EVA – Ethical Oceans

I chose to review a Dragon’s Den pitch from season five about the Ethical Oceans venture.  The pitch was delivered by Tony Hancock and David Damderger from Calgary who were asking the dragons for $150,000 for 20% of their company which they had valued at $750,000.

 

CEO Credibility and Management Team

The presenters seemed confident while delivering their pitch and remained calm when facing difficult questions/comments from the dragons, and in particular, Mr. O’Leary.  Other than introducing themselves, no additional information about their credentials or their management team was presented.  A review of the company’s website indicated that Mr. Hancock is a mechanical engineer who worked in areas of sustainability and renewable energy.  No information was located for Mr. Damderger.  In addition, the company also has a CEO, a President of Sales and Marketing and a Chief Technology Office (Ethical Oceans, 2012).

Venture Concept and Opportunity Space

The company sells organic and fair-trade items from vendors in North America via its website.  It represents a one-stop shopping outlet for those consumers wishing to purchase organic items.   The presenters indicated that they had already signed up 100 vendors for their website representing approximately 600 products ranging from soccer balls to vegan purses.  The company receives a 12% commission on each internet sale.  The presenters seemed to have a good handle on their market and provided statistics on the size of the ethical market for the previous year and the fact that the market had continued to grow by 15% despite the recession.  They also shared that their website had received 15,000 hits despite spending nothing on advertising.  They sold $1,000 in their first week and $4,000 during their second week in operation.

Competitive Edge

It was not clear if they are the first website to sell organic and fair-trade items in this manner.  Mr. O’Leary asked a question involving the competition, specifically, what would stop a retail store from devoting part of its current website to organic and fair-trade products?  I thought the presenters answered the question well by indicating that the type of consumer they’re targeting would not want to buy organic/fair-trade items from those retail outlets.

Overall Investment Status

I would fall into the demographic that would be a potential customer of this company and the pitch would have been successful in piquing my interest to learn more about the venture.  In order to make an investment, however, I would need more concrete information about the number of competitors and their market share, as well as the company’s plans/goals for expansion in the short-term, e.g. how many companies (and products) were they hoping to secure for the website and by what target date.

References

Ethical Oceans. (2012).  Team.  Retrieved May 21, 2012 from http://www.ethicalocean.com/about

Bonerfly. (2011, April 10). Ethical Ocean on Dragons’ Den [Video file]. Retrieved

            from http://https://www.youtube.com/watch?v=iFKpAvic_qY

 

Posted in: Week 03: Analyst Bootcamp