Innovation CHEF

So we are back with another season of RTE’s Dragon’s Den. We had lots of fun last year and I am very glad to have it back again. It might not be the greatest show on earth but it is encouraging and thought provoking at times.

(I actually don’t watch TV  so there may be brilliant stuff on all the time and I wouldn’t know. I heard this was on by hearing a piece on George Hook’s radio show this afternoon. I had been at the American Chamber of Commerce Presidents Lunch which is a different story)

New Season, Same Dragons,  Same laboured puns in the voiceover, ah well. Sarah is writing a book but is she going to be investing?

First up : Jennylynd Jones and her Caribbean food company. In the style of Levi Roots she was looking for cash to further her Caribbean Sauces, cook books and general enterprise. Sounds like a good idea and she was putting some good numbers of sales in front of the panel. Secret recipes are the oldest form of IP and can be the most durable, just ask Coca-Cola. The Dragons seemed fairly impressed and it was a confident pitch. Although having 10 years experience as a food scientist working in R&D and Quality Assurance some of the Dragons seemed most impressed by her frock. She ended up giving away 50% equity in return for 40K. Probably a good deal as this kind of product needs (supermarket) doors opened for it to succeed.

Pitch two was form Daniel,

His product was the Marilyn. This was an air circulation system that you put your clothes horse on top of. Consuming the same power as a 40Watt bulb it could dry a shirt in a couple of hours. I actually was intrigued to see whether this actually had solved any technical constraints and whether there was any innovation here other than just being a couple of floor mounted vertical fans. Alas the program didn’t focus there but more on Daniel’s,hesitant delivery (pure nerves I suspect), the uninspired design and some dodgy assumptions on the go-to-market front. It did seem a little underdeveloped both as a product and as a business. A slimmer, lighter, quieter version could find a niche I suspect. This wasn’t Daniel’s time and he walked away empty handed.

Next up were Mark and Andrew. http://www.greenflame.ie/

The product was a Carbon Neutral Briquette: an artificial log for the fire. As I was watching this I kept thinking “why not buy real logs?” but that wasn’t the point this is a log made from a fast growing low input crop called Misacanthus. These logs are lower ash and a Cleaner and Greener Alternative to a peat briquette.  Sound enough idea. More sustainable biomass fuels, brilliant.

Where the pitch ultimately fell down was in the structure of the business. The business is owned currently by the 35 growers of the crop. A new investor, and the lads were looking for €200K, would be the only one exposed to increases in the cost of crops that would be good for the growers but less good for the profits of the business. This seemed to be too rich and too risky for the Dragons. There didn’t seem to be anything amiss in the business,it just seemed the wrong deal was on the table.

Three Quickies:

• Gerard wanted 30K to set up a “dating” agency between those wanting BER certs for their homes and BER certifiers. Nope
• Cathal wanted 50K for an easy install blind. Nope
• Two blokes wanted 100K for a gift website (of which there are plenty). Nope

Last Up was Herbie.

Herbie was a Barvarian, by way of Donegal. His product was the dead simple solution to the unsightly interface where the soil pipe from your toilet goes into the wall or floor. It is a little plastic circlet that clips on and covers everything up. Pretty and Simple. Much inquiry was made into Herbie’s 26 years in Ireland, pike fishing in Cavan, flights from Munich; and why not, he seems like a good guy. Product wise it seemed strong if easy to copy. I would be confident that the unit cost of the moulded part could be made way way cheaper. Niall the Dragon was right in his assessment that everyone probably could use at least one.  It probably would have a  decent run if it got the right branding and promotion but it feels almost like something you might get for free with your bathroom suite.

Absolutely fair play to Herbie for spotting the gap and getting a product out there and to Gavin who gave him 25K for 40% equity.

