#video #Dragons Den - Season 20 (CA) - Episode 16: Full Circle (2)
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00:02Tonight, on a special 20th anniversary celebration, our most successful past pictures return to the den.
00:10Big show. Amazing. I think we're officially arrived. I think so.
00:15But this time as guest dragons for this final special episode.
00:19Oh my gosh. Our name and lights. Our names are lights. That's pretty special.
00:24This is like the full circle moment sets in.
00:27Tara Bosch was only 22 when she entered the den and within three years, she sold smart suites for $360
00:34million.
00:36This is actually a crazy view right here if you think about it.
00:39Mark Lafleur closed a dragon deal for his locally sourced farm-to-door subscription boxes and went on to sell
00:45the company for nearly $17 million.
00:48My makeup might get messed up right now.
00:50Barb Stegman was the first Atlantic Canadian to land a dragon deal for her social enterprise, The Seven Virtues.
00:57And now, her scents are sold globally.
01:00Wow. This is great. So comfortable.
01:04Jay Klein took The Pure Company from door-to-door sales to the fastest-growing gum business in North America.
01:10These look real enough for me. I'm not happy with this.
01:13Okay. I guess we're doing this.
01:15And Joanna Griffiths pitched leak-proof underwear and went on to build NYX into a billion-dollar brand.
01:22Now they're ready to invest their money in the next generation.
01:27A full circle moment 20 years in the making.
01:36First up.
01:37I think it's incredible to see the dragons who have been in our position.
01:41And to see that they have been so successful gives us really the momentum to continue to push.
01:47Now let's see if this Toronto-based team can butter up the full circle dragons with their tasty offering.
01:53Hi everyone. My name is Benson. I'm the founder of Fuwa Fuwa. Fuwa Fuwa means fluffy fluffy.
01:58And my name is Sylvia. Today, we're here to ask for $400,000 for 2% in our company.
02:05Okay.
02:09Back in 2017, while I was traveling Japan, we discovered these incredibly fluffy pancakes.
02:16I called Sylvia right away. Let's bring these decks of happiness home.
02:20So I flew there, I tried them, and immediately we knew we had to recreate that moment.
02:24Traditional French souffle are soft, while American pancakes are thick and dense.
02:31So after months of trial and errors, we have finally perfected the recipes.
02:34A texture that blends the best of a souffle and a pancake together.
02:39So in 2018, we opened our very first cafe in Toronto.
02:43As a new immigrant, building a brand wasn't easy, but we have done it right.
02:48Now, we are ready to scale.
02:50Let's get you guys to try some of our fluffy pancakes.
02:53Let's get fluffy, be happy.
02:55All right. Let's do it.
02:56Okay. Here we have to try these $20 million pancakes.
02:59These are expensive pancakes.
03:01Our first meal together, family. This is wonderful.
03:04So pancake crew, let's bring you all some pancakes.
03:07Fuwa Fuwa dessert cafes offer more than 15 flavors of their signature souffle pancakes,
03:13like classic tiramisu, blueberry cheese, and Nutella.
03:17Shall I feed you, Jay?
03:20I feel like I need to scoot my chair over here. I'm interrupting something.
03:24Each plate of two sells for between $14 and $18.
03:28This is probably the best pancake I've ever had.
03:30Yeah.
03:31This is amazing.
03:32I don't even eat pancakes.
03:33What? You don't eat pancakes?
03:34I don't eat pancakes. Not ever. Not ever.
03:37And this, you've converted me.
03:38It's actually made with the majority of egg whites.
03:41So we beat the egg white and then make it into a soft peak and then blend it with them.
03:46You eat the whole thing, you still don't find it very stuffy.
03:49So it's very aesthetic as well.
03:51You guys go talk business.
03:52I'll continue to sample this and give you some market research.
03:56You have to ask before you eat someone's food.
03:59Especially a fluffy, fluffy pancake.
04:01Okay, I feel like we're floating in fluffy clouds because I heard a $20 million valuation
04:05and I need to understand how did you get there.
04:08So we opened our very first location in 2018 and we actually grew through a successful franchising model.
04:14We have signed like over about 68 total locations, just in North America itself.
04:22Oh my goodness.
04:23And you guys are the founders?
04:24Yeah, we're the founders.
04:25That's amazing.
04:26What were y'all doing before this?
04:28So I was a brand curation manager in a conglomerate in Hong Kong.
04:33But like I love making food and makes people happy because that gathers people together.
04:38And I quitted my job.
04:39I went to Japan, learn pastry.
04:41I also got a degree of food and beverage management in George Brown while I immigrated to Canada.
04:47Wow.
04:47That's incredible.
04:48What a beautiful story.
04:49And you, Sylvia?
04:50So I actually studied accounting.
04:52So I went to do that.
04:54But during COVID, we decided we wanted to do something more exciting.
04:57Serendipity brought you together to make fluffy pancakes.
05:01How are your franchises doing?
05:03How are they performing?
05:05It just depends on the size of the locations.
05:08If it's a kiosk or like a 2,000 square feet location, some can be like 1.2 million US
05:15dollars.
05:16Are they paying you a royalty?
05:17And they're paying us like a 6% on royalty and 2% on like branding and marketing.
05:23And what's the franchise fee?
05:24$50,000.
05:26$50,000?
05:26For 10 years.
05:27I think you guys have run a great business.
05:30Where I want to challenge you is you come to a sophisticated group of investors and you offer us 2%.
