3 Dragons’ Den Entrepreneurs Share Their Pitch Secrets

Dragons Den Pitch SecretsWhat’s the secret to get a deal when pitching to investors, be that Dragons’ Den investors or otherwise?

Pitch pressure doesn’t come much higher than pitching in the Dragons’ Den. Pitching to five Dragons’ and a few million more people besides. If you can pitch in the Den and get investment, then you can pitch anywhere.

I turned to three entrepreneurs who where successful in getting a deal in the Dragons’ Den last year (Series 17). They shared their advice and secrets to a successful investment pitch. Between them in the Den they raised over £0.25m.

  • Episode 2, Oliver Adkins & Ruth Nicholls, Churchill Gowns – agreed a £60K deal with Deborah Meaden
  • Episode 2, Sean Mc Garry, The ShowerGem – agreed a £100K deal with Tej Lalvani, Sara Davies and Touker Suleyman
  • Episode 6, Richard Brook, Sockitz – agreed £100K deal with Deborah Meaden and Theo Paphitis

If you’ve watched Dragons’ Den you’ll know the entrepreneurs frequently slip up on their numbers – particularly under intense Dragon grilling. But there is more to it than just knowing your numbers.

The few minutes of live aired TV is only a small part of the pitch. Typically, the pitches and Dragon grilling last 2 to 3 hours! The pitch advice covers the bits you never saw too.

Tailor your Pitch

Before entering the Dragons’ Den we had some Angel investors onboard. We had the experience of pitching many times.

We’d developed different pitches to match to the investor. There is a common perception that all investors are the same – a generic investor who simply wants ROI.

Whilst they certainly aren’t going to throw money away, investors have different interests. Different things that excite them.

We created different pitches for Crowd funding, Institutional Investors, Angels and so on.

For most investors the investment is not life changing, they have enough money already. They are looking for something more than ROI. It must appeal, have an element of excitement and fun.

Research the individual investors in advance and finding out what will appeal, then adjust your pitch. Look at the other businesses the investor has backed. Look if you have synergies with those, look at what is was about those business that appealed to the investor.

Our Dragons’ Den pitch focused on three things:

  • Disruption. The consumer champion against an unfair monopoly. The David vs Goliath story.
  • Sustainability. An ethical business that want to look after the environment.
  • Better value. Providing graduates with a choice and saving them money

We tailored our message to the Dragons.

Stand your Ground (sometimes)

Know when to stand your ground and when to show flexibility. It’s a delicate balance and you need to be pragmatic.

Before the pitch be clear on what you stand for and believe in. Don’t rollover or pander to every investor comment.

It’s easy to fall into the trap of believing the investor knows your business better than you and simply agree to everything they suggest. They certainly have a wealth of experience and knowledge you won’t have.

But on some issues, you are better to stand your ground. For example, our name, Churchill Gowns and black & gold branding is very premium and traditional. We had some push back that we appeared to be positioned to look like the existing brands we are disrupting.

One investor thought we should change our branding to be fresh, new and fun. We stood our ground. Whilst we are a new fresh approach, we wanted to be respectful of the age-old tradition of the graduation ceremony. To be credible to our customers we needed to show respect of that tradition.

We still got investment even when we stood our ground. We had a clear vision and strong answer to the question. Be prepared for the questions you might get and have great answers ready.

Know who you are and be true

Gone are the days of business that are simply there to make a profit. Business needs an ideology and social conscience.

Customers are expecting more from brands. Not just to provide a product or service but to use the brand and commercial influence for the greater good. Customers now support brands that take a stance on issues important them.

Important to us at Churchill Gowns is making our gowns from recycle materials. One investor asked if that increased materials cost – it does – they said we should dump recycling and increase margin. We didn’t agree. We see a bigger picture.

Before funding raising ensure you have clear identity. Investors want to know for what you stand.

Dragons’ Den Bonus

This is specific to Dragons’ Den.

Before going into the Den, we considered our two audiences. The investors and the viewers. The Den is a tremendous marketing opportunity with almost money can’t buy brand exposure.

