Dragons.Den.CA.S19E02
Dragons.Den.CA.S19E02
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TVTranscript
00:00Coming up tonight...
00:05This groundbreaking technology helped propel me all the way
00:08to winning this Olympic gold medal.
00:11No way, that's you?
00:13I dated a bobsledder once.
00:15Was it him?
00:17We're igniting a movement to empower this next generation
00:20to embrace their natural beauty.
00:22Such a great idea.
00:24Textiles are very challenged in Canada.
00:27But if everybody had that mentality,
00:29we'd do nothing in this country. We would make nothing.
00:31I feel the fire between these two dragons.
00:34Decorating and personalizing your underwear!
00:37Oh, my God!
00:39With faces!
00:41¶¶
01:01This is like a culmination of years of work.
01:04I mean, we've poured our heart, soul, money, life savings,
01:07everything into our business over the past couple years.
01:10We've done something amazing.
01:12And we are really excited to share that story.
01:15Whoo!
01:17First to bring some fire, this couple hopes a daring pitch
01:20will have a dragon do their deal.
01:23Hi! Welcome.
01:25Hmm.
01:27Hello, dragons. I'm Sarah.
01:29And I'm Rob.
01:31We live in Burlington, Ontario.
01:33Our business is Do & Dare Undie Co.
01:35And we're here asking for $150,000 for 25% of our company.
01:39This is the most exciting underwear on the planet.
01:42It all starts with 16 vibrant colours
01:45of super soft and comfy bamboo fabric.
01:48The best part is that we make our underwear here, in Canada.
01:52And nearly all of our ingredients are also made here.
01:56But that's not all.
01:58Our superpower is...
02:00decorating and personalizing your underwear!
02:03Oh, my God!
02:05With faces!
02:08Names!
02:10Fun!
02:11Intimate!
02:12Weddings!
02:13Events!
02:14Hold on a second.
02:15Oh, my God!
02:16Is that my face on your underwear?
02:19Oh, my God!
02:21That's all of our faces!
02:23There really are no other underwear like ours, so...
02:26No, I don't think there is.
02:28Do you dare to invest in Do & Dare?
02:33Oh, my God!
02:35Ladies, we'd love for you to touch and feel
02:37our super soft bamboo.
02:39And try on your custom undies.
02:41Okay.
02:42Now you've got my attention.
02:44Oh, my God!
02:46I've got everybody's butt!
02:48Jump to the front.
02:50Now we're getting racy.
02:52This was a family show.
02:54You guys look incredible.
02:57I'm bringing this home tonight.
03:01Absolutely.
03:04That's how it's done.
03:06We're this bad boy.
03:08There ain't no junk in the trunk.
03:11Look at us.
03:12There we go.
03:13Guys, this is amazing.
03:15Well, you know what, guys?
03:16I'll give you $100,000 just for that.
03:19That's it.
03:21Whoo-hoo!
03:23So, you guys, what got you both in the underwear business?
03:29We started Do & Dare to bring joy to the world.
03:31Sarah is an amazing teacher.
03:33She is really, like, a doer to the core.
03:36And Rob is the daring side.
03:38He's the visionary.
03:39And if you tell him something can't be done,
03:41he'll figure out a way to do it.
03:43You guys look at each other with so much respect.
03:45It's really, it's really...
03:46Well, we love each other.
03:47Best partner, best friend, like, honestly.
03:49It's so, like, it's really endearing.
03:53When your underwear's awesome, your life is better.
03:56And you can also create really special moments with it.
03:59But the cool thing is that you can put anything on it.
04:02That's the whole point, right?
04:03You got it.
04:04If I'm going to pay for just a regular one without the heart,
04:07how much is that versus putting the heart on?
04:10It's $38 for a bare undie.
04:13For men's.
04:14For men's.
04:15For women, it's $27.
04:16And then it's just $10 more for a custom
04:18or for one of our designs that we've already made.
04:21That's an expensive pair of undies.
04:23Our underwear is very high-end.
04:25The difference is that you're buying bamboo,
04:27better ingredients, and it's made in Canada.
04:30But does that made in Canada matter?
04:32I mean, if you could get your price tag in half,
04:35getting them done offshore,
04:37would that be more effective for your growth?
04:40Maybe for the growth, but for personally,
04:42we want to keep it in Canada.
04:43Well, maybe your costs are competitive.
04:45What does it cost you to make, prepare?
04:47$15 for the men's and $12 for the women's.
04:50Design your 2023 financials for me.
04:52What did you do last year?
04:53Yeah, so...
04:54About $125,000.
04:55$125,000?
04:56Yes.
04:57It's less than I would have expected.
04:58What are you projecting to do this year?
05:00About $300,000.
05:01Yeah.
05:02So, can you go to the $125,000 revenue last year?
05:05What were your margins on that?
05:07So, we are not profitable at the moment.
05:09How much did you lose last year?
05:11We lost just about $50,000.
05:14And you're doing this full-time?
05:15We are full-time into this.
05:17All in?
05:18Yeah, all in.
05:19How much have you invested?
05:21$450,000?
05:22$450,000?
05:23$450,000?
05:24What?
05:25What?
05:26We have a lot of tech, a lot of machines, tech, tooling.
05:31So, we...
05:32What?
05:33Where did you get the money from?
05:34Where did you get that money from?
05:35Our life savings.
05:36Your savings?
05:37Your life savings?
05:38Yeah, your life saving.
05:39Everything that we've earned.
05:40Yeah.
05:41We have about $250,000 of equipment and machines.
