Brett Wilson, the Calgary-based investment banker and philanthropist who came to national prominence as the “dragon with a heart” on the highly rated CBC reality television show Dragon’s Den, is now no dragon at all. He and the CBC parted ways following difficult contract negotiations in which he says the broadcaster insisted he never mention his association with the CBC or the show during public appearances or in promoting his own work. Wilson had been the most active investor on the show, which sees entrepreneurs seeking capital pitch their ideas before a panel of “dragons.”
Q: Your departure from the show has garnered a good deal of attention—why do you think people care so much?
A: First of all I was surprised that CBC issued a press release saying I was leaving. I thought I would just sort of fade into obscurity. I happened to be getting on a plane when they issued that release, so I didn’t have a chance to see it for four or five hours. In the meantime there were an awful lot of phone calls to my office asking why, how come? I think there’s an irony in the eyes of some viewers—or some media—that a dragon couldn’t get a deal negotiated for his own purposes, or his own contract, if you will. And I suspect there is.
Q: You’ve challenged the CBC to dole out what you’ve called “constructive criticism as opposed to abuse” on the show. What prompted you to make that challenge?
A: I want it to respect the intelligence of the viewing community—you know, there isn’t a business school in the country that isn’t paying attention to this show. I was the lead deal-making dragon. I don’t know how many deals the other dragons have actually done or closed, but I managed to get 60 done on the show, and we’ve papered 30, and 31 should be done in the next couple weeks. That’s where my own fan base says, “Thank you for showing us how to do deals.” It’s easy to say, “No,” it takes no courage, no brains and no wallet to criticize. Criticism comes free. Action comes at some cost, and I’ve been pretty active. Will the 30 investments I’ve made all work out? Absolutely not. I suspect I’ll write off four or five in the next year because they’re stumbling. But there’s four or five that could become iconic brands in Canada because of the power of the entrepreneur. Any one of those top-five investments will pay for all 30. So I take a portfolio approach.
Q: Listening to you outline your approach—that a handful of your investments will likely pay for those that fail—is “dragon with a heart”
less about generosity or emotion than it is a sound approach to investing?
A: I invest in people. I get value from helping people, and I get value on my money. So both of those make sense. I choose partners based on the people I want to do business with because business plans evolve—we stumble, we trip, we jump, we leap, we go to different plateaus—but the people in whom we’ve invested are still the people. My partners are a core of my success. That’s been my success over the years. In the investing world I do get value for helping people, but I don’t give up financial return to get that.
Q: Some argue you’ve been Kevin O’Leary’s foil, that the CBC built the show on a Kevin-versus-Brett narrative. Were you ever coached into participating in that kind of dynamic?
A: Just the opposite. When I first tried out for the show, the commentary from CBC was that I wasn’t mean enough. I said, “Look, if it means being a prick, I’m not interested. If it means being tough when you need to be tough, check my credentials, my success, my partners, and my life, and just know I can get there.” I think in the eyes of some of the people who were putting the show together, they thought the Kevin-esque approach was typical—that he was your normal, tough-as-nails, chew-’em-up, spit-’em-out businessman. I would suggest just the opposite. I run into a lot of people who take a very hands-on, people-centric approach to investing. It’s not that Kevin’s wrong and Brett’s right. It’s that the range exists.
Q: What’s called reality television, or “factual entertainment,” as the CBC prefers to call it, are masterpieces of editing.
A: I call it “contrived reality,” because it is orchestrated. Now, when I say “orchestrated,” the dragons were never coached, we were never told what to say. To put credit where it’s due, CBC’s done a fabulous job with this format. I’m told both inside and outside CBC that CBC’s version of Dragon’s Den is used as the gold standard globally against the other 16 or 18 or 20 that exist around the world. I’m talking about how to put the icing on the cake, here, not saying throw away the cake.
Q: But it must be an odd sensation to watch how your exchanges are shaped in the cutting room. What’s that experience been like?
