Episode 12 Dragons' Den

Tonight, five multimillionaires looking for a new partner

are playing hard to get.

Right now, you have absolutely

no negotiating tools in here whatsoever.

And the Dragons have very high standards.

-It's not good news.

-How much?

You need to be a little less greedy and start sharing.

Along the way, there'll be bust-ups...

I don't think your numbers are wrong...

I think you're wrong.

..and sometimes, the chemistry just won't be there.

-This is a bit of a mess.

-There's no carrot there.

I think you're about to make a very big mistake.

But who will have their heads turned...

You are both a credit to female entrepreneurship.

Enthusiasm, passion, drive, you've got it.

..and find their perfect match?

I will make you an offer.

The magic of Dragons' Den.

Welcome to Dragons' Den,

where five powerful Dragons lie in wait for the entrepreneur

whose business idea gives them an appetite for investment.

But who will have what it takes to get a Dragon to bite?

First into the Den, two sisters proposing a toast...

..to their mission to transform women's lives,

a road that's already been particularly rocky.

There's been so many ups and downs in our journey so far,

and I think we've learnt to sort of embrace the fear.

Their next hurdle, facing the Dragons.

It is terrifying, it is absolutely terrifying.

OK?

-I guess it's why they're called Dragons.

-Yeah.

We're hoping they're friendly Dragons.

Hello, my name is Lucy

and this is my business partner and sister, Lerin.

Together we have designed, developed, crowd-funded for

and launched Halto,

the simple solution to neck pain caused by halterneck swimwear.

We're asking today for a £50,000 investment in return for 15% shares

in our company, Julie Rocks Limited.

Bra sizes in the UK are on the increase,

with the average now being a 36DD

and having a weight of around 2.5lbs per boob.

Halterneck swimwear ties at the back of the neck,

meaning the wearer is carrying around 5lbs of weight in this area,

often causing bruising, rubbing, neck aches, headaches and blisters.

Halto fits any tie-strap halterneck bikini,

by simply feeding the straps through the holes

and tying on the back of the neck as normal.

The harder top layer holds the knot in place

and stops it digging into the wearer's spine

and the soft under-cushion offers protection

from the cheese wire effect of the straps.

We started trading just nine months ago, and within two weeks,

we were stocked on the shelves at national retailer Bravissimo.

Halto is the first commercial solution to this problem

outside of North America.

Halto retails at £9.99 for a pack of two

and it's selling well both on and offline.

For those Dragons not familiar with the halter ache,

we have some weighted bikinis for you to try,

so thank you for listening, please take some samples

and ask any questions you may have.

Who'd like to try a bikini first?

-I'll go ahead.

-That's very brave of you!

A bold pitch from sisters Lucy Cox and Lerin Clare.

A nice, bright colour to match the suit.

They're looking for £50,000...

So, this is the average bra size in the UK.

..for 15% of their company, making a device

that spreads the load of a halterneck top.

That is heavy!

Welcome to our world!

I've never felt breasts as heavy as these!

While Touker Suleyman struggles to get to grips with the lock-up,

Peter Jones is in search of the product's specific function.

What does it really do in terms of...?

Is it just purely a bar of support in that neck area?

So, if I was to wear a halterneck bikini, it would just hurt,

so you put it on and you think that's kind of uncomfortable,

then you're moving around, you're running around after the kids

and within an hour, it's almost unbearable.

The next day, I still have bruising on the back of my neck from it.

It still really hurts!

So, it is a really big problem,

but there's just no solution to it, until now.

You've been going nine months,

how much have you turned over in nine months?

This financial year, we have so far turned over 14,000.

Out of that 14,000, what was your margin?

The margin that we have at the moment

when selling to trade at £4.50 is a 68% gross profit margin.

-So, what do they cost you?

-£1.42 per unit.

The entrepreneurs demonstrate a good grasp of the business basics.

Now, Tej Lalvani has some first-hand experience of the problem,

he wants to know where people are buying the product.

The 14,000 sales that you do,

how much of that is sold online and at the store?

So, about 3% of that is via UK e-commerce

and 2% of that is exporting at the moment,

so 95% of that at the moment is going to...

-To retail?

-To retailers.

And you mentioned outside North America earlier,

so does that mean there are competitors

doing the same product in America?

There is one product in North America.

Currently, they're only selling by small independent stores in America

and their turnover is approximately £140,000.

-They've been going for around...

-Ten years, I think.

That's not good news.

It shows the market size is not very big.

Or their ambition.

Slow sales of a rival product across the pond

have given Tej Lalvani cause for concern

over the size of the opportunity.

Could Jenny Campbell have a more positive insight

that the male Dragons have missed?

I'm sort of sitting here musing and enjoying the boys' conversation.

But trying to relate it to my own experience.

I totally recognise the problem you describe.

But the other angle I was thinking about is for me,

when I am tanning my back and I lie down,

-I tend to go "boop"...

-Yeah, that's fine.

-..which can be dangerous

-but you just have to be careful.

-Don't get up quickly!

So, what I'm thinking, can I just do that when this is hanging off it?

And two, then when I have to very carefully put it back together again

whilst lying on one's stomach,

I'm not sure that I can do all of this stuff.

Actually, it's easier.

Because by keeping it on, you can pull the strap out

and pull it over the top.