05:44That's a lot of money in equipment and machines.
05:46It is.
05:47It is not easy to do this.
05:48Did you get taken by some people,
05:49or did you just not know what you were doing?
05:52See how quickly that...
05:53It took 2 1⁄2 years of R&D.
05:54We built our own machines, our own robotics,
05:56our own vision system.
05:57Our underwear stretches like crazy.
05:59And you can stretch it as much as you want,
06:02and that ink is there to stay.
06:04That's 2 1⁄2 years of R&D.
06:05It won't crack?
06:06You mean like some screen printing will?
06:08No, we like to say, like,
06:09our undies love heat in the bedroom,
06:11but not in the wash.
06:12That's the only thing you've got to think about.
06:14What's your cost per acquisition?
06:16The cost per acquisition is about $30,000.
06:19Online, it's higher, it's $45,000.
06:22Are you not pretty worried about these unit economics?
06:26I mean, $20 to $30 of costs, $40 to $30 CAC.
06:30You're kind of left with a couple of bucks,
06:33and you guys are $450,000 in the hole.
06:36So we are working really hard
06:38to lower the cost of acquisition.
06:40But you've had some time,
06:41and you have, to be clear, social media gold.
06:45Yeah, we aren't that good at that stuff.
06:47Like, to be honest.
06:48This is why we're here.
06:49It hasn't blown up on social, has it?
06:51No, no, it hasn't.
06:52And that's the only thing on my mind that I go,
06:55why hasn't social media taken to this and just gone,
06:58oh my gosh, because people do like to customize.
07:00Yes.
07:01I worry about the scalability.
07:04But at this point, I'm going to have to say I'm out.
07:10Sarah and Robert,
07:11I think it's a fun hobby business for you guys.
07:14But I just don't think it's an investment
07:16scalable business for me today.
07:18I'm out.
07:24I don't know.
07:26Man.
07:28Come on, Arlene. Let's go, guys.
07:30I'm going to give Arlene some time to think about it.
07:33But here's the thing.
07:35You're losing money, and I have a problem with that.
07:38And so if I'm going to put something
07:41on the front of this underwear,
07:44the message would be too small.
07:46Oh!
07:48So unfortunately, I'm going to be out because of that.
07:55So look, I want to be really real with you guys.
07:58Textiles are uniquely very challenged in Canada.
08:02The reality is, is I've had companies
08:04nearly go bankrupt in the last 12 months
08:06that have refused to move some of their manufacturing overseas
08:10because we are just nowhere close
08:13to the competitiveness on cost and quality.
08:16I'm going to be out.
08:20But if everybody had that mentality,
08:22we'd do nothing in this country.
08:24We would make nothing.
08:26It can always be done cheaper and better somewhere else.
08:29But that shouldn't stop us as a country
08:31from continuing to innovate.
08:33And your innovation in the robotics side
08:35and the manufacturing side is very interesting.
08:38Um, I...
08:40It's just so early. It's so early.
08:48I'm going to be out as an investment.
08:52They shared their dream with Canada in their underwear.
08:55It's amazing.
08:57And those of us who are cool got to wear them.
09:00Whoa!
09:01I'm sorry, Wes, I just can't look at you.
09:03Come on, come on.
09:05No, my face on your... Just no, no.
09:08Oh!
09:13Coming up...
09:15Cheers, everybody.
09:17Cheers!
09:18Oh, she's already drinking.
09:20Mmm!
09:21Unexpected.
09:22I'm on fire.
09:23Burning!
09:36Next in the den...
09:38Childhood friends turned juice partners.
09:41Hoping to convince the Dragons to take a shot on their deal.
09:45Good Vibes shot.
09:46Good Vibes.
09:48Hi, Dragons. This is Drew.
09:50And I'm Lloyd.
09:51We're from Kitchener, Ontario.
09:53And our company is Good Vibes Juice Co.
09:55Today we're asking for $100,000 for 7% of the business.
09:59When I was younger, I lost my dad to cancer.
10:02Looking to turn a negative into a positive,
10:05I got really interested in exercise and nutrition
10:08and started to rub off on family and friends.
10:11And that's the reason why we wanted to start a wellness company.
10:14Once we opened our brick-and-mortar juice shop,
10:16we quickly recognized we had a special product with Sick Day.
10:20Sick Day is all-natural ingredients
10:22chosen for their holistic benefits
10:24and historical use, aiding immunity.
10:26We took this winning concept
10:28and created a product line called Good Vibes Shots.
10:30So, Dragons, join us up here and let's do a shot.
10:33Let's do it. I love a good ginger shot.
10:36The three varieties of concentrated juice shots
10:38sell for around $5 each
10:40and can be found in more than 500 stores across Canada.
10:43Cheers.
10:44Cheers.
10:45That's a premature there.
10:46Cheers.
10:47Dragons are ready.
10:48Cheers.
10:49Cheers.
10:50Oh, she's already drinking.
10:53Unexpected.
10:54I'm on fire.
10:55Burning.
10:56Drew and Lloyd manufacture the shots in-house
10:58and are looking for Dragon investment
11:00to automate their production line.
11:02Four grams of sugar.
11:04Dragons, now that you're settled back down,
11:06if you want to lift up the veil next to you,
11:08Good Vibes Shots is also great as a hot tea.
11:10Whoa.
11:11That's pretty cool.
11:12Have the shot with your desired amount of hot water
11:14and you're good to go.
11:16Tastes amazing as tea.
11:17It's hot.
11:18It's good and hot.
11:20And when did you start selling?
11:22We started selling in 2016.
