DRAGONS’ DEN REVIEW – Episode 907

This review makes a great forum for a critique and learning experience valuable to all entrepreneurs. Learn what to do and what not to do from entrepreneurs making a pitch for money in the Dragons’ Den. The review complements my book, The Small Business Planner and there are also great free resources including fully formatted planning and marketing templates on the book’s web site. In addition, my regular Blog, along with the Video Series on my You Tube channel can be very helpful to budding and seasoned Entrepreneurs. Of primary interest to those making a pitch on the program is the Feasibility Study as described in the book. If completed in detail, this study will indicate if there is a viable market for the product or service and if the business can be profitable. An added feature to my reviews is a rating on the company’s web site – if available. The web site has become the number one marketing tool for most businesses today and my observations are based on a quick overview whether accepted web design and development standards are met. Remember – you have a very short period of time to hold the attention of a new visitor. Therefore, the company web site deserves the appropriate investment and professionalism to be effective. Constructive comments are most welcome on any of these reviews.  Larry Wilson is author of the best selling book, The Small Business Planner, and is the founder of Dynamic Performance Group, a strategic and marketing planning firm.

Season 9 - Episode 7.           Original air date:   November 26, 2014

Pitch One: Silhouette Swimwear -        Asking $70K for 30%

Valuation: $200K.

Gabriella from Montreal has a solution to determine women body type by their silhouette which helps to find the right clothing. She brought out a number of models wearing her new bathing suit styles holding up a picture of their own silhouette, or body type with an older style suit that does not match the type, thus does not compliment the figure. She categorizes the body silhouettes into four types: the rectangle, hour glass, triangle, and inverted triangle. She has a degree as a fashion designer working for North Face but has been doing her own designs for some time. She launched her designs two months ago. David reminded her that it is a tough business to get distribution. She admitted that is why she is in the den and has five locations in Quebec that want to carry her line but she doesn’t have the inventory. She is also meeting with Hudson Bay but has low supply of inventory coupled with high demand.

Sales: $5,000.     Retail: $210.00      Wholesale:  $140.00     Cost;  $70.00

Arlene illustrated how hard it is to get such a competitive category to market but did like the looks vs. the suits in photos. David said it would cost too much to get to market and Vikram thought the industry too competitive and both opted out. Arlene then dropped out citing that it would be too hard to get shelf space. Michael offered the $79K as a line of credit for inventory if she gets the order from Hudson Bay Company. Jim offered the $70K for 40% which will drop back to 25% equity when his investment is paid. Arlene was pointing for her to go with Michael, but she chose Jim stating that she wanted a partner – not a loan.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: fashionable; Preparation / Planning: good; Chance of Success; good.

Great product and a great presentation. She was very articulate, knew her stuff, and showed that she was willing to do whatever it takes to make it work.

Pitch Two: Frylow -        Asking $100K for 10%  plus 20% royalty to double investment.

Valuation: $1 million.

Pete Heddon, VP Operations appeared with his with partner, the President of Frylow International from Victoria BC. (Couldn’t make out his name.) Their product is a ceramic device which is placed directly into the deep fryer and provides a savings in oil usage, improved food quality and lower energy costs. It is a Japanese product that they have been selling for eight years and they have rolled it out here in the past year. At $20 million in sales, Arlene didn’t know why they were in the Den especially with a 75% profit margin. David wanted to know what went wrong if they made $15 million gross profit. The Dragons finally learned that the twenty million was retail and they were selling to distributors and Arlene felt they were holding something back.

They had trouble making the quota upon which the distribution contract is based and all Dragons opted out due to skepticism.

My entrepreneur ratings:

Idea: good; Competence: questionable; Knowledge of Market and Competition: good; Competitive Advantage: unique; Preparation / Planning: poor; Chance of Success; questionable.

The pitchers didn’t come clean with the Dragons who saw through them right away.

Pitch Three: Drywall Axe -        Asking $150K for 10%

Valuation: $1.5 million.

Adam from Aurora showed up in the Den with his son-in-law, retired major league baseball player Cliff Floyd. Cliff partnered with him three years earlier to put into production a dry-wall tool that is a utility knife, tape measure and pencil holder – all in one. Arlene snuggled up to Cliff admiring his World Series ring while Adam demonstrated how easy it was to use his revolutionary tool and in two quick moves cut and fit a perfectly sized piece of drywall. They are exclusive to Canadian Tire in Canada for two years but can sell anywhere else in the world and obviously wants the Dragons help to expend sales globally.

Sales:  $160K  (3 mths.)   Wholesale:  $9.50     Cost to make:  $6.50    Retail: $30.00

He said they got beat up on the price by Canadian Tire because they helped set up the manufacturer. The pair has about $200K invested in the product which means that (without figuring in fixed costs and wages or paying off any outside investors) they would need to sell 66,666 unit to break even with these prices and margins. But seeing the opportunity in the U.S., Michael offered $500K for 25% bumping the valuation to $2 million. Jim offered what they were asking for and said he could get it into Wal-Mart and The Home Depot below the border. Vikram opted out and Arlene offered the $150K with no equity but a royalty only of 5% on all sales outside of Canada. David made a similar offer and Arlene with a $2 royalty on sales outside Canada until he has recouped (double his investment) $300K and no equity. The two huddled into the back then chose Arlene.

My entrepreneur ratings:

Idea: excellent; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: unique; Preparation / Planning: good; Chance of Success: excellent with Arlene as partners.

It is not often that a product knocks the ball out of the park from an innovative perspective – but this one certainly does. Even though they got beat up on the wholesale price to Canadian Tire, it got them started and is only for two years. But the market potential outside Canada is tremendous.

Pitch Four: Tangoo -        Asking $75K for 10%

Valuation: $750K.

Partners, Jonathan Hill and Paul David Effew from Vancouver, B.C. pitched their special event planning service, Tangoo. It is a free on-line service that matches mood with venue for a special evening. It is being tested in Vancouver and they need investment for expansion. The revenue model is based on restaurants and venue profiles in three tiers from basic free through $50 to $150. They currently have only 25 subscribers at $50 making the valuation appear very high.

Michael, Vikram and Jim thought it would be just another app that would fade out in a couple of years and David was skeptical that they could be competitive down the road. Arlene thought their business model was flawed and made a suggestion that she may be interested if there is a membership and rating system that would provide data to a company she was familiar with. She offered $75K for 25% if they were willing to change their model. Paul David immediately countered to 15% and agreed tp the change. She refused the valuation and they were out of luck.

My entrepreneur ratings:

Idea: questionable; Competence: questionable; Knowledge of Market and Competition: questionable; Competitive Advantage: questionable; Preparation / Planning: questionable; Chance of Success: questionable.

Everything about this pitch is a question mark except for the valuation (too high) and logic to turn down an offer – any offer. David was right that everyone appearing on the show things their business idea or new product is worth a million dollars without a track record of sales.