And then you can just put that back over your head, and tie it up.

One of the things that a swimwear manufacturer who

approached us really liked about the product is the fact that a lot of

his customers were very concerned

about wearing this style in case some cheeky

person just came along did that and their boobs fell out.

And actually what this does is it does offer some protection from that

actually happening. And that was a big selling point for them.

OK.

Jenny Campbell gets to the bottom of the practicalities of the product.

Does high-end fashion guru Touker Suleyman

feel the sisters have invented

an industry-changing innovation?

-You girls are great.

-Thank you.

But your product's not.

This is not going to make you any money.

Enthusiasm, passion, drive, you've got it.

But any swimwear manufacturer...

..could just make those for cents without the packaging

and include it in their swimsuit.

I think you are great, the pair you,

and I just wish you came here with a different product because I don't

believe that this is, for me anyway, investable.

I'm sorry, but I'm out.

Too easily copied is the verdict of Touker Suleyman,

who becomes the first Dragon down.

Time to see if Deborah Meaden has seen anything to make her want to

offer financial support to the business.

You've actually done a very good job on producing this.

The branding, I think, is lovely.

I totally get the product.

So I have no criticism at all, which often then follows with a,

"So I'm going to make you an offer..."

Not in this instance,

because I don't share your view that this is a big market.

What is going to happen is that if it becomes a really popular product,

it'll just be commoditised, it will be cheap.

You won't be getting £9.99,

and therefore it either becomes cheap as chips and you've got to

sell hundreds and hundreds of thousands of them, which I don't think you will,

or it stays expensive and it doesn't,

you don't sell that many of them.

I won't be investing in this - I'm out.

Deborah Meaden fails to see the product's potential for profitability and

joins Touker Suleyman in withdrawing from the deal.

Will Tej Lalvani's new-found sympathy for the problem be enough

to convince him to stick his neck out with an offer?

I'll tell you where I am.

Obviously my knowledge in this area is very tiny and today I've learned

a hell of a lot.

But, no, I mean, obviously the market is tiny and your example of the US

and US is, people consider, one of the largest markets in the world,

and if they're doing £140,000 sales,

it shows the limit of the scope.

But I wish you the best of luck, but I'm out.

Lucy, Lerin,

I think the product and therefore the business opportunity actually is

not as big as the assets that it's supposed to support.

So, on that basis, sadly, I'm out.

OK. Thank you, Peter.

Peter Jones becomes the fourth Dragon to refuse to get behind the product.

Now only Jenny Campbell remains.

Can she add some financial muscle to prop up the enterprise?

You are both a credit to female entrepreneurship, you really are.

-Thank you.

-Not in just the product, the issue you've identified,

the product you've developed, but...

..I don't see the market here.

So I wish you all the best, but I'm out.

-Thank you very much.

-Thank you.

-Good luck, girls.

-Thank you.

-Thank you so much.

-Bye, it was nice to meet you.

You'll make it eventually.

We'll be puppeteering.

Jenny Campbell reluctantly decides not to take the plunge and the sisters

leave the Den without the £50,000 they were looking for.

-It is what it is.

-Yeah, it's just not part of our journey.

-No, exactly.

-Well, thank God I didn't have to wear this every day,

-that's all.

-I think you looked quite good in it!

The show went really well, actually, they loved us, didn't they?

-They did, yeah.

-We got a round of applause, you know.

I think if we'd done all of it, they would have invested, but, you know...

-I don't know.

-We shouldn't leave it up to them really, should we?

-No, no.

Next into the Den, two entrepreneurs wary of one particular Dragon.

We are worried about Peter because he's really scary.

I hope he doesn't go for the kill.

But to survive in the Den,

they'll also have to face the fire of four other Dragons.

Hello, Dragons, my name is Michal Takac.

And I'm Tim Inskip.

And we're from Carun UK.

We're asking for an investment of £50,000 for 15% of our business.

We have the UK rights to the Carun portfolio of products,

which are all made from Cannabis sativa plant extract.

Mikhail, would you like to explain your story?

I'm from the Czech Republic and I was working in the UK when an

industrial accident changed my life.

I damaged my arm and I lost several fingers on my hand.

The amazing NHS surgeons transferred a toe from my foot to my hand.

During that times, the pain was unbearable

and the scarring was extensive.

Visiting friend from the Czech Republic brought me the Carun hemp ointment

and other hemp products.

I started using them and the results was incredible.

So I'd like to share these experience with others and I approached Carun

Czech Republic and brought these products to the UK.

So, we have 18 different products, ranging from face cream, shower gel,

hemp leaf tea and hemp seeds

and they're all made from Cannabis sativa,

commonly known as hemp. We are vegan, organic and totally legal,

as the products contain none of the psychoactive elements found in

cannabis, but they're very high in the other elements known as

cannabinoids, which are currently proven be beneficial in treating

many different complaints.

We're passionate about Cannabis sativa,

but we are plainly retail amateurs and we need the help of a Dragon to

guide us, to manage our growth and fulfil our full potential.

Thank you very much for your attention and we have some samples which we'd like to show.

Would it be possible that we have the samples at the end?

Because I'm slightly worried if I have to take any of the samples,

I might make a wrong investment decision!

No, no.

They have no psychotropic effect whatsoever.

