0:09:21but why would I get involved in your business for 5%?
0:09:21 > 0:09:23Why would I do it?
0:09:23 > 0:09:26When I can put my money in so many places?
0:09:26 > 0:09:28I think... Hope... Erm...
0:09:28 > 0:09:31I guess our thinking would be that the ten times return on that
0:09:31 > 0:09:35investment, regardless of the...the equity stake, would be worthwhile.
0:09:35 > 0:09:38- It's a bit early on that journey. - What percentage would...?
0:09:38 > 0:09:40Well, you've just said the top percent of 5% and, really,
0:09:40 > 0:09:44I'm not going to be terribly interested in that, either.
0:09:44 > 0:09:47So I won't be investing. It's a shame.
0:09:48 > 0:09:51- It is a shame.- It is a shame.- It's a real shame.- I won't be investing.
0:09:51 > 0:09:53What would interest you?
0:09:55 > 0:09:58Well, I was going to make you an offer...
0:10:02 > 0:10:03..and it would have been at 10%.
0:10:06 > 0:10:08OK.
0:10:12 > 0:10:15So, are you making an offer, Deborah?
0:10:15 > 0:10:19Actually, yes. I'll make you that offer. I'm making that offer.
0:10:23 > 0:10:25A dramatic U-turn from a Dragon
0:10:25 > 0:10:28just seconds away from declaring herself out.
0:10:28 > 0:10:32Deborah Meaden joins Touker Suleyman in tabling an offer.
0:10:34 > 0:10:38So far, drinks doyenne Sarah Willingham, who made her millions in
0:10:38 > 0:10:43global restaurant franchises, has stayed silent on the sidelines.
0:10:43 > 0:10:46But she has an ace up her sleeve.
0:10:46 > 0:10:48I-I'm going to have to blow my cover.
0:10:49 > 0:10:52- I am one of their customers. - Oh, are you?
0:10:52 > 0:10:53- Ah!- Yes, I can't believe it!
0:10:53 > 0:10:56You never know what is going to walk into the Den.
0:10:56 > 0:10:58- I absolutely love it.- Oh, thank you.
0:10:59 > 0:11:03Your business model, it's so straightforward and I think
0:11:03 > 0:11:07the craft market in alcohol itself is...is massive.
0:11:10 > 0:11:13But your valuation is so far for me.
0:11:15 > 0:11:18I mean, even at Deborah's 10%,
0:11:18 > 0:11:23I've got to be honest, I'm...I'm more 15%...
0:11:23 > 0:11:26and, at 15%, I am so excited.
0:11:26 > 0:11:27Hmm.
0:11:29 > 0:11:31So all of the money for 15%.
0:11:34 > 0:11:37Three Dragons have now made offers,
0:11:37 > 0:11:40but all three want a different share of the business.
0:11:41 > 0:11:44Deborah Meaden is asking for 10%.
0:11:46 > 0:11:49Sarah Willingham is holding out for 15%.
0:11:51 > 0:11:56And Touker Suleyman is asking for a substantial 35% of the company.
0:11:57 > 0:12:00Will Nick Jenkins want to join the party?
0:12:00 > 0:12:05I think if you had come in here in six months' time, having proved what
0:12:05 > 0:12:11you'd done, then I would be a lot more confident about that valuation.
0:12:13 > 0:12:16So I wish you all the best of luck and I might well subscribe to it,
0:12:16 > 0:12:17- but I'm afraid I'm out.- OK.
0:12:19 > 0:12:22- I think you two are brilliant.- Thank you.
0:12:23 > 0:12:27My issue is that it's the valuation that you've applied to the company.
0:12:30 > 0:12:32But I like this type of market,
0:12:32 > 0:12:35and I think I could add a lot of value to this for you.
0:12:37 > 0:12:39HE EXHALES
0:12:44 > 0:12:47- So that's the reason why I'm going to make you an offer.- OK.
0:12:50 > 0:12:53I'm going to offer you all of the money...
0:12:57 > 0:12:58..for 10%.
0:13:01 > 0:13:04Peter Jones goes head-to-head with Deborah Meaden
0:13:04 > 0:13:08for a 10% slice of the subscription box business.
0:13:08 > 0:13:12Sarah Willingham is using her drinks industry credentials
0:13:12 > 0:13:15to push for more equity in the company...
0:13:15 > 0:13:20But, with fierce competition, is a change of tactics on the cards?
0:13:25 > 0:13:27- I'm going to go halves.- OK.
0:13:30 > 0:13:33- I'm going to do 12.5%.- OK.
0:13:35 > 0:13:38- You want to have a little chat about it?- Take it to the wall?
0:13:40 > 0:13:46- Right, showtime, Jonny. What do you think, buddy?- Er, well...
0:13:46 > 0:13:50With four offers on the table and Dragons jockeying for position,
0:13:50 > 0:13:53the entrepreneurs have the upper hand in the Den.
0:13:53 > 0:13:55(Shall we try and get Sarah down to ten?
0:13:55 > 0:13:58(And if she doesn't, shall we take 10% from...)
0:13:58 > 0:14:01(That might insult him at that point,
0:14:01 > 0:14:03(but I wouldn't mind having him on board.)
0:14:07 > 0:14:08HE CHUCKLES
0:14:08 > 0:14:10- Er... - HE CLEARS HIS THROAT
0:14:10 > 0:14:12It's great to have two offers at 10%.
0:14:12 > 0:14:17Sarah, you're a bit of an outlier at 12%. Is there any way...
0:14:17 > 0:14:20I mean, it's very difficult for us to accept an offer
0:14:20 > 0:14:25at 12.5% when we have offers on the table at 10, so our first question
0:14:25 > 0:14:29to you would be, would you be prepared to match the 10%
0:14:29 > 0:14:30that these two have on the table?
0:14:30 > 0:14:33- SHE SIGHS - You're killing me.- Please.- Erm...
0:14:36 > 0:14:39What do you think that makes an investor feel like?
0:14:39 > 0:14:42When-When you're asking us to commit to you and do...
0:14:42 > 0:14:44And change your business?
0:14:44 > 0:14:47We just wanted to make sure that we're making a decision between...
0:14:47 > 0:14:50No, you're very good, but I won't believe that. I'm sorry.
0:14:50 > 0:14:51Clearly, you want Sarah.
0:14:54 > 0:14:56So I'm out.
0:14:56 > 0:14:58- That wasn't necessarily... - Can I just say?
0:14:59 > 0:15:00I'm out.
0:15:02 > 0:15:06Some seriously ruffled feathers as the Den's longest-serving Dragons
0:15:06 > 0:15:09turn on their heels and walk away from a deal.
0:15:10 > 0:15:13But Touker Suleyman's offer of 35%
0:15:13 > 0:15:18and Sarah Willingham's significantly lower 12.5% still stand,
0:15:18 > 0:15:22though both are substantially more than the 3% the entrepreneurs
0:15:22 > 0:15:24were originally willing to give away.
0:15:26 > 0:15:28Will they keep on fighting?
0:15:32 > 0:15:36I mean, we feel that 10% is as far as we can move our 3%.
0:15:36 > 0:15:38If we can go to 10%, then we have a deal.
0:15:44 > 0:15:48I am 12.5%. I've already... I feel like I've already come down.
0:15:48 > 0:15:51I sat early on and wrote down 15%.
0:16:01 > 0:16:04- Let's do a deal. We can't wait to have you on board.- Yes!
0:16:04 > 0:16:06Oh, that's brilliant.
0:16:06 > 0:16:09I am really excited.
0:16:09 > 0:16:11- We're excited to have you. - Really excited.
0:16:11 > 0:16:12You can join our tasting team.
0:16:12 > 0:16:16Oh, a lifetime of craft gin just opened up! I love it.
0:16:16 > 0:16:18Thank you, guys.
0:16:18 > 0:16:22After a roller-coaster ride of a pitch, the gin-loving entrepreneurs
0:16:22 > 0:16:28leave with £75,000 and with a drinks expert Dragon on board.