 

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DRAGONS’ DEN REVIEW – Episode 906

This review makes a great forum for a critique and learning experience valuable to all entrepreneurs. Learn what to do and what not to do from entrepreneurs making a pitch for money in the Dragons’ Den. The review complements my book, The Small Business Planner and there are also great free resources including fully formatted planning and marketing templates on the book’s web site. In addition, my regular Blog, along with the Video Series on my You Tube channel can be very helpful to budding and seasoned Entrepreneurs. Of primary interest to those making a pitch on the program is the Feasibility Study as described in the book. If completed in detail, this study will indicate if there is a viable market for the product or service and if the business can be profitable. An added feature to my reviews is a rating on the company’s web site – if available. The web site has become the number one marketing tool for most businesses today and my observations are based on a quick overview whether accepted web design and development standards are met. Remember – you have a very short period of time to hold the attention of a new visitor. Therefore, the company web site deserves the appropriate investment and professionalism to be effective. Constructive comments are most welcome on any of these reviews.  Larry Wilson is author of the best selling book, The Small Business Planner, and is the founder of Dynamic Performance Group, a strategic and marketing planning firm.

Season 9 - Episode 6.           Original air date:   November 19, 2014

Pitch One: EMULATOR Elite -        Asking $500K for 10%

Valuation: $5 million.

Al and Julie Smithson introduced the next generation in Disc Jockey electronics – the Emulator Elite – a totally touch screen music system and the new standard of DJ technology. They unveiled the large stand-up unit and Michael gave it a try putting on an impressive show for the other Dragons including the scratching of records on a simulated turntable.

Sales: $3 million.      Retail: $15,500.   (Full version)    $4,000.  (Desktop)   $45. (Software)

They asked for his projected sales in two years and when Al said, sixty million, they were all skeptical as the market was limited to DJ’s and that would mean the sale of 15000 units of  the more marketable desktop version. David liked the idea but had a problem with the valuation. Ten times sales has taken away the upside for the Dragons and Al agreed. Vikram also thought the valuation was too high and opted out. Arlene partnered with David for 33.3% also citing a high valuation. Michael and Jim joined in with the offer as well. Four Dragons and he made a counter of 25% upon which the Dragons held firm. Al wisely accepted the deal.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: new technology; Preparation / Planning: good; Chance of Success; good especially with four Dragons as partners.

Great product and impressive sales. The valuation was high but the innovative value of the product attracted the offers.

Pitch Two: Envirobrush -        Asking $100K for 10%

Valuation: $1 million.

Terry Douglas from Surrey, B.C. has designed a paint brush that will reduce the number thrown out in landfills by fifty percent. In North America the number would be in the millions every year. With the envirobrush, a push of a button removes the brush refill from the handle for easy cleaning. When the bristle wears out, they are easily replaced without buying an entire brush. It is available in three different sizes in both consumer and professional lines. The Dragons liked the concept and feel of the brush and David verified from Terry that there was nothing comparable on the market.

Retail: $4.99 to $11.99              Sales: $500K      (U/K time frame.)

Terry mentioned that selling the brush has been a struggle.  He gave an example of Home Depot where the brush was displayed with numerous other brushes so people could not see the benefits and features. He said he had a lot of money invested in the product and when asked how much, he first said, “You don’t want to hear.” “Yes we do” came the simultaneous reply. $4.5 million absolutely floored the Dragons. Michael wanted to know how one can spend that much on a paint brush. Terry replied, $600 – $700K on patents but he could not explain the remaining $3.8 million just adding that it was wasted on administration and legal fees? The money was mainly supplied by himself with some loaned from friends. He said he devoted his whole life to making the product successful and had even resorted to sleeping on the floor for the past year. Not sure if the motivation for that discomfort was penance or poverty! He is almost eighty years old and doesn’t want his kids thinking he is a failure. (So he is squandering their inheritance!)

His story broke Arlene’s heart but she was the first to opt out followed by David. Vikram admired the dedication and penance but because he has been working on the product development for so long, he also dropped out. Michael thought it was a great product, but as a business – not happening. Jim finished him off by telling him he painted himself into a corner – now to paint himself out by not pursuing this anymore.

My entrepreneur ratings:

Idea: good; Competence: questionable; Knowledge of Market and Competition: good; Competitive Advantage: unique; Preparation / Planning: poor; Chance of Success; questionable.

The brush obviously needs an end cap for display and requires some sort of brief demonstration. The valuation was far too rich for decades of sales. There comes a time, when an inventor needs to pull the plug on pouring money into something that isn’t working. In this case – the time was long ago. It’s hard to fathom how he could have squandered $4.5 million on this product. He should have tried to sell the idea to a major paint manufacturer. What a sad state to put yourself in – especially at his age.

Web Site:     envirobrush.com/

The web site suffers from a common ailment – overcrowding with small type. The font is far too small and there is far too much of it. Nobody reads paragraphs of material to find what they are looking for. The type size should be large enough to meet accessibility standards. This includes the navigation text links which are also too small. That is why a prominent button navigation system is most often utilized – it is easy to find what you are looking for. We know it is all about the environment – but the background colour – really?

Pitch Three: Nonna Pia’s -        Asking $180K for 18%

Valuation: $1 million.

Natasha and Norm (and family) from Whistler, B.C., introduced their family business, Nonna Pia’s Balsamic Reductions. It is a gluten, fat, and sodium free reduction made from pure balsamic vinegar imported from Italy. They have been manufacturing the product from their home for several years. Competitive products have a much lower percentage of pure balsamic. They come in eight flavours which the Dragons sampled and remarked favourably. Vikram had met Norm on a previous occasion through his show and has a couple of bottles of their reduction in his fridge, uses it all the time and likes the product. Vikram questioned if it can be produced in enough quantity to make it a viable business because there is pure passion in every bottle.

Retail: $10. per bottle.     Sales: $369K 3 years ago and $722K last year.

Production is all done in Whistler and once they get a foothold in the eastern market, they will open a packaging facility there to meet the geographic demand. Ninety-seven percent of their sales are in B.C. and Alberta and they are sold at Costco in western Canada. Sales are projected to $1.3 million next year. Vikram made an offer to co-produce a balsamic vinegar with his spices. Jim offered what they were asking citing that he has a big distribution company and they are building a new facility in eastern Canada. Michael passed then David and Arlene offered more than the ask, $200K for 18% and they can take advantage of two Dragons and their contacts in the food industry. Vikram reminded them that he was offering his name on a silver platter. They accepted David and Arlene’s offer.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: taste; Preparation / Planning: good; Chance of Success: excellent especially with David and Arlene as partners.

The family of entrepreneurs did everything right and it lands a deal every time. Great product with a distinct competitive advantage in a large market, proven track record, fair valuation and lots of self-confidence sprinkled with a dash of modesty. Well played!

Web Site:      nonnapias.com

The site meets all current standards for design and development and is is optimized for searches. Easy to navigate, find into and pleasant to look at.

Pitch Four: Chewber -        Asking $50K for 25%

Valuation: $200K.

Catherine from Ontario introduced her new line of dog’s toys – Chewber. The dogs love the toys because they mimic live prey by the way they feel in their mouth and the way they spring back to their original shape when let go.  She has been selling them for twelve years and the patented design is molded from reinforced rubber and switch between fetch toy and drinking dish. The multi-functional frisbee style toy is sold in Per Value for  $21.99. The main competitor is Kong and their competitive advantage over them is durability. (I don’t know as the standard Kong with the hard rubber seems indestructible. These competitive points must be proven to be stated.)