Now they've reassured the Dragons the products aren't mind-altering,

Tim Inskip and Michal Takac can get on with the business

of handing them out.

-Thank you.

-There you go, there's a selection of stuff in there.

They're looking for £50,000 for 15% of their business,

selling cosmetics made with a cannabis extract.

But Peter Jones is still confused

about the legalities of the operation.

How can you convince me that this isn't a potential front

for a big drugs ring?

We have EU certification.

All EU certification, all the farmers are certified.

There is a very strict law overseeing these farmers.

What's stopping the company in Czech Republic,

the temptation to realise that they make a small amount of money on this

but the real business behind the scenes is cannabis?

They're growing a different plant entirely,

and it's illegal to grow different plants.

What would make it restricted is the level of THC,

which is the psychoactive component of the hemp plant,

which it doesn't have. So essentially, it's legal,

it's not a restricted substance.

OK, so I'm not going to be an investor in some sort of illegal drugs ring?

No, absolutely not, Peter. We can assure you about that.

And you've given three different creams here.

-One's a balm.

-Yes, a balm.

And an ointment...

Is it all the same product?

-No.

-OK.

Is this a cosmetic or is it a medicine?

At the moment, we market it as the cosmetics,

we don't make the claims it helps people and we sell it as cosmetics.

Isn't that a major problem,

because A, you can't tell anyone what the product does,

you just said it's an all-purpose hemp ointment.

I don't know if it's to moisturise and make my skin glow,

I don't know if it's to reduce pain for, you know,

joint pain or injury that I've got.

This does have medical device certification in the EU, in Czech Republic.

They have run the trials.

We are talking specifically about this product

to get a medical device in the UK.

The point is that the evidence is that it does help in a very,

very wide range of different complaints, problems,

but we cannot say that we are going to cure any of those...

I know you definitely can't say that, you don't have a medicines license to say that,

but what I'm saying is that you don't know what the product's for.

Trouble for the entrepreneurs,

as their inability to claim their products have health benefits gets

under the skin of Tej Lalvani.

Now Peter Jones wants to establish the basis of the duo's relationship

with the manufacturer.

Who owns the company Carun?

My friends in the Czech Republic.

-Your friends?

-Yes.

How much of the company do you own?

None.

None?

-The Czech Republic, nothing.

-Nothing?

-No.

-Basically,

our relationship is that Michal developed some of the products in

the Czech Republic, brought them over to the UK.

And tell me, what's your deal with this company?

They are my close friends.

So you've got to buy from them?

-Yes.

-Is there a minimum quantity you have to buy?

-No.

-And your licence with them, this lasts for how long?

Until 2023, at the moment.

And can they terminate your contract at any time?

-No.

-Can I look at that agreement?

Yes, yes.

While Deborah Meaden gets to grips with the paperwork on that Czech

distribution deal,

Jenny Campbell has some questions on the UK side of the setup.

Tim, what's your role in this business, are you an equal shareholder?

No, I'm a minor shareholder at the moment.

The shareholding's split how?

I only have 10%.

Yep. So 90 and ten?

I've got a 60% of the company and we've got another minor shareholders

which helped at the beginning, with the start of the company.

And how much have they put in to help you from the beginning?

It was no more than 20,000 altogether.

I invested my own,

over, nearly 200,000 in the business.

£200,000?

Wow.

And what've you, where has that been spent?

Unwisely, I did a lot of mistakes at the beginning.

I hired, I rented a warehouse, 10,500 square feet.

-How much?

-Big.

Offices and hired people because I did believe,

because I watching the Dragons' Den, I want to do big.

-Oh, it's our fault, then?

-No, not yours, Peter's.

Oh, it's Peter's fault, specifically!

-I was watching it for studies...

-Normally, people do that...

Sorry. Hang on a minute, hang on a minute, this is my time, thank you.

So, it's... Peter's at fault here.

-No, it's not, absolutely.

-So, he's not your favourite Dragon?

That's good to hear.

So, you made some mistakes at the beginning.

-Absolutely.

-So, how much would you write off of the 200,000 as a mistake?

Er, 100,000 for sure.

The admission of a big cash spend with not much to show for it hasn't

gone down well with former banker Jenny Campbell.

And it looks like Deborah Meaden's now up to speed with that deal with

the entrepreneurs' parent company in the Czech Republic.

Right now, you have absolutely no negotiating tools

in here whatsoever.

On June the 3rd 2023, if you've done a cracking job,

you hand this business back to these guys.

There is nothing in here that gives you an automatic right of renewal.

From my point of view, they will be only against themselves,

how they can do it without us after years?

Because you've built their brand.

They've got a really, really valuable asset over here.

Why on Earth would they renew?

-Mm-hm.

-Job done.

Market penetrated.

Mm.

I'm not spending my time building somebody else's brand for them.

I won't be investing. I'm out.

A lack of control over the future of the business

has spooked Deborah Meaden.

And it's left Touker Suleyman wondering how an investor would get their money back.

My question mark here is the fact that you don't own the brand,

it's a distribution, and there could be no exit.

Yes, well, we believe at the moment the exit is to sell back to Carun Czech.

Have you got an agreement to that?

We are negotiating that agreement at the moment.

-But you haven't got the agreement?

-No.

-No.

I'm not doubting the product.

Amazing product, as you say.

But you don't own the brand.