11:24Okay.
11:25But we really started doubling down last June.
11:27Okay, you guys do not need to convince me of this.
11:29I buy shots all the time.
11:31I probably bought a dozen different brands.
11:33Yeah.
11:34They're amazing.
11:35Exactly what Michelle said, a dozen different brands.
11:38A dozen different brands.
11:39Of the same thing.
11:40Yeah, definitely.
11:41Cool packaging.
11:42What else makes this unique?
11:43Absolutely.
11:44Our taste profile doesn't compromise on ingredients
11:47but also puts a large focus on flavor.
11:49We also have unique characteristic
11:51in that our product is shelf stable.
11:53Shelf stable for how long?
11:55One year.
11:56Wow.
11:57And what's making this shelf stable without preservatives
11:59and not being refrigerated?
12:00Those are trade secrets.
12:02That's impressive food science.
12:04What's your lifetime sales?
12:05So lifetime sales honestly isn't really relevant
12:07because a lot of the sales in the past
12:09were related to non-related products.
12:11Okay, tell me about the sales that's relevant then.
12:13Here today we're approximately $850,000.
12:17Wow.
12:18That's great.
12:19Okay, and that's your gross.
12:21What about your net?
12:22$250,000.
12:23You're profitable.
12:24Yes.
12:25Good for you guys.
12:26So you're clearly two smart guys with a great product.
12:29This is my third one.
12:31What's your background?
12:33I come from the graphic design fine art world
12:36so I do all the branding for the company.
12:38It shows.
12:39It's very well done.
12:40And Drew, what about you?
12:42So I studied business before going to work at Blackberry
12:45so I come more from the business world.
12:48So how all in are you on this business now?
12:51This is actually a mega competitive space.
12:54We're absolutely all in 100%.
12:56So I sold my house and bought a spot to move the business into.
13:00And we know that there's a huge opportunity in front of us.
13:03You sold your house to do this?
13:05Oh wow.
13:06So you really are all in.
13:08Good for you.
13:09So guys, you've been in the industry for eight years.
13:12You're making under a million dollars revenue still, right?
13:16What is convincing me that you guys are going to blow up
13:20and it's going to stay?
13:21We're growing 300% year over year.
13:23Next year, by having the ability to enter the U.S. market,
13:27with your help, we are going to be able to do that again
13:30and project to do $3 million in revenue next year.
13:34Well, okay, but why would you go into the U.S.
13:37until you really own Canada?
13:38Yeah.
13:39I completely agree.
13:40There's still lots of room to grow in Canada.
13:42Harleen pushes back and you flip-flop on it.
13:47I think he's given answers.
13:48I think that...
13:49I'm a peacekeeper.
13:50I'm trying to break in the information.
13:52I can see that.
13:53That doesn't mean it's true, though.
13:56You know what I like?
13:57I'll tell you what I like.
13:58You guys are disciplined.
13:59You guys have a good relationship.
14:01You guys have complementary experience.
14:03And when you don't see anything negative,
14:05you go, maybe I should be in it.
14:07Right.
14:08Right?
14:09So I'm going to do $100,000 for 10%.
14:15I go so hot and cold on this
14:17because I think you are really good at this.
14:19Yeah.
14:20But I don't think you understand the space
14:22and the costs attached to it.
14:25I'm not saying that to insult you.
14:28I'm just saying I worry that there isn't that depth there.
14:31We are self-taught, for sure.
14:33But you know what?
14:34We dedicate ourselves to this role.
14:36There's stuff to learn.
14:37We will learn it.
14:38I'll go next.
14:39Guys, cayenne, ginger, lemon, turmeric in a shot
14:44isn't unique.
14:45It's been done before.
14:46I'm out.
14:47I'm out.
14:48I can't believe you're out.
14:50I'm not out.
14:51Beverage manufacturing?
14:52What?
14:53She makes cans.
14:54She doesn't like these baby things.
14:56She's just in a bad mood.
14:58She might change her mind.
14:59You never know.
15:00After people drink the beer, they can drink the shot.
15:03So I'd say junk removal isn't unique.
15:06But you figure things out by doing it a different way.
15:11You want to go in on this with me?
15:13You're the health and wellness queen.
15:16Yeah, I would go with you on this.
15:17Would you?
15:18Yeah, I would, yeah.
15:19I think these guys need more money.
15:20They need a lot more money.
15:21Because I think there's huge, huge potential.
15:22They're going to need a lot more money.
15:23What?
15:24They're going to need a lot more money.
15:25What would we do?
15:27I don't know what to say.
15:30There's 7%.
15:32So we had a little chat.
15:34We would go 150, because we think you need more money.
15:37And I think you're willing to listen,
15:39and you want some advice from a couple of different dragons
15:42with different experience for the 15%.
15:50Look, I'm actually going to step out,
15:52because I think you have two really good offers
15:54on the table right now.
15:58We got to mull things over here.
16:00I kind of think 200K for 12%.
16:08Yeah, that's what I was thinking.
16:11Yeah, OK, cool.
16:12OK, so kind of a unique counter here.
16:17I think it's awesome to get both of you in on it,
16:21but we were also really hoping to get Manjeet,
16:24because of her experience in beverage manufacturing.
16:28Right.
16:29So we're looking for $200,000 for 12% with the three dragons.
16:41Tick, tick, tick, tick, tick, tick, tick, tick.
16:45♪♪♪
16:52♪♪♪
16:56Before the break, Manjeet is out, and Wes made an offer.
17:00But then Arlene and Brian took their shot,
17:03offering $50,000 more than what the team asked for.