Sales: $850K in 12 years.   $50K in the last year.

The $50K in sales for an entire year after 12 years in business was totally unacceptable to these savvy investors. There must be something wrong here, and Catherine cited lack of distribution. She started talking about having problems with distribution companies who don’t have the enthusiasm to properly sell her products then said others won’t sell it because of the Kong products taking centre stage. She said that she wanted Dragon help with marketing and getting a deal with a major dog food company and getting it into Canadian Tire. Jim asked what they said to her when she went to Canadian Tire and she said that she hadn’t approached them yet, claiming that she needed Dragons for that.

Catherine admitted that it was her fault and not the product’s fault that she was only doing $50K after 12 years. David reminded her that if she watch the program then she would know that they invest in people. People who make it happen with selling. She continually interrupted and did so with David saying that she was motivated because she was on the show in front of them. All but Michael dropped out for the same reason – she hasn’t got what it takes, except for excuses. Michael, who has fourteen dogs, offered $50K for 51% AND A 3% royalty did so with another condition – the she be coachable. She questioned the equity share and Michael agreed to pull it back to 45% after two years if he found that she was coachable. She continued to question tghe offer and Michael promptly withdrew his offer stating that she just proved that she could not be coached.

My entrepreneur ratings:

Idea: good; Competence: questionable; Knowledge of Market and Competition: high; Competitive Advantage: durability; Preparation / Planning: good; Chance of Success: poor with her attitude.

Entrepreneurs have to be willing to do what it takes to make things happen. Nothing else needs to be said here.

Web Site:      chewber.com

The site meets all current standards for design and development, however it is not optimized for searches. The title tag does not contain any of the primary key words, such as dog toys, etc.

 

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DRAGONS’ DEN REVIEW – Episode 904

This review makes a great forum for a critique and learning experience valuable to all entrepreneurs. Learn what to do and what not to do from entrepreneurs making a pitch for money in the Dragons’ Den. The review complements my book, The Small Business Planner and there are also great free resources including fully formatted planning and marketing templates on the book’s web site. In addition, my regular Blog, along with the Video Series on my You Tube channel can be very helpful to budding and seasoned Entrepreneurs. Of primary interest to those making a pitch on the program is the Feasibility Study as described in the book. If completed in detail, this study will indicate if there is a viable market for the product or service and if the business can be profitable. An added feature to my reviews is a rating on the company’s web site – if available. The web site has become the number one marketing tool for most businesses today and my observations are based on a quick overview whether accepted web design and development standards are met. Remember – you have a very short period of time to hold the attention of a new visitor. Therefore, the company web site deserves the appropriate investment and professionalism to be effective. Constructive comments are most welcome on any of these reviews.  Larry Wilson is author of the best selling book, The Small Business Planner, and is the founder of Dynamic Performance Group, a strategic and marketing planning firm.

Season 9 - Episode 4.           Original air date:   November 5, 2014

Pitch One: Underworld LARP -        Asking $60K for 25%

Valuation: $240K.

David Ashby from Toronto, ON, seeks Dragon dollars for his Live Action Role-Playing business which include detailed story lines and quests for the participants. According to David, it is all about ‘escapism’ and players pay to use their intellectual property, stories, and rules. The players are provided with the beginning of the story, write the ending themselves, and live in the story for three days. They currently rent land near Lindsay, Ontario and are looking for investment to acquire their own property and facility to accommodate games. I don’t think the amount they are asking for comes even close. 

There are up to 150 players who pay $45 ea. for a weekend.     $6,750 Total.

That equals $375K for a full year. Participants supply their own food or purchase on site where they also have a tavern set up and many people meet at their events and date then develop relationships later. The company has been in  operation for six years and last year netted $55K in profit. David asked if that included a salary for him, and Mr. Ashby replied that it was currently a passion job or hobby. He said he was serious about making money and added that they also get a cut from vendor’s revenue on sales during the event. Vikram joked that he could barely manage in the real world let alone a fantasy world and was the first to opt out followed by Arlene who didn’t see it as an investment business, although she did like the idea.

Michael explored the potential by asking about other parts of the world where LARP was conducted and David told them about places in Europe where there are thousands of participants utilizing rented castles. They are hardly penetrating the market here with a chapter in London and potential for more.  Michael really liked it but wanted to think about it more allowing David to repeat Arlene’s concern that it was not an investable business and he was out as was Jim for the same reason who commented that they didn’t need to give away 25%. After some thought, Michael said he didn’t want to invest in a business unless there was a full-time commitment from the principals and he completed the sweep of disinterest.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: unique; Preparation / Planning: good; Chance of Success; good with growth opportunities even without venture capital.

David has a very good hobby business which is well established and profitable. Unfortunately, that is all it is likely to be unless he can find someone willing to partner with him and bring a considerable amount of cash into the fold. He wasn’t asking for nearly enough investment for the envisioned growth. It can grow slowly and add new chapters, like franchises, if he re-invests money back into the business. He needs to charge more for participation – $45 for three days seems low.

Web Site:     underworldlarp.ca/

The web site was created from a WordPress template which is often problematic when it comes to search engine optimization. It is, however, unlikely that visitors will go there from a search – rather a link or an ad. The site is very busy and confusing. It is very difficult to figure out what they are about – and that is not good.

Pitch Two: The Rupture Seal -        Asking $500K for 20%

Valuation: $2.5 million.

Glenn Cox from Charlottetown, PEI, has developed an innovative plug to block hazardous spills. The rupture seal comes in a variety of sizes and shapes and is simple to use. Just insert in hole and pull back on the toggle until the clicking stops – the silicon molds to the surface with the pressure and the leak stops. It can be used to block ruptures in tanker trucks, boats and commercial shipping. The seal has been formulated to work with every substance, except nitric acid. It is currently sold to fire houses and industrial plants in thirty-three countries and it is patented in many as well.

Retail: $110.00       Cost: $18.00     Sales:  $352K  (2 yrs. primarily in Canada)

David wanted to know why he has such an optimistic forecast of $1.6 million and Glenn reported that Trans Ocean in the Gulf of Mexico would be using their product. He claimed that the Canadian Navy was also using the Rupture Seal and his problem was getting the cash to get the product into more markets. The Dragons applauded the innovation value of the product which is actually manufactured in PEI using all Canadian parts and technologies. Jim thought he articulated the pitch very well and Glenn, also an ex RCMP, equated it to being on the stand. (Myself, also being an ex PC, knew he was talking about giving evidence where police officers often spend hours and hours on the witness stand.)

David was the first to make an offer for 25% adding that he also wanted a 15% royalty until the $500K was paid back. Arlene made the same offer but added that if the company doesn’t hit the 1.6 million as forecast, her equity would jump to 30% but only wanted 12% royalty until repaid. Michael opted out because he didn’t like the valuation followed by Vikram for the same reason. This left fellow ex cop Jim who we knew was comfortable with the new entrepreneur and offered $500K for 25% with no royalty.  The brotherhood prevailed when Glenn immediately shook Jim’s hand.