I suggest we all go buy one

Previous reviews are here:

Dragons Den week 2
Dragons Den week 3
Dragons den week 4
Dragons den week 5
Dragons den week 6

Earlier this year Micheal Connolly went on RTE’s Dragons Den with his Innovation. A Self employed animator he came up with the idea of a children’s amination kit three years ago. Now after investment from Gavin Duffy the Animatazz is set to be a contender for the Christmas number one slot.

When we reviewed the show we said:

This product promised to bring the magic of animation home. Essentially it is a box of pipecleaners and other odds and ends to make characters that are then animated by following the instructions on the book and DVD. In a smart move, you provide your own camera/phone and use the moviemaking software that comes already with your computer, thus avoiding those difficult software warranty issues. Is this business viable? Yes. Is investable? Yes again. With the right marketing and product placement strategy this is a brand that could grow and grow and make an investor a handsome return. It is the growth potential that makes Animatazz investable.

Great to see another success story.

Hope to see more when #ddire returns

Very Busy Week on the Irish Dragons Den. All looking well for Innovation in Ireland? Fortunes about to be made all round? Well maybe not. Usually we try to discuss a theme during the review. Last week it was all about getting the pitch and presentation right. This week: is the business investable, is the business viable and is there a difference? Can a good idea be brought to market? Can a brand be built? Very interesting stuff to consider.

First segment had a child friendly innovation type feel. Pitch one was from Michael with the Animatazz animation kit. This product promised to bring the magic of animation home. Essentially it is a box of pipecleaners and other odds and ends to make characters that are then animated by following the instructions on the book and DVD. In a smart move, you provide your own camera/phone and use the moviemaking software that comes already with your computer, thus avoiding those difficult software warranty issues. Is this business viable? Yes. Is investable? Yes again. With the right marketing and product placement strategy this is a brand that could grow and grow and make an investor a handsome return. It is the growth potential that makes Animatazz investable. There was some good discussion around expanding the product line with lower and higher age groups. I’d encourage Micheal and Gavin, the Dragon who invested, to look at licensing some popular cartoon characters if they really want Santa to come on board this Christmas. Sarah, pointed out the big words in the manual but I’d think that the DVD and some tweaks to the instructions could overcome any issues. Check out the Website for little animations.

We then had a whole bunch of kid themes pitches all unsuccessful at gaining investment.

• HipKidz is a fully interactive Sports & Activity centre in Galway which helps you to get fit and have fun at the same time. It is a viable business. Could the brand grow as a franchise? Maybe. Didn’t get to see too much but probably could if Aidan chose to operate in that fashion but that didn’t look to be the pitch.
• Table Huggers looked like a combination of a play mat (colourful, interactive surface) and an ironing board cover that you put on your dining table for the kids to play with. Viable Business  – Yes. The idea could probably find a large market too but did the ladies have the capability to bring it to a mass market themselves? The Dragons said they did, so I must have missed something or RTE left it out.
• Ronald had the Baser card. Top up credit card for minors. Not sure we all want to pass a fetish for plastic credit based shopping on to the kids since it hasn’t done wonders for the stability of the current economy but the dragons assured us that the banks, in their wisdom, either had this one already in the bag or would soon.
• Brians World War II based strategy game didn’t get much of a chance. I love RISK but the Irish Dragons don’t…

Back to the bigger pitches with Girls Night In.

Vera runs a pamper party business. Like an old style tupperware party, invite your friends over for flowing chocolate and cocktail, a hunk to serve you and have some Craic with the girls while your toenails get done. It’s been going for a couple of years and although the profits sounded small it looks to have survived and grown. Could this brand grow? Could it be franchised? One of the comments made tonight by Bobby the Dragon was that he didn’t have time for one of the ideas. Building a brand is hard work. Vera looked like she could do it but she didn’t get the backing she needed. I suspect the slim profits that seemed to be on offer wasn’t a big enough incentive for the Dragons to get involved. An investable business needs profit potential and for the investors to make a sizeable return. This business has the growth potential with Vera at the helm but maybe not the profit. Good luck though.

