DEBORAH: Looks like lipsticks. PETER: Looks like diaries.
There's fruit on it.
As I left the house,
my daughters shouted out from the bedroom window, "Good luck, Daddy!"
TEJ: Chocolates, yes.
Is that chocolate? Yeah. Hmm.
I think if I got the investment today,
they would just go absolutely nuts, cos that's what they do!
Hello, Dragons. My name's Stephen Conway, and I'm here today
to ask for £75,000 in exchange for
7.5% of my business, Pure Heavenly Ltd.
Now, like many families,
we have struggled with food intolerances over the years.
I've got two beautiful young daughters, and it's been
heartbreaking for me, when I've had to monitor what they eat.
It was Easter two years ago, when they were surrounded by
a mountain of chocolate that had been given
by well-meaning relatives.
I thought, well, maybe I should see if I could find
a healthier chocolate alternative that we could all enjoy.
So I went online, bought some ingredients,
and I started creating the recipe for Heavenly Chocolate.
My kids loved it, and that made me
think there was a potential business opportunity to be had.
Now, Pure Heavenly is dairy-free, soy-free, gluten-free,
palm-oil-free and less than 4% sugar.
That compares with 56% in the leading chocolate brand in the UK.
We've done £500,000 turnover in our first year,
just from our website.
We haven't taken this to retail yet.
We believe, with your help, we can take it into the big retailers
and abroad and help take this brand to heaven and back, excuse the pun.
Thank you for your time.
I'm just going to hand out some chocolate for you to try.
Thank you very much. No. Thank YOU.
Hoping to entice a Dragon with his health-conscious chocolate
brand is Salisbury's answer to Willy Wonka, Stephen Conway.
Present for you. Lovely, thank you.
He's looking for £75,000 for a 7.5% chunk of his business...
I think there's going to be some damage done here.
CHUCKLING: Well, let's hope so!
..but will his business be heavenly enough to tempt the Dragons?
Health tycoon Tej Lalvani is the first to investigate.
Stephen. Yes, Tej?
The fact that they're healthy, I love it. Yes. Exactly in my alley.
And it tastes good. Thank you.
Low sugar content, dairy-free, which is really, really good.
And you've got the sucralose and a couple of other sweeteners...
Less than 0.5% in our sweeteners is sucralose.
So, tell me, what do they sell for?
We sell the big bars for £3.45 online.
And we sell the mini bars for £1.30.
OK.
Stephen!
What I was most impressed with is that,
in your first year of trading, you did 500,000...
Yes, just from our website alone.
So how profitable was that?
We lost money, we lost 180,000 in the first year.
And the reason for that was
because there was a lot of scaling-up issues.
We made some mistakes.
We sent out quite a lot of chocolate that was not as good as it could be.
So we lost a lot of customers.
And you've got to win them back. And we've got to win them back.
You know, I appreciate your candid honesty in sharing that
with us, because you could have held that back,
and I think that's important that you did share that.
I will tell you as it is, all the way.
Stephen's upfront approach to his losses
has hit a sweet spot with Sara Davies.
Now, Tej Lalvani wants to know about his plans
to hit the shops with his chocs.
So, in terms of retail, where would you like to see this product?
Waitrose, Ocado, Harvey Nicks,
Selfridge's, Harrods, Fortnum & Mason -
you know, the list is endless. OK.
Because when you launch a product,
you want to position it correctly, and that is key. Absolutely.
So, let's assume that I am the buyer from Waitrose
and you've come to see me.
Why am I going to stock your chocolate?
Number one, we've got a product that, as far as we're aware,
doesn't exist elsewhere.
Number two, in terms of the demographic
of the customer base, it's smack bang in the middle...
OK, that's all fantastic, but as a buyer, the only way I can
keep my job is to deliver product that sells and makes a margin.
How much am I going to make?
I'm...
I'll be completely honest, I'm stabbing in the dark.
Listen, you've put a huge amount of energy, money and time... Yes.
..sweat, toil, you name it, into this.
Don't tell me you're stabbing in the dark.
No, on figures around retailers,
in terms of what number to pitch it at.
Well, have you asked them?
No.
So you don't know whether they'll require 30%, 40%, 50%?
I don't know, no.
What's the average confectionery margin?
I don't know.
Stephen's lack of research into those supermarket margins has left
Theo Paphitis unusually speechless.
But Deborah Meaden thinks she may have spotted
a potentially tasty market for his product further afield.
So, what I will say about that, that is a very nice. Thank you.
It's low-sugar, even if that's the only reason to buy it.
But I can also see that would suit a US palate.
Is there anybody in the US doing a similar product?
I've yet to find anybody who's doing the dairy-free and the low-sugar.
OK. And the fat content? Yes.
How does that compare to normal chocolate?
It's the same as other chocolate, but the research that we've done is
that fat is essential for the body, whereas sugar are empty calories.
