This weeks pitches on Dragons’ Den were:

• Virtual Puppet - Looking for an investment of £200K in return for 30% equity. They were selling their product - a virtual puppet show - for £20K + £8K for each “puppet” with a cost per kit of £10K and no mention of the cost per puppet. Unfortunately they’d sold nothing to date in their market of “branding companies”. Needless to say they didn’t get any investment. As I have an background in software engineering I doubt their claims that no one else has the technology, but I’m impressed at how cheap they can make and sell it. So I wonder why they are not pursuing the more obvious markets at a higher price point. For example why not sell it to computer game makers and the entertainment industry for motion capture?
• Twin Peaked Caps - a short spot this one. The lady was trying to sell twin peaked caps and claimed to have a patent pending. I’d be surprised if the patent is granted though as I’m sure this has been done before. I also think more entrepreneurs need to take the time to understand what patent pending actually means.
• Waterbuoy - An intelligent miniature floatation device. The demo looked like it might go wrong with the 1Kg weight but it did it’s job in the end. An impressive pitch and product meant he walked away with his £200K investment in return for giving 25% to Theo Paphitis and Peter Jones. I think they made a good investment in a sound business opportunity.
• Flotation tanks - Another short pitch, which just seemed to be cheeky.
• Cream Cutie - A cream liqueur being sold for £1.99 per bottle (small bottles) in 7 Asda’s in Scotland. Anne Hempstock, the lady behind it had previous brought three other drinks brands to market and successful sold of two of them for a total of £550K, this caused the Dragons to ask why she couldn’t finance the business herself. I think she knew damn well that her valuation was ridiculous and was their to raise the profile of the brand not for the investment.
• Radiator Fans - Another short pitch, for what seemed like a pointless product.
• BAMZ - Yet another short pitch for the daftest bunch yet, the “brand” was their initials and they had no idea what it costs them to make. I hope they’ve gone back to the day job.
• Hungry House - A takeaway website, remarkably similar to an idea my brother and I explored in 2004 we quickly dismissed the idea however has we felt it was difficult to make money from it compared to other ideas we were looking at. They were looking for £100K in return for 11% but ended up selling 50% to James Caan and Duncan Bannatyne with an agreement that they’d return some of the equity of they hit their predicted profit levels of £30K in year one £1M in year two and £2M in year three. I though it was odd that no one questioned the very low profit in year one compared to year two. I think they’ll be very lucky to achieve the levels they were talking about after all if as a restaurant owner I was paying 9% commission on every order and the average order is £15 the it’s costing me £1.35 per order on average to use their site then at an average rate of two orders per day it would be cheaper to develop my own site than use their service for a year - that way I’m not being listed right next to my competitors and I can own the customer relationship.

So what did you think of them?

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