We considered the pitch both for getting investment and to deliver the right message for viewers. We wanted to come across well to our potential customers even if we didn’t get investment.

Know Your Stuff

Put simply know three things.

  • Your product
  • The market
  • Your numbers

Your product.

Know your product, inside out and upside down. Practice your demo and make sure you illustrate the unique value you offer.

The market.

Know the market size and the opportunity size. Know the competitive products and what makes yours the better choice. There is every chance one of the Dragon’s knows of the competitive products – so you’d better know them better.

Your numbers.

Know your business numbers. Don’t make them up! Neither in the Den nor invent numbers you think will appeal in advance. The Dragon’s relentlessly cross examine the numbers and expose any inconsistences.

Most importantly know the key business numbers both past and future predicted. The turnover, profit, understand the difference between your gross margin and net margin.

Be Genuine

Some people going into the Dragons’ Den are highly skill salespeople, natural pitchers.

I’m not a salesperson. But its fine. More important than polished sales technique is being genuine, be yourself.

The Dragon’s cut through any BS. Show your knowledge, your ability. Be confident and enthusiastic about what you are doing and why.

Play the Den Game

The two-hour long pitch in the Dragons’ Den was edited down to just a few minutes of live airtime.

Ultimately what gets aired is a small amount of the pitch. Successful pitches get airtime and clips of the notable pitch fails get shown. The BBC is making TV that appeals in the first instance not trying to support Entrepreneurs.

Whilst Tej went out during my pitch, as he learned more during the two hours, he wanted to come back in and make an offer. Under the rules the other Dragon’s didn’t let him. Once a Dragon is out they are out.

Some of the best information about Sockitz and the new products that got Tej’s interested again was never aired.

If you’re looking for exposure and getting airtime then make sure its going to be good TV. But you probably don’t want to get airtime for the wrong reasons!

I asked for £100K in the Den. Looking back now I might have asked for £50K. Some of the Dragons that were interested but didn’t make an offer would have been tempted at £50K.

Getting more Dragon’s interested creates a competitive fight between the Dragon’s making for exciting and entertaining TV. More airtime for the brand.

 

Tell the Story

Learn how to tell a good story.

Most businesses aren’t really that innovative or novel, so it is very important to have a concise story which summarises everything. From initial idea to present day execution, in a very clear manner.

Making it easy for potential investors quickly understand what it is that makes your business stand out from the crowd.

A story also allows an investor a golden opportunity to learn about the entrepreneur in terms of their communication skills, personality, credibility and general likeability- all traits which are important in business.

Have a Timeline

In future investments I would make sure to put a timeline in place on how quickly the deal needs to proceed for the investment to go through.

Often investments will take several months to complete which means you aren’t fully focused on growing a profitable business. This is in nobody’s best interest!

The Elements of a Compelling Pitch

Before entering the Dragons’ Den or pitching – and to build a great business get crystal clear on these six things.

  1. Core Values. Who are you, what do you stand for?
  2. Core Focus
    1. Why do you do what you do? What is your purpose, cause or passion? What is bigger than money that drives you?
    2. What do exactly do you do? What can you do better than anyone else?
  3. Long term target. Where is it you want to take the business, the big goal?
  4. Target market. Exactly who are you targeting your message at.
    1. Get your market research done, whether that is understand the investors when pitching for investment or getting clear on your ideal customer.
    2. Research and understand the alternatives that solve the need you solve.
    3. Demonstrate your authority in the market
  5. Marketing message. When you are in front of your ideal customer what are you going to say?
    1. What are the top three unique points about what you offer?
    2. Have you a proven process for delivering what you do?
    3. Have you a great story to explain your message?
  6. Know your numbers.
    1. 3-year picture. What do revenue, profit and a few measurables look like in 3 years? How does the investment help you get there?
    2. 1-year plan. What is your plan for the next 12 months, revenue, profit and measurables?

Get clear on these and it will be easier for everyone, inside and outside of the business to understand it and want to be a part of it.