Once you've created the brand, the retailers want the brand,

they don't care about you.

I do wish you all the best because you're going to

make your friend rich.

-I'm out.

-Thank you.

OK, thank you.

Touker Suleyman joins Deborah Meaden in exiting over that controversial

distribution contract.

And Tej Lalvani has some words of wisdom over the pair's plans to

back up the potential benefits of the product.

For products like this,

the most important thing is to show the effectiveness that it works.

You'll need to do clinical trials in pretty much every region or territory

that you launch them, because they'll all have different licensing

agencies. And the cost of doing a clinical trial,

do you know how much that costs in the UK to do a clinical trial like this?

About 120,000.

Exactly.

To get the licence will cost you a hell of a lot more.

You're going to have to raise half a million pounds.

-I'm out.

-OK. Thank you.

OK, thank you.

Michal, Tim,

I'm concerned about the way that you've gone about

setting this business up,

Michal, particularly you, where,

having friendships in your home country is fantastic...

..but what you should have done was,

if you had such a huge amount of money, £200,000 to invest,

you should have found a way to invest in the holding company in the Czech Republic.

I could have been potentially interested, actually,

in something like this.

But, ultimately, you've brought a distribution-agency-style deal that

I think isn't good enough.

So, I'm out.

OK, thank you.

Peter Jones' departure leaves Jenny Campbell

as the last Dragon standing.

Is she able to see the potential for profit in a business her fellow

millionaires have shunned?

So, I mean, this is a bit of a mess, isn't it?

From where we're standing, I'm sure you can see that.

You come into the Den with an exclusive exclusivity agreement that

you're halfway through. And all sorts of issues on extending or minimum purchase levels.

How confident are you that you can renegotiate that exclusivity

-agreement?

-100% confident.

-100% confident?

-Yes.

OK. So, I think this is complex.

But I can see the belief in your eyes, Michal,

and certainly you've come on board, Tim, with the same belief.

But I will make you an offer.

So, I will offer you all of the money.

But, because of the risk factors, multiple risk factors in this deal...

..I would want 25% of your business.

OK. Thank you very much for your offer.

-Can we have a little discussion?

-Please, go and talk to the wall.

An 11th-hour change of fortune as Jenny Campbell

backs her gut instinct with an offer.

Shall we tell them it's straightforward consequently...

But, at 10% more than the entrepreneurs were offering,

they have a tricky decision on their hands.

Thank you very much for your offer.

We would like to accept the offer.

-Thank you very much.

-Marvellous.

-Well done.

-Thank you.

-Thank you very much.

-You're welcome. I look forward to it.

-Thank you very much.

Good luck, guys.

The cosmetic duo have given up a quarter of the company but leave

the Den with a £50,000 investment.

I thought we'd lost it.

I did say you shouldn't use their product before making an offer.

I can't wait till we have our first meeting.

Yes, yeah. We'd like to meet Jenny as soon as possible.

To share our excitement and our visions.

-And maybe open a bottle of champagne.

-Yeah.

So far, the entrepreneurs have tried everything to impress the Dragons.

And £50,000 has already been invested.

You're welcome.

But, as the puppet masters continue to pull all the strings...

You've made it impossible to invest.

That feels like spray and pray to me,

and you need to pray at the moment.

..there's still time before the final curtain to strike a deal.

I think you've got a chance here.

What I will do is make you an offer.

Next into the Den,

a couple of entrepreneurs with a revolutionary idea

to mix up English and foreign languages,

to help the next generation communicate with the rest of Europe.

But they've left it a little bit late to do their homework.

-Touker.

-Jenny.

-Jenny.

-Jenny.

-Jenny. Deborah.

-Tej.

-Peter.

But, now, it's time to face the Dragons in the flesh.

And I'm not entirely sure what he said but I echo that sentiment.

Hi. My name is Alex Somervell and this is my co-founder Jonny Pryn.

Together, we're the founders of One Third Stories.

We're here today looking for £60,000 of investment in return for 7.5% equity in the company.

Like millions of children across the UK,

I absolutely hated learning another language.

That's why we started writing stories that start in English

and end in a different language.

We do this through our clockwork methodology that

allows us to gradually introduce words in the foreign language into

an easy-to-understand context.

So, an example for Spanish might be,

Alex and Johnny walked into the den of five scary,

fire-breathing dragones.

-Ha-ha.

-The meaning is instantly understandable,

and our stories use this methodology to introduce individual words to

build into phrases,

sentences and eventually entire pages in the foreign language.

We created our first set of books off the back of a successful

crowdfunding campaign.

Since then, we've partnered with the Goethe Institute and the Spanish

Embassy, as well as receiving investment

from the University of Nottingham.

With their support, we launched a subscription box service.

We've already generated over £19,000 in the last four months.

We believe that One Third Stories represents a fantastic investment

opportunity. You can help to give the gift of languages to kids

everywhere. And help to bring children and their parents together

over a good old-fashioned storybook.

We hope you've enjoyed the pitch.

We'll grab some books and we'll take any questions.

An educated offering from Alex Somervell and Jonny Pryn.

They are looking for £60,000 for 7.5% of their children's books

that drop foreign languages into stories written in English.

Thank you.

Peter Jones is wondering who the tales are targeted at.

Are these books for parents to read to their children?

