Entering the Dragons' Den is a daunting prospect even for the best-prepared of entrepreneurs - and this showed in the latest episode as a series of promising business ideas were dismissed by the panel.
First out of the lift were Bob and Steve, bringing with them a drain cover designed to be safer and more user-friendly than those that are currently being used throughout the UK. The pair presented a perfectly functioning product, but were unable to convince the panel that they had a definitive plan or model for their company.
Despite Bob's unfettering enthusiasm for his idea, he did not provide sufficient clarity about the size of the marketplace his business would be entering, which led to lack of confidence about how many they would be able to sell.
It was a similar story for Richard and Steve, creators of the Truncator sawhorse. Their ingenious product enabled a large amount of timber to be chopped and distributed efficiently and safely. Although Richard and Steve clearly demonstrated that their invention dramatically improved productivity, the Dragons questioned how many people this selling point would actually appeal to. Was this a consumer or trade product? And if it's the latter, how big is the target market and how do you reach them? The tentative answers were deemed unsatisfactory.
Yogabellies deserve credit for negotiating with Duncan Bannatyne - given his extensive experience in franchising and the health industry, Cheryl and Mike might have been tempted to bite his hand off when he made them an offer for an inflated equity share
Kate and Nigel from The Makery endeared themselves and their business to the Dragons, but were also ultimately unsuccessful in securing investment in their arts and crafts business.
Initially it seemed as if offers were a foregone conclusion, but the Dragons dropped out one by one as they became less and less convinced of the prospect of major growth for The Makery.
The twist was a surprising one given how excited some of the panel had been about the product, but aptly demonstrated the fact that enthusiasm is quickly tempered if the dividends in prospect don't appeal.
The one venture that did secure investment this week was Yogabellies, with husband and wife team Cheryl and Mike MacDonald ticking a number of boxes as they pitched a franchise opportunity for teaching yoga to new and expecting mothers.
With a calm, collected and engaging style, Cheryl was convincing from the off, and using another successful Yogabellies instructor in her demonstration was an inspired decision. A franchise model, as the Dragons know only too well, can only work if all parties are happy - and this proved the case when Peter Jones quizzed the beaming (and highly profitable) franchisee. Future franchisors in the Den would be wise to follow Yogabellies' lead in this respect.
The good news kept on coming when it was time for Cheryl and Mike to answer the panel's questions. The business was already in profit and operating in a number of different countries, Cheryl had a Business Studies degree to go with her extensive experience in yoga, and, most impressively, the company had a strong Google ranking with extremely competitive search terms.
Mike fielded one tricky question particularly expertly, explaining that the company's decision to increase its franchise fee was purely a strategic one. This move would improve the profile of new franchisees, Mike reasoned, increasing Yogabellies' appeal to more committed, time-rich instructors. The higher frequency of classes led by these new recruits would generate a bigger yield for the company. Clever stuff.
Finally, Yogabellies also deserve tremendous credit for negotiating with Duncan Bannatyne, who ended up being the only Dragon to make them an offer. Given Bannatyne's extensive experience in franchising and the health industry, Cheryl and Mike might have been tempted to bite his hand off when he made them an offer for an inflated equity share. And although they were initially unsuccessful in driving Bannatyne down, Cheryl and Mike persisted, eventually persuading the Dragon to revert to their proposed percentage once he earns back his stake.
Perhaps Cheryl and Mike were shrewd enough to realise that Bannatyne wouldn't want another yoga-related golden goose to slip through his fingers, which happened in 2006 when he and the other Dragons turned down the chance to invest in the now successful YogaBugs.
Time will tell if Yogabellies enjoys similar success - but with the complementary skills of the MacDonalds and Bannatyne on board, you have to fancy their chances.
Dan O’Sullivan is Make It Cheaper's Web Content Manager, which means much of his time is dedicated to ensuring we have plenty of online material to help business owners understand the energy, insurance and telecoms industries. With years of experience working alongside SMEs, Dan is committed to making life as easy as possible for smaller firms. You can email Dan at email@example.com
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