05:36How do you think that's enough for us to get excited?
05:38We're looking into hopefully in three years, go to 200 locations.
05:42And I think that will bring us a valuation if we can increase like the unit per economics of each
05:50store.
05:50Can you give us the revenue numbers from last year that you took into your pockets?
05:57Our revenues are about $15 million last year, right?
06:00That's GMV though, right?
06:01That's across all the franchisees.
06:05What did you all take home?
06:06Okay, so we actually only took home about $350,000.
06:12There it is.
06:13Wow.
06:14$350,000.
06:16I think the air has deflated from these airy pancakes.
06:19So the reason why is because we heavily invested back into the company.
06:24So you guys are doing $15 million gross merchandising volume.
06:27Yeah.
06:27Right?
06:28So how much of it is revenue to your business?
06:32So the revenue comes from a few different streams.
06:35So where's the revenue?
06:36I think we just want the number.
06:37I just want the number.
06:38So our revenue is about $1.2 to $1.5 million.
06:42And you're paying yourselves out of the $1.2 and then there's $350 left.
06:46So we actually haven't really taken a salary.
06:49How do you guys live?
06:50We still have like international, like other locations like that is out of like North America.
06:57I don't understand what you mean by that.
07:00We have a master franchise, for example, to UK and that also bring us revenue.
07:05Oh, are you only offering us 2% of the North American businesses?
07:08Yes, the North American businesses.
07:10Oh, wow.
07:10Well, that's news.
07:11Yeah.
07:12Why not the whole company if you're wanting a partner?
07:17Because I think that like right now is not the time to really go other countries and scale
07:21the businesses.
07:22Most of our focus right now is to focusing on...
07:25But being global is part of your pitch.
07:28This is way too complicated for me and you're losing me more and more by the second.
07:33If I'm going to get in on something, I want all of it.
07:35Yeah.
07:35And so 2% of North America is just not it for me.
07:37So I'm going to be out.
07:40What are you bringing in in parts that you're not offering?
07:43I'm just curious to know what you're generating in those countries.
07:46We didn't put any numbers to calculate the other like revenue, like globally, because
07:51it's very difficult for if you ask someone to add up your revenue together because they
07:57are in different currency, different accounting system.
07:59I bet they could do it.
08:01I bet they could do it.
08:03You should still give us those numbers.
08:05I'll tell you right now, just because of that, any founder that could not tell me what
08:09their revenue is, I can't get behind it.
08:11I'm going to be out on that.
08:12Yeah.
08:13I'm with Joanna.
08:14I'll be eating the fluffy fluffy, but your business model is confusing and it's not really
08:18enough for us.
08:19So I'm out.
08:21I know what it's like to be in your shoes there.
08:25We all do.
08:26I think what's important is to come prepared to answer those questions.
08:30And that was the miss for me here today.
08:33So I'm out.
08:35When you come into the den, you have to know your business.
08:38The art of the pitch is actually how you communicate what you do with the people you're trying to
08:43sell it to.
08:44I'm out for that reason, but I do wish you luck in the future.
08:48Take care, guys.
08:49Bye.
08:50I mean, I think when all of us came on Dragon's Den, we all knew that you had to lead
08:57with
08:57exact clarity on what you're asking for, why you're asking for, where the business is at.
09:02And ultimately, that's where they fell flat.
09:03It's so hard, too.
09:04When someone says they're an accountant, I mean, for me, the bar also gets...
09:08I think she knew the numbers.
09:09She knew.
09:10But can we take that to go?
09:12My number one piece of advice, honestly, is to know your numbers.
09:15I think every pitch that goes downhill goes downhill because there just isn't a solid enough
09:22understanding or realistic understanding about how the business works, how the numbers work.
09:26Confidence is everything in the den.
09:43Next.
09:44Gender equality is a big part of the reason why we are doing what we do.
09:49This is for the girls and women who feel like they should be ashamed of the most natural
09:53thing that could possibly happen to your body.
09:58This family partnership is bringing a sustainable answer to one of the world's biggest challenges.
10:06Hello, Dragons.
10:07I'm Lisa Hertz.
10:09I'm Asaf Shargall, and we are the founders of Be Free Cup from Hamilton, Ontario.
10:14We're here asking for $500,000 for 10% of our company.
10:21Dragons, did you know that there are 1.8 billion people around the world who have a period every
10:27month, and 500 million of those suffer the indignity of period poverty?
10:32We're tackling the global period poverty crisis with an innovative, market-based approach.
10:38Be Free Cup is the world's only physically antibacterial menstrual cup, meaning it never
10:42needs to be boiled, which can be life-changing for so many people.
10:45There are no wings, no strings, and no sticky things.
10:54Be honest, if men got their periods, we would have been demanding a product like the Be Free
10:59Cup decades ago.
11:01Amen.
11:02Lisa and Asaf say the Be Free Cup can be used for up to 12 hours of protection during menstruation,
11:08and unlike other cups, they do not require sterilization.
11:12Amazing.
11:14She's so needed in the world.
11:16It's available in three sizes and sells for $45 online.
11:20I think in an industry where the gender tax is a very real thing, also where humans are
11:26inherently lazy and having to boil, I love that you're making this feel so accessible to
11:33everyone.
11:34Before we get too deep, give me the high-level overview of how it works.
11:39Simply, you know the menstrual blood is coming down and trickling out of the vagina, so with
11:43the Be Free Cup, you just fold it up, you insert it, push it up, and it sits there and
11:48collects.