My entrepreneur ratings:

Idea: excellent; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: unique; Preparation / Planning: good; Chance of Success; very good with Jim as a partner.

There were so many things that Glenn did right. His product had tremendous innovative value by providing an inexpensive simple solution to a real problem. He has a track record of sales with the product and there is high global market potential. He also gave an excellent presentation – articulated well displaying much self-confidence. The only negative was the valuation, however, that was offset by the innovative value and he accepted the Dragons corrected valuation.

Web Site:     ruptureseal.com

The web site is very good according to current web standards. The look is clean and professional, it is easy to navigate and the, ‘How To’ on the Home page is also a good idea. Like many other web sites being created today, too much real estate at the top of the landing page is taken up by graphics. The site is not optimized for search engines and should be as this is a product that people may search for. Therefore, the prime key words should appear in the title and the Meta tags. The ‘Description’ tag is empty and should contain a brief paragraph with the key words. This is the text that is usually used in search engine returns. The search engine algorithms still put some weight on keywords, not as much, but enough to warrant utilizing them.

Pitch Three: P.E.T. Card -        Asking $100K for 25%

Valuation: $400K

Wayne Bacchus from Halifax, NS, enters the Den with his solution to create more wallet space with the Personalized Electronic Transaction Card which will hold the information from four different cards (credit, loyalty, debit, etc) and fold flat like a single card. The idea was untested, the business model is flawed, there are no sales, the valuation is ridiculous, and need I go on? I hope he didn’t invest much of his own money in this. DO NOT follow this example if you get an opportunity to make a pitch on the show.

Pitch Four: IcePad -        Asking $75K for $3 royalty.

Valuation: n/a

Archie Manavian and Stan Fong from Montreal, QC, made an interesting pitch offering no equity, but a $3 royalty until the investment is repaid and $1.50 in perpetuity thereafter. A different twist based on many of the offers made by the investors. Their product, the IcePad is a revolutionary curling brush design. They tried to explain the purpose of sweeping a rock and the reason for skips to yell,  ‘hurry hard.”  First Stan tried to explain but gi=ot tongue tied, then Archie tried and suffered the same fate. They then managed to finish the sentence and started to provide a demonstration on the evolution of the curling broom from the old corn broom to  the hair brush then the synthetic brush of the nineties. They then finally showed their brush insisting that it would be the next phase of the evolution and dominate the market within four years. It is touted to be the lightest brush with the least abrasive material making for fast sweeping. Jim gave it a try. The brushes are made in Canada and are competitively priced with competitive offerings yet they claim they last twenty-five times longer.

Retail: $70.00       Margins:  30% on wholesale – 60% on retail.

Sales: 2,600 units.   David reminded them that for the investor to recoup their money the sales would need to hit 25,000  - ten times current sales in a market where change is slow and most sales are at club pro shops which are low volume. They need to get one of the top teams to use and endorse the broom but most are under contract with other brands. Michael and Jim both thought the deal was too small to make money and opted out followed by Vikram. David offered the $75K saying that he would take the broom to curler Brad Jacobs but he wanted a $10 royalty dropping to $5 when paid off. Arlene offered to partner with David who accepted her as a partner. They tried to counter but wisely took the deal when they stood their ground.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: quality; Preparation / Planning: questionable; Chance of Success; good with David and Arlene as partners.

The pair designed a great product and made an interesting pitch with zero equity. They stopped short in their planning to get a better deal because they didn’t get any of the top curlers to try and endorse it. They should have also done a test market, but in the end they did get a deal.

Web Site:     hardlinecurling.com

Their site is clean and well laid out, however there are several serious problems. The landing page offers the choice between English and French, however it is not optimized for search engines. A better alternative would be to have the English page as a landing, or home page (likely the majority of the visitors) then allow a selection to French with a prominent button. That way full optimization can be accomplished. The main site utilizes too much text that is far too small. Make it brief and make it prominent. Give detailed explanations on tier two level pages.

Pitch Five: BioSecrets -        Asking $20K for 20%

Valuation: $100K.

Sihem Benali from Ottawa, ON, cashed in $5,000 in her RRSP’s a few years ago when she got laid off in order to start her own business in Argan oil which is produced in Morocco and sold through health food stores. It can be used to beautify the hair, face, body and nails. Arlene reminded her that Moroccan oil is quite common and wanted to know what makes her Argan Oil different. She replied that it is 100% pure certified organic unlike the competitor offerings.

Retail: $30. per 50ml bottle.         Sales: $30K  (One year in the Ottawa area.)

She gives back a portion of each sale directly to the women who produce the oil in Morocco. Arlene applauded what she has done as a new Canadian and managing to maintain her culture as well. When he learned that she would be the face of the brand, Vikram offered Sihem exactly what she was asking for using his contacts to get the oil in all the stores. Arlene threw her hat in the ring with her contacts for the same deal. Michael and Jim partnered to offer $30K for 20% upping the valuation to $150K while David opted out citing the passion displayed by Vikram and Arlene. Sihem asked if the four would come together and Vikram joined the other guys while Arlene stood alone. She chose the three amigos. and rightfully so with all that clout and an extra 10K to boot.

My entrepreneur ratings:

Idea: very good; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: purity of product; Preparation / Planning: good; Chance of Success; excellent with three Dragons as partners.

She made a profound statement exhibiting her happiness at the end stating that ten years ago she was fighting for her life (during civil war in North Africa) and now she has three Dragons and is living the Canadian dream. She actually made the dream happen as can just about anyone who sets there mind to it and works hard.

Web Site:     biosecrets.ca

The web site is very clean and attractive in design. It is functional and optimized for search engines, however, like the previous site, the text is far too small and visitors will not spend time reading small print to find answers.

 

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DRAGONS’ DEN REVIEW – Episode 903

This review makes a great forum for a critique and learning experience valuable to all entrepreneurs. Learn what to do and what not to do from entrepreneurs making a pitch for money in the Dragons’ Den. The review complements my book, The Small Business Planner and there are also great free resources including fully formatted planning and marketing templates on the book’s web site. In addition, my regular Blog, along with the Video Series on my You Tube channel can be very helpful to budding and seasoned Entrepreneurs. Of primary interest to those making a pitch on the program is the Feasibility Study as described in the book. If completed in detail, this study will indicate if there is a viable market for the product or service and if the business can be profitable. An added feature to my reviews is a rating on the company’s web site – if available. The web site has become the number one marketing tool for most businesses today and my observations are based on a quick overview whether accepted web design and development standards are met. Remember – you have a very short period of time to hold the attention of a new visitor. Therefore, the company web site deserves the appropriate investment and professionalism to be effective. Constructive comments are most welcome on any of these reviews.  Larry Wilson is author of the best selling book, The Small Business Planner, and is the founder of Dynamic Performance Group, a strategic and marketing planning firm.

Season 9 - Episode 3. Original air date: October 29, 2014

Pitch One: Knixwear - Asking $200K for 10%

Valuation: $2 million.

