Texting the Dragons in their Den

Recently, the full cast of Dragons’ Den agreed to participate in a live web chat conversation with their fans to mark Small Business Week. In the end, only two dragons were able to take part, but the result was a remarkably informative and fun experience.

The dueling dragons were Arlene Dickinson of Venture Communications and Lavalife co-founder Bruce Croxon. Kevin O’Leary, as you’ll see, joined the conversation briefly, but was mainly the subject of his colleagues’ zingers.

Here are some of the highlights of that 90-minute online conversation, which was hosted by Dragons’ Den MC Dianne Buckner:

To start, Dianne asked the two dragons to sum up life as an entrepreneur. Arlene said: "The work is always twice as hard and the money twice as short." Bruce offered a similarly downer reply: “It takes a lot of time. You need to grind it out and don’t take no for an answer.”

Noting that Kevin O'Leary hadn't joined the live chat yet, Bruce says that Kevin's probably out selling books. "Maybe he's getting a haircut," says Arlene (who has also just published her own autobiography).

When an online observer asked for the Dragon' top three tips for entrepreneurs, Bruce replied: "Focus, focus, focus." Arlene offered some more thoughtful replies: “Never wait to have 100% of the answers before acting. Always ask enough questions to feel informed. And make your first hires people that are way smarter than you are and have skills different than yours.”

In answer to the question, “What was the one defining move you made to get as successful as you are now?” Arlene said, “For me it was buying out my partners to follow my vision.” Bruce responded, “I don’t think there is one defining move. That’s part of the problem: it’s a series of efforts that never really stops.”

Asked to identify the most common mistake in startups, Bruce said: "Lack of focus. Entrepreneurs think they can do more things well than they really can." For Arlene, the biggest startup mistake was "underestimating the money you will need and the energy it will take."

One entrepreneur said, “I'd like to know whether marketing on a very low budget for an online business is a waste of time, or can it lead to success?” Arlene said: "Online marketing is effective for a lower budget and for any budget if it's framed properly." She then added, "Marketing is critical to business success. It's about telling the marketplace about your business and why they should care."

Asked to explain the origin of the name (Lavalife) of his former online-dating company, Bruce responded: "Lava is warm. Life was all about single life. [But] the name is less important than what you build it into."

At this point, the CBC inserted from stats from their simultaneous survey of the live-chat audience. One stat in particular made me pause: Asked how they market their business, 60% of participants said they use online tools, 10% use print, 1% radio/TV – and 30% said they don't market at all. When she saw those results, Arlene expressed shock at the size of the not-marketing group, and said, "You guys better get busy!"

Then came the question, "At what point should a small business start marketing?" Arlene responded: "Marketing is the business strategy expressed in a way that creates customers/employee loyalty. It is your vision expressed in a way everyone can understand. The answer then is, immediately.”

Asked, "What business owners and entrepreneurs inspire you?" Bruce identified Virgin founder Richard Branson. Arlene offered Guy Laliberte of Cirque du Soleil and ("in spite of the flak I'll get") RIM's Jim Balsillie.

Another viewer (okay, it was me) asked the Dragons to name the biggest business lesson they've learned from Dragons' Den. "That a great idea can come from anywhere and anyone. Great execution is much more rare," said Arlene. Replied Bruce: "I think I've learned how to give a better pitch."

Dianne Buckner then interrupted to say, "Kevin O'Leary is on THE PHONE now.... taking instruction about how to get on the chat." Arlene responded: “Luddite." Kevin joined the conversation using the alias, "Mr. Wonderful," that he often uses to describe himself on the show. Dianne then sniped, "Have you ever noticed you're the only one who ever calls you that?" However, Kevin apparently suffered more technical problems, and contributed virtually nothing to the rest of the conversation.

Tom, a working single father of two, then posed a question regarding his dream of opening a video-game cafe: "How do I do this without losing the security of a steady income to support my kids?" Arlene responded: "Tom, I would say you can't. That's the risk you likely need to take to really succeed if it's what you truly want to do." Bruce was a little more helpful: "Tom, that's a tough one. Getting a backer to allow you to draw some money as you build your business may be a good start."

Asked if cold-calling is dead now, Arlene said, "It's not dead, but its pulse is very weak." Bruce said: "I disagree re: the cold calls, Arlene (with respect). We need to get back to voice!" Arlene responded quickly: "I didn't say don't call people—that's different!"

Susan asked, I like to create but I hate to do the selling. Should I hire someone to do this for me? [Should I pay them by] percentage or hourly?” Bruce responded: “Percentage = win/win: always great if you can find it.”

Ryan asked the dragons about the classic startup marketing dilemma: “Low prices or pro-bono services to generate business, or higher prices to generate a profit margin?” “The market will let you know,” said Bruce. Arlene added: “Always put a value on your time/effort/services.”

Another question took on the other classic small business dilemma: “Debt or equity financing for capital to grow a small business?” Bruce responded, "Debt if you can get it. [But that’s] tough to do in Canada." That answer may have prompted this question: "What is your No. 1 rule for living debt free?" Bruce replied, "I have never lived debt-free. Get comfortable with debt."

Finally, the Dragons were asked to name the leadership traits they consider most important in business. Arlene said: "Allowing yourself to be vulnerable, being authentic. Giving people a purpose. Expressing your vision in a way people can follow." Dianne thanked Arlene, saying “those are great qualities and you have them in spades.” Bruce concluded by agreeing, apparently: "I love you, Arlene. There, I'm vulnerable."

Despite the impersonal nature of online chat forums, the two Dragons created a caring, positive environment that the participants seemed to enjoy. Asked if they would do such a chat again, both Dragons said they would be happy to. As Bruce said, “The den is about promoting and helping small business.”