Key Points:
Investment: £50,000
Investor: None
Equity Offered: 10%
Business: Fresh Seasonal Olive Oil Club
Target Audience: Food Enthusiasts, Quality-Conscious Consumers
Challenges: Financial Viability, Market Demand, Price Point Competitiveness
Blog Post
Passionate Olive Oil Entrepreneur Fails to Secure Investment on Dragons' Den
Michael North, a 57-year-old entrepreneur from Somerset, presented his unique business, the Fresh Seasonal Olive Oil Club, to the Dragons on Dragons' Den. Despite his fervent pitch and compelling product, he walked away without the £50,000 investment he sought in exchange for 10% equity. Here’s a detailed breakdown of his journey in the Den.
The Pitch
Michael North passionately introduced his Fresh Seasonal Olive Oil Club, a subscription-based service delivering high-quality, fresh olive oil from around the world to customers' doorsteps. He drew parallels to the success of wine clubs, emphasizing the untapped potential of olive oil varieties. With 57 initial members, Michael believed it was time to scale his business. His proposition involved traveling to different countries, sourcing the freshest olive oil, and delivering it within eight weeks of harvest to ensure maximum quality and flavor.
Financials and Offer
Michael offered 10% of his company for a £50,000 investment. His price point for the subscription was £264.85 for 12 bottles, delivered seasonally. However, he struggled with his financial projections, which did not instill confidence in the Dragons. Despite his enthusiasm, Michael admitted he wasn’t great with figures, leading to confusion and skepticism among the investors.
Challenges Highlighted by the Dragons
- Financial Viability: Michael's unclear financials and inability to present accurate projections were major red flags. His numbers didn't add up, causing concern about the business's profitability and sustainability.
- Market Demand: The Dragons questioned the demand for a premium-priced olive oil subscription service, especially when quality olive oil is available at much lower prices in supermarkets.
- Price Point Competitiveness: Deborah Meaden highlighted the availability of excellent olive oils in supermarkets for under £10, making Michael’s £22 per bottle price point seem excessive to the average consumer.
Conclusion
Despite Michael North's infectious enthusiasm and deep knowledge of olive oil, he failed to secure the desired investment. The Dragons appreciated his passion but had significant concerns about the business model’s scalability, market demand, and financial viability. Ultimately, they couldn't see a return on investment and opted out. Michael left the Den without the funding but with valuable feedback that could help refine his business strategy moving forward.