So, the way that we've design the books are so that they can be used

individually by the children or in tandem with a parent or teacher that

doesn't actually speak the foreign language.

But I get to words like...

..leon, gato.

Mm-hm?

What's that?

So, that's lion and cat.

How do I know that I've pronounced it correctly because I obviously haven't.

One of the first things we do is that,

whenever you order a book or a subscription,

even before it arrives, we send out an audio book.

So, I'm the subscriber.

-Yes.

-Tell me my journey, what do I do?

OK. You'll sign up, you'll get an e-mail.

And in that e-mail is the audio book.

A few days after that, your book arrives.

Then there's an activity book.

-And this is all in the same pack.

-All in the same pack.

All of these things are themed around the story.

OK. So, talk me through your subscription models?

On a monthly rolling basis,

you'll be paying £14.99 plus postage and packaging,

which is 2.95.

If you sign up for three months, then you'll pay 13.99 per month.

And with six months, you'll pay 12.49.

And what are your costs associated to that?

The cost at the moment is £5 and it's something that we're printing

right here in the UK. Once we move abroad,

whether it's to Malta or Turkey or China,

that will go down to under £1 in total

once we get to around 10,000 boxes going out each month.

Plans to cut costs by printing overseas

are revealed by the entrepreneurs.

But dad-of-five Peter Jones wanted to know how many who sign up for

the books come back for more once they've tried them.

So, how many customers have you got on a one-month subscription?

-Roughly around 60.

-And how many repeated?

Um, all but 15.

Right, so you have 45 customers?

-Yes.

-Why did those people in the first month, why did they leave you?

So, the vast majority of people were from their kids being of a too young

age group and actually saying it's not quite age appropriate at this

stage. So, it was more around the messaging on the site maybe.

OK. And how are you going to make your messaging clearer?

At the moment, we're experimenting a lot on the website,

looking at the ads and the way those are messaged.

So far, we've tried out a variety of different images and messages that

-we're using to advertise.

-And what was the result?

To be honest, at the moment, I think we're still finding the exact result.

We have definitely improved our kind of conversion funnel.

What's the conversion funnel from the web?

-At the moment?

-Yes.

-It's just under a percentage,

so it's something we're not happy with.

-So, you're under 1% on conversion?

-Yep.

-Yeah.

-Wow.

That is awful, guys.

I could do nothing on the web,

literally nothing and get 1% traction.

-I think...

-I could just put a tiny little ad and do nothing and I'll

have a conversion of 1%.

Failure to attract and keep a big customer base

proves a problem for Peter Jones.

And Touker Suleyman wants to know how they've managed to bankroll

-the business so far.

-Alex and Johnny.

-Yes.

-So, you've had some funding already.

Um, so, we had £40,000 in revenue from the crowdfunding campaign.

-Yes.

-We've received £30,000 from Nottingham University.

We also got a £10,000 loan.

So, in total, you've raised 140?

Um. It's a bit more, it's probably closer to 200,000 now...

-OK.

-..with the crowdfunding.

OK, £200,000.

-Yep.

-Yes.

-How much have you got left?

We've got £150,000 in the bank at the moment.

Yep.

You've got 150,000 in the bank?

-Yes.

-Yes.

-Um.

-So why are you here?

-We're here because having a Dragon on board

just gives us, A, a lot more credibility,

it gives us a superstar investor to have in the business.

And it also just opens up so many more doors in terms of contacts, PR.

Guys.

You've got 150,000 in the bank.

You could do that without a Dragon.

Do you honestly believe that a Dragon who is going to add value to

your business and advise you and guide you and open doors for you is

going to invest 60,000 for 7.5%?

I think there's definitely a huge amount of value from the kind of

investor sitting in this room.

OK. So, what are you offering a Dragon?

We would be offering you to invest £60,000 and also we'd like to offer

you advisory shares.

What's an advisory share?

So, it means that basically we would take you on board and you would be a

member of the team and dedicate a couple of hours a month

to advising us,

and we would give you shares in return for that.

If you think for one second I'm going to be signing up to working for you,

that's like a job. People get an awful lot more than that at some times in

my life, and at other times they're getting on and carrying on and running their businesses.

So, that really doesn't appeal.

I'm out.

Deborah Meaden refuses to put her name on the business's rota and

exits the deal.

But is Jenny Campbell prepared to find the time

to help the entrepreneurs

nurture their fledgling business?

Your enthusiasm is wonderful.

And I don't hear you talking about, you know,

we want to drive a business that will deliver this, X sales, Y profits,

and make a difference.

You started the other way around.

We want kids to learn languages.

Yes, but we all want to do that.

You need to take a pause now and look at where you are and say,

this is not working yet.

Before you go out with more languages and different marketing strategies.

Because that feels like spray and pray to me,

and you need to pray at the moment and just take a step back and think

about where you can start monetising this business and making it

interesting for an investor.

I think, from our perspective, anyway,

we see what similar subscription boxes for just activities are doing

-in the market.

-We all see subscription boxes and we all get excited about it.

So, it feels like you're jumping on the bandwagon a little bit.

We're back to this spray and pray marketing.

So, for that reason, it's not an investment for me.

-I'm out.

-Thank you.

Guys. I mean, you've definitely proven that you can raise money.

The problem is, you've made it impossible to invest.

