How I tamed the Den's richest Dragon
Dragons’ Den investor Duncan Bannatyne was so impressed with Grant Morgan’s watch business that he bought 25 per cent of it.
Grant Morgan and business partner, Duncan Bannatyne of Dragons’ Den
What do you do if you want to expand your business? Ask one of the multi-million pound investors from BBC television show Dragons’ Den for backing, of course. Entrepreneur Grant Morgan did and, fortunately for him, one said yes.
The business angel in question was Scottish businessman Duncan Bannatyne. Worth an estimated £320 million and believed to be the wealthiest Dragon on the show, Mr Bannatyne owns a chain of health clubs, hotels, bars and property — and now a 25 per cent stake in Mr Morgan’s luxury watch brand, Kurt Zeiss.
The company was established by Mr Morgan in 2007 using £100,000 of his own money. Earlier this year, Mr Bannatyne, 60, injected an undisclosed amount for a quarter of the business. He adopted a strategic role and agreed to be the public face of the brand.
Mr Morgan, 42, says: “I first met Duncan a few years ago at a Marie Curie charity dinner. We hit it off almost immediately. We have a lot of common interests and goals.”
And so, when Mr Morgan decided a few months ago that he wanted to expand Kurt Zeiss, he approached Mr Bannatyne for investment. “I sent him a watch. He loved it and said he wanted to be involved. He believes in the product.”
The range includes classical and contemporary designs for men and women, and sits at the middle of the market. The watches are, as Mr Morgan puts it, “for people who aspire to own a Rolex or a Breitling but can’t afford to.
“When I started there were many watches available in the lower-price category and equally as many in the higher price range but very little in the middle market, and that’s where we pitched.” The watches, only available online, cost between £140 and £200.
Mr Morgan and Mr Bannatyne meet once a month to “talk through the numbers, agree marketing and advertising strategies and how best we can both grow and scale the business. He is very passionate about the look and feel of the brand.” Mr Bannatyne has been particularly involved in the design of his own KZ Bannatyne Signature Range, due for launch in October.
According to Mr Morgan, “Duncan’s off-screen persona is very different to his on-screen one.
“On the television, he doesn’t seem very forgiving. In real life, he is hugely philanthropic and is an inherently good man. But when it comes to business he is very focussed and very driven. He knows what he wants.
“Duncan has a gift for seeing numbers and seeing how they work. This is ideal for an entrepreneur, especially if you want to achieve the level he has in business. I knew he was the right person to help me get Kurt Zeiss where it needs to be. With his business acumen and profile, I am confident Kurt Zeiss will be a huge success.”
Mr Morgan himself is no business novice. He runs two other companies: multi-million pound marketing agency Louis Kennedy and Purple Peach, a manufacturer and distributor of sticker products. Having left school at 16 with few qualifications, he landed a job working in his uncle’s company supplying merchandise.
After six years in the business, he had learnt about sourcing, manufacturing and trading commercial products, and decided it was time to set up on his own.
In 1991, investing everything he had — about £5,000 — he launched Louis Kennedy, a marketing agency which facilitates partnerships between businesses and charities. Established from his parents’ front room in Muswell Hill, north London, the company has grown from a value of £80,000 in its first year to a multi-million business today. It has helped the charities raise more than £100 million and Mr Morgan now hopes to expand into America.
As for Kurt Zeiss: is it not a tough time now to be launching a luxury watch brand when people are cutting down on discretionary spending?
“That’s not what our data is showing.” He says they are selling 300 pieces a month and is confident this will increase in the run-up to Christmas — traditionally a good time for jewellery. “The watch market is pretty buoyant at the moment. For men, it’s the one jewellery item they can really wear with confidence, above an ID bracelet or ring. Moreover, you may not be able to spend £3,000 on a Breitling but you might be able to afford £199 for a Kurt Zeiss watch.”
What other opportunities does he see for aspiring entrepreneurs? “It is about seeing things early. In 2006 one could have argued against entering the watch market because there are 50-100,000 watches online. I saw that as an opportunity. I thought that if there were that many pieces online at any stage then there was a market.”
He cites the internet as the greatest opportunity. “It enables businesses to form very quickly with fairly low operating costs. That was the reason we did not go to retail. We could reduce our overheads, our margins and supply directly through our core market.”
He adds: “It is hard for entrepreneurs on Dragons’ Den as they only have a short while to impress. I think potential investors such as Duncan are looking for integrity, honesty, opportunity but, above all, the numbers have to be right. The reason we are partners is because he likes the business model. He sees the opportunity in the growth and scalability of the business.”
Mr Morgan lives in Finchley. He is married with four children.
The duo’s top tips on how to pitch
- Do your research on the company you are pitching to
- Be honest and have short, precise answers
- Prepare a list of questions for the interviewer
- If asked: “What do you want to be doing in 5 years’ time?”, don’t answer: “sitting in your chair!”
The new series of Dragons’ Den starring Duncan Bannatyne is on BBC 2, Wednesdays at 9pm