Last night saw my fave programme on telly at the mo’, Dragons’ Den. TV editing can of course be deceiving, yet it was noticeable last night how, beneath the shroud of pretending to ask for in depth P&L details, the potential investors actually made up their mind pretty instantaneously.
The first guy on was pitching an idea around a helpline for car drivers. Ripped to shreds for an unviable concept, the real interest for me was when he was asked to explain the revenue figures. He stuttered and spluttered, the pressure clearly getting the better of him.
I’ve often thought people are generally rubbish at talking through numbers. If they’re good ones, you really need them to spring into the imagination. They must be easy to understand. I remember an old teacher of mine (the happy-when-miserable Martin Brough who once played hockey for Wales and, despite doing a forerunner to the MBA in 70s Britain, became a history and business studies teacher driving an ancient banger) bemoaning the fact people reached for their calculators, when a quick piece of mental arithemtic can get you close to the figure, which if necessary, should then only be verified by a calc.
I myself try and do this, whenever someone asks me for prices, I endeavour to frame them in easy to grasp terms, and always in context of either an RoI, or cost justification, And even talk them through slowly, so each step of the way can register with the prospect.
There are so many sub-plots in this show, contributing to the overall addiction. A juicy scene always develops whenever more than one Dragon wants to invest. They jump around from either undercutting each other on percentage ownership, or join forces. It’s when you get this happening that for the first time, the ‘power’ shift can be sensed in favour of the pitcher. Alas, they usually fail to capitalise fully.
During last night, two terrific phrases came out in the heat of such negotiation. When searching for a better deal, the entrepreneur implored the Dragons to “put a bit of sweetness back in the taste“, which unfortunately left his favoured Dragon unmoved, with a beaut of a rebuff “the offer is the offer“!
The bulk of this 2nd latest show homed in on a lorry-wash for motorway service stations. During the final negotiation, one Dragon asked, clearly impressed with the idea and initial evangelist sales, why the entreprenuer hadn’t simply nipped into their local bank and easily borrowed a couple of hundred grand. The response was awesome. Yes, they could’ve re-mortgaged their house, but this was about more than the money. What he wanted was to build a winning team, people with expertise and real interest in making it fly, and that’s why he wanted Dragon help. They all loved this reply, and (a possible record) 4 of the 5 shuffled, competed and bid to get a slice of the action.
And finally, when someone was thrown out for a lame-brain idea, a final word was they needed a “check up from the neck up”!