

Dragons Den scandle of investments are in fact loans for stock. - HNer
http://www.dailymail.co.uk/news/article-1303097/Dragons-Den-winner-reveals-80k-promise-fact-loan--26-500-emerged.html?ito=feeds-newsxml

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forkqueue
This doesn't sound like a loan to me - it sounds like a contract where the
party buying equity is given priority on dividend payments, which as I
understand it is reasonably common.

Of course, the money not actually appearing is a different matter.

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zb
When someone asks if you need a lawyer, it's not actually a question.

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pclark
These companies are really unlikely to ever get acquired, how, other than with
a loan, are the investors meant to get liquidity on their investment?

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mistermann
> unlikely to ever get acquired

Not true, if you have a cash flow positive business, it can and will sell for
the right price (not nearly what a public company trades for though
unfortunately.)

Also, how about dividends?

I watch the Canadian or US (not sure which it is) version of this show and I
have encountered several of the products I have seen on the show later in
stores. Just this weekend, I saw some childrens play-dough (there was
something special about it that I can't recall) being sold in Costco. This
product was developed by a young guy living in a small town of about 200
people. Getting a product into a store as big as Costco is a godsend for most
people. Even if you have to give up 80% of your company, you'll likely still
do better in the end.

It seems the British version of this show is a tad unscrupulous however.

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hellweaver666
I think at the worst, this shows one member of the Dragon's to be
unscrupulous. Duncan Bannatyne has posted a copy of his contract on his
personal website, which shows a normal equity stake.

James Caan on the other hand has spent his time and resources trying to get
the book banned (at least according to Tweets by his fellow Dragons).

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pwim
_"Well, you're not going to rip me off are you, because you've got a lot more
money than me."_

That's pretty faulty reasoning.

