The day I met the Dragons with my guitar and my song, I put on a performance of a lifetime. Everything I had ever learned during my musical career came together for me at that moment.
When I walked up those stairs, I wasn't performing to Peter Jones and his Dragon colleagues - in my mind I was performing to a packed crowd at Wembley stadium.
I knew that I needed to put on an Oscar-winning performance to win them over. No performance before or since has ever been as nerve-racking - but I know that every performance in a business meeting is just as important. I treat all business people with the same amount of respect as I did the Dragons. I prepare more thoroughly these days as well because my figures very nearly let me down that day.
Preparation and planning
One of the reasons that so many people fail when they go on Dragons' Den is because they haven't fully prepared. I didn't really know the format of the show, but believe me when I say that I thought my pitch had been well rehearsed. I had written my song at the same time as my business plan; I had been cooking up a business in my kitchen long before the day I tried to win over those hard-nosed business tycoons; and I had pitched for funding more times than I can remember.
But I nearly blew it - because I hadn‟t learned my numbers off by heart.
When I asked for the investment of £50,000 in exchange for 20% of my business, I backed that up by telling them that I had got a very nice order from a meat company in Yorkshire for 2.5 million litres of sauce. I had taken the confirmation letter with me, too, as part of the "due diligence‟ process.
Richard Farleigh had been tapping his toes to my song, and as Dragons go, looked friendly - though I will never forget the cold feeling around my heart when I heard him say, "There is something I don't understand… You've got an order for 2.5 thousand kilos of sauce. That is not 2.5 million litres, that is 2.5 thousand litres."
I got very confused. "That's 250,000 litres isn't it?" But it wasn't. It was 2,500 litres. 1 kilo = 1 litre. Oh dear.
Then they said, "You‟re getting £6.50 per litre?"
I confirmed that I was. That was about £130,000 per year.
A big difference from what I had suggested. Deborah and Duncan
Theo Paphitis‟s next words cut through me like a knife: "That letter is not an order - and it is a hugely difficult and complicated business to get into major supermarkets. You've got very little hope." Dragon number four went fast.
At that moment I thought it was all over. I could see my spirit hovering above my body, slain by Dragons and lying on the floor of the television studio.
But Peter had reread the letter and noticed that 2,500 litres
was the initial requirement. Thereafter there was a potential order
for 500 kilos per week. The dawn was breaking. Richard noted that
was a potential 25,000 kilos a year - which was a turnover of more
"You would probably admit that your business skills need a little bit of help," said Richard. Well, that was certainly true. Fortunately for me, he was starting to see a spark of potential.
Then Peter spoke up. "To try and range one product is nearly impossible," he said, pausing dramatically. "But I like impossible challenges!
"I will offer you half the money - for 20%." Peter's promise to call the CEO of Sainsbury's, clinched the deal and made up Richard‟s mind. Richard put up the rest of the money for another 20 per cent.
Always be careful when you negotiate terms
The other person will always want more than you are willing to give. Know what your high and low points are - before you begin to bargain.
While I stood there, weighing up my options, something that my mother had said to me came back to me: "It's better to have less of a business that is going somewhere fast than to have 100% of something that is going nowhere." 60% of something backed by two millionaire investors could turn into quite a lot.
Money could not buy the worth of the expertise that Peter has
given to the business since then. Money couldn't have paid for the
value of Richard saying, "Yes, I am going to invest" on national
TV. The extra 20% that I had to give away bought me an extra Dragon
- and overnight recognition for my brand.
People (even Dragons) always buy from people. So brush off your charisma and polish up your likeability factor. Remember that you are your brand - and anything is possible.
Levi's top tips for making a winning pitch
•Know your USP.
•Practise getting your core message across clearly in less than one minute.
•Know your numbers and learn the lingo. If you are asked questions, you need to be able to answer them knowledgeably.
•Think about what you may be asked, and be prepared.
•Breathe and relax.
•Speak slowly - and pause between points - to give people time to absorb what you are saying.
•If you lose your way, stop and ask a question to give yourself thinking time.
•Invite questions and listen carefully to what people have to say.
•Give yourself time to think before you answer.
•Stay calm and polite at all times. Avoid becoming challenging or defensive.
•Know what deal you will agree to before the negotiation begins.
You get get your hands on a signed copy of Levi Roots' new book here. Or you can buy it from Amazon.
COMING SOON: Look out for our video interview with Levi Roots!