0:16:28 > 0:16:31- HE SIGHS - Gave up a lot of that company.- Fives?
0:16:32 > 0:16:35We've got a great Dragon. We should be very happy.
0:16:35 > 0:16:38We didn't get the valuation we wanted, but we're paying for...
0:16:38 > 0:16:40We're paying for the expertise.
0:16:40 > 0:16:43How do you feel about being not their...their real favourite?
0:16:44 > 0:16:45What do you mean?
0:16:45 > 0:16:49- Well, it was a default, wasn't it? - Default, yeah, yeah, yeah!
0:16:55 > 0:16:57Next to enter the Den,
0:16:57 > 0:17:01two entrepreneurs who aren't afraid to mix their metaphors.
0:17:01 > 0:17:03We are in something of a race
0:17:03 > 0:17:05and we know that people might try and do this
0:17:05 > 0:17:08and it's a bit like we are on a race between London and Edinburgh
0:17:08 > 0:17:10and we are on the M1 and we are ahead,
0:17:10 > 0:17:13we are in Watford, and that's great. The only slight problem is,
0:17:13 > 0:17:15we are in a 1962 Mini with 56 horsepower
0:17:15 > 0:17:17and in my rear-view mirror,
0:17:17 > 0:17:20I can see the Ferraris putting their tyres on in London,
0:17:20 > 0:17:22so what we need is more horsepower.
0:17:23 > 0:17:28But will Ross Williams and his business partner Surlender Pendress
0:17:28 > 0:17:31cruise through the interrogation, or hit the skids?
0:17:31 > 0:17:33So, to business.
0:17:45 > 0:17:48Hello, Dragons. My name is Surlender and this is Ross.
0:17:48 > 0:17:51We are here to ask you for an investment of £50,000
0:17:51 > 0:17:54for a 12.5% share in our company.
0:17:54 > 0:17:58If you bear with us, we will reveal all about our product very shortly.
0:17:58 > 0:17:59I'm going to hand you over to Ross.
0:17:59 > 0:18:03Thank you for your time. What we want to show you today
0:18:03 > 0:18:07is something we have created based upon two things - maths and logic.
0:18:07 > 0:18:10So, what is the product? Can I deal with the logic first?
0:18:10 > 0:18:13I already have two other small companies and in those companies,
0:18:13 > 0:18:16I've been looking at scale drawings of buildings for the last 20 years
0:18:16 > 0:18:20and it is scale that we draw the logic from.
0:18:20 > 0:18:22What's interesting is...this.
0:18:22 > 0:18:24You are all holding one.
0:18:24 > 0:18:28We don't think of a pen as a hand tool, but that's exactly what it is.
0:18:28 > 0:18:30We may get richer and buy bigger cars and bigger houses,
0:18:30 > 0:18:32we don't buy a longer one of these.
0:18:32 > 0:18:35It is the perfect-sized tool for our hand.
0:18:35 > 0:18:36If I can show you this...
0:18:38 > 0:18:41Would anybody use a pen of this size?
0:18:41 > 0:18:43I don't think so, it's not the right-sized tool.
0:18:43 > 0:18:48We also use this tool - a pencil. We use it often,
0:18:48 > 0:18:52but actually it's not the tool we choose to use.
0:18:52 > 0:18:56If it were, pens would be that length, but they are not.
0:18:56 > 0:18:58This is the maths.
0:18:59 > 0:19:01But here's the thing.
0:19:01 > 0:19:04When you have a child who is five years old,
0:19:04 > 0:19:07they are about 55% the size of us
0:19:07 > 0:19:11and when you give them this to learn to write with,
0:19:11 > 0:19:17to them, it will actually feel like this because of scale.
0:19:17 > 0:19:20This is the right-sized tool for us
0:19:20 > 0:19:24and these are the tools that we've made.
0:19:31 > 0:19:32Oops.
0:19:34 > 0:19:37Write Size pencils makes learning to write easier.
0:19:37 > 0:19:41Learning to write is a fundamental learning block of education.
0:19:41 > 0:19:44Thank you for listening to us, we welcome any questions
0:19:44 > 0:19:48and I'd like to bring some products over to you, if that's OK.
0:19:48 > 0:19:52Passionate about pencils are West Midlands-based business partners
0:19:52 > 0:19:55Ross Williams and Surlender Pendress.
0:19:55 > 0:20:00They are asking for £50,000 in return for a 12.5% stake
0:20:00 > 0:20:02in their children's stationery business.
0:20:02 > 0:20:05You will find some normal pencils in there as well,
0:20:05 > 0:20:07so you can see the difference.
0:20:07 > 0:20:13But is the business proposition they are offering promising or pointless?
0:20:13 > 0:20:16Peter Jones wants to get to the nub of the matter.
0:20:19 > 0:20:21Why?
0:20:21 > 0:20:23Why do it?
0:20:23 > 0:20:26Why would you want to buy different sized pencils?
0:20:26 > 0:20:30It's scale. They don't have the same size shoes,
0:20:30 > 0:20:32they don't have the same size anything
0:20:32 > 0:20:34and this is a tool, a craftsmanship...
0:20:34 > 0:20:37We forget this, learning to write is a craftsmanship...
0:20:37 > 0:20:39No, Ross, I see your salesmanship, but what...
0:20:39 > 0:20:41They are smaller people, Peter.
0:20:41 > 0:20:43No, I understand that. I'm questioning why.
0:20:46 > 0:20:50Because for a century, at least,
0:20:50 > 0:20:53our children have had not an issue with this thought
0:20:53 > 0:20:55and my children, all five of them,
0:20:55 > 0:20:59have never said, "Dad, I can hardly lift this pencil!"
0:20:59 > 0:21:03So I don't get why you would go to all of this expense
0:21:03 > 0:21:06to choose to buy a smaller pencil just because your child is six.
0:21:06 > 0:21:08But... Peter...
0:21:08 > 0:21:12In every adult profession where somebody learns a dextrous skill,
0:21:12 > 0:21:14we give them the tools to fit their hands.
0:21:14 > 0:21:17All tools fit our hands. They are adult tools.
0:21:17 > 0:21:20Yes, but I'm not teaching my five-year-old to be a calligrapher.
0:21:20 > 0:21:26Peter Jones puts a black mark against the pencil pitch.
0:21:27 > 0:21:31And now Nick Jenkins has a point to make.
0:21:33 > 0:21:35What I slightly struggle with,
0:21:35 > 0:21:38although I realise that I have been unable to read my own writing
0:21:38 > 0:21:41and the reason is that I probably started with
0:21:41 > 0:21:42a pencil that was just too long,
0:21:42 > 0:21:45but it's amazing that no-one else has thought of this.
0:21:45 > 0:21:48Very often, you think, "Why hasn't anyone looked at this before?"
0:21:48 > 0:21:50It isn't that people haven't looked at it,
0:21:50 > 0:21:52they probably looked at it and thought it wasn't worthwhile.
0:21:52 > 0:21:54There are lots of things, like dog nappies,
0:21:54 > 0:21:57why hasn't anyone ever come up with dog nappies before?
0:21:57 > 0:21:59Probably have, decided it wasn't worthwhile.
0:21:59 > 0:22:03Do you know what, I can't work out if this is completely bonkers
0:22:03 > 0:22:07or...there is a moment of brilliance,
0:22:07 > 0:22:13where, actually, marketed right, are you going to get loads of mums
0:22:13 > 0:22:18buying lots of different-sized pens for different-aged kids?
0:22:20 > 0:22:23Unique or useless, the pint-sized pencils
0:22:23 > 0:22:27are certainly giving the Dragons plenty to ponder.
0:22:27 > 0:22:31But there's a grey area that Touker Suleyman wants to explore.
0:22:34 > 0:22:37Why grey? You're catering for children.
0:22:37 > 0:22:38- Yes.- They love colour.
0:22:38 > 0:22:42Why have you got to have them all grey looking, quite industrial?
0:22:42 > 0:22:45It shows that they are not colouring pencils, these are pencils
0:22:45 > 0:22:48made to improve the ability of a child to learn to write,
0:22:48 > 0:22:51to give them the best-sized tool you can give them,
0:22:51 > 0:22:53to take it more seriously.