A: In the early seasons it was frustrating. One of my favourite questions I ask every entrepreneur I invest in is, “How much time and how much money have you got invested in this idea?” There’s no wrong answer, but I do need to know. Have you been working on it for 10 years and you’re beating a dead horse? Or did this just come to you a week ago and you’ve got daddy’s money behind you? Or is this your heart and soul? I don’t think that question has ever made it to air. CBC is looking for that quick repartee, what you would call the juicy moment. I know that’s what they’re chasing in the editing room, and I’m completely okay with that. They own the mouse that does the cutting.
Q: But do they make the exchanges sharper than they really are?
A: I would suggest to you that they edit out some of the heated exchanges. It doesn’t get nasty but sometimes it might be a little bit too snippy, a little bit too rude.
Q: What’s the best advice you’ve given?
A: People who come on the show overestimate the share of market they can achieve. First they guesstimate the market—let’s say $1 billion in widgets can be sold next year and they say, “Well, jeez, I can get one per cent of that market, therefore I can make $10 million.” My response is, it might cost you $50 million to pursue that slice of the market, and you don’t have that money. I don’t care if you can make it—if you can’t sell it, there’s no point. Understanding your market—who will buy it and who will buy it at a profitable price—is key.
Q: You’ve done 60 deals on the show and about 30 have led to cheques being written. What happens to those 30 that don’t work?
A: Of those 30, I would say 10 were people who didn’t ultimately want to do a deal—they weren’t ready. There were another 10 where due diligence didn’t hold up. In one case someone on the show said, “I have a signed memorandum of understanding,” which turned out was an email expressing interest in a deal. There’s a big gap. I would say the other 10 would be ones where, when we did the homework, we just weren’t comfortable. In one case—again, names don’t matter—I just became uncomfortable with the entrepreneur. I didn’t like the way my people were treated. So I pulled the pin and said, “I will not tolerate that kind of abuse,” if you want to call it that, “of my own people.” You know—kissing me and kicking my staff. That’s not a relationship that’s a basis for anything. Not every marriage has to be consummated.
Q: Some of the pitches can be heartbreaking. I remember seeing an engineer who’d designed a device that would open Freezies for his kid, and he’d sunk $250,000 of his money into it. And he was turned away on the show with five outs. I’m not sure if you remember the case.
A: Oh, I remember it very, very well. He had an amazing product, it was beautifully engineered. He could make it—but he couldn’t sell enough of them to justify his investment. It was one of those sad moments for me where I’m looking, going, “You know what? This isn’t a product that the market needs.” On the flip side, it’s that passion, that sometimes blind belief in oneself, that allows some businesses and products to move forward.
Q: I also watched as you listened to 18-year-old Ben Gulak pitch his motorized unicycle, the Uno, and you were clearly enchanted.
A: Here was a kid who I looked at and thought—you know what? Even if Uno doesn’t work exactly as it’s been invented, I want to be this guy’s go-to, his brain trust, I want to be his wallet for the next idea. Because coming out of a kid who’s 18, who’s built this Uno literally out of scrap parts in his family garage, who’s been accepted to MIT, that’s a kid I wouldn’t mind investing in. You know, the evaluations that were applied to the original round of financing for Google and Yahoo and eBay and Amazon and Facebook probably made no sense either.
Q: You’ve hinted that a television show around philanthropy could be in your future. I think it’s fair to say the received wisdom goes that people like watching greed, or the consequences of greed. Can you make compelling TV out of philanthropy?
A: Time will tell. I would entertain putting myself in front of the camera again if it was to celebrate entrepreneurship or celebrate philanthropy. I happen to be one of those who still thinks a good-news television network makes sense. I understand that “if it bleeds, it leads.” But I also think there’s an awful lot of people who are tired of the irrelevance. Let’s be serious here—The Bachelorette shows are completely irrelevant. They make interesting TV, but there’s no learning, no education, no nothing other than a fairly low-brow way of spending an hour watching some guy bouncing from bed to bed.