Hello, Dragons.
My name's Richard Brook.
I'm here today looking for investment of £100,000
for a 30% share in my company Sockets.
Sockets is a safety shield.
The safety shield is used during the refurbishment of occupied housing
by the electrician during the electrical rewire.
This creates a protective shield around the electrical installation,
then allowing the electrician to leave the installation fully tested
and in full use,
allowing plasterers, your tilers, your painters,
to carry out their works in full safety.
At present, we sell 240,000 units per year within the UK.
This gives me a turnover of £50,000.
All the products and all the sales at the moment have been with zero
advertising, marketing campaigns.
It's all been through myself pushing the products.
I'm not a salesman, as you can tell from my pitch.
I need a Dragon, like yourselves, on board to assist me in what I think
is a fantastic patented product
we can take to market and increase the sales...
..to between two and five million per year based on the number
of properties refurbished per year in the UK.
Erm...
Would anybody like some samples or like a closer look at the product
before we go to questions?
A plastic casing which makes plug sockets safe
while they're being worked around...
I'm just showing you how this one's fitted now.
..is the proposition on offer from Yorkshire-based
entrepreneur Richard Brook.
The plasterer would unscrew the sockets.
You'd get plaster, you'd get paint within -
fitting the safety shield alleviated that problem.
The 47-year-old is looking for a £100,000 investment...
No pressure. Yes, no pressure.
In return, he's willing to give away 30% of his business.
PETER: Shall I do it?
THEO: You're putting him off.
SARA: This is probably the most stressful moment of his life
and you're making it ten times worse.
THEO: You standing there is giving him the stress!
So, that's the principle of it.
Super. Well done.
Now the demo's boxed off,
can Richard spark some interest from the Den's queen of DIY
Deborah Meaden?
Thank you, Richard. So, actually,
it's quite a simple product to understand.
It means that you can carry on using your electrical switches
when the... ..property's being refurbished. Thank you very much.
So, what do they sell for? Right.
The retail price is 44p for the single,
48p for the double.
Yeah. And the cost price?
Ten and a half pence for the single
and 12 and a half pence for the double.
When did you start selling them?
I started selling back in April 2009.
And your sales to date
are 240,000 to date?
Per year, per year. 240,000 a year? Yes.
OK. And has that grown at all since 2009?
Yes, 10% a year, year on year.
OK, so, I don't know if you're aware but I've actually got a business
that sells electrical sockets that are completely flush to the wall
and what we have to do is work out who saves the time,
who saves the money,
because if it's the tiler that saves the time
but the electrician that's got to buy the product
it's never going to sell.
We've found that it actually benefits the electricians.
The feedback we've got is rather than doing two visits to site,
they would do a rewiring in a day,
complete, energise, fit the shield -
they never went back.
OK. And you know I'm going to ask this,
what type of plastic?
It's high impact styrene.
Right, so, is that recyclable?
Yes, recyclable, it's got the stamp on the back. OK.
A positive start to Richard's pitch as Deborah Meaden draws out
more detail about his plastic product.
Now, Sara Davies wants to know if her investment
will be well spent.
Richard, right,
I'm going to assume that part of what you want the money for
is to make a bigger impression tool to get that price down.
With the investment from yourselves,
I would like to have four impression tools
so then we can meet the demand of two and a half million a year
which I would like to anticipate we could achieve easily.
And to make that four impression tool, what's the quote you've got
for that? That's £12,000.
And what will that bring your unit cost down to?
9p for the double
and 8p for the single.
And why would you just do a two and two,
why wouldn't you move to a six and six?
The cost of a tool increases...
..dramatically.
But then your unit cost comes down dramatically.
I think you need to think a little bit bigger.
Yes.
Richard, the bottom line is that you're asking
for £100,000 investment. Yes.
And you're going to have to put more money in,
so you definitely need an investor,
but, in terms of the opportunity,
I think 100,000 is really quite an ask at the moment.
Out of that 50,000 revenue, what was your net profit?
It's been zero for the previous years because every penny I've made
profit has gone back into the business.
This wasn't my day job.
This is something which was originally a hobby and now
it's developed into a very good interest of mine
cos I like, you know, inventing things.
Do you actually have a full-time job?
I'm an estimator for one
of the national repairs and maintenance companies.
If I decide to give you £100,000 of my children's inheritance...
Yes.
..are you going to give up your job
or are you going to carry on working?