11:49When you take it out, you can just give it a light rinse or even just wipe it clean.
11:52So we've done cleaning tests at the research institution in France.
11:56And then you can use it again and again and again.
11:58So basically, the surface is super hydrophobic, so a biofilm can't stick to it.
12:04But the crucial point is it's not chemically antibacterial.
12:08It's physically antibacterial.
12:09It won't wash out.
12:10It won't like overrame.
12:11Exactly.
12:11What's your background?
12:12This is innovative.
12:13I'm trying to know how you got into this.
12:15I was a healthcare worker, but then I went into product design and development.
12:18I'd known of research that was coming out of Harvard and it was being used on other materials.
12:23And I said, can we try it on silicone?
12:25How did you guys meet?
12:26Asaf was in elementary school with my daughter.
12:29And there was this immediate synergy and sense of social justice.
12:34Now he is the husband of my daughter, the father of my grandchild.
12:40Lisa needed help.
12:41She was, at the time, my girlfriend's mom.
12:43And now you're wearing the vagina suit.
12:45We support Days for Girls and Period Poverty around the world.
12:49And I believe every country needs to cover this.
12:52What is your model?
12:53We are a social enterprise.
12:55We've kind of started the opposite way, literally from sub-Saharan Africa.
12:59A menstrual cup is a nice idea, but without access to clean water and fuel to boil it, it's just
13:07another waste.
13:08We have been working in Africa since 2013.
13:11We work with our local teams, local NGOs, on the ground in the countries where we're working.
13:17Always led by the government, Ministry of Health, Ministry of Education.
13:21And the business model is looking at, you know, direct to government.
13:25As someone who helped invent the period under our category, I know a lot about this industry.
13:30There is a really exciting shift that's happening where more and more governments and institutions are starting to pay for
13:36these products.
13:37Then let's talk about the money part, because now you're turning this into a business, which I love, because the
13:42Seven Virtues is a social enterprise.
13:44It's about making money, doing good in the world.
13:46Our sales to date have been 1.1 million, and I would say that 75% has been that international
13:52through NGOs.
13:54So we've had 1.1 million lifetime to date.
13:57Are we growing?
13:58Like, what happened last year?
13:59What do we think this year is going to look like?
14:01So last year was 385.
14:03This year we are anticipating, you know, 500,000.
14:07Were you break-even or profitable on the 385?
14:10I think the break-even is going to be 2026.
14:14So there's obviously two different business models here.
14:17You've got the international sort of aspect of it for people that are in need, but then also domestically you
14:21have the North American market that we want to tackle.
14:24So what's your guys' focus?
14:27So first of all, I'll say that you're right to look at it as these two different elements of the
14:32business.
14:32The last few months have been really tough.
14:34We're here asking for help because we've put millions into just the R&D.
14:38We've raised 2.3 million at this stage.
14:41How much have you invested?
14:44Everything.
14:47We've put in about $500,000.
14:49Wow, you've personally put in $500,000.
14:52Yeah.
14:52We truly believe we're sitting on a gold mine, not just in terms of menstrual cups, but this technology.
14:59The point is us getting out there and really having that money so that people are aware that the product
15:03actually exists.
15:04I didn't know that this existed.
15:05Yeah, so, you know, when I came on Dragon's Den, one thing that I really made sure to come in
15:12with was a really clear plan.
15:14And I haven't heard exactly what that plan is.
15:19I'm so rooting for all that you're doing, but I'm out.
15:25I don't necessarily think you guys need money.
15:27I think you need somebody who very much knows the market.
15:30For that reason, I'm going to be out.
15:33Lisa and Asaf, I want to thank you for the education today.
15:37Today, on behalf of the dads, the brothers, and the young boys growing up, you have a period expert, or
15:45should I say, an expert period in Joanna.
15:48But for today, I'm going to be out.
15:55What you've created is the solution, and it should be taken care of.
16:00It's a medical device.
16:02I hope every government official is watching this episode and starts getting their s*** together, because this is unacceptable.
16:10Joanna is your partner.
16:11There's no question.
16:12You're so passionate about this.
16:14I'm passionate, but I'm not the solution.
16:16I will lobby with you to get the changes made that you need to be the kind of progressive business.
16:20Otherwise, we're just chipping away at it.
16:21But this is the challenge with this category.
16:24It was so hard to raise money.
16:26Yes.
16:26Because you sit at this intersection of social, human rights and commerce.
16:32I wish you were at the stage for me to invest in you, but I'm out.
16:44You know, it's obvious that Joanna is such a great partner for you.
16:48Someone needs to write the Dane check, right?
16:50And that's such a big problem that nobody wants to be the first one.
16:54And I know that frustration, and I think what you're creating is so important.
16:58And so my feelings have evolved.
17:01I know CBG.
17:02I know retailers.
17:03I know how to drive brand awareness and make periods cool again.
17:07And if she'll have me, I will come in with her as a partner.
17:12Okay, so here's what I'm going to offer you.
17:14There's a lot of work to do, and I know that I can help you tremendously.
17:19So I think Tara and I will go in together.
17:21So we'll do $250,000 each, but we want 25% of the business.
17:31Okay, you say it.
17:32Okay.
17:37We're going to do it.
17:39Yeah!
17:41Amazing.
17:42Good job, guys.
17:44Yay!
17:45Thank you so much.
