Trial Blog- Dragons' Den

Two friends from university, Will and Henry, seemed to engage all the dragons when presenting their business idea ‘Look After My Bills’. The site minimises the price people pay for their gas and electric by automatically switching to the best deal and best provider for them every year. Although the dragons were keen on the idea of the business, they were not as keen on the offer of just 1% stake in the company for £90,000. 

          For me, the most interesting aspect of the business is that the aim is purely to save the public money; not letting big energy companies take advantage of customers and fail to give them the best deals. We learn that one of the partners Will, was previously a member of the Green Party and realised during his time there, that this is what big energy companies try to do. Has this been done before? Is this not just another price comparison site? Will and Henry make it clear in the pitch that this is very different to competitors- comparison sites- that they have found a gap in the market. They state that although people can compare prices already online, few get around to actually changing providers; whereas with ‘Look After My Bills’ it is automatically done for you.

          Will and Henry appeared to have an answer for everything, as they calmly answered all questions fired at them by the dragons. Had they really thought of everything? The two partners received offers from all five dragons- an impressive full house. However, none of them offered exactly what the pair were looking for. The most competitive was Deborah Meaden, offering all the money for a 3% share of the business. As potential shareholders in the company, the dragons are looking at what they can obtain from this business. Will they gain anything from this venture? Can this company maximise their wealth? In this case, the dragons clearly believe that this business, valued at £9 mil by the two partners, can benefit them in some way.

          The entrepreneurs were very reluctant to give away any more of their business than their original offer of 1%. I feel this may have been too ambitious and personally would have jumped at the chance of taking Deborah Meaden (and the £90,000) on board for just a 3% stake in the company. After conferring, the pair altered their offer to a 2% stake in the business but for £120,000, resulting in 3 of the dragons finding them too ambitious and to have “too much naivety in business”, causing them to bow out. Leaving just Jenny Campbell and Tej Lalvani left in the running.

          At this point I feel the pair should have done more to prove to the potential investors what they could bring to them. What are potential shareholders expecting to get in return for the amount of money they are investing? Will and Henry should have emphasised and proved exactly how much the dragons would get out of this deal and how they can be sure that this will happen. If the dragons were certain this would absolutely benefit their lives they may be more lenient with their offer to meet Will and Henry’s.

Finally, it is agreed that Jenny Campbell and Tej Lalvani will share 3% of the business for £120,000. 3 times the stake that the partners originally wanted to give away, for a third more money than they originally asked. Although they didn’t get exactly what they were looking for, I think coming out of the process with two dragons, rather than one, could really benefit them. The dragons, “such important people” as the pair described them before entering the ‘den’, have years of expertise to offer, hopefully helping and developing their business further.

            After looking for the website online, I found out it now has 400,000 members and that, Will and Henry have saved members over £15 mil, so they must be doing something right!

            I now realise that being strict with how much of the business the pair were prepared to give the dragons did pay off. However, it nearly cost them a very good opportunity when it seemed for a moment that all 5 dragons were going to bow out. Overall, I feel that their strong pitch and confidence to answer all questions given to them is what put the partners off to a strong start with the dragons- as well as their impressive and innovative business idea. They should have really been clearer on how this would benefit the shareholders but, all in all, came out with a very impressive result.