Dragons' Den Episode 3 – The Air Mouse
This week’s episode of Dragons’ Den on CBC featured one of the smoothest deals I have yet seen.
Mark Bajramovic and Dr. Oren Tessler of Ottawa, Ontario, presented the Air Mouse. Originally developed in order to reduce Carpal Tunnel Syndrome, it has applications in a variety of areas. The invention looks like a glove, and works like a mouse on a dedicated pad. They expect to retail the device for about $100, which is a good price point for a quality mouse.
They came on the show asking for $75,000 for a 15% share in the company. To back them up, they pulled out a letter of intent from a manufacturer agreeing to produce the device, pending them getting sufficient funding. The investment was to be used to refine the prototype and to move into production.
Robert Herjavec and Kevin O’Leary got into a brief debate about how to market a product like this. Robert felt that it could be marketed as being a “cool” device, appealing to the gaming industry. Kevin disagreed, saying that for people who suffered from carpal tunnel syndrome, a device like this could become a necessity, thereby pushing up the price.
Jim Treliving was concerned about the asking price – why weren’t Mark and Oren asking for more money? (Their response was that rather than get into an argument with Kevin O’Leary, they just made a fair evaluation.)
Brett Wilson was quiet for this deal – only saying that he liked the idea, but wasn’t going to invest.
Arlene Dickinson then made an offer – $75,000 for 15%, with the caveat that there was not yet another such product on the market (there isn’t). With such an offer, the other Dragons did not have much room to counter – after all, Arlene was offering exactly what Mark and Oren were asking for.
After some pushing, Mark and Oren managed to get Robert to go along with Arlene on the deal. Robert, with his experience in the computing industry, could really help them move their product through the computing world. Arlene’s marketing expertise would balance that, pushing the product out at the gaming industry.
The deal was struck.
This deal shows that if you know what you have, and know what you’re worth, it doesn’t have to be so tough on the Den!