0:22:53 > 0:22:55You've moved from "why" to "why grey".
0:22:55 > 0:22:57I think we're still on "why"!
0:22:57 > 0:22:59DRAGONS LAUGH
0:23:02 > 0:23:07Has there been any concrete research to back this up,
0:23:07 > 0:23:08that you can then demonstrate...?
0:23:08 > 0:23:12If there has, you're walking into every school in the country.
0:23:12 > 0:23:15- Yes.- Well, when we were in Dubai, we were at an education show
0:23:15 > 0:23:19and 120 teachers bought them for their own children.
0:23:19 > 0:23:23But where is the research that shows that children are better writers
0:23:23 > 0:23:26- as a result of having a smaller pen? - As I said at the start of the pitch,
0:23:26 > 0:23:30it can only be based upon the logic of the fact
0:23:30 > 0:23:32that if the tool fits the person's hand,
0:23:32 > 0:23:34will it be easier for them to learn that skill?
0:23:34 > 0:23:37- So, it hasn't been tested? - It can't be tested.
0:23:37 > 0:23:40Well, of course it can be tested! That's what people do
0:23:40 > 0:23:42when they come up with a prototype or with an idea.
0:23:42 > 0:23:44They might research it or test it. You don't...
0:23:44 > 0:23:47- We have children who love... - We have tested them on parents,
0:23:47 > 0:23:49you know, the parents who bought them for their children.
0:23:49 > 0:23:52We have gone into the schools and the schools loved them.
0:23:54 > 0:23:55A lack of concrete research
0:23:55 > 0:23:59is threatening to put a line through the pencil proposition.
0:23:59 > 0:24:02And now Deborah Meaden wants to get to the bottom
0:24:02 > 0:24:04of Ross and Surlender's sales.
0:24:07 > 0:24:09How do these compare, price-wise,
0:24:09 > 0:24:11to, you know, buying standard pencils?
0:24:11 > 0:24:13They are £3.99 a packet.
0:24:13 > 0:24:15That feels quite expensive to me.
0:24:17 > 0:24:20So, who have you shown them to in the UK?
0:24:20 > 0:24:22At the moment, Ryman is looking at how many shops
0:24:22 > 0:24:25they can put them into in time for back-to-school this year,
0:24:25 > 0:24:28but, you know, they're driving a hard bargain,
0:24:28 > 0:24:31it's a new product, they want them on SOR, which we are happy to do,
0:24:31 > 0:24:34but that's all we've got to in the UK so far.
0:24:34 > 0:24:36- OK, and that's sale or return?- Yes.
0:24:37 > 0:24:39That doesn't say to me
0:24:39 > 0:24:42that there's an awful lot of confidence in that product.
0:24:44 > 0:24:47A product unproven in the marketplace
0:24:47 > 0:24:49rarely goes down well in the Den
0:24:49 > 0:24:55and it appears that online expert Nick Jenkins has made up his mind.
0:24:55 > 0:24:59If you put this in front of parents, they will probably look at them
0:24:59 > 0:25:02and think, "I've never thought of that, better have them."
0:25:02 > 0:25:06Unfortunately, the issue I have with it is the amount of sales effort
0:25:06 > 0:25:09that it takes to get something into a chain of stores
0:25:09 > 0:25:12when you've just got the one product is...
0:25:12 > 0:25:15quite huge and I think that might impact
0:25:15 > 0:25:18on the success of the business, so I sort of see the point,
0:25:18 > 0:25:23but I think it's a bit too narrow, so I'm afraid I'm out.
0:25:23 > 0:25:25- PETER JONES:- There is one thing that you could speak to
0:25:25 > 0:25:27any stationer in the world
0:25:27 > 0:25:30and say that they never ever get worried about
0:25:30 > 0:25:32and that's the stock of pencils.
0:25:32 > 0:25:35I think there's a fundamental flaw with your business.
0:25:35 > 0:25:38You're introducing products that will just sit on a shelf
0:25:38 > 0:25:39and that's a problem.
0:25:41 > 0:25:44So, I'm going to say it's not for me, I'm out.
0:25:47 > 0:25:49- DEBORAH MEADEN:- Do you know, I don't think it's crazy.
0:25:49 > 0:25:52I actually can see that there's definitely something in it.
0:25:52 > 0:25:56But...it's not proved at the moment
0:25:56 > 0:25:59and I don't think it's a premium product.
0:25:59 > 0:26:01I'm not going to be investing, I'm afraid.
0:26:01 > 0:26:02I'm out.
0:26:06 > 0:26:09Three Dragons have now left the negotiations.
0:26:10 > 0:26:13Will high street retail magnate Touker Suleyman
0:26:13 > 0:26:16be the man to take Write Size to the masses?
0:26:18 > 0:26:22To launch that worldwide, as you are talking,
0:26:22 > 0:26:26the 50,000 that you're asking for won't cover the stock,
0:26:26 > 0:26:29the marketing, the online, the...
0:26:29 > 0:26:31in running the business.
0:26:31 > 0:26:34We already have 30,000 units in stock.
0:26:34 > 0:26:36I've just sent over 3,000 units to Dubai...
0:26:36 > 0:26:39Right, but then the 50,000 is not enough for your marketing.
0:26:39 > 0:26:41You know?
0:26:41 > 0:26:43You probably need half a million,
0:26:43 > 0:26:45so on that basis, I'm not going to invest.
0:26:45 > 0:26:46I'm out.
0:26:47 > 0:26:51With four Dragons out and just one remaining,
0:26:51 > 0:26:54is the writing on the wall for the pencil entrepreneurs?
0:26:54 > 0:26:59Millionaire mum-of-four Sarah Willingham has yet to declare.
0:26:59 > 0:27:04Does she think the petite pencils are investible or illogical?
0:27:04 > 0:27:06As I said earlier, I think it's...
0:27:06 > 0:27:09I can't quite decide whether or not it's just...
0:27:09 > 0:27:11it's so bonkers that people would buy it.
0:27:13 > 0:27:14I do think you'll sell some.
0:27:15 > 0:27:18I really do. I think somebody will take it,
0:27:18 > 0:27:21I think you'll be that kind of guilt purchase that we make
0:27:21 > 0:27:22and I can see mums buying it.
0:27:26 > 0:27:29But I just can't see it being mass-market
0:27:29 > 0:27:33unless there really is concrete evidence
0:27:33 > 0:27:37that kids are better off with a smaller pencil
0:27:37 > 0:27:40and I think that is a lot of money that needs spending,
0:27:40 > 0:27:43it's a lot of marketing and it is A LOT of PR.
0:27:43 > 0:27:46I just think it's too big a hurdle,
0:27:46 > 0:27:48so I'm afraid it's not an investment for me, so I'm out.
0:27:51 > 0:27:53- NICK:- Thanks, good luck. - Thank you.
0:27:53 > 0:27:55In the end, the Dragons decided
0:27:55 > 0:27:58that half-sized pencils is a half-baked business idea
0:27:58 > 0:28:02and the two entrepreneurs leave with nothing.
0:28:02 > 0:28:04I don't understand.
0:28:04 > 0:28:05Never mind.
0:28:06 > 0:28:09If I only get half the world's population of parents
0:28:09 > 0:28:12that have to buy pencils for their children in the future,
0:28:12 > 0:28:15I'm only going to sell about a billion...
0:28:15 > 0:28:17ish.
0:28:25 > 0:28:27Still to come on tonight's show...
0:28:27 > 0:28:29Beanbags...
0:28:29 > 0:28:31and boot cleaners.
0:28:31 > 0:28:33- How are you finding it, Nick? - Therapeutic.
0:28:33 > 0:28:37But will either business get the Dragons to bite?
0:28:37 > 0:28:39- 250,000...pounds?!- Yes.
0:28:41 > 0:28:43How much?!
0:28:43 > 0:28:45That's a lot of fish and chips you must have sold.
