What happens to successful entrepreneurs once they’ve left BBC’s infamous Dragons’ Den; once the lights are out, and the cameras have stopped rolling? It’s an issue cloaked by controversy, and as Rebecca Burn-Callander discovered last year – less than half the equity finance pledged between series 1 and 11 was actually ever delivered.
So it seems as though it’s a case of Duncan Double-time, or Deborah out right Mean-den, or even Lewis Kha-not. In light of this, we decided to look at the companies that did secure investment in the den, to ask – Where are they now?
We’ve tracked 48 winners from the den. And the sector spread tells us that the Dragons’ have an appetite for companies outside of tech. The Food and Drink sector recorded the highest number of fundraisings, while Games and sports equipment, and Clothing companies also featured highly.
But how successful have the Dragons’ investments been? Are the Dragons as savvy as they seem, or is their bark worse than their bite?Of the 48 winners, just 5 have gone on to secure further equity investment so far. We’ve tracked one exit. ValueMyStuff, founded by former Sotheby’s President Patrick van der Vorst, was acquired in September by German auction house Auctionata. And one company now in trouble – Ploughcroft, the Yorkshire-based efficient homes specialists, which entered into liquidation in 2014.
What we’re left with is a small data-set, admittedly, but looking at those that secured subsequent investment, the average time elapsed before they raised again was approximately a year and a half. The average size of this investment was just over £1.5m.
There have been some success stories. Lost My Name, which creates personalised kids books using an on-demand, zero-inventory manufacturing process, initially completed a £100k deal with dragon Piers Linney in exchange for 5% equity. In June last year, the Hackney-based company completed a £4.7m equity round with a cohort of investors including Google Ventures, Greycroft Partners, and the Chernin Group, at a pre-money valuation of over £25m. However, while the BBC might’ve led viewers to believe the den was the driving behind force Lost My Name’s success, the company had already raised £400k in angel investment prior to going on the show.
Other start-ups that went on to secure further equity fundraisings include Indian sauce purveyor Vini & Bals, dog food engineers Billy + Margot, hi-tech advertising specialists Kino-Mo, and ambassador for paid internships InternAvenue.
Nonetheless, while just a small number of Dragon-funded companies have gone on to secure further equity investment, there is an encouragingly low failure rate. Still, with the majority of the 48 winners filing only abbreviated accounts, we can’t help but suspect that many are turning over less than £6.5m annually. Which could suggest that although Dragon-backed companies aren’t failing – they’re not growing at a particularly fast rate either.