Cormac had his hands on a brand already. The Zsweet. It is a zero calorie, natural, kosher sweetener that doesn’t affect diabetics. Cormac is the sole distributor in Ireland. Cormac wanted to promote Zeroworry foodstuffs based on this product rather than the Zsweet itself. He had been advised that promotion of the existing brand would be too expensive in the competitive sweetener market and was creating a new brand instead. Now, I probably expect that there was quite a bit of leverage from the existing brand and whatever promotion that was happening elsewhere could have been used but perhaps Cormac was going to use this new food range as a beachhead into the Irish market. Bobby the Dragon offered half the money, the others didn’t get the proposal Cormac was offering and unfortunately Cormac didn’t get the cash.

The producers snuck in a couple more short unsuccessful pitches then

• rentcollectors.ie
• a shotgun cartridge component separating machine for recycling
• connector.ie

Final Pitch

It’s been a long show and the final pitch came from veterans of the UK Dragons Den: Alan and Dave with the Toilet Cobra. It’s a toilet bowl cleaner – replacing the unhygienic brush. Retrofitted by screw tapping a hose onto the cistern water supply pipe this then hangs on the side of the toilet and then cleans with the patent protected arrangement of tablet and water gun. The guys had a granted UK patent and said they had a European Patent (doesn’t actually exist but it means then can validate their patent in any EPO member country).  The arrangement of the  system depended on having a tablet in the water gun bit. No tablet – no toilet cleaning. Since you have cut into your pipe to install the thing you are pretty much stuck with it and are locked into providing the guys with an annuity stream coming from their tablet sales.  There are dangers with this particular business model but the guys are at an early stage and Niall the Dragon chipped in the €25k they where looking for and the promise of some design help. Not too bad at all.

Last week in the Poll the CleanPass tied with the Chordelia.
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Dragons Den week 1
Dragons Den week 2
Dragons Den week 3
Dragons den week 4
Dragons den week 5
Dragons den week 6

If you are pitching to a Venture Capitalist, the Bank Manager(!)  the Dragons Den, your boss or anyone who could help you build a business you want to get the basics right.  This is a slide pack to help you cover some of the key questions in a succinct an effective manner.

Intentionally the slides are plain so you can add a bit of branding and sizzle  for yourself.  The content on these slides are pointers; filling in the blanks will get you started nothing more so think about the material and make it work for your business.

Guidelines

• 10/20/30 10 slides, 20 minutes talking, 30 point font size minimum.
• Talking points – don’t read them while looking at them, look at the audience
• Black & white hardcopy- No fancy graphics or animations or anything that depends on subtle colour variation.
• Intelligible - It should make sense when they read it again tomorrow.
• Positive and honest – your business is good so don’t trash the competition or oversell.

Best of Luck!

Hooray! More Dragon’s Den. Though, I confess it is probably a show that is better as entertainment rather than at actually helping out entrepreneurs. Even then, the fun is had at the expense of those who have taken a risk by getting up of national TV with something they believe in.  I tune in because there is always something to learn. This week the key things to learn are all about presentation and pitching of ideas.

on #ddire the Dragons Den got called the Wasps Nest and it certainly seemed that the Dragons were in poor form. A bit testy and less encouraging that one might hope for.

Lisa was up first with Cleanpass. Essentially it is Safepass but for hospitals. Lisa provides training that meets the standard required by personnel to work in hospitals. Crucially though; it just provides  accredition of the Cleanpass training but is not HSE approved or validated. It is hitting a niche but for the longevity of the business that exclusive contract is the key. Later in the show some of the inventions got hammered for being at the Patent Pending stage. Patents are valuable because they create scarcity and this business doesn’t have much of that and is vulnerable because of it. Most of the Dragons saw this as a weakness and were out. Sean offered the cash (€130k) for a 30% stake. Lisa tried for a clawback option that Sean didn’t humour and she walked away from the offer.

