Many of you will be here because you’ve just finished watching the latest Dragon’s Den episode. I walk away from a £75,000 deal with new Dragon, Sara Davies. As I’m sure you saw, there was a lot of back and forth between myself and the Dragons before I walked away empty handed. However, the experience was far from a waste of time.
Here’s my side of the story. We’ll start from the very beginning. Just over two years ago I applied to pitch PLIQO’s ultra-compact suit bags to the Dragons, and in June of last year that opportunity finally came to fruition.
As regular viewers will know, the Dragons often appear antagonistic and hostile. In my experience, this couldn’t be further from the truth. Despite it being the last day of filming for the current series, the Dragons were engaged throughout, and genuinely interested in myself and the business I was pitching.
Although the conversation was lively at first, it quickly became bogged down in the minutiae of company valuation methodologies. As this dragged on, I felt the positivity in the studio ebbing away, as we became fixated on the valuation, rather than the business opportunity. One by one, the Dragons pulled out, leaving Sara the only Dragon not to fold.
When Sarah sprang to the rescue with an offer of £75,000, I was initially elated. When I realised she was eyeing 50% of my business, I was felt equally crushed. This would value PLIQO at just £150,000 – my valuation of £750,000 was five times that. Unfortunately, with nearly two years of anxious preparation pressing down on me, I made a miscalculation. I rejected the offer outright, failing to realise that the better option was a counter offer to move the valuation back up the scale.
I can’t say whether this negotiating tactic would have worked, but by refusing the offer outright, I ultimately walked away without the investment I had sought, and without exhausting all of the options.
Why did I reject the offer? Isn’t any investment, and all that goes with it, better than none?