Refined sugar, empty calories.
So what we have found in our feedback from our customers
who are the slimmers is they are having, some of them,
a bar a day and still losing weight.
Hold on, that's 400 calories.
Whether you call them empty or otherwise,
there's 400 calories that have got to be absorbed by the body.
Well, if I give my children normal chocolate,
"More, more, give me more, give me more, give me more."
I can give them two pieces of this, they're completely satiated,
they feel like they've had their chocolate hit and off they go.
You're not stuffing your gullet with a whole bar.
I've got that, I just wouldn't want to say
you can go on a diet and eat this. OK.
Because it's still big on calories. Yep.
A rap on the knuckles from Theo Paphitis,
who finds Stephen's dietary claims less than palatable.
But it doesn't look like watching his weight is currently
top of Peter Jones' agenda.
Stephen. Yes. Hi. Hi.
I'm starting to feel a little bit sick now.
And it's not a reflection of your chocolate... Oh, thank God!
..it's the fact that I think I've got through every bar.
I love it. I'm a big chocolate guy.
I've not tasted chocolate as good as this for a long time.
Thank you.
But is this a business opportunity?
And I think it is.
I could do all of the things that you need...
..but I would also do it equally with passion, drive and enthusiasm,
because I like it that much.
So I'm going to offer you all of the money...
..and I just want 20% of the business.
Peter Jones makes a play for the confectionary company,
but he's setting the bar high with a 20% bid,
almost three times the share that Stephen was prepared to give away.
Does Tej Lalvani think the business would be a divine addition
to his health care empire?
Stephen.
I love your passion for nutrition. Thank you.
And that really resonates with me.
And I love you as an entrepreneur.
I mean, everything you're saying is exactly what, as an investor,
I'd look for. Thank you.
People make mistakes, and it's great to make mistakes,
but you're learning from them.
Is this going to be a long speech before...? It is going to be, yeah.
So have your water, have your chocolate.
And I think you've done really well by not
going into retail at the moment, because once
you establish your price point, it's very difficult to change that.
Yeah.
What you're going to spend in terms of promotions, in-store budgets...
PETER SNORES
Stop being jealous, just cos you can't add the value I can, Peter.
So, I'm going to make you an offer.
And I'll offer you all the money, £75,000...
..also for 20%.
OK, thank you.
Tej Lalvani decides he too wants a piece of this chocolate business,
and tenders an identical bid to Peter Jones.
Is Sara Davies tempted to compete?
Stephen, I could come in here
and make you an offer that was stronger than their offer,
but I would hope that you would be a smart enough businessperson
to realise the value of the offer is the value that the Dragon brings.
Absolutely, yes.
And sometimes, industry-specific knowledge is worth way more
than a percentage of your company.
So it pains me to do it, because I really don't want to be out,
but I think the situation we find ourselves in,
it's the right thing for me to do.
So best of luck with the business, and I'm out.
Stephen, let me tell you where I am.
So, I'm sitting in this chair...
400 calories heavier.
A lot heavier!
I think you've got two incredibly competitive offers already. OK.
I'm sure there's a lot more to do, but I think it looks like
you're ready to go, and I wish you all the best of luck.
But in this particular instance, I'm going to say I'm out.
Theo Paphitis and Sara Davies decline to take a bite
of the investment proposition.
But it looks like Deborah Meaden wants to woo the entrepreneur
with a different approach.
Stephen, I love it, I mean, what's not to?
I actually wouldn't put you into the healthy place to start off with.
Because I think what you need to be is just good chocolate.
"I'm buying cos actually it tastes lovely,
"and look at that, only 4% sugar!" You know.
So I'm going to make life really, really difficult for you.
I'm going to offer you all of the money...
..for 20% of the business.
OK, thank you.
With Deborah Meaden making a matching bid,
albeit with a different marketing strategy,
Stephen now has three offers of £75,000 for 20% of his company.
So, quick question, would any of you consider if,
once you got all your money back, going back down to 15?
Sometimes I've done that deal, but here, I'm going to try and add
so much value to this, I don't want to look back and think about getting
shares, I want to keep pushing it to get you to where you need to.
Deborah? Well, it's a bit counterintuitive, that, to me,
because you want to go absolutely for it to grow a business,
and then when you've done all of that and you've opened the doors
and you've got you all over the shelves, then my percentage reduces.
OK, thank you, Deborah.
Obviously, you invest money to make money.
I'm giving you all of the money for 20%.
If I received £100,000 back...
..within 18 months, I'll drop down to 15%.
OK.
If you want to shake on that deal now.
I'm going shake on that deal right now.
SARA LAUGHS
Well done, amazing. Thank you, thank you. Congratulations. Thank you.
Peter Jones' incentivised offer seals the deal.
And with a very chuffed chocoholic investor on board,
Stephen can go and break the news to his kids.