17:07But even that wasn't enough.
17:09We're also really hoping to get Manjeet.
17:12So we're looking for $200,000 for 12% with the three dragons.
17:23Guys, like, no, not for me, at least, not for me.
17:27You have a long hill ahead of you,
17:29and I think we are probably extremely well-qualified
17:32to support that.
17:32I'll do that on my own.
17:33So if you want-
17:34$200,000 for 12%.
17:35Let me finish Manjeet.
17:36So if you want Manjeet, then you should think about that.
17:39It's not that I have anything against Manjeet.
17:41I just don't want to slim the deal down by 12%.
17:43I'll do it on my own.
17:44$200,000 for 12%.
17:54Deal.
17:55Deal.
17:55Whoa.
17:56You guys brought me back in.
17:58Wow.
17:59Look at that, just like that.
18:01Happy to work with you.
18:02Thank you guys.
18:02She doesn't even like the product.
18:03Thank you for all your time today.
18:04Awesome.
18:05Good luck.
18:07Wow, that couldn't have went better, really.
18:09That was interesting for sure.
18:10I like how we flipped that.
18:12Yeah, flipped that script.
18:13Things change in the den fast, Brian.
18:15They do change fast.
18:17Yeah.
18:17Brian, I thought you had it, man.
18:18Everybody needs a little bit of challenge and competition.
18:21Yeah.
18:22Right?
18:23It's all good.
18:24I still got the good vibes.
18:31Stepping into the den,
18:32high school friends from London, Ontario,
18:35looking to put their best foot forward.
18:42Hello, Dragons.
18:43I'm Alex Kopach, and this is Matt Beaulieu.
18:45And together, we are the co-founders of Step Sciences.
18:48Today, we are seeking an investment of $500,000
18:51for 6.5% of our company.
18:53Wow.
18:56In 2018, I represented Canada at the Winter Olympics.
18:59On that journey, I came across a sensory motor solution
19:02that focused on the connection
19:03between the brain and the body.
19:05Okay.
19:06This groundbreaking orthotic technology
19:08helped not only revitalize my feet,
19:10but helped propel me all the way
19:11to winning this Olympic gold medal.
19:14No way, that's you?
19:15Wow.
19:16Is that in bobsled?
19:17Is that in bobsled?
19:18That's right, bobsled.
19:19I dated a bobsledder once.
19:21Was it him?
19:22No.
19:24I remember.
19:25Maybe your dad, I don't know.
19:27So I want people to feel the same benefits
19:28that helped me along my Olympic journey.
19:30These orthotics can not only help prevent injury
19:34and long-term disability,
19:35but can help workers be more productive.
19:36More importantly, they'll be happier
19:39because their feet and lower bodies hurt less.
19:41So I've been friends with Alex for more than 20 years.
19:43I come from the world of corporate finance,
19:45strategy, and business development.
19:47We've been selling for more than three and a half years
19:49and have successful partnerships
19:51in automotive, healthcare, and oil and gas.
19:55So Dragons, who's ready to take the first step
19:57on their gold medal journey?
19:59I want to feel what these are like now.
20:01You'll be able to handle them, actually,
20:03just beside you.
20:04So you unveil these.
20:05The orthotics are custom made from recycled materials
20:09using specialized German 3D printing technology.
20:13Each pair sells for about $500.
20:15So you take my foot and then you map it
20:17and then you create a 3D printed orthotic solution for it?
20:21That's right, absolutely.
20:23I have a couple of ski racers in the family
20:25and when we go to get ski boots done,
20:28they step on a machine and they print custom orthotics
20:32for them, for their ski boots.
20:34What's different about this?
20:36So there's different mechanical stimulations
20:38that focus around the four afferent nerve clusters
20:41in your foot.
20:42Where we put those stimulants are unique to your foot
20:45and your anatomy so that we can manipulate
20:48and influence the proper biomechanic gait.
20:51That's a lot of big words.
20:52Yeah, but it's stimulating parts of your foot
20:56to help stimulate performance.
20:58And so I'm understanding this as a sports driven thing,
21:02but when you first got up here,
21:03you talked about automotive and...
21:05That's right.
21:06How is it dynamically helping people in automotive?
21:11Well, so as you step...
21:12So are you trying to say that for specific industries
21:15where there's, you know, there's factory lines, right?
21:19Like beer, I've got a thousand people.
21:21Cause they're standing a lot of the time
21:24that they won't have as many injuries,
21:27they'll be more productive.
21:29Like, what's the claim here?
21:31The way that we've had so much success
21:33is we actually, in parallel with our product,
21:35developed a mobile and accessible clinic
21:37where we actually bring the necessary licensed
21:39and designated professionals on-site into industry
21:42to facilitate the insurance process.
21:44This minimizes, if not eliminates,
21:46any out-of-pocket costs for our customers.
21:48So 2023, what were your revenues?
21:51We did $240,000.
21:53Okay, and so far this year?
21:56$210,000.
21:58In four months?
21:59In...
22:00Guys, like, I mean...
22:02Listen, we've listened and I appreciate
22:04that this is innovative, maybe.
22:07It's a very simple product.
22:09It's too simple.
22:10And I guess I'm just like,
22:12you're asking $7.7 million on a business
22:15that's done $200,000.
22:19Just this year.
22:19Yeah, but I don't, okay.
22:21They've been around three and a half years,
22:22so lifetime sales so far.
22:24What have you done?
22:25About $600,000.
22:28So Matt, you're a corporate finance guy.