17:46Incredible what you've done.
17:48Incredible.
17:49Good for you.
17:51It's, you know, being validated that the work and the sleepless nights and the long days,
17:59that the work was worth it.
18:11Next up, I would say that my kids are the reason that I started this business.
18:18I love popcorn, but I really started it so that I could stay home with my kids.
18:26Now they're grown up.
18:28I've got more time to put into the business, and we're ready to scale it up.
18:34This Yukon mom-turned-entrepreneur is popping with ambition to take her Klondike creation from the North to the nation.
18:42Hello, dragons.
18:44My name is Katie Young, founder and CEO of Klondike Kettlecorn, and I've come to you all the way from
18:50Whitehorse, Yukon,
18:51in order to ask for $225,000 for 15% of my company.
18:56I launched Klondike Kettlecorn at our local community farmer's market 15 years ago,
19:02and I'm proud to say that we are now in retailers across the Yukon, Alberta, and BC.
19:07I've developed 50 different flavors.
19:10Now I'm ready to take the Yukon's favorite snack across Canada,
19:13and I'm looking for a dragon to join me on this exciting adventure.
19:18Dragons, I've picked out five of my favorite flavors for you to try, so feel free to share.
19:24Ooh, dark chocolate sea salt.
19:26I love popcorn.
19:27I've talked about this flavor.
19:28Mark, try this one.
19:29Okay.
19:31What?
19:32We were meant to do business together, Jay.
19:35Katie says the dark chocolate sea salt and dill pickle are her top sellers,
19:40but her unique flavors like birch caramel and spruce tip make the brand stand out.
19:45I know a thing or two about popcorn, but the coating on this, this is very indulgent.
19:50There's a lot of flavor.
19:52This is really good.
19:53I'm glad you like it.
19:54I can't stop eating it.
19:56The spruce tip.
19:58That's fascinating.
19:59Yeah, so spruce tips, they're an odd thing to put onto food,
20:02but in the Yukon, we seem to really like to use spruce tips in our cooking.
20:07Is it a bit of a hook for you guys, the idea that you have a lot of flavors?
20:1050 skews.
20:11Yeah.
20:11We've come up with a lot of different flavor combinations,
20:14eight different caramel flavors, eight seasonal skews,
20:18and then eight of our year-round skews as well.
20:21But I still have others to pick from that we've already developed.
20:25Is everything made out of the Yukon?
20:27Yes.
20:28Talk to us.
20:29Our production facility in the Yukon is really important to me,
20:32and we will keep producing out of there and servicing all of our northern communities
20:37and our direct sales and our online sales.
20:40But we have partnered with a co-packer out of Kamloops.
20:44Okay.
20:44That's pretty key in order for us to be able to scale nationally.
20:47Very good.
20:48What are your sales this year?
20:49So our sales this year were $420,000.
20:53Okay.
20:53Good for you.
20:54And then are we break even?
20:56Are we making money on that?
20:57This last year we're break even,
20:59only because we decided to invest some money into our website.
21:03We also hired a marketing team and a sales broker.
21:08It sounds like this has been a great business for you.
21:11So why scale now, and what is that big vision?
21:16Absolutely.
21:17Barb, I am reading your book, and I'm on Chapter 1.
21:21Wonder.
21:22And the theme is Wonder,
21:24and I have to say that is absolutely exactly why I'm here today.
21:28I know we have a really solid product,
21:31and I just feel like I have more to give.
21:33Katie, where do you want to go nationally?
21:35What's your dream?
21:35I would like to be in major grocery stores.
21:39I know it's a super competitive space,
21:41but I think you can stand out on the shelf.
21:44I don't want to crush the popcorn,
21:45but, you know, building smart suites,
21:48I had two SKUs until we hit well over $50 million in sales.
21:53And having the discipline of having a small number of SKUs
21:57gets you in the retailers.
21:59Which ones are you ready to get rid of?
22:01For our national sales, we've signed on with our first distributor,
22:06and they've picked five of the SKUs to go with.
22:08Jay, I want to hear this from you, actually,
22:11because popcorn is part of his business.
22:12How big is this market?
22:13Is this a big part of your business?
22:15The popcorn market is big,
22:17and I can see a gourmet popcorn like this doing really well.
22:21I would also like to hear a little bit about the costing,
22:24because when you're making it far from your consumer...
22:27So retail, the caramel corn sells for $10.50.
22:31The wholesale pricing is $7.
22:34How much does it cost for you to make a bag?
22:35$3 for the caramel.
22:37Great.
22:37So about a 50% margin.
22:39Yeah.
22:39You've got a distributor.
22:40So I'm just wondering what they're taking in terms of a percentage.
22:44Our profit margin working with our distributor will go down to 35%.
22:48Is that an act, Jay?
22:51It's tight.
22:52It's tight to be national.
22:54What is the plan with your distributor and your plan together for distribution
22:57for Canadian domination with your Canadian product, which is amazing?
23:01So our plan is pretty modest.
23:02We're opening up BC first.
23:04There's a lot of stores that wouldn't take us on until we had a distributor.
23:08We didn't bring much to the table for a distributor,
23:11because all of our stores are based in the Yukon, right?
23:14Katie, I'm going to jump in quickly here.
23:16You're obviously at this important stage where you are making that shift
23:18from being a lifestyle business and to go to something that's more venture-backed.
23:22For me, I want to see a little bit more clarity on the ambition
23:26of where you want to get things to.
