- Investment: £60,000
- Investor: Touker Souleyman
- Equity Offered: 30%
- Business: BAD Brownie, gourmet brownie producers
- Target Audience: High-end food market consumers and potential retail customers
- Challenges: High costs associated with opening a retail shop in central London, skepticism from investors about the feasibility of the retail model
BAD Brownies Secure Investment from Tuka Suleiman
BAD Brownie, a gourmet brownie business, successfully secured a £60,000 investment from Touker Suleyman in exchange for 30% equity. Despite initial skepticism from other dragons, Suleiman saw potential in the business and decided to back their vision of opening a retail shop in central London.
The Pitch
BAD Brownie founders, Paz Samah and Morag Ekanger, entered the Dragons' Den seeking £60,000 for a 15% share in their business. They showcased their range of gourmet brownies, highlighting popular flavors such as salted caramel and bacon with maple syrup. The duo, passionate about chocolate and baking, emphasized their journey from a small kitchen operation to producing thousands of brownies per week from their own production unit in southeast London.
Financials and Offer
BAD Brownie had a turnover of £300,000 with projections to exceed £800,000 in the next 12 months. The investment sought was to fund their first retail shop in central London, supplementing their own capital. While their brownies were praised for taste, concerns arose about the financial viability of a central London store. Suleyman, recognizing the potential but wary of the high equity request, offered the full amount for 35% equity, which was later negotiated down to 30%.
Challenges Highlighted by the Dragons
The dragons raised significant concerns:
- High Operating Costs: Sarah Willingham pointed out the substantial costs of securing a central London retail space, which could erode profits.
- Skeptical Financial Projections: Nick Jenkins questioned the margins, revealing potential financial instability.
- Retail Model Viability: The dragons doubted the feasibility of sustaining a retail shop with the projected costs and turnover.
Conclusion
Despite the challenges and initial rejections, BAD Brownie founders persisted. Touker Suleyman's belief in their brand and vision led him to invest £60,000 for a 30% stake, helping them take a crucial step towards expanding into retail. This investment marks a significant milestone for BAD Brownie, setting them on a path to potentially become a leading brownie retailer in London.
Life After the Den
Investment and Early Challenges Paz Samah and Morag Ekanger, the founders of BAD Brownie, secured a £60,000 investment from Touker Suleyman in exchange for 30% equity. The paperwork for the deal took nearly a year to complete, but once finalized, the investment allowed BAD Brownie to expand their business operations. One of the first initiatives under Suleyman's guidance was opening a kiosk in a shopping center, which provided valuable retail experience despite not being an immediate success (Bad Brownie) (Insider Growth).
Adaptation and GrowthTheir business model evolved post-investment. Initially, the founders envisioned opening flagship stores; however, Suleyman advised targeting smaller, high-volume locations. This strategic shift led to a partnership with Pret A Manger to create a vegan and gluten-free brownie, which became a popular addition to their product range (Bad Brownie).
Impact of the PandemicThe COVID-19 pandemic brought unexpected challenges and opportunities. While their physical retail locations had to close, online sales soared, particularly around events like Mother’s Day. This surge in demand led to record-breaking online sales, necessitating the expansion to a larger production facility in Hayes. The pandemic, while disruptive, ultimately accelerated their shift towards e-commerce (Bad Brownie) (Bad Brownie).
Current Status and Future Plans Today, BAD Brownie continues to thrive, with a net worth estimated at around £1.5 million as of 2022. They have expanded their product offerings to include keto brownies and have focused on maintaining high-quality standards using premium ingredients. The company has rebranded and relocated to a new headquarters, positioning itself for further growth and innovation in the gourmet brownie market (Insider Growth) (Bad Brownie).
BAD Brownie’s journey demonstrates resilience and adaptability, turning challenges into opportunities and continually evolving their business to meet market demands.