22:31You're a valuation guy, right?
22:33That's your background.
22:34That's right.
22:35Does this make sense to you on $600,000
22:38in revenue in three and a half years?
22:40Yeah, tell us about that,
22:41because right off the bat, I'm looking at that.
22:43So we went to industry.
22:45We have made agreements with some of the largest
22:47tier one automotive employers in Canada,
22:49as well as national logistics and distribution.
22:52We have commitments for $37.5 million
22:55in total available revenue,
22:56because we include their families.
22:58So you have written, signed agreements
23:01for $37 million worth of inventory.
23:04Because we are a D to C,
23:06we cannot get a PO because the company is not paying.
23:08It's the individual employee.
23:10Right.
23:13Let me rewrite your pitch for you real fast.
23:16Okay.
23:17I have a slightly better orthotic,
23:19and I have a superior distribution advantage,
23:22because I go to companies with employees
23:24who have never used their orthotic benefits,
23:26and I sell them orthotics onsite.
23:29The employee pays $0.
23:31They're happy as a clam.
23:33The employer doesn't care,
23:34because it's all with insurance.
23:36And you guys are making bank,
23:37because instead of putting a brick and mortar store
23:39where you gotta get people to come in,
23:40you get 600 people in a single company.
23:42That's your business, right?
23:44100%.
23:44That is your business.
23:45Why didn't you say that?
23:48Well, I mean, I think we feel like we said that in our way,
23:50but we could definitely simplify it.
23:52I agree.
23:53I think sometimes when you live it,
23:54it makes sense to us.
23:55Yeah.
23:56We're being super easy on you guys,
23:58but I've only,
23:59mostly because you're an Olympian.
24:01You can't come in and ask
24:04for a $7.7 million valuation
24:06on the belief that you're gonna be able to convert
24:09to the extent that you're gonna have the sales.
24:11That very well may happen,
24:13but it hasn't happened yet.
24:15And so I'm gonna be out.
24:17Okay.
24:18Well-
24:19Do you understand the dilemma?
24:20Like, it's-
24:21I do understand where you're coming from,
24:23but the fact that we penetrated
24:26into these tier one automotive plants is not easy.
24:29It took more than a year of diligence and compliance.
24:32Nothing about business is easy.
24:33Being an entrepreneur isn't easy.
24:34Absolutely.
24:35But to say that you're worth $7.7 million,
24:40like, that's a lot of money.
24:42Like, your business is worth half a million dollars.
24:44It's worth maybe two times revenue today.
24:46Maybe.
24:47Maybe.
24:48Even that's being a bit generous.
24:48Maybe one times revenue, right?
24:49Like, you're so far away from the ballpark
24:52of what's happening in this market and what's reasonable.
24:56But the problem is you came with a deal that made no sense,
24:58so I gotta be out.
25:01Fellow Alex, problem is that your valuation is way too rich.
25:07It's just not deserved.
25:09It's not earned.
25:10I'm out.
25:11Okay.
25:12I don't understand the product.
25:13I don't understand the valuation.
25:17I'm out.
25:18The real opportunity with what we're doing right now
25:20is that the 3D printing space is growing quickly
25:23and changing.
25:25For us to be in a space where we can apply
25:26a material science perspective on this
25:28is going to be a game changer.
25:30And we are on that point where we can actually
25:32be one of the leaders.
25:33There's a lot of ifs there, Alex.
25:34You haven't done it yet.
25:36I'm out.
25:37All right.
25:45Coming up.
25:48I would say that don't put all your eggs
25:49into that basket.
25:51Like, build your own business and your own brand.
25:53Do you have a negative Nelly doll?
25:56Give it to my sheets.
26:14It's a dream come true.
26:15I grew up watching Dragon's Den
26:17and never thought that I would actually be the one
26:20to actually share my business.
26:21So it is really a milestone no matter which way it goes.
26:26Now, this mom from Stoney Creek, Ontario
26:29hopes her hair-raising mission snags her a partner
26:32to bring her children's products to the masses.
26:36Come on in.
26:37We're not scary.
26:38Hi.
26:39Oh, she's going to be a future dragon right there.
26:41Hi, Dragons.
26:42My name's Anita Grant.
26:44I'm from Stoney Creek, Ontario.
26:45And I'm here today seeking a $250,000 investment
26:49for 9% equity in my business, Hello Hair.
26:55Today, I have with me my 11-year-old sister, Jaleesa.
26:58Hello. Hi.
26:59And my three-year-old daughter, Tiana.
27:01Hello.
27:02Hello.
27:03Hi.
27:03The inspiration behind and the future of Hello Hair.
27:08See, growing up, I felt the most pretty
27:10when my hair was pressed straight or chemically relaxed.
27:13And in my adulthood,
27:14I thought I'd only be accepted in the workplace
27:16if I hid my Afro-textured hair under a weave or a wig.
27:20Arlene, I know you also struggled with this
27:22after you shared your own curly hair experience
27:25in a LinkedIn post that resonated with thousands.
27:28And Wes, you shared how you boldly decided
27:31to shave your head bald in your 20s
27:33as the boardroom rebel.
27:36So this is why I created Hello Hair,
27:39to revolutionize the black and curly hair narrative
27:42through inclusive children's products.
27:45Dragons, beside you, each of you have
27:47a Hello Hairstyling doll and children's book.
27:50So you can practice on here, right?
27:52Like I can start braiding.
27:53So they're 100% human hair, professional grade.
27:57Human hair?
27:57Human hair.
27:58Human hair's expensive.
27:59To give you the actual real-life experience.