The valuation is definitely out.

And you want to give me advisory shares.

If I wanted advisory shares,

I could go to 100 companies without investing.

There's no carrot there.

I'm not going to be there for the rest of your journey.

I'm out.

No fairy-tale ending from Touker Suleyman,

who becomes the third Dragon the entrepreneurs fail to tame.

And now their stories are out of the hat,

Tej Lalvani has some concerns of a potential copycat.

What if somebody else comes up with a similar book in terms of teaching

-languages?

-The main thing for us is really around not divulging too much

around what we're actually doing,

and really assemble a team of experts around language learning that no-one

-else can do.

-So, what you're saying, is that, because it's easily copyable,

that you don't want to market it and let people know about it?

Not that we don't want to market it,

but that we don't want to kind of let on too much about

the actual process behind the scenes.

I can't agree with that model because, if you want something to do

well, you've got to let everyone know about it, you've got to advertise it,

you've got to create the awareness.

I'm not going to be investing today.

I'm out.

Tej Lalvani becomes the fourth Dragon to say, "Non, merci,"

leaving the final chapter of the entrepreneurs' journey into the Den

in the hands of a previously scathing Peter Jones.

Guys, I got to the halfway line here,

and I was struggling with this.

Um, and I had to go back and re-read it.

And then I realised somebody that's partially dyslexic is not going to

actually do very well anyway in trying to get through this book.

But...

..I think you've got a chance here.

I think that you have...

..an opportunity, with the passion that you have...

..to do something quite good.

Um, and it is a real small seed of a chance.

But you have made it very difficult because you very clearly preset

a valuation.

Um, but I'm going to make it really difficult to you, now.

I'm going to offer you all of the money...

..but I want 20% of the business.

HE SIGHS

That was a big sigh!

That's an interesting offer, Peter, and quite unexpected!

Could we have a moment to have a chat?

Absolutely. Yes.

A twist in the tale as Peter Jones comes up with a surprise offer.

-Phew.

-It would be great to have him on board.

-He was the Dragon we were talking about.

-Exactly.

He's putting up the whole £60,000 but wants 20% of the company,

almost three times what the entrepreneurs wanted to part with.

Thank you for your offer, Peter.

I think

we're aware that we're going to need to raise again and quite possibly

again after that, and I don't think we can afford to give away a further

20% of equity in our business at this stage.

-Is...?

-Is there any room for movement at all?

I think you're about to make a very big mistake.

Because any future fundraise, if I want to maintain my 20%,

you've already got somebody that can afford to put the money in.

So you're not going to have to dilute.

So I think, guys, you need to be a little bit less greedy and start

sharing. That's my feeling.

It's naive, not greedy.

It is, guys, honestly.

-Well...

-But you've got to make that decision for yourself.

Well, Peter, it is a fantastic offer.

But I think, for us, we really believe in this,

we believe we're going to need more money down the road to do it as well,

and we can't accept an offer for 20% equity.

But thank you for it, it's very encouraging for us.

What would you accept?

I think, to be honest,

we'd be hard pressed to go anywhere above the kind of offer and we

came in with.

I think it's way too much.

I think it's not... We don't see it as greedy from our behalf,

-I think we know that we're going to...

-Your way too much is...

..is...stupid.

Your level of negotiation is 7.5% or nothing.

I've offered you 20, and you're not even going to come back.

Really?

We really think that it's a fair valuation.

So the answer's no, then?

The answer's no, with regret.

Well, then, it's arrivederci, ich bin aus.

-Grazie.

-Thank you.

-Adios, amigos.

-Thank you very much.

-Thank you.

One for the books,

as the entrepreneurs refuse to budge on their equity stake.

They leave the Den empty-handed.

20% is too high.

-Yeah.

-20% is too high, like, that was wrong.

Yeah, we couldn't take that.

-Ich kann nicht verstand.

-The next book is The Great Big Mistake.

Would you like to be tempted?

Oh, absolutely.

Over the years,

entrepreneurs have entered the Den with

some interesting health food offerings.

..the world's healthiest dairy ice cream.

Seaweed-flavoured food is set to be the next big superfood trend.

But persuading the Dragons their products are investable...

Isn't this already a crowded marketplace?

You've chosen a very difficult sector.

..can be a very tough nut to crack.

Nobody buys a snack that does that.

That aftertaste, it's a complete deal-breaker for me.

It's like a weeny, weeny, weeny packet of crisps.

Vile.

Now, a young entrepreneur who believes he's got the answer to help

-improve our wellbeing.

-It's an idea I've had for a long time.

I've been watching the market and the way it's moved and changed over

the last few years.

I felt like it was time that I needed to try and make a difference in the sector.

Hello, Dragons. My name's James Dawson

and I'm the founder of T Plus Drinks.

T Plus is a new generation of vitamin super tea,

made by blending together functional herbs with green tea,

natural fruit flavours and 50% RDA

in nine daily essential vitamins in every bag.

I'm here today to seek £75,000 funding in return for

10% equity in my company.

165 million cups of tea are drunk every day in the UK.

And one in three UK adults regularly takes some form of vitamin supplement.

T Plus has been designed to bridge that gap and offer something new,

convenient and healthy into the market.

Since launching T Plus,

we've grown to over 900 retail listings

through the independent sector,

as well as retailers such as Whole Foods, Ocado,

and most recently Holland & Barrett,

where we've won a nationwide listing.

