Robyn and Chris Carrier pitch Men in Kilts Window Cleaning to the Dragons on CBC's Dragons' Den

(from left)Robyn and Chris Carrier of Men in Kilts Window Cleaning. Photo: CBC

More than a decade in, Dragons’ Den continues to inspire and amuse Canadian TV audiences. But the CBC’s hit show isn’t just meant to be entertaining. It’s a televised school for entrepreneurs. For each episode of Season 11 (which airs Wednesdays at 8 pm ET), we’ll be talking to one of the Dragons to get a behind-the-scenes glimpse of their decision-making process and hear what they hope viewers learned. And we’ll be examining the pitches for smart strategies and useful tips that entrepreneurs can use to make their own businesses better. Episode 8 featured a fun franchisor, some outlandish asks and a charming couple with a cute product line.

Men in Kilts Window Cleaning

Entrepreneurs: Chris & Robyn Carrier | From: Calgary | Ask: $400,000 for 15%

Operators and franchises a window cleaning service

Uniqueness can go a long way in a competitive market. “It’s a good thing as an entrepreneur to have something nobody else is doing,” observes Jim Treliving, who’s built massively successful companies in the crowded food service and auto repair spaces.

Chris and Robyn Carrier’s washing service for building exteriors certainly employs a creative concept, as the Men in Kilts Window Cleaning moniker suggests. But when they pitched their business in the Den, Treliving saw more than gimmicky branding. “They’ve built out the model [so] that it isn’t just the kilts,” the Boston Pizza chairman said in an exclusive interview before the episode aired. Rather, it was the consistency and quality of the service that was driving growth. “They’ve built a business on the window washing.”

Treliving wasn’t the only one to see promise—his offer of the $400,000 for 20% was matched by Michele Romanow. But the Carriers, focused on franchising their business, weren’t going to pass up a chance to work with the Den’s franchise king, and they shook hands with Treliving.

The couple first got involved with the Men in Kilts brand as franchisees, later buying the whole company. And Treliving says their success as operators is a good sign of things to come. “They’ve gotten through the hard part, and that’s getting started with 60 trucks on the road now, in a reasonable amount of time,” he says.

(The deal has yet to close, according to Treliving. Men in Kilts has both an operating arm and a franchising business. Treliving says the company needs to pick one or the other, citing his experience with the Mr. Lube auto repair chain. “We became a pure-franchise company, so our whole focus is on our franchisees,” he explains. “That’s what I would do with Men in Kilts.” The two sides are still trading offers.)

At the time of taping, Men in Kilts had 19 locations split between the U.S. and Canada, with six of those added in the preceding quarter. The company hadn’t been going out of its way to sell. “My focus was 100% on our existing franchisees,” said Chris Carrier, explaining that he’d been touring outlets to ensure they were in good shape and that potential partners had reached out organically. But the couple aimed to grow their franchise count to 300—hence the Den appearance. “We’re looking to use most of the money for support staff for our franchise owners [and] for PR and marketing as we expand,” explained Robyn Carrier.

The Men in Kilts lends itself well to promotion, the Carriers noted in the Den. But smart branding alone isn’t enough. Post-taping, Treliving explains that there’s one thing he always tells anyone interested in buying a territory or a location in a chain. “Before you send a cheque or get involved, go and ask the other franchisees how it’s operating,” he says. A prospective partner making such an enquiry about Men in Kilts would likely get a favourable report, he suggests.

It’s that operational savvy, as much the uniform gimmick, that will help insulate Men in Kilts from the competition. “An independent [entering the window cleaning space] would have no marketing or history,” notes Treliving. “This company has a number of years in business, and trucks on the road right now. It’s a proven business and a proven brand.”

WoodsCan Industries Inc.

Entrepreneur: Michael Marek & David Woods | From: Victoria, B.C. | Ask: $150,000 for 10%

Manufactures and distributes an electric airhorn

Mind your trajectory: Mercifully for anyone within range, disposable air-horns can only sound for 90 seconds before giving out. David Woods’ version, by contrast, has a lifespan of 1,000 seconds of use per charge. “I think you have truly designed a much better product than what’s on the market today,” noted Michele Romanow. At $500 a pop, WoodScan’s product was proving too pricey for the drilling and blasting concerns that are its target market, and it had come up with a cheaper version to sell. But the Dragons weren’t happy with the company’s sales figures—about half a million dollars worth over four years—nor that revenue was declining year over year. “It’s scary when your biggest sales year is your first year, and then it’s on the trend in the negative direction,” said Manjit Minhas. WoodScan’s is a niche market, Michael Marek conceded. “I’m not going to say we saturated it, but we got the low-hanging fruit initially,” he said. Most of the Dragons didn’t see enough growth potential, but Michael Wekerle made an offer, proposing to trade the $150,000 for a 10% equity stake, plus a 10% royalty that would double if he had to inject more capital. Marek tried to bring the per-unit cut down to 7%, but when Wek wouldn’t budge the duo took his deal.

