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A lesson from the Den
A lesson from the Den
November 16, 2007
What does Dragon’s Den tell us about the world of small business? Not a great deal if you view it solely as entertainment. After all, this is reality TV, and reality TV’s stock-in-trade is the ritual humiliation of hapless members of the public. There are times when I find it excruciating to watch yet another hopeful squirming under the unforgiving scrutiny of the Dragons, their dreams visibly crumbling as Duncan Bannatyne spits a mocking question about sales projections that he knows they cannot answer. It’s like watching someone being skewered and roasted over an open fire.
Thankfully, there’s more to it than this. Dragon’s Den is not actually a game – these are serious investors with real cash to put into real businesses, and they’re not going to throw it away on a whim. Harsh as it is, their scrutiny has a purpose; they have to be sure that the risk is going to be worthwhile.
I know we’re supposed to boo and hiss at the Dragons whenever they grunt the dreaded “I’m out”, but I can’t help siding with them when I’m watching the show. Most of the entrepreneurs are so ill-prepared for their ordeal that they don’t deserve to be given any money to develop a business. This staggers me. There’s no secret here - they know the format, they know what sort of questions they’ll be asked and they know what’s going to happen if they can’t answer them.
Granted, it’s a nervewracking business and that’s going to affect their ability to recall information quickly and easily. Even so, if you’re seriously asking for £150,000 to open five retail outlets selling baseball caps in five major cities, you really should be able to demonstrate some sort of understanding of leases, health and safety regulations and employment law, as well as offering realistic cashflow forecasts, sales projections and some sort of basic marketing plan.
Unfortunately, too few of the applicants standing in the Den seem to grasp the fundamentals of running a sound business. They’ve got where they are on a wing and a prayer and a following wind. But the Dragons are hard-nosed business folk who don’t invest in dreamers – unless they can see a healthy profit at the end of it.
And I suppose that’s what makes the show compelling. We see, vividly, the collision between an entrepreneur’s dream and the realities of the marketplace. Every business reaches this point eventually, some sooner than others. If the entrepreneur has done their homework, they stand a good chance of getting over the wall, or around it or under it or even smashing straight through it. Their dream continues - a little tarnished maybe, but in a much better state to survive in a competitive environment.
What the Dragons offer is a reality check. It has to be harsh. It’s not easy to get a business up and running, but it is possible. And when it happens, nobody is more pleased than the Dragons who, after all, just want to invest in good businesses.
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Comments
Good spot Stuart. I have amended Simon's first post - thanks. Mick
It's Duncan BANNATYNE not BALLANTYNE!
Ah, this really annoys me! The guys worth £160,000,000, you would have thought people would remeber his name!
I agree, Clive. I actually think that would be a far more interesting programme - it would show the next stage for small business sturggling to make an impression on its market; and it would give us an insight into the entrepreneurial skills that have got the Dragons to where they are. Or not. If you were a Dragon, would you agree to that kind of exposure and the possible loss of face? I think they thrive on a certain amount of mystique.
What is interesting for me is that there have been very follow up programmes of what the Dragons actually did to help. They say things like "I can give you this expertise or access to that market", but I'd like to see them with their sleeves rolled up actually doing just that, then we might see who is actually a bit hapless as a dragon!
I had an interview for Dragon's Den this year, their researcher contacted me after seeing an article in the Telegraph. It appears there is a format to every show, a 'sensible' business first and last and a few 'novelty' ones in between. The series has been running for long enough now, so there should be no excuse for not being prepared. I read Peter Jones's book and got all the tips off the website. That said it is unrealistic to have everything in your head, if you were meeting a potential investor or bank manager you would have everything written down to back up what you were saying. It is easy to crumble and forget under pressure, but the important thing is to be honest and if you don't know something or have forgotten, say so! You will be respected far more than if you try and bluff your way through.
I didn't get on the show, but I haven't invented anything and my business is probably not whacky enough. They invited me to try again next year but I probably won't bother.
What an interesting topic of debate and it's fantastic to have Rachel's contribution.
I personally believe that both Simon and Andy are right in their belief that Dragon's Den is slowly becoming less and less an "info-tainment" programme than purely an entertainment programme with a business hook.