Joanna Griffiths introduced her new line of lady’s underwear which are meant to protect from light leaks  after a laugh, sneeze or cough which is common in one third of women. Specially made for workouts and activity, they help guard against seat, odour and panty lines. The high-tech underwear can be purchased on-line or at Hudson Bay Company stores across Canada and are tagged to: Knix sweat, Knix odour, Knix worrying. David was curious about the technology and Joanna identified the unique panty liner which contains silver adheres to the odour causing bacteria and inhibits it from growing.

Sales:  $375K in 7 months.    Projected $1.2 million for this calendar year.

Retail:  $22 to $32 per pair.

The Dragons commented on the high price point and she stated that they had their own place on the market and there was a great deal of positive feedback once women had tried them. To convince buyers to try them on the shelf, she invites a trial with ladies in the office using them and the results have been favourable. Arlene thought Joanna was a great entrepreneur with knowledge of her product, the market and her strategy. Jim asked why she needed the money and Joanna replied that she cannot keep up with the demand. David asked if she had approached celebrities to try and endorse the product as it would be an ideal strategy, but she had not. Vikram was the first to opt out saying that he liked the business but not to invest in.

Michael then spoke up telling everyone that he would be the most qualified investor as he was once a model and he offered $225K for 10% adding the he thinks he can work with her. Arlene offered the $200K for 20% and adding extra value by include her name as an endorsement. Jim had been taking in the other offers with pen in hand until it was his turn and he said that Arlene was not her person as she needed an investor with International connections and he offered $250K for 20% because he wanted some control and also expressed the need for a celebrity endorsement. Joanna felt overwhelmed at the interest shown in her product but stated that she was most interested in growing the US market and countered Jim’s offer to $300K for 20% and he accepted.

My entrepreneur ratings:

Idea: excellent; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: unique; Preparation / Planning: very good; Chance of Success; excellent.

Joanna entered the Den full of confidence and she made an excellent presentation. Her business was at a perfect stage with an excellent track record to make a pitch for equity investment. The valuation was fair and everything added up to multiple offers. Well done!

Web Site:     knixwear.com

The web site is excellent and meets all web standards for design and development. It is graphically pleasing making good use of a rotating image bar – not too large but eye catching; – it is easy to find information as the text is a large enough size for all visitors to read comfortably; – there is an obvious method for purchasing; – the site is optimized for search engines including the proper use of keywords in the page titles; – they have adopted a way of acquiring names to build a direct marketing database that is not annoying.

Pitch Two: Sun Clipz - Asking $75K for 33.3%

Valuation: $225K.

Scott Hendrick, a Toronto inventor, has developed a portable device that clips on to the traditional visor with a swivel pad that blocks the sun , like putting up a hand in areas where the visor doesn’t work. Right away problems were identified. First Jim pointing out that the device would create a blind spot. Scott countered; “Just where the disc – the circle of the sun is.” Jim said a motorcycle could fit into that area and you could have a problem with liability. Then David pointed out that not only is the sun moving, but the car is at a quick pace and the driver would need to make subtle adjustments thus creating a distraction. Scott agreed that on a windy road it would be a limitation for the device. Ouch – not looking good so far.

Vikram asked the big question on the business side; “Have you sold any?. To which Scott replied, “Not so far.” He doesn’t have the packaging done yet, admitting that he is not a marketing person. He has invested $75K of his own money to this point which came from his savings, the same as flushing it down the toilet according to Vikram. Scott pointed out that industrial molds are not cheap. The Dragons unanimously opted out of this one with Vikram adding some advice for Scott not to invest any more money on the product, not even for packaging.

My entrepreneur ratings:

Idea: poor - it addresses a problem but creates more than it fixes; Competence: very low – he is not an entrepreneur; Knowledge of Market and Competition: low; Competitive Advantage: questionable; Preparation / Planning: limited; Chance of Success; minimal.

Scott is an inventor, and like most inventors, he gets very excited about his innovations because there is a great deal of  bias and limited objectivity. This is clearly displayed here – a product and pitch that is a prime example of several common mistakes and a picture of some not to do’s when developing a product. New product development goes through several stages which get progressively more costly from alpha (discovery & design), through beta (prototype and market analysis) to commercialization (mass production and introduction to the market place). The inventor is generally expected to fund the initial stage and if the idea had high innovative value and tremendous market opportunity, investors may be interested, especially in the area of new technology and really solves a problem. In other cases, the chances of commercialization are usually very slim and before the inventor invests any more money, extensive market research must be conducted. Had Scott followed this logical path, he would have discovered the problems inherit to his design, and corrected it or abandoned the idea before, as Vikram put it, flushed his savings (and retirement income) down the toilet. Too often people get blinded from their own excitement to see the real picture.

Pitch Three: Gorilla Cheese - Asking $150K for 25%

Valuation: $600K.

Graham Smith, from Hamilton Ontario, pitched his idea for Canada’s first grilled cheese food truck. He had a single truck on the set and his two helpers announced that the Dragons’ sandwiches were ready and promptly served them a variety including classics of aged cheddar and mozzarella. There is also a Lumber Jack with apple slices, bacon and maple syrup. Vikram, who has his own food truck, checked out the interior of Gorilla Cheese mobile. David and Arlene really liked the branding. He currently has only one truck in his fleet. He brought in $89K the first half year in 2011 and $375K in 2012 in gross revenue. His partner left the company and he struggled to keep it going through 2013 and didn’t make a profit after paying himself.  He wants to open a storefront and another truck.

Arlene advised Graham to make it happen on his own. He has the brand, the equipment and the loyal customer base to show a profit in another year. That’s when he related the story about maxed out credit cards and a poor credit rating. This is something investors never want to hear as they don’t often engage in bail out investing and they generally lend based on the strength of the principals in experience and character. David didn’t like the math and was the first out followed by Jim. Vikram liked Graham’s passion and offered the $150K with a 6% royalty to be paid after a year until the money is paid off, then 3% in perpetuity. There was a condition that he not open a restaurant, but concentrate on the trucks. The others passed as Vikram was the best partner and Arlene urged him to take the deal as he is obviously desperate and he quickly accepted.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: high; Competitive Advantage: unique; Preparation / Planning: good; Chance of Success: good with Vikram as a partner.

Graham was very fortunate to get an offer and if Vikram was not on the show, he would most certainly be out of luck for a bail out. He will need to provide solid financial management, if the deal goes through. There is a feeling that the due diligence process may expose even more problems

Pitch Four: Lost Dog App-   $500K for 15%

Valuation: $3.3 million.

I won’t take much time to review this ridiculous valuation. The app launched just six weeks ago on a subscription service so there is no track record of renewal rates and no revenue track record upon which to substantiate a crazy valuation like this. Some apps have a very high innovation value, but this one does not have the wow factor or even an indication that there is a market for it. Have these people not seen the show before?