Sean set himself apart from the other Dragons this evening with this offer. They said “this business is vulnerable – I’m out” Sean said “I can help you to address a vulnerability with your business – this is my premium”

Lesson 1. in making a pitch – Listen to the audience  – when they are helping, pay attention.

Tim had a novel invention. Called the Chordelia it is a mechanical block that fitted around the fretboard of a guitar and allowed chords to be played by the talentless. You hold down a lever and the strings are held to the neck of the guitar to make an D or A or whatever while you strum. Take the hard work out of playing but keeps the fun said Tim. Yeah, but learning to play is the point of having a guitar said the dragons. At €100 for a Chordelia it did seem to be steep for a bit of novelty item.

Lesson 2. Identify your market segment. 1% of all guitars sold is not identification of customers. Niall actually put forward special needs guitar players as a potential market.

If you can identify your market then you can figure out a lot more about your business. Where they shop, how they shop, how to position your product. I’ll follow up this post with a quick 4Ps / SIVA model later.

Tim mentioned his patent application and that there was prior art going back to at least the 1920s on this problem. As I covered in this post you want your patent to protect your business NOT the technical choices you made. I hope Tim has a robust design. There is a niche there for his product. Maybe as more of an Artisan product but the Dragons didn’t go for it.

Curt and Carl had there Oil Guard product. It used some kind of undisclosed oil level measuring system to  monitor the level of oil in your home heating kerosene tank. If the level drops too much too quickly the OilGuard tells you you are being robbed by text and sets off the house alarm. It also functions a standard oil level detector to let you know when you should top up. I liked it. Seemed like good engineering and the technology seemed like it could integrate with other systems. I probably would have tried a licencing play with some of the big alarm systems manufacturers. Anyway. Something went a bit astray during the presentation and the guys seemed to get the Dragons offside. The valuation of the company did seem quite high at roughly €2million and this seemed to annoy the panel somewhat.

Lesson 3 – Build Rapport. The Dragons invest in people. How well you sell your idea and help your audience accept your pitch is really important. Use context and example to build your case. If your business is worth €2m then great – show how big the home security market is, the average household expenditure on alarm products, the relative value of the investment to the asset it is protecting make it easy for them to see the value.  Lisa really annoyed the panel earlier by refusing to disclose how much she was charging for training and probably cost herself a deal she could accept.

The guys also got battered for being patent pending. This seems a bit harsh because the Dragons seem to have it in their collective heads that only a granted patent would be worth investing in. An issued patent is a huge validation but might not offer any real protection to the business.

The unsuccessful quickies:

• Mick with carsireland.ie was about 2 years too late
• Bidforfreight.ie the online transport auction site seemed in tune with recessionary times but maybe less so with quick logistics and transport risks
• Slidofloor – pull out shelving for tucks and vans looked ok
• Ritas advertising for cabs seemed ok again – captive audience
• The mobile kitchen design showroom was 2 years too late aswell.

Final Pitch

Darren represented sourcingproductdesign.com a one stop shop for design, prototyping and production in Ireland. The concept was good and Darren , part time comedian, was a confident speaker. Wasn’t immediately clear what he was speaking confidently about though at the start.

Lesson 4 – be clear on what you are asking for. Context is great but not at the expense of diluting the message or muddling up the audience.

Darren the Designer and his partner the Engineer wanted to create, design, manufacture and distribute their own brand of products. I thought the 70K they asked for was a little light to do all this and Sarah rightly pointed out they would need to get someone else on board to accomplish this without giving up completely on the current business.

Darren got his cash at the expense of 45% of the business to three Dragons. A result in a tough week.

Last week the buttons charm bracelet topped the poll
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Dragons Den week 1
Dragons Den week 2
Dragons Den week 3
Dragons den week 4
Dragons den week 5

We have been offline for a little while but now we are back with the traditional Thursday night review of the Irish Version of Dragons Den. Ideally we would have a show packed with new and useful ideas. A showcase of the best of Irish Innovation and talent. The Dragons would be discerning and adventurous business angels ready to help give the struggling entrepreneur the kick start they need. It all hasn’t worked out that way but there are still some glimmers of hope. It is a fun show to watch and to have twitter running a live commentary on #ddire is added entertainment.

