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Dragon's Den PART 2: DEAL OR NO DEAL??

Well friends, if you haven't had a chance to watch the episode, I've included the video below for you to check out before I write any spoiler alerts. Click on the image below to be directed to Season 16: Episode 2 on CBC Dragon's Den.

 

The Pitch

Ok,  the first thing I will say is that you are actually out on stage in front of the Dragons for somewhere around 45mins, so the episode is a slice of the conversations that occurred. Overall, I think the episode captured my opening pitch - but here was the whole pitch:

When I think about my childhood I think about a time when Fort/Night meant tree forts,

when your curfew was dictated by the streetlights,

and when “Find My Friends” meant locating a pile of bikes on a neighbouring lawn. 

Today, with the rise of technology, outdoor play and all its benefits have been disappearing from childhoods.

A study in 2019 found kids aged 8 to 12 spend 5 hours online per day, not including school time. And that was before the pandemic. 

For too many children, their window to the world is no bigger than an iPhone

The impacts are real - mental health challenges and a lack of basic physical literacy are taking a toll on our youth.

Kids need MORE WILD in their lives

So, we created adventure kits, and we deliver them right to your door.

Each of our 12 kits come with quality custom gear, 3 unique activity cards built to align with Canadian curriculum with over 10 hours of skills, activities and games, nature-inspired crafts and a pin to collect and celebrate each new adventure

Everything kids need to develop essential life skills like resilience, creativity, and leadership.

In one short year, we have shipped out over 5000 kits across Canada - literally to every province and territory. 

Listen Dragons, looking into the future - subscription kits will be how we started the company, but our purpose is to make outdoor play fun, easy, and adventurous, so this is just the beginning of our journey.

Because when kids feel safe, welcome, and confident in outdoor spaces they develop the lifelong skills to thrive anywhere.

Dragons, this is not an opportunity to be a part of something big, this is a chance to help create a movement, to be a part of something HUGE.

Join us in creating adventures that will inspire lifetimes of exploration.

Join The Wild | Life 

The "Ask"

We gave the Dragons' and opportunity to invest 15% for $115,000 - essentially evaluating our company at $767,000. We based this valuation on:

  •  Sales to date
  •  Projected sales for this calendar year
  •  The value of the content/curriculum created
  •  The value of the product designs
  •  The value of the Brand
  •  Current retail value of inventory on hand

The Demo

Ugh. I think I've mentioned this but moments before the taping I was told that I couldn't do the demo I wanted to do... Tarp Stretcher Race! I wanted to highlight this because it showed how the kits built on each other and used gear over and over from previous kits. It showed a real outdoor skill and it highlighted just how we MAKE LEARNING FEEL LIKE PLAYING!

Questions and Objections

Manjit: While the episode didn't fully reveal this, my observation of Manjit was that she was confused, I think the first question she asked was, "So is there an App for this?"

While an App may be in our future to add educational enrichment and community building opportunities - our inspiration for these kits was to bring back classic outdoor play, games, and basic outdoor skills. We want them to feel a bit nostalgic and emulate the tools, skills and adventures that taught us leadership, creativity and resilience as kids ourselves.

Wes: "It's a big fuss to get (my 10 year old) outside, now I am going to ask him to go outside and run around and do all these activities, how am I going to get him to do that?"

It's true, as parents today we are competing with on-demand technology and  distractions everywhere. That's WHY we created these. These are kits for kids and a tool for parents. We are the Yoda to your Luke Skywalker and we are here to restore balance to the digital and analog world. Here is what I've seen, heard and experienced with Wild Life kits... they don't work if the parents aren't excited about them. If you don't show an interest in learning about the outdoors and spending time outside - how can we expect our kids to want to? We've put everything you need to INSPIRE your kids in each box. All the gear, tools, toys, and supplies you need plus over 10 hours of activities, games and crafts. And yes, YOU MIGHT HAVE TO GO OUTSIDE WITH YOUR KIDS... to introduce them to something new, like; how to use a compass, pitch a tarp, or safely light a camp stove, but like most things - when you give your kids a BIT of inspiration and they will AMAZE you on what they come up with. I've seen it work for thousands of our customers, the families around me, and my own.

Michelle: "For $47 is there enough product in here?"

All of our pricing does INCLUDE Canada-wide shipping (I really wish that part would have made the cut) we ship to EVERY province and territory in Canada because EVERY kid deserves these kits. But beyond that, I can confidently say that the retail value of the goods in the box are between $50-$70. And while that value is a great start - our customers CONSISTENTLY tell us that the MOST value comes from the activity cards that go along with each kit. Over 10 hours of skill building activities, games, and crafts. Everything you need is already in the box. Being a parent is exhausting - we took the work out of outdoor play. BONUS: During the winter we include a winter card specific for cold weather fun. Just for fun, I created this chart to represent the "Fix-it" kit that Michelle unboxed during the episode.

 Wild Life Item Comparable Item Retail Price
7 in 1 Bear Multi-Tool  Multi Tool Credit Card $11
Know The Ropes Game Knot Tying Kit $25
Roll of Duct Tape (10 m) Multi-Use Duct Tape (10m) $4
Paracord (2 m) Paracord $7
Sew-What Mending Kit Outdoor Mending Kit $12
Nylon Repair Stickers  Nylon Repair Patches $13

Total retail value $72 

Custom Wild | Life Activity Cards
Priceless? Over 10 Hours of skill building activities, outdoors games & nature crafts

 

Michelle: "The subscription model works because you can retain customers and you can put highly discounted brands in your box, do you have that second piece?"