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DRAGONS’ DEN REVIEW – Episode 902

This review makes a great forum for a critique and learning experience valuable to all entrepreneurs. Learn what to do and what not to do from entrepreneurs making a pitch for money in the Dragons’ Den. The review complements my book, The Small Business Planner and there are also great free resources including fully formatted planning and marketing templates on the book’s web site. In addition, my regular Blog, along with the Video Series on my You Tube channel can be very helpful to budding and seasoned Entrepreneurs. Of primary interest to those making a pitch on the program is the Feasibility Study as described in the book. If completed in detail, this study will indicate if there is a viable market for the product or service and if the business can be profitable. An added feature to my reviews is a rating on the company’s web site – if available. The web site has become the number one marketing tool for most businesses today and my observations are based on a quick overview whether accepted web design and development standards are met. Remember – you have a very short period of time to hold the attention of a new visitor. Therefore, the company web site deserves the appropriate investment and professionalism to be effective. Constructive comments are most welcome on any of these reviews.  Larry Wilson is author of the best selling book, The Small Business Planner, and is the founder of Dynamic Performance Group, a strategic and marketing planning firm.

Season 9 - Episode 2. Original air date: October 22, 2014

Pitch: Schnitzel Queen - Asking $250K for 50%

Valuation: $500K

Karl Hubsch and his sister, Michelle Srnec from Toronto, Ontario, pitched their schnitzel restaurant to the Dragons. It is only a four seat facility which was bestowed upon him a year earlier along with an age old recipe for several styles of schnitzel. He is grossing about $150K per year, yet wants to use the investment to start a franchise operation. To keep this review brief, he had no idea about franchise operations. Jim warned him that it required volume to substantiate franchising and obviously he didn’t have that. His knowledge of  restaurant management was equally as bad as he refused to work the second busiest day of the week, Saturday, to be with his family. He was equally as poor as an entrepreneur as he had no idea what his bottom line was and could not relate any pertinent financial information when pressed. Obviously all the Dragons were out – and surprisingly polite in doing so given the situation.

My entrepreneur ratings:

Idea: possibilities in the hands of an actual restaurateur; Competence: questionable; Knowledge of Market and Competition: questionable; Competitive Advantage: questionable; Preparation / Planning: poor; Chance of Success; very little chance for growth and zero chance for franchising at this stage.

This pitch is full of examples of; ‘What not to do!” Just add them up.

Web Site:     schnitzelqueen.blogspot

This is not an actual web site. It is a blog posting done through the site blogger. The company will need to establish their own professionally developed web site sooner than later if they want to take full advantage of the web as a powerful marketing tool.

Pitch: Pur Gum - Asking $1 million for 10%

Valuation: $10 million.

Jake Klein from Toronto, has developed a line of chewing gum that he claims has become number one in the health food market as it is sugarless but contains no Aspertame. It is also gluten free and diabetic friendly and still tastes great. The gum is manufactured in Switzerland and comes in six flavours and sold in over ten thousand stores. It retails for the same price as regular chewing gum. The ingredient substituted for Aspertame to provide the sweetness is Xylitol, which is roughly as sweet as sucrose with 33% fewer calories. The Dragons tried and liked the gum. Jake was in the marketing business before but had an eye opener when he got into this business with relation to the complexity of the supply chain and distribution channels.

Sales:  $10 million in 2013.   Launched in May 2010 and doubled every year.

Fifty percent of sales is in Canada but the gum is also sold in twenty-four other countries. Fifteen percent is in the U.S. where there is tremendous gross potential for them. The Dragons were curious as to the reason why an investment is required if the sales are so good. He said the main reason why he came to the Den is for the Rolodex of each Dragon, and a few dollars as well. He obviously wanted to partner with them for their contacts, but we haven’t heard anything about his margins and profitability. Even without that key info, David said he was in for the Ask amount. (Of course, the profitability will be revealed through the financials in the due diligence stage before any cheques are written. Vikram matched the offer saying that the proof was in the taste (not the pudding). Michael liked the packaging and Jake as an entrepreneur and thought they were going to make a lot of money but he wouldn’t pay ten times on a private company valuation and opted out.

Arlene admitted that there was real value for him to take multiple Dragons involved and asked to speak with her prospective partners in private. He returned from the back room and Arlene announced that her and Jim would partner but wanted 15%. David wanted to stay alone and give him what he was asking for but Jake countered Arlene and Jim’s offer to 10% resulting in Vikram’s ire and the withdrawal  of his offer. Arlene tried to talk David into joining them at 15  but he refused and Jake wisely gave up a little equity for a lot of experience and contacts with the two Dragons as partners.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: good; Competitive Advantage: unique; Preparation / Planning: high; Chance of Success; very good even without the Dragons.

When you can justify a valuation of ten million then you obviously have done something right – primarily established sales and great market potential. Jake had done just that and the deal was pretty much a slam-bang with four Dragons hooked. He started to get a little greedy and one got off the line but he managed to negotiate an excellent win – win.

 

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DRAGONS’ DEN REVIEW – Episode 901

This review makes a great forum for a critique and learning experience valuable to all entrepreneurs. Learn what to do and what not to do from entrepreneurs making a pitch for money in the Dragons’ Den. The review complements my book, The Small Business Planner and there are also great free resources including fully formatted planning and marketing templates on the book’s web site. In addition, my regular Blog, along with the Video Series on my You Tube channel can be very helpful to budding and seasoned Entrepreneurs. Of primary interest to those making a pitch on the program is the Feasibility Study as described in the book. If completed in detail, this study will indicate if there is a viable market for the product or service and if the business can be profitable. An added feature to my reviews is a rating on the company’s web site – if available. The web site has become the number one marketing tool for most businesses today and my observations are based on a quick overview whether accepted web design and development standards are met. Remember – you have a very short period of time to hold the attention of a new visitor. Therefore, the company web site deserves the appropriate investment and professionalism to be effective. Constructive comments are most welcome on any of these reviews.

Season 9 introduces two new Dragons as Kevin O’Leary and Bruce Coxon have left the Den. Culinary expert Vikram Vij, and financial mogul Michael Wekerle, have taken their place along side Jim Treliving, Arlene Dickinson and David Chilton. Larry Wilson is author of the best selling book, The Small Business Planner, and is the founder of Dynamic Performance Group, a strategic and marketing planning firm.

Season 9 - Episode 1. Original air date: October 15, 2014

Pitch One: The Smart Cookie - Asking $75K for 20%

Valuation: $375K

Greg and Maya Liberman from Oakville, ON, introduced their cookie dough mold to the Dragons. The two part mold, keeps the dough fresh and in shape for storage in the freezer and they can be stacked to save space. When the cover is removed there are perfectly shaped cookies ready for the oven and Vikram tried it out admitting that it is very convenient. They are sold in over fifty retail stores across the country.

Sales:  1,500 units since November 2013.

Jim asked if there were any other products and Greg showed them the Burger Master which is soon to be launched. Arlene questioned the burger mold at this stage as the branding is all about the Smart Cookie. David loves simple solutions and thought they had done a good job. Michael thought they needed more than $75K and wanted to think about it while Vikram went ahead and made an offer of $75K for 30% plus 10% of all sales until his investment is recouped prompting David to opt out commenting that they had a good offer from a  famous chef. Jim also opted out along with Arlene who commented that they had a long hill to climb to get the business large enough to invest in.

