The boss of a gifting platform at the centre of a three-way bidding war on Dragons’ Den has revealed that Peter Jones, Touker Suleyman and Sara Davies all changed their mind on investing.
Last week, millions of viewers saw Omid Moallemi and David Parr offer 4 per cent of their digital gifting platform Prsnt in exchange for a £90k investment.
The duo spent nearly three hours being grilled in the Den before eventually accepting a combined offer of £90k from Jones, Davies and Suleyman in exchange for up to 12.5 per cent of the business.
The episode ended with hugs and handshakes all round but BusinessCloud has discovered that none of the Dragons decided to invest after the cameras stopped rolling.
It’s estimated that around half of investments on Dragons’ Den never go through following due diligence.
However, despite the lack of investment, the Brighton-based startup has enjoyed a 4,572 per cent sales surge and a 350 per cent increase in new customer acquisitions after being featured on Dragons’ Den.
Moallemi told BusinessCloud that the decision not to invest was a mutual one with his business partner and the trio of Dragons and he revealed Prsnt was on track for a five-fold increase in turnover to £1.5m.
Hold strong
“We had to hold strong,” he said. “12.5 per cent is massive because we need to be able to raise capital in the future. It wasn’t right for the Dragons and it wasn’t right for us.
“If you’re looking to gain exposure for your business, Dragons’ Den is perfect.”
Moallemi and Parr joined forces to launch Prsnt to send gifts instantly using just a phone number.
He said: “I’m a product designer and David’s background is in marketing. I love innovation and I see the world differently to everyone else.”
They started working on Prsnt in 2019 and the platform has so far facilitated over 200,000 digital gifts from brands including Selfridges, M&S and Starbucks.
David Parr and Omid Moallemi, co-founders of Prsnt, on Dragons’ Den
The business raised £450,000 in investment before being invited to pitch on Dragons’ Den.
The duo spent nearly three hours in the Den, which was eventually edited into nearly nine minutes of footage.
Moallemi recalled: “The lift opens, you see them all, and it’s weirdly familiar, then it hits you, it’s your turn to talk.
“Within three minutes of the episode airing, the sign-ups went off and didn’t stop. We’re still seeing thousands of new users five days later.
“Sales went up 4,572 per cent and new customer acquisition jumped 350 per cent (based on the previous month).
“On top of that, we’ve had new brand interest and industry outreach off the back of it, especially from loyalty and rewards partners. The timing couldn’t have been better.
“It was a surreal moment having a conversation with three Dragons in the corridor afterwards.
“We shook hands on a deal in the Den for £90k for 4 per cent, plus a performance-based structure to reach 12.5 per cent.
“But after a couple of months, during due diligence, there were concerns around projections (we actually hit those in the end) and the performance of vested shares.
Didn’t need investment
“In the end, we didn’t need to raise, we landed new contracts and grew fast so the deal didn’t close. We kept all the equity, and that’s worked out better for us.
“Even though the deal didn’t go through, having three Dragons back the idea on national TV gives huge credibility. We’ve already seen a shift in how we’re viewed in the industry.”
Prsnt may not have the Dragons’ investment but the company has expanded to eight staff with more hires planned.
Moallemi said: “We did about £300k turnover last year, and we’re on track for £1.5m this year. The traction post show has pushed everything up a gear.”
And he had this advice for any founders thinking about going on Dragons’ Den. “Do it,” he said. “Dream big, get out there, make stuff happen. What’s the worst that can happen?
“It was an unforgettable experience and a major moment in our journey.”