The 10x Rule
Want more business tips? Check out the book Wise Words by Sean Wise, the official blogger of Dragons' Den | This week we heard the usual assortment of reasons for not investing.- not enough profit
- not enough revenue
- not enough sales
In previous posts, I've spent time discussing why sales are so important as proof of concept. I've also discussed what it takes to get a deal. Today, I'd like to chat about the 10 x Rule of investing. While it is true that angel investors (like our dragons) typically seek 10 times their money back over 3-5 years that isn't the source of the "10x rule". The 10x rule means that in order to gain market traction a product must be exponentially better. ie 10 x faster, 10x smaller, 10x cheaper, 10x more profitable. |
The reason for this? --Market adoption. Historically, being a little better isn't enough to gain huge market share fast:
- Beta is a little better than vhs
- Blu ray a litter better than hd dvd
- Plasma a little better than lcd screens
Now compare that to:
- email is WAY faster than snail mail
- airline travel WAY faster than train
- mp3 players can hold way more than cd players
It doesn't take an MBA to see which of the above gained significant market traction and which still struggle for mass adoption.
That....is the 10x rule and if you are going to be seeking high returns on investment you only want to back high risk, high growth companies that meet and beat the 10x rule.
Posted By: on Nov 28, 2007 at 10:00
FAQs
Magic Whiteboard
With an original investment of £100,000 from Deborah Meaden and Theo Paphitis, this portable whiteboard roll became a smash hit. The Magic Whiteboard was created by husband and wife Neil and Laura Westwood and has since become the two Dragons' most successful investment.
Who is the most successful rejected Dragons Den? ›
Dragons' Den rejects who had the last laugh and went on to huge success after the show
- Tangle tee*zer. Shaun Pulfrey ended up making tens of millions from his product (Image: Shutterstock) ...
- Oppo. The low calorie ice cream failed to attract any investments from the Dragons. ...
- Trunki. ...
- Approved Food. ...
- BrewDog.
A plastic case that allows electrical wires to be stored safely and securely, after granting the two Dragons' a 36% stake between them, ChocBox then scored a sales deal worth £25million. Just three months after he set foot in the Den, the partnership had made Peter a millionaire.
How did Sara Davies lose weight? ›
To improve her health, she followed a low carbohydrate high fat diet suitable for diabetics. And in eleven months, Sara lost six and a half stone and fully reversed all illness in a year.
Which Dragon is a billionaire? ›
Net worth - £1.157 billion. Peter Jones is the richest and longest-serving Dragon, having joined the show on its very first season. Jones has an impressive portfolio including Expansys, Data Select, Jessops, Levi Roots, Red Letter Days, Wonderland Magazine and Bladez Toyz.
Who made the most money from Dragons den? ›
Peter Jones
He's the only Dragon still standing from the very first series 19 years ago, and he's also the richest. According to the Sunday Times Rich List in 2023, he reportedly has a net worth of £1.2billion.
Which Dragon from the den died? ›
Former Dragons' Den star Hilary Devey has died aged 65.
Devey, who grew up in Leeds, died after a long illness on Saturday night, her publicist Benjamin Webb said.
Who turned down dragons den? ›
Theo Paphitis: “I turned down Dragons' Den at first - now I'm passionate about helping small businesses" Theo Paphitis turned down the chance to be on the Dragons' Den when producers first called: “I [blew a raspberry] down the phone and said, 'I'm not going to go on television!”, the retail tycoon admitted today.
How many dragons Den investments fail? ›
More than 50% of the companies that secure investment on Dragon's Den never receive any finance… Although the BBC's long-running reality TV show Dragon's Den has produced several business success stories, there have also been some missed opportunities.
Is the money on the table in dragons Den real? ›
'During filming, you get breaks and while I was up talking to Peter Jones his money was on the table, so I picked some up,' he explained. 'The top one was real but the rest of it was just like a good forgery. But for the purposes of the camera it's real enough.
Here was me thinking they'd spend all day listening to pitches from entrepreneurs all for their own image and the chance at making money from the companies afterwards. But no, that's definitely not the case! The Dragons are actually paid a fair whack for their time in the Den, to add to their already huge net worths.
Who has invested the most on dragons den? ›
Peter Jones has invested over £2m during his 18 seasons in the Den
| Dragon | Amount invested per Dragon (£) | Average amount invested per deal (£) |
|---|
| Richard Farleigh | 205,000.00 | 102,500.00 |
| James Caan | 724,166.67 | 181,041.67 |
| Doug Richard | 85,000.00 | 42,500.00 |
| Peter Jones | 2,080,666.67 | 115,592.59 |
14 more rowsNov 29, 2021
Sara Davies' net worth
First Business - Founder and owner of Crafter's Companion (worth over £35 million). Net worth - £37 million (according to The Sun). Sara Davies launched her company Crafter's Companion while she was still a student at the University of York.
How did Deborah Meaden make her money? ›
How did Deborah Meaden make her money? Deborah Meaden launched her first business - a glass and ceramics import company - when she was just 19. It became hugely successful, supplying the likes of department store Harvey Nichols, but it was in leisure parks that Deborah really made her fortune.
How did Peter Jones get rich? ›
He bagged himself a job at a big corporate business, where just a year later he found himself running things. This was just the start for Peter's new-found success. He went on to establish Phones International Group in 1998, which generated an impressive £14 million worth of sales during its first year of business.
Which dragon has made the most deals? ›
Peter Jones has been on the show since the beginning in 2005 and has taken on the most deals. Over the 18 series of the show, he has made a whopping 41 deals averaging at 2.28 deals per season.
What is the best selling items in the world? ›
Clothes are among the best-selling products online. That's why there is a high potential for high earnings in the apparel niche. However, people often prefer to purchase clothes from well-known brands. Nevertheless, there are still many opportunities for businesses or individuals to explore.
How rich is Steven from Dragon's Den? ›
According to Forbes magazine, Steven's net worth was £71 million in 2019 when he was 26 years old. His up-to-date fortune is not known. The millionaire is coming to Manchester for a talk aimed at inspiring budding entrepreneurs at the end of March.
Do the dragons actually invest? ›
Well, it turns out that the deals made on the show are just verbal agreements, and neither party is obligated to go through with them after the show. As you can imagine, there is an incredible amount that goes on behind the scenes once the cameras stop rolling to actually make a Dragons' Den deal real.