This left Michael who asked to go last and said he had an interest in eight restaurants including a burger establishment but thought they needed $250K. His offer was that amount for 50% plus a 10% royalty for 7 years. Vikram made another pitch to get the deal by offering to use the tray on all his shows equating to free branding. They didn’t take long to accept the extra money and partnered with Michael.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: good; Competitive Advantage: unique; Preparation / Planning: high; Chance of Success; very good with Michael as a partner.

They came into the Den with a good unique product which had established distribution and substantial sales. The actual numbers were not revealed but they waited until the business was operating profitably before approaching investors. They also were confident in making a good pitch and knew the industry. The next step before the cheque is written – due diligence.

Web Site:     shapeandstore.com

The web site meets all the requirements of W3C and design standards, with one small exception. It is easy to navigate and the landing page is not cluttered. There is a large window for a video, but they wisely allow the visitor to activate it. It is also easy to purchase the products right from the home page. The only negative is the key words are not included in the title or meta tag to help search engine rankings. Although the major search engines are putting less emphasis on this, it is still a factor that has some weight in the algorithms. Otherwise, well done – clean and professional – good first impression.

Pitch Two: Power Tabs - Asking $100K for 20%

Valuation: $500K

Luke Robak and Martin-Andre Young from Brampton, ON, developed a tablet that transforms any drink into an energy beverage. The pitch got off to a very poor start as the entrepreneurs did not show any excitement about their product and the presentation was on the dull side. They said that the tabs were approved by Health Canada and contain the same amount of caffeine as a cup of coffee. They are sold in hasty markets and convenience stores throughout southern Ontario. The Dragons tried a tab in water and Arlene winced while Vikram read out the ingredients and exclaimed, “Are you trying to kill us?” He also said the taste was nasty.

Retail: 20 tabs for $10.     Sales:  $22,000 to date.

They have $75K invested in the company so far which has only been operating three months and Arlene complained about a valuation that was seven times their own investment. The pitchers started making claims about their marketing head start on competitors and arguing with the Dragons. They also claimed that the company will make between a quarter and a half million dollars this year and then the Dragons were very surprised when the pair admitted that they had no experience in this type of business at all. Arlene said no, no, no because they had no experience, the price was too high and the model was flawed. David followed her lead telling them that the competition was fierce in that market and they should have industry experience and work at it full-time if there is any chance at success.

Vikram also repeated that it was a tough market prompting him to back away. Then Michael related a story about a product that he was involved with that was competing against Red Bull. The marketing budget was fifty million dollars but the company still folded after fourteen months indicating once more how tough it is to enter that market. He also felt that there was no protection for children over-indulging so he opted out leaving Jim who was seriously thinking about it but also passed because of the child aspect.

My entrepreneur ratings:

Idea: questionable; Competence: questionable; Knowledge of Market and Competition: questionable; Competitive Advantage: convenience; Preparation / Planning: poor; Chance of Success; poor.

The pair had a number of strikes against them. They had no experience in the industry and any investor will want to see that the principals behind the idea are experienced and competent – one of the first things they will look at in any business plan. The also had no track record to justify a crazy valuation and had not addressed the child over indulgence through the sale at hasty markets where there is no control.

Web Site:     powertabs

The web site is good and meets standards for design and development. It is brief and tells the story immediately assuring visitors about ingredients, and it is easy to purchase.

Pitch Three: BitLit Media - Asking $125K for 5%

Valuation: $2.5 million.

Peter Hudson from Vancouver, BC, developed a smart phone app that offers discounted e-book editions of print books that customers already own. It allows the user to scan their own physical library of books (a shelfie) then locate and download the e-book version. His valuation drew a snicker from the Den when announced but his business model garnered interest as he displayed how their patented technology located the book when the cover was scanned. Signing and scanning the inside cover then completes the proof of ownership and a link to download the digital version is e-mailed to the registered owner of the app and their credit card is charged. The same applies to the ‘shelfie’ where all the books scanned on a library shelf are identified and matched to digital copies. The company will earn a commission, up to forty percent, from publishers.

Michael was the first to bring up the valuation. There were no sales as he is preparing to launch and looking for someone who can bring more to the table than money – contacts. They are in content acquisition mode and looking for contacts to publishers – something right in David’s ball park. Michael described products in three phases: wholesale, retail and fairy tale and classified BitLit in the latter with the valuation. He countered with the value in their database and identifying people with titles they read giving the example of GoodReads which was purchased by Amazon for its database. David concurred with the value comparison. Vikram thought the idea was great but couldn’t get past the valuation and dropped out. David met the ‘Ask’ with an additional caveat that he receive a 40% royalty on the sale of books from any publisher he sets them up with until his investment is repaid. Jim jumped in right away and partnered with David on the deal. Arlene said that she liked him (he did deliver his pitch with confidence), but let’s see how quickly this can change. She liked the idea of the app in the hands of OEM’s and downloaded upon purchase of new laptops, tablets, etc. She made the same offer as David, $125K for 5%, but wanted a 30% royalty on the sale of each book and an additional 10% royalty if an OEM deal was struck.

Peter surprised the Dragons’ when he said he would need to go in the back room and confer with his director. He discussed the two offers with a young fellow in the back room who was dressed smartly in a business suit. While they were discussing the offers, Jim was telling the other Dragons’ about a similar tech deal which netted the investors millions. The two agreed that David had the connections but Arlene’s was a slightly better deal. The plan was for Peter to go out and see if Arlene would sweeten the deal and use a little bluffing to get a higher valuation. Here is where the tactics are hard to comprehend. Sensing a sure deal, Peter’s confidence quickly changed to arrogance when he addressed Arlene directly and said he didn’t like the royalty and for her to come clean with David’s deal – the $125K for 5% even explaining that David could earn his 40% royalties with his connections. He continued that if he were to go with her offer then she would need to give him something more and she obviously didn’t understand where he was going. He wanted the $125K for less that 5% because he said she didn’t have the connections that David has and therefore less value. Of course everyone was astonished as he was now asking for more than when he first came in. It didn’t take long for Arlene to refuse the deal, and when the cocky pitcher turned to David, it was retracted because he insulted one of his colleagues. The result was anticipated when greed consumes someone and clouds the big picture: a possible multi-million dollar comapany if they were willing to make a reasonable offer to get the money and contacts from an influential partner.

My entrepreneur ratings:

Idea: good; Competence: high; Knowledge of Market and Competition: good; Competitive Advantage: unique; Preparation / Planning: high; Chance of Success; very good with Michael as a partner.

This was another one of the high tech innovations that could really take off as it addressed a void in the market. The entrepreneur actually had a deal before greed kicked in. What more can I say.

Web Site:     http://www.bitlit.com/

The web site is good and meets standards for design and development. It is brief and gives visitors the story immediately upon landing on the page, and it is easy to download the app for either Apple or Android.

Pitch Four: Covergalls - Asking $75K for 20%

Valuation: $375K

Alicia Woods from Sudbury, ON, has worked in the mining industry for fourteen years and identified a problem from day one when she could not find any coveralls or safety clothing in a woman’s size. She resorted to small men’s work wear which did not have the convenient features for relieving ones self. She developed a rigged line of work wear strictly for women which were modeled for the Dragons who were very impressed. The new coveralls had the same appearance as men’s but the buttocks section released from the coverall dropping down for of using the washroom then attached back with a Velcro band. They are sold through all the major mining companies in Canada.