0:28:45 > 0:28:47- Can I have a look at the bag? - Of course you can.
0:28:47 > 0:28:49I wonder whether...
0:28:51 > 0:28:52..three Dragons...
0:28:52 > 0:28:56could give this exactly what this needs.
0:29:00 > 0:29:02Next to enter the Den is former
0:29:02 > 0:29:05market trader Mark Yewman from Essex,
0:29:05 > 0:29:07who is looking to bring a Dragon outsider
0:29:07 > 0:29:11into his tight-knit but chilled-out family firm.
0:29:11 > 0:29:14Pitching to the Dragons can be a lonely business,
0:29:14 > 0:29:18but there are often others who stand to benefit
0:29:18 > 0:29:20from a potential Den investment.
0:29:20 > 0:29:23Mark's two children, who are both employees in the company,
0:29:23 > 0:29:27will be watching the pitch unfold from our new reaction room,
0:29:27 > 0:29:31so with hearts in mouths and fingers crossed,
0:29:31 > 0:29:34it's time for Mark to face the Dragons.
0:29:34 > 0:29:37It's a family business, which we all take part in.
0:29:39 > 0:29:42And, yeah, we work hard, but it's not all about money,
0:29:42 > 0:29:44it's more down, for me, quality in life.
0:29:46 > 0:29:49I think I was a really young man, in my youth, when you realise
0:29:49 > 0:29:52that money is not the be-all and end-all to everything.
0:29:52 > 0:29:5523-year-old Alex and 25-year-old George
0:29:55 > 0:29:59are also hoping for new fire in the family enterprise.
0:29:59 > 0:30:01Love you, Papa.
0:30:03 > 0:30:07But will their laid-back dad have enough drive for the Dragons?
0:30:07 > 0:30:09He's been driving everyone mad,
0:30:09 > 0:30:12walking around the house, repeating it over and over again.
0:30:14 > 0:30:17I'm actually really nervous for him.
0:30:17 > 0:30:19I'm glad I'm sitting here, really,
0:30:19 > 0:30:21and I get to watch from the sidelines!
0:30:28 > 0:30:31My heart is actually pounding for him.
0:30:31 > 0:30:32Good evening, Dragons.
0:30:32 > 0:30:34My name's Mark Yewman.
0:30:34 > 0:30:37I've come here today to give you an opportunity
0:30:37 > 0:30:44to invest £75,000 in a 15% share of my brand, BigBoy Beanbag.
0:30:45 > 0:30:46Approximately eight years ago,
0:30:46 > 0:30:51I decided my small design studio needed a bit of an update
0:30:51 > 0:30:54and the two things I always craved as a kid
0:30:54 > 0:30:56was a Chopper bike and a beanbag.
0:30:56 > 0:30:59Unfortunately, I had to accept that, at my time of life,
0:30:59 > 0:31:01I was never going to look any good on a Chopper any more,
0:31:01 > 0:31:04but I could still buy myself a beanbag.
0:31:04 > 0:31:06So I found a particular brand.
0:31:06 > 0:31:09When it arrived, I just didn't like the fabrics used,
0:31:09 > 0:31:13it was slippery, it was slidy and then when I went to sit on it,
0:31:13 > 0:31:16it offered no structural support at all, it was very unstable.
0:31:16 > 0:31:20And then I discovered that it couldn't be used outside
0:31:20 > 0:31:22because it wasn't waterproof, it wasn't UV protected,
0:31:22 > 0:31:26it couldn't be machine washed either. So, I thought to myself,
0:31:26 > 0:31:28"You know, I could do better than this,"
0:31:28 > 0:31:31so I spent the next few months experimenting with modern fabrics,
0:31:31 > 0:31:35different fillings and then we have the product here today.
0:31:35 > 0:31:39We've run the business very much like a cottage-style industry.
0:31:40 > 0:31:45But we've still managed to sell around about 24,000 units,
0:31:45 > 0:31:49which equates to roughly £2.7 million.
0:31:51 > 0:31:52Em...
0:31:52 > 0:31:54Keep going.
0:31:58 > 0:32:02My main part of this pitch is to get you to have a try
0:32:02 > 0:32:07because it's the product which sells itself, I like to think,
0:32:07 > 0:32:10so if you would be kind enough, at some stage, to give it a try,
0:32:10 > 0:32:12that would be fantastic, Dragons.
0:32:13 > 0:32:17A pitch with bags of charm from laid-back family man Mark Yewman.
0:32:17 > 0:32:19Just sit on the front edge...
0:32:19 > 0:32:21Whoops!
0:32:21 > 0:32:24He's looking for a £75,000 investment
0:32:24 > 0:32:28for 15% of his BigBoy Beanbag business.
0:32:28 > 0:32:30OK, OK.
0:32:30 > 0:32:34With the formality of the pitch over, this one-time market trader
0:32:34 > 0:32:37is back in his comfort zone, but for how long?
0:32:40 > 0:32:42What's with the scarf?
0:32:42 > 0:32:44Do you know what? You've got to stand out sometimes.
0:32:44 > 0:32:47- ALEX LAUGHS - I love an accessory!
0:32:47 > 0:32:49I don't wear ties, to be honest with you.
0:32:49 > 0:32:52No, no, it does... It's quirky.
0:32:52 > 0:32:54It covers my belly up a little.
0:32:54 > 0:32:55- Mark?- Yes?
0:32:55 > 0:32:58- I'd like to understand a bit more about the business.- Of course.
0:32:58 > 0:33:00How long have you been going for?
0:33:00 > 0:33:02With this product, approximately eight years.
0:33:02 > 0:33:04- OK.- Just under.
0:33:04 > 0:33:07And in that time, you've had £2.7 million worth of turnover?
0:33:07 > 0:33:09- Yes.- In that time? - 24,000 units.
0:33:09 > 0:33:13OK, so let me understand, where are you at the moment?
0:33:13 > 0:33:15So, what was the last year, for example?
0:33:15 > 0:33:17This year, which was finished in July,
0:33:17 > 0:33:20we were turning over about half a million.
0:33:20 > 0:33:22OK. And what is your margin?
0:33:22 > 0:33:27Em... Our margin... Manufacturing costs about £35 per unit.
0:33:27 > 0:33:29- Delivered?- No.
0:33:29 > 0:33:33Including delivery and packaging, about £15, just under.
0:33:33 > 0:33:37- So, 50 quid?- Yes.- All in, per unit, delivered.
0:33:37 > 0:33:39And what are you selling them for?
0:33:39 > 0:33:43We roughly average at about £113 per unit.
0:33:43 > 0:33:46I want to take this to a wider market,
0:33:46 > 0:33:48but I'm just a dyslexic barrow boy.
0:33:48 > 0:33:50I can't take it any further than that.
0:33:50 > 0:33:55So, really, I'm here, not so much for the investment,
0:33:55 > 0:33:58but for your ability to open up the market
0:33:58 > 0:34:02and take the product to the next stage and hopefully beyond.
0:34:04 > 0:34:08Unfortunately for the self-proclaimed dyslexic barrel boy,
0:34:08 > 0:34:10a financially forensic Deborah Meaden
0:34:10 > 0:34:13wants to dig deeper into those numbers.
0:34:17 > 0:34:19You've been around a long time.
0:34:19 > 0:34:21I would be very interested to understand
0:34:21 > 0:34:24- what your balance sheet looked like. - Em...
0:34:24 > 0:34:26This will be tough.
0:34:26 > 0:34:29Money at the bank?
0:34:29 > 0:34:31Balance sheet, so what's your turnover at the top
0:34:31 > 0:34:33versus what's your net worth at the bottom?
0:34:33 > 0:34:35Right, em...
0:34:35 > 0:34:37Sorry, forgive me.
0:34:37 > 0:34:38Em...
0:34:38 > 0:34:41- That is quite scary. - She is scary!
0:34:41 > 0:34:44- What...- Let's help.
0:34:44 > 0:34:46- So, your turnover is about half a million.- Yes.
0:34:46 > 0:34:48And how much stock have you got?
0:34:48 > 0:34:49At this current time...
