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some great businesses in Britain have had their gestation in 1 of our universities
Where better to develop and refine an idea
well next out to the lift is Cheshire based
Tim Morgan whose inventions started out as a final year project at uni
Hello dragons
my name's Tim Morgan and I'm managing director of the Mountain Trike company
I'm here today it's pitch for a hundred thousand pounds
in return for a five percent share in the business our product is the
revolutionary
mountain trike all-terrain wheelchair it uniquely gives
wheelchair users the freedom and independence to access and enjoy the
countryside
the patented lever drive steering and suspension systems
enable the user to ride over a wide variety of terrain
such as deep mud snow sandy beaches
in comfort and safety and the whole time
with clean hands and is this versatility that is really appeal to a target market
as in the same chair they can go for country ride and pop into a pub for
lunch
or go for family cycle ride. Or if they're feeling even more adventurous
Go an summit Mount Snowdon or Ben Nevis. No other manual wheelchair
on the market offers this level off-road performance
combined with practicality and comfort. the mountain trike has been very well received
by our target market since we started trading in August 2011
and we've generated a turnover 360,000 pounds
and are now at break-even. in addition to a wide variety of
individual customers worldwide we have also sold direct to the British Army
you have a fleet of 5 trikes at their main rehab unit Headley Court
where the injured soldiers use them to aid in their recovery
I feel this is an attractive proposition for an investor
as there's opportunity to double your money in the next two to three years
I also feel their considerable social and ethical benefits to
being involved with this UK made Product that is having a fantastic
difference to the lives have
wheelchair users worldwide and if you'd like to speak to one of our very first
customers
we have someone here today he can give you his first hand experience of
how to trike has benefited his life
a robust pitch from Crew based Tim Morgan
his mountain bike wheelchair
hybrid needs a sizable 100,000 pound
cash injection in return for just a 5 percent stake
Peter Jones wants to put the wheels of interrogation
into motion
I will come back to something in a minute and it's the two million pound
valuation
but before I do can we see your advocate in action
ok, sure
good afternoon dragons
Hi there, what's your name? My name's Richard
Hi, could you give us a quick demonstration yep
you got any rough terrain I could go over?
And how fast can it go Richard?
erm, about 4-5 miles per hour
wow - do you feel safer in it
than a normal wheelchair, is that one of the yeah
I haven't fallen out of this one yet
I've fallen out of my regular wheelchair several times, there isn't anything that I
don't like about it
I mean it helps me to live my life
in the way that I want to live it. Richard thank you very much.
You're welcome. - Thank you Richard
Richard's seal of approval has made a good first impression on the dragons
but Peter Jones wants to get back to the thorny issue of how much
Tim thinks his company is worth. what is in your mind
about valuing this at this stage
your business at 2 million pounds. First of all, I'm kinda recognising that we're
no longer a start-up, we're an early-stage company we've been trading for a
year-and-a-half we're also just breaking even and starting to break into
profitability
So we've just got American approval so this is a
very large market for us we feel that the overall addressable
market is around half a million
so the actual unit figures we've sold so far, we've projected in our plans
are a very modest percentage of that. for this year
we've projected 70 units and a turnover of 282,000
for next year forecasting a turnover of 406,000
and 100 units and how much you make unit at present the manufacture cost is 2 and half
thousand pounds
and retail is 3995
Tim's impressive sales projections
have revealed a potential money making opportunity but Duncan Bannatyne
suspects
he's priced himself out of the market I was pushing a wheelchair last weekend okay
and... two wheels a bit of cloth between them
I don't believe for one minute it costs that sort of money
very basical wheelchair would be a couple hundred pounds but that would last
not very long you couldn't really go out and buy
ok what I'm trying to do is to see what you're comparing your price
with
yeah so what's the next one above that what so really than you
probably there is a maybe more entry-level type things - wheelchair
that's reasonably lightweight that if someone
is paralyzed from the waist down for example they will need something like
that for that kind of
getting about the house to into the office it's small it's
lightweight
but it's limited to smooth ground this really is
offering a whole different range of capabilities
how big is this market do you think
in UK there are 1.4 million wheelchair users
what they're buying pattern a wheelchair user? traditionally they may buy from