Sales:  $61K in 5 months.   $180K projected by the end of the first year.

Cost:  $70 to $160.          Retail :  $135 to $282

Users will purchase two or three pairs at a time and turn around up to three times a year. She also has mining industry contacts to start selling in the United States. Arlene didn’t like the fact that she was currently working full-time as the director of sales for a mining equipment manufacturer, but that was no problem for Jim who offered her the full amount for 20%. He didn’t feel she needed to quit her job but could handle taking it to the next level the way it is, commenting that she was a great front person for the products. David made the same offer but wanted her to quit her job and start selling right away.

Vikram thought there were good offers on the table and opted out and Michael boasted about his connections in the mining industry and matched Jim’s offer including keeping her job. Arlene beat the others by wanting only 18% and saw the applications of the apparel far beyond the mining industry. She was super impressed with Alicia as an entrepreneur and wants to work with her. Alicia turned down David as she was not prepared to leave her job right away and made a counter offer increasing the equity to 30% for the remaining three bidders to partner with her. They all agreed and Arlene, Michael and Jim were on board.

My entrepreneur ratings:

Idea: excellent

; Competence: high; Knowledge of Market and Competition: good; Competitive Advantage: unique; Preparation / Planning: high; Chance of Success; excellent with her new partners.

Alicia was prepared, confident and came across as an excellent entrepreneur with an superb tested product and huge market potential. She was not greedy and even improved the equity stake to get all three Dragons. Well done! She is an excellent example for everyone going on the show to follow.

Web Site:     covergallsworkwear

The web site is very good – professional looking and easy to navigate. It would likely be more effective if the large graphic was half the size as it takes up about 80% of the home page. That would leave room for several small static windows with brief  descriptions and the message – ‘What’s in it for the Customer.’

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TAKING CARE OF BUSINESS – October 1st, 2014

The first October show, aired on Wednesday the 1st, was the second with an accounting theme. Stu Gilbert, from the accounting firm Westcott Larkin in Bracebridge, again joined me to go over some important accounting fundamentals for business. These included the financial projections and start-up cost analysis portion of the Feasibility Study; understanding Financial Statements, mainly the Profit & Loss (Income Statement) and Balance Sheet; along with budgeting and measuring results with a Variance Analysis.

I will be presenting my first Success Story to the audience on Wednesday October 8th at 3:05pm when Darren Smith, founder of Lake of Bays Brewing Company, joins me in the studio to discuss some of the secrets to his company’s rapid growth. You can Listen Live or go to thesmallbusinessplanner.com/tcb.php to replay episodes of the show on mp3.

The Honourable Tony Clement, Member of Parliament for Parry Sound / Muskoka and President of the Treasury Board of Canada, will be my guest for the show airing on October 15th and we will be discussing opportunities for businesses in Muskoka along with the Canadian Anti-Spam legislation which was enacted into law on July 1st, this year.

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Employee Relations – Part One

This important subject is featured on this week’s episode of Taking Care of Business, my weekly radio show on Hunter’s Bay Radio – FM 88.7, Huntsville, Ontario. My guest was Catherine Clarke, Human Resources Specialist and currently the HR Manager at The Home Depot in Huntsville, Ontario. The following is an excerpt from the show on the subject of employee relations.

Employment Contracts must state the following:

-Position Title and Start Date; -Who the employee will be reporting to; -Wage/Salary (and how they will be paid); -Required Safety Certifications/Equipment; -Hours of Work;           -Information about Probationary Period (employee/employer may terminate the employment relationship at any time during this period); -Benefits Package if offered (health and dental + financial benefits); -Code of Conduct; -Sign off on Confidentiality and Non-Competition (protection of customer’s/company’s information).

Safety Standards:

-Become familiar with the Occupational Health and Safety Act and  have it posted in your workplace; -Be prepared for MOL visits to ensure you’re in compliance; -Educate and Train your workers: Right to Know, Right to Participate, Right to Refuse Unsafe Work.

ESA (Employment Standards Legislation):

-Recommend reading the Employment Standards Act and workbooks provided for employers; -Post the ESA Poster “What you should know about the Ontario Employment Standards Act”. This is a legal requirement of all workplaces; -Includes topics regards Wages, Hours of Work, Meal Periods, Public Holiday Pay, Terminations etc.

Human Rights Legislation:

-Have a workplace free of harassment, discrimination and violence;  -Be fair and equitable with recruiting and making hiring decisions; -accommodate employees or candidates that have special needs; -remove barriers to ensure safe return to work if employee has been off due to injury.

Job Descriptions need to be specific!!

-Include a job overview; -Primary Tasks and Responsibilities; -Competencies and skills required; -Physical Job Requirements; -Minimum Qualifications/Preferred Qualifications; -Sign, date and witness.

Employee Handbook:

-Especially important for new hires; -Help guide them through their first few months with the company;  -Basic expectations, code of conduct, attendance, benefits etc; -Info on the company’s history, mission and values.

Visit - thesmallbusinessplanner.com/tcb.php for mp3 replays of each show. Be sure to Listen Live every Wednesday at 3:05PM.

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Taking Care of Business Episode 3 – Legal

This past week’s episode of my radio show, Taking Care of Business, on Hunter’s Bay Radio, FM 88.7 in Huntsville, Ontario, was a great show on the subject of Legal Concerns for the Entrepreneur. The topic was based in part on Chapter One of my book, The Small Business Planner. My guest was Rebekah Dunsmore, corporate lawyer with the Miller Law Group from Huntsville, and in the first of several shows covering this important topic, we discussed a number of legal matters important to anyone starting a new business. These included: name searches; business style to adopt, such as sole proprietorship, partnership of corporation; partnership and shareholder agreements; asset protection; along with employee relations and legislation. This episode of the show can be replayed at thesmallbusinessplanner.com/tcb.php and you can Listen Live every Wednesday afternoon at 3:05PM by visiting: http://74.119.88.66/test.html

Larry Wilson is author of the best selling book, The Small Business Planner – The Complete Entrepreneurial Guide to Starting and Operating a Successful Small Business. The companion web site,thesmallbusinessplanner.com has a multitude of FREE Resources for entrepreneurs including fully formatted templates for Business and Marketing Plans, Profit & Loss – Cash Flow Projections, Start-Up Cost Analysis, and many more.

Stay tuned for a new season of Dragons’ Den and Shark Tank reviews.

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Taking Care of Business

Some great topics and guests coming up on the show in the next few weeks, heard Wednesday afternoons at 3:05PM on Hunters Bay Radio, FM 88.7, Huntsville, Ontario. Listen live at http://74.119.88.66/test.html and if you miss the show, check out a replay in mp3 format from previous shows at http://www.thesmallbusinessplanner.com/tcb.php.

Next week for the September 17th show, I will be discussing ways to protect your business from predator customers, partnerships gone sour,  troublesome employees, and unsavory contractors. My guest will be corporate lawyer, Rebekah Dunsmore with some tips you don’t want to miss.

Also, Dragons’ Den will be starting up soon so stay tuned for more reviews.

 

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