0:34:49 > 0:34:51Erm...
0:34:51 > 0:34:52£150,000 worth?
0:34:52 > 0:34:54At retail or cost?
0:34:54 > 0:34:56- Cost.- At cost, OK. 150,000.
0:34:56 > 0:34:58Sorry, let me just... Forgive me one second,
0:34:58 > 0:35:01I don't want to give you some false information.
0:35:01 > 0:35:03- Yeah.- Em...
0:35:03 > 0:35:07No, about 220 at retail.
0:35:07 > 0:35:09Oh, this bit's nerve-racking!
0:35:10 > 0:35:13OK, so, do you have premises?
0:35:13 > 0:35:17We have... We have premises, but we've run it, again,
0:35:17 > 0:35:20like a cottage-style industry. Our rents are very, very low.
0:35:20 > 0:35:22We keep a very tight ship.
0:35:22 > 0:35:23And who's we?
0:35:23 > 0:35:27Myself, my partner of 30 years, and my two children.
0:35:27 > 0:35:29Oh, right, so it's a real family business?
0:35:29 > 0:35:31A proper family business, yeah.
0:35:33 > 0:35:35Good.
0:35:35 > 0:35:36The beanbag businessman
0:35:36 > 0:35:40survives Deborah Meaden's interrogation of his figures,
0:35:40 > 0:35:44but global outsourcing supremo Touker Suleyman is concerned
0:35:44 > 0:35:47that his cottage-industry set-up is lacking in ambition.
0:35:52 > 0:35:54Do you want to be a niche player for the rest of your life,
0:35:54 > 0:35:56or do you want to make money?
0:35:56 > 0:36:00I...I have a very nice quality of life, don't get me wrong.
0:36:00 > 0:36:04- OK.- Money doesn't bring happiness, as I'm certain we all realise,
0:36:04 > 0:36:06but I would like to be in a better position
0:36:06 > 0:36:09and I genuinely believe this is a product which merits...
0:36:09 > 0:36:11Nobody is querying the product.
0:36:11 > 0:36:13My only thing is, if I'm going to invest my money,
0:36:13 > 0:36:17I need to know that I can grow the business,
0:36:17 > 0:36:18so all I'm saying is
0:36:18 > 0:36:21you look a little bit laid-back...
0:36:21 > 0:36:22I am very laid-back.
0:36:22 > 0:36:25- I can see that. - I live in a lovely house,
0:36:25 > 0:36:28I get to drive a nice car, I've got a fantastic family.
0:36:28 > 0:36:30It's not necessarily all about the money for me,
0:36:30 > 0:36:33it's about you being able to move the product forward.
0:36:37 > 0:36:42An entrepreneur unmotivated by money is a red rag to a Dragon.
0:36:42 > 0:36:45Nick Jenkins, who built an online business empire
0:36:45 > 0:36:50worth a cool £120 million, has some home truths to dish out.
0:36:53 > 0:36:54- Mark?- Yes.
0:36:54 > 0:36:57I'm all for quality of life and taking a relaxed approach to life,
0:36:57 > 0:37:00that's fine, but don't bring investors in
0:37:00 > 0:37:02because investors will encroach on your quality of life
0:37:02 > 0:37:04because they might ask you awkward questions,
0:37:04 > 0:37:06like when are we going to get a dividend,
0:37:06 > 0:37:08when are we going to improve sales,
0:37:08 > 0:37:09when are we going to pull our finger out
0:37:09 > 0:37:12and try and catch up with our competitor?
0:37:12 > 0:37:15- I actually don't want to watch this, this is...- No, don't be a wimp!
0:37:15 > 0:37:20I really don't think that you would appreciate having an investor
0:37:20 > 0:37:23putting the kind of pressure on you to do it,
0:37:23 > 0:37:25or even worse, you're just expecting one of us
0:37:25 > 0:37:27to come and run your business for you...
0:37:27 > 0:37:29- No, I...- In which case, I'm certainly not doing that.
0:37:29 > 0:37:31But also, I'm just staggered.
0:37:31 > 0:37:34You have done an appalling job of selling them online,
0:37:34 > 0:37:35really appalling...
0:37:38 > 0:37:40..which goes to show you're just not terribly good at it.
0:37:42 > 0:37:46I won't be coming in to help you run your business, so I'm out.
0:37:47 > 0:37:51A dramatic turn in the Den, as an irritated Nick Jenkins
0:37:51 > 0:37:56decides he's heard enough and bails out of the beanbag pitch.
0:37:56 > 0:38:00Will Peter Jones go any easier on the Essex entrepreneur?
0:38:03 > 0:38:06So, what's the potential for this business?
0:38:06 > 0:38:08Because it seems that you've been pretty flat
0:38:08 > 0:38:11and that resembles, very much, your character.
0:38:11 > 0:38:13I'm really just a market trader.
0:38:13 > 0:38:16Never say JUST a market trader!
0:38:16 > 0:38:17Some of the best businesspeople I know
0:38:17 > 0:38:19have come through market trading.
0:38:19 > 0:38:21He's done well.
0:38:21 > 0:38:23Very proud!
0:38:23 > 0:38:25Do you want to grow this, or do you want to...
0:38:25 > 0:38:27- Are you quite happy with life?- No.
0:38:27 > 0:38:29Well, I am happy with life at the moment,
0:38:29 > 0:38:33but I don't feel I'm doing this particular product justice.
0:38:33 > 0:38:35I have to say, I think the product is brilliant.
0:38:35 > 0:38:37Thank you.
0:38:41 > 0:38:43But you've got this whole family piece in,
0:38:43 > 0:38:46which I think is a major, major thing,
0:38:46 > 0:38:48and having invested, in the Den,
0:38:48 > 0:38:51in businesses that are family-related as well,
0:38:51 > 0:38:55I've seen firsthand what happens after a year or two,
0:38:55 > 0:39:00and the reality is the family really focusing on what they want
0:39:00 > 0:39:03rather than what an investor would want
0:39:03 > 0:39:05and it becomes a real conflict of interest
0:39:05 > 0:39:06and I don't want to be part of that.
0:39:06 > 0:39:10- Why do they hate us?- I don't know, but I feel like we'll get fired.
0:39:10 > 0:39:13I don't know what I've done for them to hate me!
0:39:13 > 0:39:15So, I'm going to say I'm not going to invest, Mark,
0:39:15 > 0:39:17and say that I'm out...
0:39:17 > 0:39:19But I'm certainly going to be a customer.
0:39:21 > 0:39:27Mark, I know where I am as well and I... I'm just not feeling it.
0:39:27 > 0:39:30Do you know, I've possibly given my impression
0:39:30 > 0:39:33of being a bit too laid-back in my persona.
0:39:34 > 0:39:36There's something...
0:39:36 > 0:39:39and I don't know what it is, but as an investment,
0:39:39 > 0:39:42- I'm really sorry, but...- It's all right, no need to apologise.
0:39:42 > 0:39:45No, it's not for me. I'm out.
0:39:45 > 0:39:46That's OK, thank you.
0:39:48 > 0:39:52Sarah Willingham becomes the third Dragon to bin the beanbags.
0:39:52 > 0:39:54Touker Suleyman loves the product,
0:39:54 > 0:39:58but can he see beyond the low-energy presentation?
0:40:02 > 0:40:05I'm just concerned. You said, "I don't need the money, I don't..."
0:40:05 > 0:40:08You're very sort of, you know, it's like you...
0:40:08 > 0:40:11You want a magic wand to say, "Let's just grow the business,"
0:40:11 > 0:40:15so, I'm going to give you 30 seconds of Touker Time
0:40:15 > 0:40:18to tell you I think you should bring somebody in
0:40:18 > 0:40:21to do that job that a Dragon would do.
0:40:21 > 0:40:25- Yes.- You can buy expertise without giving up equity
0:40:25 > 0:40:28and keeping the business within the family.
0:40:28 > 0:40:30If I got involved, I'd say to you,
0:40:30 > 0:40:34"You've got your children, have you ever thought about kicking them out,
0:40:34 > 0:40:35"get them to get a job,
0:40:35 > 0:40:38"and employing somebody who could take it to the next level?"
