P.E.I. company offered $150K deal on Dragons' Den
It wasn't quite the deal they came looking for, but two P.E.I. entrepreneurs accepted an offer on CBC's Dragons' Den Thursday night.
Jeff Ellsworth, one of Canada's top softball players, and his brother-in-law Jeff Keough had asked for $150,000 for 20 per cent of their company, Exit Speed. The company developed and sells a swing training aid that fits over baseball and softball bats to help players build strength and hitting power.
"It's a very simple product but sometimes the simplest products are often the best," Keough said during the pitch.
Ellsworth, wearing his Team Canada softball jersey and the gold medal he won at the 2015 Pan-Am Games, invited Nick Shailes of Australia, who he called the top-ranked player in the world, to demonstrate the Exit Speed product.
The company describes it as a "durable terry cloth, pendant-shaped tail approximately three-feet in length that attaches to the bat via a metal-supported grip that slides onto the barrel of the bat."
The cloth creates resistance equivalent to a traditional donut weight for the first half of the swing, but on the second half of the swing causes drag which trains the batter's "full range of swing muscles," according to the company's website.
All six Dragons expressed interest in the company and product, but felt the valuation was too high. The company had been launched for just three weeks when they appeared before the Dragons in May, 2018. They said they had $25,000 in sales at the time, with little marketing.
Four of the Dragons bowed out, including Michele Romanow who said she saw the product as great not just for baseball and softball but for many sports.
"The problem is you've priced your deal out of the ballpark," she said.
Dragon Lane Merrifield was initially out, saying it was difficult to make an offer because under the Dragons' Den rules, the Dragons have to agree to at least the dollar figure asked in the pitch.
"If you would have come in saying $50,000 for five per cent, we can now have a conversation," he said.
He then reconsidered, offering $150,000 for a 25 per cent stake in the company. But, he added, $100,000 would be a loan that requires payback at $10 a unit.
Arlene Dickinson then made another offer — "$150,000 for a 10 per cent royalty until I get my money back and then the royalty drops down to five per cent … forever."
Ellsworth and Keough accepted Dickinson's offer, and were shown backstage celebrating with their wives.
Either party can back out of a deal after appearing on Dragons' Den. CBC is awaiting confirmation on whether the TV deal has officially closed.
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