23:28Don't be afraid to dream big, to think big,
23:30especially when you're bringing on board a partner.
23:32But for that reason, at this moment, I'm out.
23:34Okay, thank you.
23:35I think I'll go next after that.
23:37So listen, it's difficult to build a business in Canada.
23:39I think everybody knows that.
23:40Even more so in the Yukon.
23:41What you've done is incredibly impressive.
23:43But I'm not a huge fan of popcorn.
23:45I'm going to be out just because I'm not a user of the product.
23:49You know, Katie, when I hear you say that the distributor
23:53didn't think that you guys had enough to offer,
23:57that gets me fired up because I'm like,
23:59you have so much with it.
24:01You've been creating this for 15 years.
24:03I think there's such power if you can't reach a retailer from the top
24:06to reach them from the bottom, go into the stores, meet the store managers.
24:10And that's also how you can get the merchandising
24:13and tell the story that you have in such a powerful way.
24:17I love popcorn, but I don't love sugar.
24:21I'm out.
24:24Katie, I love your story.
24:27I love your innovation.
24:30For me, it's a little bit uneasy for me to get into another popcorn business.
24:36I'm going to be out on this deal.
24:39Ever since I was little, all I dreamed of was selling popcorn and iced tea.
24:43Two things that are of huge profit margin.
24:45I'm in love.
24:46It's my favorite snack.
24:47Fragrance is the hottest business right now.
24:50It's the highest beauty category.
24:51We're on fire outpacing all growth.
24:54If we can do something fun with the popcorn candles and perfume and gourmand,
24:59I think we shake it up and not do what everybody else is doing.
25:02That sounds amazing.
25:04Is that an offer?
25:06Looking at the numbers, it's a bit steep for me.
25:10So we are just launching in TJX.
25:13There's 500 stores in Canada.
25:15By the end of 2026, we could double our revenue.
25:19My only concern is that I do not have the food background.
25:27When I was standing where you are, I needed wisdom from my investor.
25:31Barb, I feel like I really connected with you when I...
25:35Looked into your business.
25:38And I feel like what you are trying to do globally is what I'm doing in my community.
25:44I thought I was going to get through this without crying today, but I do really connect with you.
25:52Suspense is killing me.
25:56$2.25 for 20%.
26:05You ready?
26:06Let's do it.
26:12Barb, thank you.
26:13This is an amazing deal.
26:14That was amazing.
26:15This is a great deal.
26:17Thank you, Katie.
26:18Thank you so much.
26:19I was like, I've never been in the food business, but hey.
26:22You are now.
26:22I've never been so invested emotionally in a deal.
26:26Like, I was holding my breath.
26:28That was unbelievable.
26:30It's possible.
26:32That's really what I want people to know is that, you know, you should be uncomfortable.
26:35You have to get uncomfortable.
26:37You have to go do things that terrify you, but they're worth it because that's when you grow.
26:41That's when you stretch.
26:53Next up, a solo founder ready to milk an opportunity and make big moves in the dairy farming industry.
27:01Hi, Dragons.
27:02My name is Dr. Sherry Vandepoel.
27:04I'm from Hamilton, Ontario.
27:06I am the founder and CEO of Catalytics.
27:09And I'm also both a large animal veterinarian and a computer engineer.
27:14Wow.
27:15Good for you.
27:16I'm looking for $1.2 million for 10% of my company.
27:22We are revolutionizing dairy software by creating smart solutions.
27:28Now, dairy farmers work incredibly hard.
27:31This is a really complex industry, but they're using WhatsApp for management.
27:36Protocols are in a dusty binder.
27:38And on top of that, their software was made in the 80s.
27:41This is a $21 billion industry, and we can do so much better than this.
27:46So I founded Catalytics.
27:48We do management, team, and data connection.
27:50Because farmers say, I'm great with cows, not so great with people.
27:53We help them be great with people.
27:55So everybody knows what to do, how to do it, and when to do it.
27:59And now we have, dare I say, the best dairy scheduler out there.
28:04So together, we can be legend dairy.
28:07Hey.
28:08Oh, I love it.
28:10Actually, there's a couple cows that need to be looked at today.
28:14I'm wondering if anybody would want to be a dairy farmer with me.
28:17Cows? Oh my gosh, who does not want to be a dairy farmer?
28:19Pumpkin and Spice?
28:21They need a checkup.
28:22Oh, wow.
28:24Real cows?
28:24So I was hoping that you could do a checkup with me on these beautiful, show-ready cows.
28:30Yes.
28:32Oh my gosh.
28:34Oh my gosh.
28:34I've never actually been this close to a cow.
28:37Do you want to have one?
28:38Can I give it a try?
28:39She's beautiful.
28:39Sherry says the platform is an all-in-one farm management tool that saves farmers time
28:45and money.
28:46She's created a task manager that automates daily operations like training and staff schedules
28:52and tracks chores.
28:54Yeah, yeah.
28:55Never pet a cow before.
28:56Oh, it's so fun.
28:56Another component in development is a dairy management system, which can track each cow's
29:02milk production and monitor its health.
29:06And finally, that tracked data can help pinpoint where farmers may be losing profits through
29:12inefficiencies and offer potential solutions.
29:16Aw.
29:18Amazing.
29:18Okay, let's get moving back to my chase.
29:21Yeah.