0:40:38 > 0:40:40He's killing me, I'm not even there!
0:40:40 > 0:40:42Very difficult. It's a family business.
0:40:42 > 0:40:45If there are tough decisions, I don't want to be the one
0:40:45 > 0:40:48that's going to put a wedge between your family
0:40:48 > 0:40:52and, for that reason, I'm not going to invest. I'm out.
0:40:52 > 0:40:53No, that's fine. Thank you.
0:40:56 > 0:40:57Four Dragons out.
0:40:57 > 0:41:00Just Deborah Meaden remains.
0:41:00 > 0:41:04With a portfolio of investments in textile-based companies,
0:41:04 > 0:41:08has she seen a business opportunity that the others have missed?
0:41:11 > 0:41:13This is a really difficult one because I like this.
0:41:13 > 0:41:15I'm not buying that you're laid-back, either.
0:41:15 > 0:41:18You got the product together, you're selling half a million a year.
0:41:18 > 0:41:20You know, having a nice, relaxed way about life
0:41:20 > 0:41:22doesn't mean to say that you're not on it,
0:41:22 > 0:41:24so I don't... That doesn't worry me at all.
0:41:24 > 0:41:28What does worry me is that there's kind of no endgame.
0:41:28 > 0:41:31It feels to me like you have a nice family business
0:41:31 > 0:41:35that you will probably want to carry on working in for a long time
0:41:35 > 0:41:38and that's a worrying thing for me as an investor.
0:41:40 > 0:41:42Em...
0:41:42 > 0:41:43Ohh...
0:41:55 > 0:41:57Come on. Come on!
0:42:09 > 0:42:10I'm not going to do it.
0:42:11 > 0:42:15I'm really sorry, Mark, but I won't be investing. I'm out.
0:42:15 > 0:42:18That's fine, thank you. Thank you very much.
0:42:18 > 0:42:20Good luck!
0:42:20 > 0:42:21Poor Papa.
0:42:22 > 0:42:24With five noes,
0:42:24 > 0:42:28the stuffing has fallen out of Mark Yewman's beanbag pitch...
0:42:28 > 0:42:30Family business killed it.
0:42:30 > 0:42:32..and the easy-going Essex entrepreneur
0:42:32 > 0:42:37leaves the Den without the £75,000 investment he was hoping for.
0:42:37 > 0:42:39MARK SIGHS
0:42:39 > 0:42:41The truth about family businesses,
0:42:41 > 0:42:43and Peter is absolutely spot-on,
0:42:43 > 0:42:45is that when they don't want to do what you want them to do,
0:42:45 > 0:42:48they glue together and there is absolutely nothing
0:42:48 > 0:42:50you're going to be able to do about it.
0:42:50 > 0:42:52- Oh, Daddy!- Well done, mate.
0:42:53 > 0:42:55You done so well.
0:42:55 > 0:42:56Yeah, you did do well.
0:42:56 > 0:42:59- It was brutal. You're both sacked, by the way.- I know!
0:43:07 > 0:43:12The final entrepreneurs to face the Dragons also have a family business.
0:43:12 > 0:43:17London-based fish and chip shop owner Rashpal Dhillon is here
0:43:17 > 0:43:20with her two sons, Arminder and Gurminder.
0:43:20 > 0:43:24The Dragons have already rejected one family business tonight.
0:43:24 > 0:43:27Will this mother-and-son set-up get the same short shrift?
0:43:27 > 0:43:30If we pull it off, the rewards will be amazing.
0:43:39 > 0:43:41Hi, I'm Gurminder.
0:43:41 > 0:43:43Hi, I'm Arminder.
0:43:43 > 0:43:44Hi, I'm Rashpal.
0:43:44 > 0:43:47We're the Boot Buddy.
0:43:47 > 0:43:49We're here today pitching for £60,000
0:43:49 > 0:43:51in return for 10% equity in our company.
0:43:51 > 0:43:53So, here in my hands,
0:43:53 > 0:43:56I have the home-made prototype of the Boot Buddy.
0:43:56 > 0:43:58The idea came one day after football training when I decided
0:43:58 > 0:44:01there had to be an easier way to clean my muddy football boots,
0:44:01 > 0:44:02so when I got home that day,
0:44:02 > 0:44:04I fiddled about with some items we had -
0:44:04 > 0:44:08the first being the brush, the second being a plastic water bottle
0:44:08 > 0:44:10and the third being a plastic knife.
0:44:10 > 0:44:12When I stuck these three items together,
0:44:12 > 0:44:14we had a prototype which sort of worked.
0:44:14 > 0:44:17Now we have our own proper Boot Buddy
0:44:17 > 0:44:19in one compact, portable gadget.
0:44:19 > 0:44:22OK, so, the scraper here is to take off all the big chunks of mud,
0:44:22 > 0:44:25so what you do is you unscrew it,
0:44:25 > 0:44:27you fill up with water,
0:44:27 > 0:44:29take the Boot Buddy with you wherever you might be going,
0:44:29 > 0:44:31whether it's football, walking the dog or playing golf,
0:44:31 > 0:44:34then, when you wish to use it, unlock the head
0:44:34 > 0:44:37and then that's it - away you go.
0:44:37 > 0:44:41So, as you can see, what you have is a really simple and easy method
0:44:41 > 0:44:44of cleaning your boots in seconds.
0:44:44 > 0:44:46Right...
0:44:46 > 0:44:50To date, we've turned over £100,000 in the last year
0:44:50 > 0:44:53and we've sold 6,500 units.
0:44:53 > 0:44:57Thank you for your time and I hope, together, we can...
0:44:57 > 0:45:00- ALL THREE:- ..Leave the outdoors outside.
0:45:01 > 0:45:04Hoping to clean up in the Den are the Dhillon family,
0:45:04 > 0:45:06who are asking for £60,000
0:45:06 > 0:45:11in return for a 10% stake in their company, Boot Buddy.
0:45:11 > 0:45:13- How are you finding it, Nick? - Therapeutic.
0:45:13 > 0:45:17Surprising how little water goes a long way.
0:45:17 > 0:45:18So you can maximise cleaning.
0:45:18 > 0:45:23Product demonstration over and it's time for its 15-year-old inventor
0:45:23 > 0:45:26to leave his mother and older brother
0:45:26 > 0:45:28to face the Dragons' questions.
0:45:28 > 0:45:31High-street retailer Touker Suleyman gets the ball rolling.
0:45:33 > 0:45:35- You've turned over £100,000?- Yes.
0:45:35 > 0:45:38- What is the retail price? - These sell for £12.99.
0:45:39 > 0:45:40OK, and costs?
0:45:40 > 0:45:43Costs right now, it's about £7.
0:45:43 > 0:45:46£7? Yeah.
0:45:46 > 0:45:50I have to say, until you said you've sold £100,000 worth of product,
0:45:50 > 0:45:52I was a little bit in shock
0:45:52 > 0:45:56because it is just a water bottle with a brush on the end.
0:45:56 > 0:46:00The product works, it does exactly what it says it is going to do
0:46:00 > 0:46:03and, you know, we get mums e-mailing us all the time saying,
0:46:03 > 0:46:05"Look, our kids never used to clean their boots,
0:46:05 > 0:46:08"our HUSBANDS never used to clean their boots,
0:46:08 > 0:46:10"and now they do, because they've got a cool, fun gadget."
0:46:10 > 0:46:12But, as you can see, when you were cleaning the boot,
0:46:12 > 0:46:14you run out pretty quickly.
0:46:14 > 0:46:18And you'd have to refill to do your second boot.
0:46:18 > 0:46:20I think that that is a design fault
0:46:20 > 0:46:22and I didn't want to say it in front of Arminder
0:46:22 > 0:46:26because the last thing I want to do is not praise and encourage,
0:46:26 > 0:46:29clearly, a young entrepreneur in the making,
0:46:29 > 0:46:32but my biggest issue is the fact you've got to continue to refill it.