Belly Ice Cream Company

Entrepreneur: Shelley Westgarth | From: Huntsville, Ont.
Ask: $50,000 for 5% royalty until capital returned

Manufactures and distributes ice cream

What’s in it for me?: They may have thought her ice cream delicious, but the Dragons had problems with Shelley Westgarth’s pitch from the moment she explained the terms of the deal she was seeking. The former chef was essentially asking for an interest-free loan. “I actually look for a return on my money,” Michael Wekerle said. “I’m not going to do this for zero.” The product itself—especially a whisky-infused flavour—proved more popular. Belly sources all its dairy from a single Creemore, Ont. farm, and was in the process of putting freezers into the cafe locations of Toronto gourmet retailer Pusateri’s. The company had recently moved into a new factory, taking on $360,000 in bank debt in the process. Manjit Minhas didn’t approve. “One of the keys to being successful in manufacturing is that you have to do it at half the cost of everybody else to get ahead,” she said. “You need to do that by finding used equipment, by shopping around, by negotiating.” But it was Westgarth’s original ask that proved her undoing—though she indicated she was willing to discuss an equity stake, the Dragons saw her opening bid as proof she lacked business acumen. “You definitely need to understand how to keep both parties interested,” said Michele Romanow. None of the Dragons made an offer.

Nooks Design

Entrepreneurs: Ruthy Penner & Louis-Philippe Lavoie | From: Kelowna, B.C.
Ask: $100,000 for 15%

Manufactures and distributes cloth shoes for toddlers

Scale changes you: Like so many entrepreneurs, Ruthy Penner and Louis-Philippe Lavoie happened upon their business idea while solving their own problem: they couldn’t find natural, soft-sole shoes for their daughter. So seamstress Penner made some from recycled wool and leather jackets. “This looks very handmade, which is what’s so cute about it,” observed Joe Mimran. Nooks had moved 12,000 pairs of booties since its inception, with $250,000 in gross sales and $105,000 in profits to show for 2015. “I would have thought this would be very labour-intensive and cost quite a bit to put together,” said Michael Wekerle. Penner and Lavoie were looking to scale the business, and needed capital to fund the purchase of materials from a proper supplier—they’d been finding their cloth at thrift stores to that point. Scale would change the company and product, warned Mimran. “Once you get big, you’re no longer as charming,” he noted. “But that doesn’t mean it’s not the right thing to do.” Wekerle made the first offer, proposing the $100,000 for a 10% royalty until he’d doubled his capital, at which point he’d take a 5% equity stake. Michele Romanow countered at a 10% piece of the company and a 10% royalty, but Manjit Minhas undercut them both, at a straight 6% royalty. Mimran decided to go in with Romanow. Penner and Lavoie took Minhas’s deal.

Lumo Interactive

Entrepreneurs: Meghan Athavale, Jocelyne Le Leannec & Keith Otto | From: Winnipeg
Ask: $2,000,000 for 20%

Develops tools for creating video games for digital displays

Ambition and reality must eventually meet: Those large touchscreen games you see kids playing at the mall? There’s a chance Lumo Interactive helped create them. The Winnipeg firm started as a consultancy making content for digital displays, but now makes the tools to enable advertisers to do it for themselves. Michele Romanow recognized the model. “Your story is actually very familiar to two other Canadian success stories, Shopify and Hootsuite,” she observed. Both companies had grown by focusing on subscriptions and monthly recurring revenue. But Lumo’s $500,000 in revenue for 2015 came mostly from individual pay-as-you-go sales. “Some customers will buy 10 games in a month and then not buy anything for six months,” said Meghan Athavale. Lumo was on track to double revenue for 2016, and was targeting $20 million target for the following year. “The market that we’re looking at, it’s expected to go to $240 billion by 2019,” Athavale said. But the projection and the company’s valuation didn’t impress the Dragons. “Your optimism is commendable,” said Michael Wekerle. “However, it has to eventually meet realism.” Romanow didn’t see enough similarities between Lumo and the two blockbuster companies she’d previously named to warrant an offer. “The digital signage market is not as large as the social market or the e-commerce market,” she noted.“And then on top of that, you have a very small percentage [of] monthly recurring revenue, which really needs to be the core of your business.” None of the Dragons offered a deal.

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