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The last show in the current run of Dragons' Den, and again it is one where we get to see two investments occur. The money really seems to have been flowing fast in the last eight weeks.
In fact, the total that has been offered by the Dragons and accepted by the entrepreneurs is just ten thousand pounds short of £1.5 million.
Evan will write weekly updates of Den activity throughout the 2009 series.
Lovers of statistics might like to know that this year the most prodigious investor has been Peter Jones (£442,000), who in fact put up more than James Caan (£277,000) and Duncan Bannatyne (£140,000) combined.
But from Duncan up, all of them have had their wallets open to a remarkable degree. Veterans like myself can remember the second series of the programme in which there weren't enough investments to put one into each episode.
In fact, I used to work on a rough rule of thumb that for each ten people who walked up the stairs into the Den, one would walk down again with the money. For most of this series, the success rate has not been one in ten, but two out of nine.
It's hard to understand this. After all, don't the Dragons know there is a recession on?
You might have thought that economic conditions would have ensured the Dragons were more careful with their money than usual.
For one thing, they don't have as much of it. The value of everything for everyone has gone down, and the posh houses and commercial properties in which Dragons have stakes are no exception.
But more significantly, one might assume that a recession is a difficult time to launch a new business, or grow one, what with the customers all staying at home and choosing not to spend so much money.
It has been said in fact, that a recession has the same effect on entrepreneurship as alcohol does on sex: it increases the desire, but reduces the ability. When the economy is low and other jobs are not available, people desperately want to set up their own company. But it is wrong time to get a business going.
Yet events in the Den this year seem to have by-passed that general rule. How come?
There is more than one reason for this.
Number one is that the quality of pitches has gone up. Hard to measure, I know, but it certainly feels that way. No wonder the Dragons find themselves tempted to invest more often.
Number two is that in the pits of an economic downturn, the Dragons need new investment opportunities more than ever. They may have lost some wealth but in a recession there are fewer things than usual to do with the money they have. It's not as though they can get a lot of interest on it by putting it in the bank at the moment. Again, no wonder the Dragons find themselves tempted to invest more often.
But there is a third and most important reason for the recession not to have had much effect on the Den. A good new business has to be good whatever the conditions in the overall economy. A recession should never be a very decisive factor.
Imagine you had invented the aeroplane before the Wright brothers. Or the mobile phone, or the cats-eye for that matter. No-one would say "hmm, it looks like a good idea but we should wait until the economy is a little stronger.. now is not the right time to launch it".
No, if an idea isn't going to fly in a recession, it wouldn't be worth investing in during a boom. And if it is worth investing in at all, it is worth it in a recession.
Great entrepreneurs are the very people who specialise in seeing opportunities where there are difficulties.
They'll see that even though many of their potential customers may be staying at home this year, that may not be a bad thing. It is a good time to start out, to finalise and test their design, to finish the product, put it on the market and be ready for when the customers come out and spend again.
It's been a particularly pleasing feature of this series of Dragons' Den that it has reflected this typically positive entrepreneurial attitude during the worst of economic times.
So for those that got their money in the Den – and for those that didn't.. good luck.
Last updated: 2 September 2009
Each week Evan Davis gives us his take on some of the key moments from the TV Den.
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Evan, your summary of the amount of investments made in 2009 series makes interesting reading. Have you considered putting together a ‘Dragonometer’ to present on the TV show? You could display how much each Dragon has invested and how many investments they have made. Following on from this you could display how successful each investment or Dragon has been in terms of real money or points (like euro tour golf) if £s are considered too vulgar. You could keep the viewers regularly updated which may also encourage more competition amongst the Dragons.
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Love the quote used;
"A recession has the same effect on entrepreneurship as alcohol does on sex: it increases the desire, but reduces the ability."
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I have watched Dragons Den since its inception and enjoyed the programmes however I have always had an uneasy feeling that something was not quite right. Firstly, the dragons are confrontational and secondly, the approach to valuation.
The Dragoons do appear to enjoy humiliating the entrepreneurs and their analysis seems often to highly personal. Surely constructive criticism and a mentoring style would be more would be more useful?
On the question of valuation West Coast US practice seems aim at a first round funding percentage of between 22% and 33%. This leaves the management motivated and with sufficient interest if second round funding is required. Given that this philosophy has created the Google and Microsoft it seems it might be wise to learn from this?
Finally, the UK has a poor record in creating large, successful, tech businesses and the Dragons Den seems a missed opportunity in contributing to putting this right - a sad missed opportunity for the BBC?
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I have watched Dragons Den since its inception and enjoyed the programmes however I have always had an uneasy feeling that something was not quite right. Firstly, the dragons are confrontational and secondly, the approach to valuation.
The Dragons appear to enjoy humiliating the entrepreneurs and their comments are often personal rather than business like. Surely constructive criticism and a mentoring style would be more would be more appropriate?
In regard to equity the dragons are exteremly aggresive and I am wondering this in fact counter productive. West Coast US practice aims at a first round funding percentage of between 22% and 33%. This leaves the management motivated and with sufficient interest if second round funding is required. Given that this philosophy has created the Google and Microsoft it seems it might be wise to learn from this?
Finally, the UK has a poor record in creating large, successful, tech businesses and the Dragons Den adds little value in putting this right - a sad missed opportunity for the BBC perhaps?
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