a local dealer or what we're seeing increasing now is that
with the increase in web sales and things like that that
people are wanting to source more directly. It sounds to me
to be honest if I was buying a bike, certainly if I was buying a wheelchair, I'd want to sit in it
so is that not an issue when you're trying to sell online? basically we
we still have a lot first-hand contact with the customer so
we go out and do personal home demos, we have hiring scheme where people can hire for
a week or a weekend
try it at home for longer periods and a lot of time that's a nice
try before you buy method as well I'm
right
the entrepreneur seems to have thought of everything Piers Linney want to know
whether that includes protecting the design of his product
seems to me that somebody else not easily but could
come up with a wheelchair with levers and brakes and steering
that's probably as effective as yours but maybe not design in quite the same way
the patents I wrote were very broad for a start, so they covered lots of different
options so
someone can't for example just put the steering wheel at the front and get around it
so nobody else could copy that in anyway
I should point out the UK patents not
so I filed them when I still a student at that stage
was only able to afford UK Patent coverage
and since then we've been through various stages so we couldn't extend it to be
international. just a shame was it's a case in point on how not to protect
intellectual property
criticism have Tim's patent could the wheels be starting to come off
is otherwise perfect pitch. Kelly Hoppen
wants to drill down into the structure of Tim's business
When you say we all the time how many people is in the company
myself I've a 47 percent share in the business
I have two good friends from Univeristy
who helped in the development and commercialization they have 10 percent
and 3 percent respectively
and then the two other people kind of
helped me get to market and get to where we are now
are our manufacturing director and he has 20 percent
and also our chairman who has 20 percent
Kelly Hoppen has unearthed some crucial information about the
complicated chair structure
of Tim's company. Deborah Meaden wants to know how the revelation
affects a potential deal. have you come in here today
with the other directors agreeing to any form of dilution
yes we've agreed that the five percent share is the
most that we can offer between us and we've also agreed how that
would break down
myself I'd lose three percent and... so there would be no point in me making you any offer
above 5 percent?
I'm afraid not no, really for the stage we're at and the amount we've all put into it already
we can't go any higher than that. well I'm going to...
and the reason I'm going to make an offer
I want to force that out
and for you to think that through or are you saying that they haven't given you
the
you telling me that they haven't given you any rights to go about 5 percent
it's between all of us, we've agreed that that's the most we can offer today
Gosh, I wish I'd known that the beginning
because I think
you're great, I think it's great and I think the valuation is
crazy and
if you're honestly saying that five percent is it I just could not reach that
valuation
and is that right? so if I offered you now
all have the money, for 15 percent of the business -
take it?
I'm really sorry but I'd have to say no to that
I am so sorry about that! I would have love to got on board with this but I gotta tell you
at five percent
can't do it - so I'm sorry I'm out
the last minute disclosure of his company shareholder breakdown
has lost him his first dragon which way
will the others go? I feel stupid not asking the question earlier
2 million pounds valuation is
is bordering on on the delusional so Tim
you've made it uninvestable because you're unwilling to move on the percentage
unfortunately
so I'm going have to say that I'm out. thanks Peter
Tim, there's not an awful lot I can add to that other than
I do think you're incredibly inspiring and I think it's an incredible product
but I want to wish you a lot and I'm sure you'll do really well with it
but I'm afraid I'm out - okay thank you. I think what you've done is fantastic
but I'm sorry Timothy I'm out
thanks Duncan
four dragons bow out of the deal
only Piers Linney remains
I was coming off a I thought when you were talking about
we've all agreed about percentage that was negotiation given Deborah's made you an
reasonable offer and you've rejected it
I wouldn't make an offer any better than that so
I think you're fantastic, love the product means we've done on your own literally
but I'm afraid your valuation's killed it so I'm out
OK thanks. what what we shoulda said really with that evaluations was "on your bike"
but we didn't
- On your tike! A frustrating conclusion to a pitch that had such
promise
in the end it was tim's inability to negotiate
the dashed his investment dreams and he leaves The Den
with nothing. - How sad - disappointing
two million pounds for that
but a good guy, good product, good luck to him