No experimentation with the format of the show is matched by a unimaginative review structure

• 3 reasonably comprehensive pitches
• a few short unsuccessful tries
• the final pitch of the show

Pitch 1

Elaine Sarah is a trained goldsmith and her product was a novel take on the charm bracelet. Inspired by her mothers button box, Elaine Sarah has created silver button charms to be collected on “needle and thread” style bracelet, The innovation is probably low in this idea but it looks well implemented and I wouldn’t underestimate the design elements or craft that was needed. This kind of a business requires a brand to be built in order to be successful. The button bracelet has to be more than just another bangle, it has to have the cachet that allows the wearer and the admirer to see additional value and that only genuine additional buttons are bought to fill out the bracelet. She was looking €45k to build the brand. Elaine Sarah was a little nervous but had offers of the 45K in return for hefty chunks of equity in her company. She went with Niall, a fellow silversmith in return for 45% of the company.

I think this business will fly.

Pitch 2.

Leprechaun hair….Really…..

In the style of air in a jar, lucky shamrocks and other novelty items this is fake hair in a plastic bag stuck to a little piece of printed material with nonsense printed on it. This is a niche market and Gary is making sales. Anyone who saw the reception that the Paddygames got a couple of weeks ago won’t be surprised that the Dragons didn’t go for this. This kind of thing is either one of a multitude of products rolled out or a simple oneshot wonder. The latter may be the case.

Pitch 3

Ken the engineer has invented FAXCOP. It is a device you plug into your fax machine and it prevents junk faxes. Useful and environmentally friendly. Now, junk faxes are pretty wasteful, but if you think about it so are fax machines. Email does the same job and the resolution and readability you get from a printed document is much better and probably in colour and you choose if and when to print it out. Nevertheless, Ken has spend €100k of his own money in developing the device and sees a multibillion dollar business potential. Most of the Dragons baulked at investing €85k in a Fax machine busines reckoning it was 20 years too late.

Sean and Gavin looked like they might have gone in but for Ken’s reluctance to share how the device worked. Ken was looking to protect his Intellectual Property and not disclosing secrets on TV is one way to do that. However he had already said that he had filed for Patent protection and that the patents here at the national filing stage. This essentially means that he has already disclosed publically how the device works! That is the fundamental part of a patent filing, even if it is NOT granted – you still have to tell everyone how your invention works. (The application is kept secret for a while though you can change your mind after the process starts, but not at the national filing stage) Anyway, Ken felt he couldn’t share and the Dragon’s didn’t share with Ken.

Fast pitches

• correctfooddirect – healthy food baskets just for you! But not for the Dragons
• Used wedding dresses – no again
• Ecofriendly bicycle holidays seemed to be too expensive a proposition
• The scales that weighed beer kegs to check if free pints were being pulled wasn’t a winner

Final Pitch

Geena and Joan with Greenme.ie It’s the Irish Green directory site, with great material to pull you back for more. Boasting of €55k sales in two months and millions being projected this was surely a winner. The inquiry began. The business model is essentially selling advertising space with a green heart. Concerns were raised about whether the green ethos could remain pure if they needed the revenue to come in. Assurances were given that was not the case. Concerns were raised they might be tree huggers, Assurances were given again that this was not the case. Concerns were raised that they might be overvaluing their business by looking for €150K for only 10% equity share, Assurances came forward but in this case failed to win over the dragons.

There seemed to be a bit of a theme in this evenings show about businesses being overvalued. If you have a great business idea based on a new technology I recommend you check out this podcast. It is from the Killer Innovations podcast series and comes highly recommended.

The Grass Carver won last weeks poll:

Dragons Den week 1
Dragons Den week 2
Dragons Den week 3
Dragons den week 4