Our value is not cost savings. We are not Fab Fit Fun or Birch Box etc. Our value is providing a monthly opportunity to inspire outdoor fun and curiosity and we ship everything you need to do that right to your door. When we started this project we did look for existing tools and gear but to be honest, either the wholesale price was too high or the gear wasn't quite right. We wanted each box to create an experience, with cool colours, durable materials, and items customized just for kids. Extra loops on our backpacks for snacks and supplies, survey monuments that straight up look like pirate treasure, a quality tarp that wasn't too big and cumbersome for kids but big enough for a sweet fort.... Every. Single. Box. is meant to feel fun and inspire first - we call them, "incidentally educational". That being said, when we do find awesome products and brands, we work to get them into our kits! We carefully curate items that are often not easy to find from local Canadian and North American brands like:

 

 Michelle: "You're already in the red on the first box."

Here would have been a good place for me to expand on the fact that we sell the most of our 3 and 6 and 12 month PRE-PAID kits, which means were spending $20 to acquire a customer with a Life Time Value (LTV) of $260 (At that time). We had only been launched 14 months when this was filmed and have since been able to increase that LTV. Again, subscription boxes are just the beginning - we are building an outdoor brand.

Arlene: You're not ready yet for an outside investor.

No rebuttal to this - Arlene is just spot on here. We weren't ready YET for an outside investor, and we knew that going in... but we also knew we would learn something from the experience and benefit from the exposure. 

Arlene: Not scalable.

I still struggle with this a little bit, because we have modelled what our margins and profit look like as we scale. But I'm mindful that we've mapped out our first 5 years to 2MM and the Dragons'  have more experience in what scale at $20MM needs to look like. Quite honestly, bigger is not always better in my mind. I look KiwiCo, who has taken on I believe $20MM in investment and now do $300MM a year, and went through an IPO and I've also watched their quality and value go down. I have no desire to get to that point. It made me ask the question, how big is big enough? 

Arlene Dickenson Dragon's Den Wild Life Outdoor Adventures

Vince: Profit on sales to date?

I stumbled on this question not because I didn't know the answer but because I was trying to frame it without blurting "$0". I should have clarified if Vince was asking for net margin on sales to date or net margin as a percentage on each kit. The short answer to net margin on sales to date was $0 if you look at our year end Profit and Loss statement, but a significant amount of one-time investment was made on:

  • Product Development 
  • Curriculum development
  • Branding
  • Start-up business costs

What I should have reiterated here is that our initial offering is a close-loop 12 kit program, which means now that everything we spend on the initial development of those kits is now a sunk cost. While our 5-year business plan does plan for gross margin and net profit increases as we scale, our first goal was to establish a brand and build a high-quality product that helped solve a real problem. From my research, an 8-11% net profit for companies similar to ours is realistic and we are on track to meet that goal within our 5-year plan.

Vince: You haven't spent enough time looking at your numbers.

For us, the challenge here was having a limited amount of data with only 14 months of sales. In addition, I was really conservative with numbers when I had to use blended costs or estimates. We knew we were early going into the Den with the data we had at the time but hey - you have to take chances!

Deal or No Deal?

If you still don't know... We did not find a deal in the Den. And that was OK with us! Honestly getting a deal was not our primary objective. We wanted to learn something from the experience, gain exposure for our brand and introduce ourselves to a few of the most influential entrepreneurs and VCs in Canada. If there was an opportunity to do the right deal with the right person, we would have considered that a bonus.

What I learned:

Know your audience.The Dragons' themselves are not our target audience, with the exception of Arlene, who mentioned how much her grandchildren would enjoy this. I should have also done a better job of describing what was in each of their sample kits, and the value and reasons that our target audience finds in them.

Sell yourself.I struggle with this, I feel like my persona was the Mom with a side hustle. The investors don't know you, and they may not be your target audience so you have to sell yourself a bit, knowing they are investing in YOU as well as your product. I am a Mom, a proud Mom - but I also have worked for multi-national companies in Consumer Packaged goods. Did a BComm in Marketing from University of Calgary, and completed my MBA at Queens University. While I am a first time entrepreneur, I do have 15 years of experience in various Marketing and Business Development roles. Our core team is highly qualified and diverse and has experience in working on multi-million dollar projects.

Ask Questions. I asked a few questions, but I was struggling to pin down what exactly the objections were, was it the product? the business model?

It has to be a fit.I was early for outside investment and I have other options for capital so more than anything I was looking for an investor who was aligned and passionate about our purpose and had a portfolio and/or connections that could help our company grow. 

Have fun, take risks.Did it turn out perfectly? No. I would have loved to have seen more excitement and interest from the Dragons'. Would I do it again? Heck ya. Nothing ventured, nothing gained.

Celebrate along the way. I felt a little strange inviting friends and family to our "Watch Party" knowing that we did not get a deal. However, I felt so proud knowing that my daughter was there watching her Mom doing something hard and a bit scary - technically failing (no deal), and celebrating anyway. The impact of the Wild Life on my family has been two-fold, we have had some incredible outdoor experiences and my daughter has watched me grow a business and celebrate the successes and failures along the way.

 Wild Life Co-Founders Heather, Jeremy, Jenelle and our team Leanne and LJ (Missing Dave).

I hear from our customers over and over again that the quality and value of our product is unmatched. We are making a difference and helping to solve a problem. This is just the beginning and we are here for the wild ride.

Check out a few of our reviews HERE.

Please help us share our story and get more kids outdoors more often!

 



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