29:23Just being from Anna Ganesh, rural Nova Scotia, and having a cow as a pet as a child, my cow
29:28Buttercup, we know we're facing a lot of challenges in the industry.
29:32We're seeing the kids are not necessarily taking over the farm.
29:35And so this kind of software is going to be really important for farmers.
29:40Absolutely.
29:41Like, it absolutely is.
29:42So just our task manager alone, I mean, I called some of our clients and they're like,
29:47yeah, easy two hours a day, it saves me.
29:50It's massive.
29:51And when I was going to dairies, I started modeling things like lactation curves.
29:55But one of the farmers I was talking to, I was looking through his data and I said,
29:59you know, why is it that last October you made so much less milk?
30:04And then when I talked to him about it, he said, I know what it is.
30:08I changed my feed.
30:09And when we uncovered the amount of money that meant, it was huge.
30:13But because of the complexity on a dairy, it's really difficult to actually tease out what's
30:19causing the difference.
30:20But when we were able to do that, we were able to uncover so much.
30:23How much money have you put into this so far?
30:25Did you say cow much money?
30:26I don't know if I'm just hearing that.
30:28That would be a good thing.
30:29Yeah.
30:29So cow much money.
30:30So it's taken about $1.4 million to get to this point.
30:34Whoa.
30:34Wow.
30:34But we have no debt.
30:36Where did you get $1.4 million from?
30:39This actually is a priority of the Canadian government.
30:41And they have been so generous as well.
30:44And they funded you as well?
30:45Yeah.
30:46Good job.
30:46That's very good.
30:47And do you have any investors?
30:49No, we don't.
30:50That's incredible.
30:51Congratulations.
30:51So it's you.
30:52Yeah.
30:52That's amazing.
30:53That's amazing.
30:54And quite the feat to get to where you have and bootstrap it along the way.
30:58And to be a solo founder on top of that, I am so inspired by you.
31:03You did this too.
31:04I'm inspired by you guys.
31:06So what's the revenue model?
31:08How do you make money?
31:09I knew you guys were going to get into that.
31:11I can only keep you distracted with cows so long.
31:15So there's three tiers to it.
31:17The first tier is really that direct-to-farmer software as a service.
31:21So it's an annual $750 for farms that are less than 1,500 cows.
31:27Okay.
31:28The second tier is the one that we're building right now.
31:31And that's the management.
31:32And the market for that right now is $3 to $4 a cow.
31:35And the third tier is really the data analysis.
31:37Okay.
31:37Tell us a bit about how many customers you have.
31:41So right now, we have 200,000 cows on our platform.
31:45So you're making $4 at 200,000 cows.
31:49I'm just trying to get the math on this.
31:50So there's the three revenue streams.
31:51One is getting the data in and providing those team services.
31:54That's a minimal amount.
31:56So I get the streams.
31:57Can you convert that to dollars?
31:59Tell us the dollars.
32:00I'm trying to do cow math over here.
32:01I'm trying to do cow math.
32:02It's last year we made.
32:03So last year we made $120,000 off of that first piece that we had out, which was our team
32:11piece of it.
32:12Did you guys break even then?
32:13So we still didn't break even.
32:16Our burn rate's probably about $9,000 a month.
32:18Gotcha.
32:19So you guys lost about $120,000.
32:21So we lost that.
32:22Gotcha, okay.
32:22So we do have that.
32:24Here's what I'm worried about with your valuation at the moment.
32:26You've got one tier of revenue that is going well.
32:30And then you've got two potential in the pipeline that we don't have proof for yet.
32:35Yeah.
32:35And if this doesn't go as planned, it's going to be really hard to get a valuation that's higher than
32:41$12 million.
32:42And I think to what Joanne is saying too, I think if you choose a valuation that puts you in
32:47a pressure cooker, that sets the expectation for growth and the pace that you're going to grow at.
32:53Today, I am passionate about petting your cows and hugging them, but not as much about managing them.
33:01So I'm going to be moving out of this one.
33:07Here's what I'll tell you on that too.
33:08This goes from being something that everybody here is really excited about that we can invest into trying to milk
33:13a deal.
33:13So I'm going to be out.
33:15Okay.
33:17But the thing is, is that we talked about three streams, but two of the streams have money set up
33:22for the next year.
33:22So we still have an additional almost million dollars in matching funds from the Canadian government.
33:28It's a lot of money, $1.2 million.
33:30It's not a small check.
33:31Right.
33:32And I don't know enough about this industry to be helpful.
33:36I just can't get behind it.
33:37So I'm out.
33:41I would challenge you to hang on to your equity a little longer and see if you can build your
33:46numbers, grow, convert, and add on more farms.
33:49I'm out for that reason, but I do wish you luck.
33:52Okay.
33:54Sherry, memory lane for me.
33:56Buttercup.
33:564-H club, my cow buttercup, looking at her big brown eyes.
34:00And, you know, I think about you and I think of my farmers in Afghanistan and Haiti and Rwanda helping
34:06them.
34:06But I'll tell you, when I stood right there, and I know what it feels like, thinking you need all
34:12this money, I really don't think you'd do.
34:15I had one investor, Brett Wilson here on Dragon's Den, and then I bootstrapped for 15 years until I got
34:22my millions of investment.
34:24You couldn't bootstrap with the money you're getting from the government, and this is yours.
34:29And I want that for you.
34:31Today, I'm going to be out.
34:34Okay.
34:35Thank you, Sherry.
34:37Okay.
34:38Congratulations.
