Key Points:
Investment: £60,000
Investor: Sarah Davies and Tuka Suleiman
Equity Offered: 49%
Business: Beach Powder
Target Audience: Beachgoers, Families with children, Outdoor enthusiasts
Challenges: Limited initial sales, high business valuation, need for strategic partnerships
Ingenious Beach Product Wows the Dragons
Stephanie Kelsey entered the Dragons' Den with her innovative product, Beach Powder, seeking an investment to take her business to new heights. The product, designed to easily remove sand from the skin, captivated the Dragons with its practicality and unique solution to a common problem faced by beachgoers.
Investment Details
Investment: Stephanie sought £60,000 in exchange for a 10% equity stake in her company. After rigorous discussions and evaluations, she secured the full investment amount from two Dragons, Sarah Davies and Tuka Suleiman, but had to agree to give up 49% of her business.
Business Background
Business: Beach Powder is a powder that effortlessly removes sand from the skin, making beach trips more enjoyable and hassle-free. Stephanie highlighted her self-sufficiency in creating, manufacturing, and marketing the product, but acknowledged the need for strategic partnerships to scale her business.
Target Audience: The product appeals to beachgoers, families with children, and outdoor enthusiasts who frequently deal with the nuisance of sand sticking to their skin.
Challenges and Opportunities
Challenges: Despite its promising concept, Beach Powder faced several challenges. The company's turnover in the past 12 months was only £18,000, which led to skepticism about the high valuation of £600,000. Additionally, Stephanie's ambitious sales projections and the notion of her running the business solo raised concerns among the Dragons about her business acumen and scalability plans.
Opportunities: Sarah Davies and Tuka Suleiman saw potential in the product and its marketability. Sarah, with her TV shopping experience, and Tuka, with his extensive retail connections, provide the perfect synergy to propel Beach Powder to new heights. Their investment not only brings financial support but also invaluable industry expertise and market access.
The Pitch and Negotiation
Stephanie's pitch impressed the Dragons with the product demonstration, proving its effectiveness in removing sand. However, her high valuation and modest sales figures drew critical scrutiny. Deborah Meaden and Tej Lalvani highlighted the unrealistic nature of her financial forecasts and ultimately decided not to invest.
Sarah Davies, recognizing the genuine need for such a product and having personally experienced the inconvenience it addresses, offered Stephanie the full amount but for a 49% stake, valuing the company at £120,000. Tuka Suleiman proposed splitting the investment with Sarah, making it a combined offer from both Dragons.
The Outcome
Stephanie accepted the joint offer from Sarah and Tuka, agreeing to give up nearly half of her company. This decision came with the understanding that the partnership would provide essential support in opening doors, enhancing marketing strategies, and scaling operations internationally.
Conclusion
Stephanie Kelsey's journey in the Dragons' Den ended with a successful deal, securing £60,000 for a 49% equity stake in Beach Powder. With the combined expertise and resources of Sarah Davies and Tuka Suleiman, Beach Powder is set to expand its market presence and achieve significant growth, transforming Stephanie's innovative idea into a global success.
Stay tuned for more updates on how this investment will help Beach Powder make waves in the beach product industry!