Well, at the end of April I was made redundant
by the company I worked for,
so how everything's aligned, now I am full-time with this
and from now onwards, we can take this product to the next level
and I will give you 100%.
So you'll be doing it full-time? I'll be doing it full-time, yes.
What else have you been doing?
I'm into my vintage race cars.
Are you racing them? Yes. Mid-life crisis!
I race a Ford Anglia and a Zodiac.
Do you? Oh, fantastic. That's two midlife crises.
Exactly. Yeah.
Excellent.
Some mid-pitch respite for the entrepreneur as Theo Paphitis
discovers a common interest.
But before these kindred car spirits drive off into the sunset together,
Tej Lalvani wants to know if Richard has more spark about him
when it comes to selling his own product.
Can I understand what your margins are in terms of wholesale?
So I know your retail price is 44p and your cost price is 10-12p
depending on the size. I sell to the electrical wholesalers at 24p
for the single and 28p for the double.
You've got about a 50% gross margin. Yes.
And you've been growing at 10% a year, which is growth,
but I would expect this to be a much higher growth.
Why haven't you approached the construction industry distributors?
I'll be totally honest with you.
Sales and marketing is not my expertise.
I haven't pushed the product and I haven't marketed the product,
and I'll admit that. That's my failure on my side.
Look, it's a really good product.
It works really well.
You're selling already.
You're ticking all the boxes here.
But...
..it just doesn't excite me as a business.
Money excites me...
..but I feel that you've got to sell millions of these units
to get my investment back.
And £100,000 is a big ask, I think.
So if it was a smaller amount, I may have considered it,
but, on that basis, I'm going to say I'm out. Good luck.
Tej Lalvani isn't convinced by Richard's projections
and bows out of the deal.
Does Sara Davies see any promise in the product?
You know what, Richard? The product does excite me.
Not that I do a lot of wiring plugs in my spare time,
but the product, your enthusiasm for the product. However...
..I worry that you've bumbled along for ten years...
..and the thing that's forced you to come here today
isn't that you've just thought,
"Yes, come on, I'm going to go for this, I've got the drive..."
..it's the fact that you've been made redundant.
This is forced to become your job,
not that you think the opportunity is great enough
and took that risk.
And that's what's bothering me.
I would hire you tomorrow...
..but this isn't an investment for me and I'm out.
Richard, to get 10% of a market,
that's a challenge for you to do that.
But in terms of the opportunity, I think it's a great business
for you and I'm sure you're going to take it further.
And if you'd come in at less money...
..I think this might be a bit of a punt.
But £100,000 is a big ask.
Sadly, that's why I'm out.
Peter Jones casts doubts over Richard's target growth
and switches off his interest in the deal.
Now Theo Paphitis is preparing to give his verdict.
Richard...
..I'm all over the place with this.
I think it's an ingenious product.
I think it's amazing that you've put it together in your spare time.
But...
..you've come in for £100,000 and that is a lot of money.
And at £100,000, it's such a specialist product,
the return on my investment might take a while.
I think this is the sort of product that is worth sharing
with another Dragon that's got experience in making
these type of products.
Got Khaleesi in the middle there.
I'll take Dragon Queen any day of the week, Theo.
Now, I don't know if that's something that she thinks
is worth considering.
Well, if it wasn't £100,000,
I would not have sat here so long and so quietly.
And I also think that you would have a fantastic combination
between Theo and I.
So I would certainly be interested in sharing.
Erm, OK. Now, the percentage.
If I did 50,000,
I would want 25% or otherwise it's just not worth my investment.
I think we would be a dream team,
so I would make you an offer.
£50,000 for 25% of the business...
..but with a buy-back, so I'll reduce my shareholding to 20%
once we have our money out.
You'd then go to 60% and we'd be at 40%. 60%.
It's a big moment for the entrepreneur -
a double Dragon deal on offer from Theo Paphitis and Deborah Meaden,
but they're asking initially for half of his company,
20% more than Richard was willing to give away.
I'm confident, with two Dragons like yourself on board...
..we've got great potential and great team.
Erm...
I think my energy and enthusiasm
will go get the sales if you tell me which direction to go in,
so I've no doubt that I could pay back that investment
within, you know, two years.
So, for that reason, I'm in.
You're in! Excellent!
Excellent! Congratulations!
Thank you.
Oh, thank you. There you go. Thank you very much.
And more to the point, we're back in business, Mr P!
The dream team! There we go.
Thank you, Dragons. Excellent.
Speak to you soon.