34:38Thank you, Sherry.
34:39Thank you, Sherry.
34:39That's a blast.
34:40She's got this, though.
34:41She's a smart cookie.
34:42She's got this.
34:43Doing that as a solo founder, it is truly nothing short of incredible.
34:48She is amazing.
34:50To be part of the Dragon's Den legacy is a huge honor.
34:54I could never have imagined when I watched the show obsessively in my early teenage years that I could maybe
35:02be capable of acting on an idea.
35:04The advice that I would give to entrepreneurs is think big and then pause and think even bigger.
35:25And finally, these university grads from Montreal are here with their natural performance solution designed to keep athletes buzzing.
35:33Hi, Dragons.
35:34I'm Jeremy.
35:34And I'm Maddie.
35:35We're here today asking for $150,000 for 10% for a company.
35:40Jeremy is a longtime gym goer, and I used to play competitive soccer.
35:43We never really liked taking chemical pre-workouts.
35:46Instead, we just used honey.
35:47After testing different markets, we realized that runners are the biggest gel consumers in the world.
35:51Most gels on the market right now, they either taste bad or they're filled with chemicals.
35:55But Hornet Energy is different.
35:56Made from pure honey and pink helium salt with the optional caffeine coming in from black tea and the 100
36:01% natural flavors, Hornet Energy tastes amazing, digests clean, and fuels you naturally and optimally.
36:07Dragons, how about we go for a quick taste test?
36:09There's all three flavors.
36:10Blueberry raspberry, original, which is matcha, and apple cinnamon.
36:14And the three gels under them, it's the same flavors, but just the caffeinated 50 milligram version.
36:18Jeremy and Maddie say the honey's natural sugars deliver about 30 minutes of boosted energy, while the pink salts help
36:25keep electrolytes balanced.
36:27I'm obviously going to go for the caffeine so I can be buzzing.
36:31A single-serve pouch sells for about $3.
36:35Well, the apple cinnamon's really good.
36:37It is actually good.
36:37It just tastes like honey in a pouch.
36:39Yeah, don't like honey.
36:40It's the purest Canadian honey we can find in large volume as well.
36:42It tastes better than other gels in the market for sure.
36:45Like, there's no question about it.
36:46Do you use these a lot when you're running?
36:48I use these a lot.
36:48So, I run essentially every day.
36:50You know, we'll be doing 90 kilometers a week in training, and I want to find a more natural alternative.
36:55So, this is filling a need flavor-wise?
36:56Mark, I drove 90 kilometers last week.
36:58Yeah.
36:59So, guys, now that you've tasted it, how about we put it to the test in the Hornet Energy Gym?
37:06Hornet Energy Gym!
37:07Oh, my goodness.
37:10Mark and Jay, how about you guys go get in your gym clothes?
37:12Jay, you ready?
37:13Mark, I'll see you in the gym.
37:15All right.
37:15Do it.
37:16All right.
37:16Jay, with the muscles, let's do the gun show.
37:18Let's go.
37:19Let's go.
37:20Yeah.
37:21Keep those away from me.
37:22Yeah.
37:23Three, two, one, go!
37:26They're putting two dragons to the test for a three-minute run to see who finishes strong
37:31and who's left winded.
37:33A minute down.
37:34Mark, how are you doing?
37:35You tired?
37:36We're good.
37:36I've got a secret weapon here.
37:37Boy, you're going.
37:38With Mark as the only one powered by Hornet Energy.
37:42Got to pick it up there, Jay.
37:44I'm trying.
37:45Does anyone need a towel and some water?
37:47Mark doesn't look like he's fading.
37:49Stay focused.
37:50Five, four, three, two, one.
37:55Stop your treadmill.
37:56Woo!
37:57Who did it?
37:58Congrats, guys.
37:59Oh.
38:03And the winner by unanimous decision, Mark.
38:07Yay!
38:08I present to you the Hornet Trophy.
38:12Thank you, Tara.
38:13Yay!
38:13Yay!
38:14And I'd like to dedicate this to the Hornet guys for getting me through that run.
38:17Thank you so much.
38:18Well done.
38:20Congrats.
38:22I was waiting.
38:24I was waiting for that.
38:26Cheers.
38:29How did you come up with this?
38:31I was in university with Madi, and we saw this trend on TikTok about this honey and pink
38:35salt challenge.
38:36People going to the gym, ingesting honey and pink salt, and that gave them a pump.
38:40I looked online.
38:41Not many options.
38:42Like, well, we've got to commercialize this, right?
38:43Yeah, just became a co-founder, and the rest is history.
38:45That's a great story.
38:46How many competitors do you have?
38:48The red ones with honey?
38:49Yep.
38:49One in Canada.
38:50I'll say this is a better product.
38:52Here's the thing.
38:53Somebody's going to win in the space.
38:54This is going to be who can market better, who can get into the running community better,
38:59because there are a lot of incumbents in the space that are doing a good job.
39:01Why don't you tell us a little bit about your business and your financials and your sales?
39:05Lifetime revenue so far in that year and a half has been close to $100,000, with more
39:08than half coming in this year alone.
39:10Wow.
39:11We have a distributor that we just launched, like, about a month ago.
39:13With 800 stores across Canada.
39:15So the stores that they have access to, they basically have all the sports checks, all
39:18the sports experts.
39:18That's already a huge market.
39:19Those alone are six-figure deals.
39:21What's your production in the factory?
