Almost a decade in, Dragons’ Den continues to inspire and amuse Canadian TV audiences. But the CBC’s hit show isn’t just meant to be entertaining. It’s a televised school for entrepreneurs. For each episode of Season 10 (which airs Wednesdays at 8 pm ET), we’ll be talking to one of the Dragons to get a behind-the-scenes glimpse of their decision-making process and hear what they hope viewers learned. Episode 7 featured three young founders with a lot to say and some innovative outdoor products.
Michael Wekerle knows ice-cream when he tastes it. “I’m like an aficionado, on ice-cream,” claimed the founder of Difference Capital in this week’s episode. And the protein product CoolWhey brought to the Den was not it.
Friends and co-founders Bernett, Vassiliou and Outmezguine got a tough workout in the Den, with Bernett in particular taking the Dragons fire for overzealously arguing his point. Ultimately, the trio negotiated their way out of a deal with Jim Treliving worth $50,000 for 25% and a 50% say in the company.
Bernett’s pugnacious pitching style didn’t sit well with Wekerle on the show. “You’ve got to be coachable. But to say no, nah—it’s a bad way to run,” he said after Bernett interrupted one too many times. “You’ll never get along over the long term unless you can sit back for two minutes, listen, and then make a decision based on that information.” And in an exclusive interview before the episode aired, Wekerle repeated the lesson. “I worked for my dad since I was a very young child, I had a paper route at six, and I had to learn the hard way that sometimes you have to bite your tongue and listen,” he says. “You’ve got to put your dues in.”
On the show, CoolWhey’s valuation and sales record—$70,000 in four months from 41 locations—fuelled a running dispute between Michele Romanow and Joe Mimran. “I know what it felt like to start something, I knew what it felt like to have product Version One,” Romanow said. “She’s giving you empathy right now, is what she’s doing,” Mimran teased.
When the time came for offers, the two ended up on opposite sides, but the Dragon seeking a deal wasn’t the one you might have expected. “You’re not there yet,” Romanow told Bernett, Vassiliou and Outmezguine. “I think you guys will hustle your way into figuring out a better product and getting more sales, but you’ve got some big moves to take and you should do those.” Her jaw dropped when Mimran served up a deal, offering $50,000 for a 40% scoop.
Wekerle also found the valuation outrageous, hollering “Dragons’ Den doesn’t pay for futures” as Bernett detailed CoolWhey’s ongoing discussions with national protein chains and upcoming sales goals. But what rankled him most was the response to Treliving’s offer. The trio countered with $50,000 for 10%, and an equal say (i.e. 25%); Treliving declined. “This man, if you could have done a deal with him, any deal, and get him to sit at the table with you, that was the most valuable piece,” Wekerle told them on the show. “It’s not about the money, it’s about his 40 years of experience.”
Afterward, Wekerle reiterated the value of experience. “Jim Treliving has taught me a lot. And what a brilliant man, but he’s gone through a lot.” he said. “How do you get 40 years of experience? Forty years.”
The old ways still work: McLean’s musician alter ego was a big hit with the Dragons, but his business model didn’t immediately have them signing. Wish My Teacher Was Bubba B is available online, but also via CD. “My computer hasn’t had a CD drive for two years now,” Michele Romanow observed. But the seemingly-obsolete piece of hardware actually makes a lot of sense. “For the children’s market, the CD is great because to be honest I don’t let my girls listen to the radio because I never know what’s coming next,” Manjit Minhas told her. Minhas and Michael Wekerle got the deal, giving McLean $100,000 for 50% and a 5% royalty on all forthcoming productions.
Seeing is believing: Appearances may be deceiving, but the Dragons were pretty sure they’d seen everything they had to after a look at River Rock’s shipping panel. “ It looks pretty low-tech to me,” Joe Mimran told Johnson. And it didn’t help the Barrie entrepreneur’s case that Manjit Minhas, whose brewery ships tons of product each year, wasn’t impressed either. But what really damaged the company’s prospects in the Den was the lack of sales. “All it takes is to go to two big retailers in this country, get an appointment with the supply chain guy, [and] he’ll tell you in a minute if he wants to do it or not,” Mimran told him. “I mean it’s that simple.” Johnson got no offers.
Targeted products can be a big risk: The superiority of Safety Shine’s product to the incandescent flares traditionally used at accident sites was obvious, but Jim Treliving didn’t think government agencies were the obvious buyers. “The police departments right now, they’re all cutting back,” he said. “I don’t see how you’ll sell any of them at $180 a kit.” Nebrijo’s struggle to build his business while working three jobs struck a chord with the Dragons. “I commend you for working this hard,” Michele Romanow told him. I just think about my own parents, and if they wouldn’t have taken risks I wouldn’t have been here either.” But the risk was too big for the Dragons, and Nebrijo didn’t get an offer.
The power of community: Holland and Gunderson formally launched their company only 22 days before entering the Den, so it’s not surprising that they’d done only $6,000 in sales to that point. But it was the future of Resourceful Redneck that confused the Dragons. “I think we might be missing something here,” Michelle Romanow told them. “Do you want to build an e-commerce website, or do you want to be a distributor of these products and sell them at BassPro?” The answer, it turned out, was both, and Romanow gave them a quick game plan to achieve those objectives. But that’s not all the company got. “I don’t know this space, and I don’t know if there’s a community out there that’s been developed yet,” Joe Mimran admitted. “So I think you could be sitting on a gold mine. He offered $50,000 for 20%, and made the deal.
MEET THE DRAGONS THEMSELVES:
- The Secrets of Jim Treliving’s Success »
- How Manjit Minhas Built Her Booming Business »
- Inside the Brilliantly Weird Mind of Michael Wekerle »
- How Michele Romanow Picks New Product Ideas»
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