28:02Anita's hairstyling dolls retail for $70
28:05and the books sell for $43.
28:07Currently, Hello Hair products
28:09are available exclusively online.
28:11We're not just selling books and styling dolls,
28:14we're igniting a movement to empower this next generation
28:17to embrace their natural beauty.
28:19Such a great idea.
28:21Such a great idea.
28:22Now I wish I had hair like this,
28:25that I didn't cut it off.
28:27Yeah.
28:27I'd still grow it, you know,
28:28it's just probably gonna be coming in patches.
28:30Sure, sure, you can.
28:31It's gonna come in patches, that's still a problem.
28:34We believe, yeah.
28:35I always wanted big curly hair and then, you know.
28:38You know, the beauty of it is that
28:40you should be able to do whatever you want
28:41with your hair.
28:42You should, exactly.
28:43It's so versatile and that's so beautiful
28:46to be able to do so much with your hair.
28:47Yes, we actually are the lucky ones
28:49because we can do both with it.
28:50Exactly.
28:51The diversity is the beauty of it all.
28:53I mean, the variety is awesome.
28:55And that's what you're doing is to say,
28:58this is beautiful.
28:59Absolutely.
29:00You've been amazing.
29:01Thank you girls.
29:04Could you explain to me the business itself?
29:08Yeah, absolutely.
29:08So tell me what you're selling,
29:10you're actually selling.
29:11So we started off with a children's book
29:13and this features 100 natural hairstyles.
29:16We got picked up by Forbes.
29:18It significantly impacted our exposure and brand awareness.
29:22Awesome.
29:23From there, we realized there's a bigger gap
29:25and that is education.
29:26And that's where the second book comes in.
29:28So this is more, it's a science-based.
29:29They go through a series of experiments
29:31to understand the science of their hair.
29:33But most recently, we launched the Hello Hairstyling Dolls.
29:37We received 1 million views on our first video.
29:40Congratulations.
29:42Our inventory is 95% sold out.
29:46We had 2,000 people on that wait list from that same video.
29:50People just found you with a single viral video?
29:54Just one viral video.
29:55And have you made any others after that?
29:57We made one other and got 400,000 views.
30:00Wow, you are struck a chord with the audience.
30:05What's your background?
30:06I worked as a business consultant at a not-for-profit.
30:09So I have a big passion for business,
30:13but I consider hello hair my life purpose
30:15because I know the impact that it has,
30:17not just for myself, but for my daughter.
30:21So can you go through your revenues?
30:23How much on the books?
30:2460,000 on the books.
30:25And?
30:26$400.
30:27So 30,000 on the dolls.
30:29And to date, you've sold 60 plus 30, basically.
30:32Right, 90,000 dollars.
30:37So Anita, this is when you tell me about that 2.49,
30:41whatever that number is.
30:422.78 million dollar valuation.
30:45Tell me about that number.
30:47So the valuation was based on our rapid growth,
30:50the market opportunity, and lastly is the IP.
30:53So those characters allow us to really amplify
30:56those properties through licensing,
30:58but also we're exploring the TV animated series
31:01with the hello hair characters.
31:03You're putting some things in the fire.
31:05Great.
31:07But just because they've reached out
31:08and you've reached out, doesn't mean that it's happening.
31:12Well, the business that I do have,
31:13the launch of the new dolls that pre-order,
31:16I will be doing a marketing campaign
31:17with actress Taraji P. Henson.
31:20Awesome.
31:20That's awesome.
31:21Have you signed that already?
31:23So we are really at the tail end of that
31:25and about to sign off.
31:26What are you, are you paying her?
31:27So we're still working on the fine details of that.
31:29What do you think it'll be?
31:31Royalties, potentially, yeah.
31:33How much?
31:34The numbers I'm not fully sure about.
31:38The celebrity world is very fickle.
31:40It's not as all of us dream and hope to be sometimes.
31:44I've been there myself, right?
31:45And so I would say that don't put all your eggs
31:48into that basket, like build your own business
31:51and your own brand.
31:52Do you have a negative Nelly doll?
31:55Give it to Manjeet.
31:56I actually think there's a Joseph Riala doll.
32:01Somebody who's been there, done that.
32:04Yeah, I actually think that's good advice.
32:05Celebrities come and go.
32:07Yeah, but the community stays.
32:08I feel the fire between these two dragons.
32:11So do you have any debt in the business?
32:12I do not.
32:13Any other investors?
32:14No.
32:16Your passion for your kids and for changing the world
32:20and hair diversity, I mean, it's beautiful.
32:22It's awesome.
32:23I think your valuation for having so much potential
32:27that isn't locked in yet as an investor,
32:29I look at that and say, nothing here is guaranteed
32:34and for that reason, I'm out.
32:37One of the things I love about this is that
32:39it's not just a black community problem.
32:42It is a problem for anybody who has curly hair
32:45and has to go through that.
32:46You saw the reaction to that post on LinkedIn,
32:49I mean, and all my other platforms.
32:50It was insane, the feedback.
32:52Put it on the table, Arlene.
32:56You've got hair.
32:58I have hair.
32:58You've got hair.
32:59You've got curly hair.
33:001-800-Got-Hair.
33:04I would do $250,000,
33:07but I would want three times my money back
33:10and a royalty for 5%.
33:12And I'll say that because I think you actually want more.
33:15You want somebody who's gonna stay with you
33:16on the journey long enough to make a difference.
33:20I'll come in with Arlene's deal.
33:22Okay, okay.
33:23I love your mission.