39:23You're going all across the country, and how will you keep up with that?
39:26We own a production facility.
39:27We now make close to 500 gels per hour at maximum capacity, but we are in very heavy
39:32talks with a supplier to make new machines that will make up to 2,000 gels an hour, which
39:36is $8 million a year in potential revenue, automated.
39:39And how much does it cost you to make one of those?
39:42Per gel, it's about 30 cents.
39:4330 cents.
39:44Have you guys thought about doing this as a subscription?
39:47Because I'm always looking, same thing.
39:48We actually launched it recently, and we've amassed over 100 subscribers.
39:51And since our substitution model entails a three-month commitment, those 100 subscribers
39:55is basically 300 guaranteed orders, which is basically $15,000 of guaranteed money at
40:0050% margins.
40:01Wow.
40:02Great.
40:03What does five years look like from now, revenue-wise?
40:06Well, in five years, we'll be the biggest natural gel on the market.
40:08Like, our only goal right now is to make 50K next month.
40:10Step by step.
40:11Look, I think that it's so important to, yes, take it step by step, but also to know where
40:16you're going.
40:16I mean, it's a bit of a funny question, because right now operations are going to get pretty
40:21lean.
40:22And our goal is just to get into Europe.
40:23You're financed, though, so I'm sure you've run the model, right?
40:25Like, I'm hoping you have a financial model.
40:27Yeah.
40:27You do, right?
40:29I can tell you, year one, 500,000, year two is 2 million, year three is five, and year
40:34three is where we get to Europe, United States, and all this.
40:36How are you guys differentiating yourselves?
40:38I'm thinking about brands that are scaled way beyond where you guys are today that you
40:41will inevitably sit on shelf next to.
40:44We go viral on a weekly basis on Instagram.
40:46Our ads are insanely good.
40:47We tend the most run clubs out of any of our competitors, and we actually show up and run
40:50with them.
40:51We don't say, hey, I'm a product.
40:52We just run and talk as a runner, because we are runners.
40:55We actually came and sponsored the Toronto Marathon.
40:58I think Mark was running it, actually.
41:00I don't know if he had to.
41:01They have been there, yeah.
41:02This is the kind of spirit we want to see in entrepreneurs.
41:04I don't think I've ever seen anybody like you two.
41:06I love how you guys show up.
41:09I think so much of entrepreneurship is just showing up.
41:12Absolutely.
41:13Jeremy and Maddie, we see ourselves in you guys, and we know we can bring this thing full
41:19circle and get you to scale your company the same way we have.
41:23Today, we'd like to present you with an offer for $150,000, and all five of us are going
41:29to split 30%.
41:32There's a big gap in valuation.
41:33We come in with a $1.5 million.
41:34You guys offer $500,000.
41:37We are willing to budge to $250,000 for 25%.
41:42I think the valuation that you're bouncing back to us is just not rooted in reality of
41:47where you guys are today, or in a way that I think any of us would feel honored in participating
41:52in your journey.
41:53The reason why is that if we were to sell 25% of the company, I would then have around
41:5851%.
41:58I want to retain that because I want to control my own company.
42:01I'm the founder of this.
42:02Think about the multiple that you're asking us for, though, on a numbers perspective.
42:06We are honored to be here, but we're very adamant on that 25%.
42:09We're literally doing what you did with Pure and what you're doing with Smart Suites in
42:13the job industry, in a booming industry.
42:15This market is going to exponentially just grow.
42:17How are you guys going to get to that market without some help?
42:20We're very confident in our ability to do it ourselves as well, but the thing is, you
42:25guys want founders that are also going to always look for a better deal and listen to
42:29our gut.
42:30I did exactly what you did just now in my pitch, and I don't want to speak for everyone, but
42:36I'm going to here.
42:38I think 5% each is a fair trade-off.
42:40Yep.
42:44I'm happy to throw in one of my percent.
42:46Yeah, I'll do it for sure.
42:48Yeah, I'm in.
42:49Tara, are you okay?
42:51Tara?
42:52Let's see.
42:55I mean, I think there are those moments where you are taking a bet on the person, and I
43:04believe in you.
43:05So, yeah, let's get buzzing.
43:07Let's do it.
43:07Awesome.
43:08Good job.
43:09Good job, guys.
43:10That's amazing.
43:11So much, too.
43:12I was breaking the sweat here.
43:13Good job.
43:15Awesome.
43:15Yeah, man.
43:16Congratulations.
43:17Good.
43:18Congrats.
43:18Thank you so much.
43:19Love what you guys do.
43:22We came here with the mind that perhaps we would get a deal, but who knows, right?
43:26And now all five dragons.
43:27And I'm happy that we stuck to our gut and stood our ground.
43:30This is a great deal.
43:31Great founders.
43:32This is what you want to see.
43:33It's what you want to see.
43:34These guys are going to do great things.
43:35Oh, my God.
43:36We get to stay together forever.
43:39We get to stay together forever.
43:41Put some money on your mouth.
43:44It's your mama said that you know it's real.
43:49Put some money in your mouth.
43:51And your hands are up on the wheel.
43:58There you are.
44:05I'm happy that they're together.
44:08We are now and to listen.
44:08Here you are.
44:09bĂȘnckĐžĐœ's high FORWARD.
44:09We areŰčÙan.
44:09Everything was second time.
44:10I'm hungry.
44:10Being praised and stew is my arguments.
44:10Thsek and Wahey.
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