But should we be surprised? After-all the entire audition process has been used repeatedly since Pop Idol first burst onto our screens. The entertainment industry has always operated on the basis that imitation is the sincerest form of flattery. It is always hard to be an innovator in an industry famed for pursuing the easy dollar. Programmes can be reluctant to make the kind of changes that Andy suggested to their format until that kind of drastic action is made absolutely necessary. Any producer wanting to do this would present their case to an executive who would wave the high viewing figures in their face and tell them to come back in a year.
However, ultimately this issue is a difficult thing to debate without reducing the discussion to the simple matters of taste and perspective. What is the "reality" that we are being presented with in Dragon's Den? It is in fact a very narrow reality showing only a glimpse of an entrepreneurs’ world. We see enough of what it can be like for a business starting out - but only enough to give the show its slice of originality and a showcase for the real stars of the show, the experts.
The long-term success of Dragon's Den will always be remembered in the context of these celebrity panelists. The contestants that audition their ideas will come and go - and a couple will last - but the memory will always be drawn to the experts when recalling the show in 10 years time, not the man with the idea of making that non-melting chocolate teapot. This is the true sadness, that Dragon's Den has the ability to offer the business world another window to success. But too many of the contestants will chase their 15 minutes of fame. In the long-term most will lose and the only winners will be whoever gets to be an expert Dragon's Den version 2.
Hello Rachel,
Thanks so much for taking the time to read my post. You’re quite right about the extent of ‘selection’ that goes on – being a journalist I’ve done my fair share. But presumably this brings us back to my point about reality TV producers prioritising entertainment above information. Which is fair enough (it’s what they’re paid to do), but how can we know then whether this is a fair representation of the small business sector or of the investment process? How can we know it's 'real'?
Interesting point about some of the participants deliberately manipulating the format to garner publicity. I suppose if Dragon’s Den leaves us with nothing else, it at least tells us this: everyone’s in it for themselves.
Regards,
Simon
Surely there is scope to move Dragon's Den on a bit.
I’m no fan of reality TV shows as a whole, and am staggered that people watch the same format year in year out. Even programmes that do morph into others ('let’s have a programme to find a Maria', and 'why not a version to find a Joseph') are so similar. I’m sure it is entertainment; it’s just not for me.
Dragon’s Den is different. Or I should say, it could be. It could be so much more. The BBC has a history of failing to innovate and sticking with a format it is comfortable with. For decades it covered Test Match cricket in the same old way. Then, when Channel 4 won the contract it brought new dimensions to its coverage; Hawkeye, real-time replays, The Analyst and so on. An intelligent application of new ideas brought the viewer closer to the game without detracting from its main aim, to show what was happening on the field.
Equally, Dragon’s Den has not moved on. We know the deal, the director selects the hapless, the ill-prepared and fantasists who make great TV. They are humiliated and then once in a while, somebody who knows their numbers and answers the questions slips through the net and a deal is struck. Even then, the question remains the same: will they withstand the Dragons trying to get more for less?
Now we know the deal, could the programme not move on? How about a bit of freeze-frame, or even an action replay. Let’s take that a bit further…..
Duncan Bannatyne stumps a victim with a shot from the hip ‘There are no barriers to entry in your market….I’m out’. Instead of focusing on the position this leaves the poor entrepreneur in, why not dig into that a bit further? What does he mean by that? What sort of sectors or business do have barriers to entry and why are they important to Mr Bannatyne? We don’t want economics lessons here, but surely someone as engaging as Evan Davies (who is happy to explain why sub-prime lending has led to an international credit squeeze on News at 10) could spend a minute talking to camera developing a theme and educating the viewer. After all, presumably if the viewers didn’t have some interest in business they would be watching Big Brother…on ice.
Hi Simon
Great post, but you have to remember those chosen to appear on the show, and the footage most likely not to end up on the cutting room floor, is of the 'hapless ones'. Slick, well presented business ideas don't make nearly such good TV. In fact if you want a free ad for your business/product, it's actually a good strategy to try and get on the Show and be ridiculous/burst into tears etc etc. It gives you more airtime.
Regards
Rachel
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