33:24Like, I have two young girls at home too
33:26and the impact that you can have,
33:28like you say, is pretty profound,
33:31but you've got a long way to go still.
33:33There's a lot of work here.
33:35Yeah.
33:36I'll give you an offer.
33:39I will give you $250,000 for 15%.
33:4415%.
33:46Okay.
33:46You have really good offers on the table.
33:48I'm gonna be up.
33:54Thank you all for your offer.
33:57I am gonna take Wes and Arlene.
34:00That's awesome.
34:01Good job.
34:01Well done.
34:02This is one of those ideas that's just really gonna make
34:05a difference in the world and you're fantastic.
34:07Congrats, everyone.
34:08You were fantastic, everyone.
34:09You're in good hands.
34:10Thank you so much.
34:16I'm actually so buzzy.
34:19Oh my gosh.
34:19Yannick, we've got it for you.
34:21Hey, you have, you did so good.
34:24You did so good.
34:27This serial entrepreneur turned venture capitalist
34:31runs one of the country's largest funds
34:33in the food and wellness space.
34:35With funding and mentorship,
34:36she's investing in the next generation of entrepreneurs.
34:44Coming up.
34:46How does it know I'm snoring?
34:47It's monitoring your breathing.
34:49It's a gentle waking motion.
34:51Hey, hey, hey, honey, stop.
34:54More gentle than me hitting you to stop snoring.
35:01And finally, let's see if these brothers from Toronto
35:04will convince the dragons not to sleep on their deal
35:07that promises to save suffering bedmates.
35:10Smart Nora.
35:14I'm intrigued.
35:17Hello, dragons.
35:18My name is Behzad.
35:19I'm the head of the team.
35:20I'm going to show you how to sleep on a bedmate's bed.
35:23I'm going to show you how to sleep on a bedmate's bed.
35:26I'm going to show you how to sleep on a bedmate's bed.
35:29Hello, dragons.
35:30My name is Behzad.
35:31And I'm Behrooz.
35:32We are brothers and co-founders of Smart Nora.
35:34And we are here today asking for $400,000
35:37in exchange for 5% of our business.
35:38Wow, okay.
35:40We all need good sleep to be healthy, happy, and productive.
35:43But sleep's biggest enemy is snoring.
35:46I sleep beside one.
35:47Yes, so every night more than 2 billion snorers
35:50ruin sleep for themselves and anyone in the blast radius.
35:53Yeah, totally.
35:54So as a family of professional snorers,
35:56we looked for solutions,
35:57but anything we could find was worse than snoring itself.
36:00Really?
36:01Then we invented Nora,
36:03the genius solution that turns any pillow
36:05into a smart pillow and stops the snoring
36:08without even touching you.
36:09What?
36:10No.
36:10We've already helped more than 100,000 customers
36:13get rid of snoring for good.
36:15So dragons, who wants to get in bed with Nora?
36:18I do, man.
36:19I don't want to do it, but I don't snore.
36:21He don't think you snore.
36:22I don't snore.
36:23I don't snore.
36:24You don't think you snore.
36:25But I'm going to snore right now.
36:27So Behzad's going to show you how easy it is
36:29to turn a pillow into a smart pillow.
36:31Lay down, buddy.
36:32Okay.
36:33No, no, you be on that side.
36:34Okay, yeah, I just.
36:34Yeah, that has a side.
36:36I wasn't sure what you were talking about, buddy,
36:38and I'm not going to spoon you or anything.
36:40I'm just facing this way.
36:41I'm a spooner, so if you don't want to spoon me,
36:43I'm spooning you.
36:44You see how snoring creates problems.
36:46Yeah, snoring creates problems.
36:46So you take out the insert.
36:49Yeah.
36:50Put it in this pad, so it makes it super comfortable
36:52and soft.
36:53Then you can place it under your existing pillow.
36:57Connect the tube.
36:59You can simply store this away.
37:03And then turn on your pebble and you're ready to go.
37:06Okay, Brian.
37:07Let's go, brother.
37:08Let's do this.
37:08Closer, man, closer.
37:10Put your head on your pillow.
37:11Okay.
37:12It's very gently moving your pillow up
37:14and then back down.
37:15Without you really noticing it,
37:16and that's the magic of snoring.
37:18How does it know I'm snoring?
37:19It's monitoring your breathing,
37:20and before your snoring actually gets loud to wake anyone,
37:23we really gently move your pillow.
37:26What it does,
37:26it activates the muscles that support our airway
37:29and we stop snoring.
37:30It's moving.
37:32That's pretty cool.
37:33It's a gentle waking motion.
37:35It doesn't wake you.
37:36Hey, hey, honey, stop.
37:37It doesn't wake you up.
37:38More gentle than me hitting you to stop snoring.
37:41It works for eight out of 10 people.
37:42Good enough for me.
37:43Hopefully my husbands want to be eight.
37:45We high five this out just to kind of bring some-
37:48Some closure to it.
37:49Let's go, honey.
37:50You just want to make it a little more macho
37:51so you're going to high five.
37:54Truth be told, I did have a little catnap there
37:56that was amazing.
37:57So were you guys respiratory therapists?
37:59Or like, how'd you guys come up with this?
38:01It was inspired by our own needs.
38:02So I'm a product designer,
38:04Behzad is a marketer,
38:05and our father is a mechanical engineer
38:06and also a snorer.
38:07Mine too.
38:08So we realized that sliding your hand under the pillow
38:11and give it a small nudge does the trick,
38:13except everybody runs out of patience.
38:15So we were like, okay, what if we automate this?