0:46:35 > 0:46:38Design flaws and Dragons don't mix well.
0:46:38 > 0:46:42Will the set-up of the family business also be a concern?
0:46:44 > 0:46:47What is the structure? Are you working out of home...?
0:46:47 > 0:46:50Yeah, we are, we're working out of our home office.
0:46:50 > 0:46:52Everything is done from there.
0:46:52 > 0:46:57The distribution, as well, is out of the basement of one of our shops.
0:46:57 > 0:47:00- So, what is your real business? - Fish and chips.
0:47:00 > 0:47:02- Fish and chips?- Catering, yeah. - Yes, fish and chips.
0:47:02 > 0:47:04Oh, I love fish and chips!
0:47:04 > 0:47:08- But I've got my own business... - What is your business?
0:47:08 > 0:47:11Again, it's just fast food.
0:47:11 > 0:47:12Fast food? What...?
0:47:12 > 0:47:13Chicken, chicken.
0:47:13 > 0:47:16And what is your share structure?
0:47:16 > 0:47:17I mean, who owns the business?
0:47:17 > 0:47:20GURMINDER LAUGHS
0:47:20 > 0:47:22Well, obviously, Mum is the boss, she put the money in,
0:47:22 > 0:47:25so Mum's got 60% and...
0:47:25 > 0:47:27- Everybody else has 10%.- Right.
0:47:27 > 0:47:30And how much did Mum put in?
0:47:30 > 0:47:32Em... Total,
0:47:32 > 0:47:34just below 250,000.
0:47:36 > 0:47:37How much?!
0:47:37 > 0:47:39Sorry?!
0:47:39 > 0:47:41- 250,000...pounds?!- Yes.
0:47:41 > 0:47:43- TOUKER WHISTLES - Wow!
0:47:44 > 0:47:46Wow! Good God!
0:47:47 > 0:47:50That's a lot of fish and chips you must have sold!
0:47:53 > 0:47:57Disbelief across the board as the revelation that the boot product
0:47:57 > 0:48:00has already been funded to the tune of £250,0000
0:48:00 > 0:48:02leaves the Dragons reeling.
0:48:04 > 0:48:08Serial investor Nick Jenkins wants answers.
0:48:10 > 0:48:11What did you spend it on?
0:48:11 > 0:48:13- Er...- Tooling.
0:48:13 > 0:48:17How much would the tooling cost for something like that?
0:48:17 > 0:48:19Just below 40,000. Yeah.
0:48:19 > 0:48:23The intellectual property, below 150.
0:48:23 > 0:48:27- Oh! Oh!- And stock... - I'm sorry, I'm sorry,
0:48:27 > 0:48:30did you say you spent £150,000 on the intellectual property?
0:48:30 > 0:48:31Below, just below.
0:48:31 > 0:48:34It... The design is registered in 22 countries.
0:48:37 > 0:48:39That's an ENORMOUS amount of money
0:48:39 > 0:48:42to have spent on something quite simple. Enormous!
0:48:44 > 0:48:46I...I just don't understand why so much.
0:48:46 > 0:48:49We thought it was the best thing to do.
0:48:49 > 0:48:51I just think you could have done it for a hell of a lot less.
0:48:51 > 0:48:53A fraction of that!
0:48:56 > 0:48:58The blows just keep on coming,
0:48:58 > 0:49:00as excessive spending in the business
0:49:00 > 0:49:03leaves Nick Jenkins questioning their business savvy.
0:49:03 > 0:49:08Can the fast-food family salvage any credibility?
0:49:08 > 0:49:11That money you put in, is it a loan?
0:49:11 > 0:49:14- Or...- Yeah, it's a director's loan.
0:49:14 > 0:49:17So, basically, the company owes you the money.
0:49:17 > 0:49:19Yeah, but, it's not like it's interest
0:49:19 > 0:49:21or that I'm in a rush for it, you know, it's...
0:49:21 > 0:49:24I don't want to stifle the growth of their company.
0:49:24 > 0:49:27Are you in the position...
0:49:27 > 0:49:30to look at a bigger picture and say,
0:49:30 > 0:49:33"I'd waive my director's loan on the basis that,
0:49:33 > 0:49:35"by bringing a Dragon on board,
0:49:35 > 0:49:38"I might get some actual dividends back?"
0:49:38 > 0:49:40If it helps the company move forward
0:49:40 > 0:49:42and it's the right decision, then yes.
0:49:44 > 0:49:48Rashpal's calm demeanour and the suggestion
0:49:48 > 0:49:51that she might waive the £250,000 loan
0:49:51 > 0:49:53has raised a few Dragon eyebrows.
0:49:53 > 0:49:57Can she snatch victory from the jaws of defeat?
0:49:59 > 0:50:03When it gets to the point that most of the people playing football
0:50:03 > 0:50:07would need to buy this in order for this investment to break even...
0:50:09 > 0:50:11..it's a bit frightening.
0:50:11 > 0:50:13To make any sense of this as an investment,
0:50:13 > 0:50:15you would have to sell more
0:50:15 > 0:50:17than I believe you can sell in this market.
0:50:20 > 0:50:22Em, so, for that reason, I'm out.
0:50:25 > 0:50:27Nick Jenkins puts the boot in.
0:50:27 > 0:50:29Will Sarah Willingham
0:50:29 > 0:50:33see more business potential in the Boot Buddy?
0:50:35 > 0:50:37Guys, I'm going to tell you where I am.
0:50:37 > 0:50:41I've got houseful of muddy boots and I'm still...
0:50:42 > 0:50:46..I'm still using the outdoor tap and the scrubbing brush.
0:50:46 > 0:50:50I...I just don't think I'd use it.
0:50:51 > 0:50:54You know, and I'm a mum surrounded by muddy boots,
0:50:54 > 0:50:58so I'm going to say no, but I really wish you all the best.
0:50:58 > 0:50:59Thank you.
0:50:59 > 0:51:02So, good luck, but I'm afraid I'm out.
0:51:04 > 0:51:09A second Dragon brush-off for the Battersea-based entrepreneurs.
0:51:09 > 0:51:12Now the chips are down, where does Touker Suleyman stand?
0:51:15 > 0:51:17It needs a lot, it needs...
0:51:17 > 0:51:22to be focused, to sell it,
0:51:22 > 0:51:23somebody who has got the contacts,
0:51:23 > 0:51:26somebody who can run the website,
0:51:26 > 0:51:29somebody who can give you some offices to work out of.
0:51:30 > 0:51:32I tell you what I'm going to do.
0:51:34 > 0:51:37I'm willing to give you all the money, but I want 35%.
0:51:40 > 0:51:43It's not often the Den sees a Dragon go from
0:51:43 > 0:51:47almost falling off their seat after discovering company debts
0:51:47 > 0:51:51to piling in with an offer, but Touker Suleyman springs a surprise
0:51:51 > 0:51:55and tables a bid for 35% of the boot-cleaning enterprise,
0:51:55 > 0:52:01way more than the 10% stake the family want to part with.
0:52:01 > 0:52:05Does Deborah Meaden have a better offer in mind?
0:52:06 > 0:52:08I like an awful lot about it.
0:52:08 > 0:52:11I like the story and that it was invented by your son
0:52:11 > 0:52:15and I think that you are a very, very supportive mum.
0:52:15 > 0:52:18- Thank you.- I think you've done an amazing job and I...
0:52:18 > 0:52:20I think... It's a good product.
0:52:22 > 0:52:27What's holding me back is that it's just not an area that I love.
0:52:29 > 0:52:31You know, I'm not into football.
0:52:31 > 0:52:34I always feel like I can stand up and proudly shout about
0:52:34 > 0:52:36the brands I'm involved with because I feel it.
0:52:37 > 0:52:41I just don't think I'm the right fit for you and, you know, that...
0:52:41 > 0:52:43I suspect you will get a better fit here,
0:52:43 > 0:52:46which is kind of a shame because I would love to be involved with it,
0:52:46 > 0:52:49but I don't think I'm going to do the best job for you.