We're now ready to move on to the next level

and scale the business up,

and we would love to a Dragon along for that part of the journey with us.

So, thank you for listening.

I look forward to receiving your questions,

but first I would love for you to try some T Plus.

Brewing up a business making herbal teas with vitamins...

Just grab one of the trays.

..is James Dawson, who's looking for £75,000 for 10% of his company.

Now all the Dragons are suitably refreshed,

mineral mogul Tej Lalvani seems the natural person to start things off.

Hi, James. I guess you know a bit about my business.

-Yes.

-Vitamins, supplements.

-Yes.

-See, this categorisation of teas has been done

years and years ago.

Detox, boost, etc.

Sure, but never with vitamins.

I agree, but that doesn't come across to me.

Because when I see that, it looks like again you've got another tea

company coming out with detox tea, with immune tea.

How do I know it's a vitamin-based product?

So it's through what we're trying to do on our marketing.

-So it's now...

-The biggest marketing has to be your product packaging.

That's part of it, yeah.

You can do all the marketing that you want,

but you're selling this on shelf, it's just going to come across like a normal herbal tea.

And the other thing that concerns me is that you've

just gone with B and C vitamins, and that really, I think, isn't right.

Anyone that wants more, anyone that is looking for D, A, K,

whatever other vitamins,

then they will stay in the vitamin supplement market.

I think it's quite confusing. Unless you have a product which has got all

the nutrients in there that covers it...

But it also provides antioxidants for people looking for a green tea,

-herbs, looking for that.

-You haven't got all the antioxidants.

You've just got vitamin C, really.

It's got B and C vitamins, yeah.

And we can't be the same as a supplement,

because it has to be water-soluble.

A product range lacking the full spectrum of vitamins

isn't quite hitting the spot for Tej Lalvani.

But reluctant convert to the herbal tea revolution, Deborah Meaden,

wants to know how this one compares to the competition.

James, for healthy reasons, I do drink herbal teas,

but I don't really like them.

You know, but they do make me feel worthy,

and they make me feel better.

But that has actually got quite a nice taste.

So, can we just look at the business side of things?

First of all, price on 15 bags compared to your nearest competitor.

Yeah. So our RRP is 3.69.

We've priced ourself at a slightly premium market, but

we are below the top-priced tea, which is normally £4.50 up,

but we are also above certain other herbal teas,

that are around £2.30.

So last question from me...

You've been going for two years, how have you done to date financially?

So in our first 12 months of trading last year,

we posted 25k in revenue with a net loss of 55k.

We're now half, just over halfway through year two,

and we're on track to hitting this year's forecasted figures of 230k

revenue with a gross profit of 140k and a net loss of 43k.

And what's causing your losses, then?

It's been investment in stock. So we're currently sitting on a lot of stock.

Because we had a long delay to Holland & Barrett coming live,

we were delayed quite a few months on that, so we had to...

I think that's just cash flow, it wouldn't be driving your losses.

James, you're going to do a gross margin of 140,000 this year,

but lose 43, so somewhere you're spending 183,000.

It's predominantly from marketing.

-Because Holland & Barrett...

-So are you going to spend 100 grand or

-something on marketing?

-Not as much as that, about 80.

That seems like an awful lot of money to have to spend to drive

the revenues you want.

Heavy losses have left a bitter aftertaste for former banker Jenny

Campbell. And Peter Jones wants to know if the pot is now empty.

You've obviously raised some money to be able to afford the losses that

you're taking in the last couple of years.

-Yes.

-So how much money have you raised?

So we've done two funding rounds of 50k.

I've also put in 20k into the business myself.

So you're at a 55k loss and a 43k loss.

Mmm. Yes,

because we've had quite a lot of high start-up costs relatively in

formulating the product, the branding.

You have invested or received £100,000?

-Yes.

-That's now gone?

Mmm-hmm.

You personally have put a director's loan in of 20,000,

that's a loan that's due back to you?

-Mmm-hmm.

-That's gone.

You have no money.

Well...

That's why we're looking for investment.

Why do you think your company is worth three-quarters of a million pounds, James?

That valuation is based on three times this year's projected

-revenue.

-What company has been sold for three times revenue

that you're aware of?

Well, various other food and drink companies.

-Tell me one.

-Innocent, GU...

Innocent was sold for what?

Was it north of 20 million, I think?

I don't know the exact valuation it was.

OK, so that tells me you don't know.

James, I'm going to be really quite quick.

I think you need more than just money,

you need some financial help and assistance with your business to

remodel it and really get a decent, concerted plan.

I don't see this as a very big opportunity, and your forecasted growth,

I just don't believe.

I'm sorry, I can't invest.

I'm out.

Peter Jones is unable to forecast a rosy future for the company.

But it appears that Deborah Meaden has little faith in

her fellow Dragon's financial fortune-telling.

James, I don't actually agree.

-I don't think your numbers are wrong. I think they're right.

-I think you're wrong.

-How?

-They are wrong. The only reason why he's got 20,000 left,

which is what I said, is because he had his director's loan.

Yeah, but he's still got the cash. It doesn't make any difference.

When he got to the end of the year, he has not got any money.

If he was to take out his director's loan and repay it back...