38:17So we built handmade prototypes,
38:19did a Kickstarter campaign,
38:20raised a million dollars in 30 days,
38:22and we're off to the races.
38:23Bravo!
38:24Because snoring is a problem
38:25and people want to solve it, right?
38:26It breaks up marriages.
38:27Absolutely.
38:28And so how have things gone since then?
38:30So Kickstarter was at the end of 2015,
38:34entered the market in 2017,
38:36and we've sold it at $4.99 for the past four years.
38:40We've done $42 million as a bootstrap company since.
38:44Lifetime sales.
38:45Lifetime sales has been $42 million.
38:47Wow, $42 million, bravo!
38:47People aren't snoring,
38:48there's money in the bank, things are going well.
38:50Maybe.
38:51Is there money in the bank?
38:52We are break-even at this point.
38:56Our annual sales was an average of $5 to $6 million.
39:00In 2022, we were on the ramp up to get to $15 million
39:04and then we had to slow down.
39:05So in the past two years,
39:07we've done $2.7 million each year.
39:10You said you had to pump the brakes.
39:12I don't understand why.
39:14Because of COVID.
39:15So there was no microchips that we used in the product.
39:18So we've had to scale down our marketing
39:21to manage our inventory.
39:22Is this as big as this gets though?
39:24I mean, you were ramping up to $15
39:26and then the chip shortage happened.
39:28You haven't gotten to $10 yet.
39:30Is that sort of a ceiling?
39:31Like, could you really grow this beyond?
39:33I mean, it feels like there might be a cap.
39:35So let's give you a sense of the market itself.
39:37We have sold 100,000 units.
39:40There are 134 million snorers in North America alone.
39:44And this is the first year
39:46that we've signed other distribution channels
39:48than are direct to consumer.
39:50So why are you worth $8 million?
39:52Well, we have proven traction.
39:54We have our patents granted.
39:56We signed the top three distributors in North America,
39:58which they're gonna put us directly into Best Buy,
40:01Target, Walmart, the list goes on.
40:04And the other reason is we already raised 600,000
40:08with this current valuation.
40:12Where do you see yourself in five years?
40:15We see growing this into a company
40:16with a valuation of $150 million in three to four years.
40:19How much in revenue?
40:21In revenue, we're projecting to $40 to $60 million
40:24in four years.
40:27Okay, I'll go first, guys.
40:29I have a lot of experience in the sleep industry,
40:34but I also have a lot of war wounds.
40:37For that reason, I'm gonna be out.
40:40I see some really big challenges ahead of you.
40:43I'm not willing to take that journey with you today.
40:46I'm out.
40:50Well, fellows, listen, there's an underwear company,
40:54men's underwear, and their customer is 70% female
40:59because of the fact that women tend to choose
41:02the underwear for their spouses.
41:04So as I think about you guys,
41:05your marketing is not to the snorers.
41:07It's actually to the person next to the snorer.
41:10And they're the ones to say,
41:11I will pay anything to stop this from happening, okay?
41:15Hey, Wes, is this something you wanna hop back
41:17and bed together on?
41:21Brian, I'll spend all kinds of time in bed with you, brother.
41:25I wouldn't do this by myself,
41:28but I just wanna throw it out there to you.
41:29The problem is it's only 5%, right?
41:31And it's just not enough juice.
41:33Do you get up for 2.5% in the morning?
41:38Wes, is that deal happening?
41:40Aurelien or Wes?
41:43Here's what I think.
41:44I think the check size is too small
41:47to really feel like I could get in there.
41:50For now, I'd be out.
41:53Yeah, I'll do it with Brian, 400,000 for 7%.
42:00Okay.
42:02And I'm good with that, by the way.
42:05He just made the offer without even asking you, yeah?
42:07No, no.
42:09They telepathically talked.
42:09You know, we're telepathic.
42:10It's okay, we're in bed together, for goodness sake.
42:13We spooned.
42:14He knows me intimately.
42:16Let me make the counter.
42:17Will he come in for six?
42:18Because we think that's pretty...
42:21This year, we're on track to double our revenue.
42:24Okay, so if you double your revenue, it's six.
42:27If you don't, it's seven.
42:29That's a nice bet.
42:30I like that.
42:31He said he's gonna double his revenue.
42:32That's an interesting deal.
42:34Yep, put some performance on the line.
42:36I like that challenge.
42:37That's a good challenge.
42:38Done?
42:39You have a deal.
42:39All right. Awesome.
42:40Done.
42:41The brothers didn't have to collaborate on that either.
42:44Any more than Wes had to collaborate with Brian.
42:46A little conversation.
42:48Good job.
42:49Thanks, Wes.
42:50My wife will be happy because I am a snorer.
42:52Awesome.
42:53You guys are awesome.
42:54Guys.
42:55All right.
42:56Congrats.
42:57Thanks, Wes.
42:58No worries, let's do it.
42:59Back in bed.
43:00Back in bed together.
43:01Back in bed together.
43:02Aw.
43:03Oh, this is so...
43:05We did it, man.
43:06We did it.
43:07Yes.
43:11Tune in next time.
43:12A Marvel superhero turned dragon.
43:17Simu Liu enters the den.
43:20Well, I have a Hollywood-sized question
43:22because it's the big elephant in the room.
43:25What do you think about Ozempic?
43:26It's not actually a threat to us at all.
43:31Nice.
43:31You got it.
43:32Let's do it.
43:33All right, we'll edit the clip
43:34so that's all you see me do.
43:36This is reality television, Simu.
43:38We don't do that.