0:52:49 > 0:52:52It's not just football that we can restrict it to.
0:52:52 > 0:52:55That's the beauty of it. We can keep the same design
0:52:55 > 0:52:57and just change the bristles very easily.
0:52:57 > 0:52:58For each market.
0:52:58 > 0:53:01Anyone can actually use this product and it's easy.
0:53:01 > 0:53:03Dog walkers, golf,
0:53:03 > 0:53:06and also the people who work on building sites, tarmac,
0:53:06 > 0:53:09you know, if you change the bristles, make them harder,
0:53:09 > 0:53:12so it's anybody with muddy boots.
0:53:13 > 0:53:15She is persuasive, your mother, isn't she?
0:53:17 > 0:53:18Well...
0:53:25 > 0:53:28I don't normally do this, because 60,000 isn't a huge ask.
0:53:28 > 0:53:30Often, I'll sit here and I'll say,
0:53:30 > 0:53:31"It's £60,000, I want it on my own,"
0:53:31 > 0:53:34but I'm not offering the full package,
0:53:34 > 0:53:36but I would love to be involved,
0:53:36 > 0:53:39so I'm going to offer you half of the money...
0:53:41 > 0:53:43..and I would want...
0:53:50 > 0:53:53..12.5% of the business.
0:53:56 > 0:53:59But what I would say is that I'd rather we parked your money,
0:53:59 > 0:54:01we didn't write it off, so it is said, look,
0:54:01 > 0:54:03when we've got our money out or there was an exit,
0:54:03 > 0:54:05it is still sat there
0:54:05 > 0:54:08because it's the thing that got the business off the ground.
0:54:09 > 0:54:13With offers on the table from Touker Suleyman and Deborah Meaden,
0:54:13 > 0:54:17the Boot Buddy has found some Dragon friends in the Den.
0:54:18 > 0:54:20Will seeing his fellow Dragons make bids
0:54:20 > 0:54:23incentivise Peter Jones to enter the mix?
0:54:27 > 0:54:32Do you know what's really interesting is I can absolutely see
0:54:32 > 0:54:35tens of thousands of these being sold.
0:54:35 > 0:54:38If you could find a way to get that manufacturing costs at a level...
0:54:39 > 0:54:45I could see this being sold almost with every pair of boots that sold.
0:54:47 > 0:54:50Touker and Deborah have both given you an offer.
0:54:51 > 0:54:53And in my head, instinctively,
0:54:53 > 0:54:56I would normally think that I'm going to go and compete with them.
0:55:01 > 0:55:03I'm actually sitting here, thinking,
0:55:03 > 0:55:05"I wonder whether...
0:55:06 > 0:55:08"..three Dragons...
0:55:09 > 0:55:11"..could give this exactly what this needs?"
0:55:13 > 0:55:16With my contacts in some of the sports places, you know,
0:55:16 > 0:55:17making use of Touker...
0:55:17 > 0:55:20He's been trying to, for almost a year now,
0:55:20 > 0:55:23to give away his office in any investment,
0:55:23 > 0:55:25and it would actually make me happy to be part of that,
0:55:25 > 0:55:28that I would see somebody use his office for once!
0:55:28 > 0:55:30TOUKER CHUCKLES
0:55:30 > 0:55:33I think that this has a real chance of success,
0:55:33 > 0:55:35but do what Deborah suggests -
0:55:35 > 0:55:36you keep your quarter of a million
0:55:36 > 0:55:38because I think it's really important
0:55:38 > 0:55:41- that you get your money back. - I agree with that now.
0:55:41 > 0:55:44So, I will offer you
0:55:44 > 0:55:46£20,000
0:55:46 > 0:55:48for 10%
0:55:48 > 0:55:51if the other Dragons agreed, but you get three Dragons.
0:55:52 > 0:55:56I... I would certainly...
0:55:56 > 0:55:58Yeah, I would like to do that.
0:55:58 > 0:56:00OK, three of us would make a fantastic team.
0:56:02 > 0:56:05Do you want to go and think about that and have a chat?
0:56:05 > 0:56:08Whilst Arminder nervously waits outside,
0:56:08 > 0:56:12his mum and brother have a huge decision to make.
0:56:12 > 0:56:15I think with three of them there, we've got those three markets.
0:56:15 > 0:56:18Peter Jones, Touker Suleyman and Deborah Meaden
0:56:18 > 0:56:22are each offering £20,000 for 10% of the business.
0:56:22 > 0:56:24They want to take a smaller chunk of the pie
0:56:24 > 0:56:26and it is your favourite number...
0:56:26 > 0:56:30But giving away nearly a third of their company in total,
0:56:30 > 0:56:33three times what they were offering when they entered the Den,
0:56:33 > 0:56:35is a big ask for the entrepreneurs.
0:56:35 > 0:56:38- Seeing as Mum is the boss... - No, I'm...
0:56:40 > 0:56:41Yeah, we would...
0:56:41 > 0:56:44- we would love to work with all three of you.- Great!
0:56:44 > 0:56:46Three is my favourite number, so thank you.
0:56:46 > 0:56:48- DEBORAH:- Is it your lucky number? - It is my lucky number.
0:56:48 > 0:56:51- Well, there you are. - SARAH:- Well done, fantastic!
0:56:51 > 0:56:52Oh, OK!
0:56:52 > 0:56:54DRAGONS CHEER
0:56:54 > 0:56:55The man of the hour!
0:56:57 > 0:57:00- DEBORAH:- Well done, you!- Do you think Mum made the right decision?
0:57:00 > 0:57:02Yes, the best decision!
0:57:02 > 0:57:05- It's been a remarkable turnaround... - Thank you, bye-bye.
0:57:05 > 0:57:07..from the shock revelation
0:57:07 > 0:57:10of Rashpal's £250,000 investment into the company
0:57:10 > 0:57:14to the Dragons agreeing that it would eventually be paid back.
0:57:15 > 0:57:20The Dhillon clan leave the Den with a Dragon dream team on board.
0:57:20 > 0:57:21That is intense!
0:57:21 > 0:57:24There are no words that can explain what I'm feeling.
0:57:24 > 0:57:27It is amazing just to have one Dragon,
0:57:27 > 0:57:30but to have three is just overwhelming.
0:57:34 > 0:57:38A lot of discussion about family values in the Den today,
0:57:38 > 0:57:41the value you put on a family business, that is.
0:57:41 > 0:57:42The Dragons didn't plump for
0:57:42 > 0:57:46a laid-back beanbag pitch that wasn't quite full of beans,
0:57:46 > 0:57:50but they did see potential in that innovative boot-cleaning product.
0:57:50 > 0:57:54Just goes to show there's no predicting what might happen
0:57:54 > 0:57:57when you enter Dragons' Den.
0:57:57 > 0:57:58Bramble, jump.
0:57:58 > 0:58:00Before you say anything, there's my money.
0:58:00 > 0:58:04Still to come in this thrilling new series of Dragons' Den...
0:58:04 > 0:58:07Have you come here for investment or counselling?
0:58:07 > 0:58:09I'm flabbergasted by that.
0:58:09 > 0:58:12There's a grave. You're now two foot in the grave.
0:58:12 > 0:58:15This is the thing, that was out of my control.
0:58:15 > 0:58:17Well, it's not, you're running a business,
0:58:17 > 0:58:20- it's supposed to be well within your control.- Yeah, I know.- Ugh!
0:58:20 > 0:58:22Have you ever seen anybody say,
0:58:22 > 0:58:26"My business is worth half of what I'm asking you to invest in?"
0:58:26 > 0:58:28Have you ever met someone that ambitious
0:58:28 > 0:58:30that he wants to be free from life and be a billionaire?
0:58:30 > 0:58:33- Rachel, Rachel and Paula, can we...? - Oh, my God!
0:58:33 > 0:58:36Can we start being a bit more serious about this, please?
0:58:36 > 0:58:38You told me categorically, several times,
0:58:38 > 0:58:40- you've got a trademark and you haven't!- Yeah.
0:58:40 > 0:58:43What else are you completely wrong about in your business?