Tips on how to survive the Dragons Den - 14th July 2011
Posted by Barry Cassidy on July 14, 2011 in Marketing, Media with 0 CommentsThe Dragons Den makes and breaks people, Here's how to make it.
Tips before entering the Dragons Den:
Like a lot of people in Ireland and throughout the world I am an avid fan of Dragons Den. I've been following the series for over 6 years, starting with the BBC and now RTE. While the structure and questions are largely repetitive, there is nothing mundane about watching budding entrepreneurs enter, pitch, mumble, crumble, lash out and walk out successful, on the Dragons Den.
However a lot of the crashing and burning could be avoided if people followed some basic principals (see below). These steps are not original, or ground breaking; in fact all you have to do is watch previous episodes, or any one episode to figure out what you need to have before entering the dragons den.
On a personal level, as a marketer, I am astounded at how many people fail to prepare when entering the den, (and with that prepare to fail). I mean the same questions are asked over and over, yet people still get caught out, don't people watch the shows before going on them! The answer is NO.
Don't over or undervalue your business:
A common mistake that entrepreneurs make, and something that really frustrates the Dragons is over-valuing your company. Now this may be caused by two things: A genuine miscalculation based on an over optimistic sales projections, or greed, overvaluing your company in the hope of receiving more investment for your business idea. Either way the entrepreneur will most likely leave without their head.
On par with overvaluing your company but you will probably leave with your head, is undervaluing your company. If your asking price is too low, it will not excite the dragons. Low investment usually means low return.
Know your figures past & projected:
Figures are always a sore spot, I admit trying to remember revenue for the past 3 years, and projected revenue for the following 2-3 years can be tricky, but the dragons are interested in profit, so yes, they will be very interested to know the sales figures.
Apart from an entrepreneur getting nervous and forgetting the figures, there is no excuse for not remembering your revenue; in fact it should be the very thing you think about everyday.
Personal Investment:
The Dragons are always impressed by entrepreneurs who have already invested huge amounts of time and finance into their project. In most cases it shows 100% commitment and belief on behalf of the entrepreneur. In the rest of the cases it shows madness, the entrepreneur is so fixed with their idea all sense has gone out the window, usually with massive investment, and zero return.
The Dragons are also very sceptical of entrepreneurs who pursue the business venture on a part-time basis. This suggests that the entrepreneur is not fully convinced of the products potential, and so isn't 100% committed to the cause. A lot of the time the Dragons will say "I can manage the product, but I can't manage you", so basically you better be able to run the business on your own, with some help.
Invest in yourself:
My last piece of advice is invest in yourself. Scrub up, Suit up, and the odd media training session wouldn't go astray. Doing a presentation in a boardroom is one thing, but doing a pitch in front 5 Dragons, 8 film and sound crew, and about 250,000 viewers, media training would be the best self investment you'll get, regardless of the dragons investment.
Other equally important tips are research the dragons (who is the best fit for your product), know your market (Consumer trends, competitors), do you have a patent, practice, practice, and practice.
The next series of Dragons Den will be aired on RTE One in September, and I guarantee in the first episode somebody will fail to gain financial funding by failing to comply with the above tips before entering the dragons den.
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