But he's not going to... Are you going to take your director's loan out at the end of the year?

-Categorically, not. I am not.

-Yeah, but the statement was factual, at the end of the year,

-the company has no money.

-But right now we do have 23k cash...

At the end of the year, the company has the cash, because it has £20,000 from your director's loan account.

So I don't think the cash is your particular issue.

I have one issue with this business,

and that is if I'm bothered about drinking green tea

for a health aspect, and I'm taking vitamin supplements,

I am worried that this is not as good as doing what I currently do.

That is not designed for somebody that already takes green tea and

already takes a supplement. It could be, because they might want the convenience.

It's designed for anybody that's coming into the tea category,

the two areas that are growing,

and they're looking for a tea for their immune system.

The trouble is, you're saying the vitamins piece

is a bit of an add-on, so that is a real worry for me.

I'm afraid I won't be investing.

-I'm out.

-Thank you, Deborah.

After a financial storm in a tea cup with Peter Jones,

Deborah Meaden leaves the negotiations

unconvinced by the product.

But has Touker Suleyman spotted something refreshing

in a business making supercharged char?

James...

You come across...

-..credible.

-Thank you.

But at the end of the day, I totally agree with what Peter says,

you'll run out of money.

And I think it's what you call in the old business sense overtrading.

Today, you're getting no investment from me, but thank you for the tea,

-and I'm out.

-OK, thank you, Touker.

Touker Suleyman becomes the third Dragon to make

an early exit from the party.

But does supplement giant Tej Lalvani see infusing tea

with vitamins as a potent business?

James, your biggest problems here is your £750,000 valuation

for the business.

OK, it's a nice product.

I'm not happy about the packaging.

I think it doesn't communicate stuff on there.

Formulation, again, I'm still not 100%.

But...

..what I will do is make you an offer.

It would need to be on the following basis,

that I'd like to co-brand it or brand it with Vitabiotics,

because it needs to be a shared vision,

and I would want to take more of an active role in it.

UK, internationally.

And to make any sense of the valuation...

..I'll need a significant amount of equity.

Which means I would want 50% of your business.

OK. Thank you.

Tej Lalvani shakes things up with a bid,

offering the full £75,000, but for half of James' company.

Only Jenny Campbell remains.

Does she share her fellow Dragon's thirst for investing

in the boosted beverage?

See, my position, James,

is that I do think you probably have something here.

Hearing Tej talk about, you know,

wanting to take 50% of your business makes me think that leaves a

structure in the wrong place.

Having said that, I totally get the value that

he would add to your business.

So I think it's very difficult to compete with that.

Come on, Jenny, you're a Dragon.

Says he.

OK, so I think where I would be, James, I do like it,

but there is an awful lot to do.

So I would be prepared to put up half the money...

..for 20%.

OK, thank you, Jenny.

Is that anything...

..you would respond to, Tej, or...?

See, I feel I don't need another Dragon,

and that's precisely why I wanted 50% of the business.

We do marketing better than any other vitamin company in the UK.

And the expertise in formulation, nutrition, product development,

branding - all those areas I can help in.

So that's my position.

So, in light of that, Jenny,

is there any way that you would put in an offer before I consider it

-of...?

-No, my offer is for half of 20%.

So you really need to consider Tej's full offer.

Do you mind if I chat to the wall for two minutes?

Thank you.

Jenny Campbell's offer is void without Tej Lalvani

being prepared to share.

But he is citing his strength in the supplement sector to demand 50%

equity, five times more than the ten originally offered.

Right, OK. Well, thank you first of all for everyone's comments and Tej

and Jenny for your offers.

Tej, is there any way that I could counter offer

with some kind of ratchet deal so that if we do hit

the projections that I'm setting out that you would

reduce equity to below the 50%?

For me, as an investor, I would like to have

as much involvement as you are.

It needs to really be 50%.

So is that no, Tej?

No. Unfortunately.

Can I talk to the wall for one moment?

-Yeah.

-Thank you.

Tej Lalvani sticks with a risky strategy.

To add his reputation to the vitamin tea comes at a cost.

It's a tough decision for James.

Reject the offer to keep control of the business

or give up half his company.

OK, yeah, I'd like to accept it.

-Well done.

-Yay!

-Good.

-Thank you.

-Well done.

-Thank you much.

-I appreciate it.

-Good decision.

-Yeah, absolutely. Thank you.

Well done. Well done, James.

James leaves the Den with £75,000 in the caddie and the financial

liquidity to help the profits flow.

It's incredible.

Tej is the Dragon that I wanted.

It's really going to help take our business to the next level.

That business had no chance unless you'd done that deal.

-Totally.

-Yes.

-Match made in heaven.

The magic of Dragons' Den.

Of course, there is always some magic involved in creating a convincing pitch

but our successful entrepreneurs tonight can't expect

to wave a magic wand to guarantee future success.

That will all be down to the quality of their product

and the hard work of them and their new Dragon partners.

Leigh, listen, focus.

Coming up next time...

I don't see what's even slightly unique about this.

You're going to be breaking even if you're lucky with that sort of margin.

Your valuation is crazy.

Is there one Dragon you really want

or is it just playing games between us?

-Have you been doing this while still at school.

-I graduated three months before I set this up.

You've... You've graduated?

-10%?

-10%.

-No!