1. Identify the various strategies and tactics Cole+Parker uses to help consumers through the buying decision process.

2. Identify other factors that might influence customers' decisions to buy Cole + Par Parker socks.

Entering the Den, a couple from London, Ontario, who hope their new charitable business will knock the Dragons' socks off.

Hi, Dragons. How are you doing?

>> I'm Diana Cherabin.

>> And I'm Jeff House, and we are from London, Ontario.

>> We are Cole and Parker.

>> And our business is socks.

>> Did you say your business sucks, or it's socks?

>> Socks. Socks.

>> Our business is socks, and we are asking for --

>> $50,000 for 10 percent of our company.

>> So, Dragons, if you don't mind, we are going to have to ask you to take off your shoes.

>> Seriously?

>> Seriously.

>> All right.

>> No problem.

>> The things we do.

>> So models.

>> Wow. Cool socks.

>> Cool on top of those boots.

>> These look colorful.

>> Funky socks.

>> Thank you.

>> Thank you very much.

>> Thank you.

>> If you guys don't mind just giving those a try and seeing how those look. Help your suit stand out.

>> No problem.

>> Bruce, I can already see you got a pretty high sock game there.

>> Yeah. And I am going to up the game right now.

>> I like it.

>> But, Dragons, we don't just make socks.

>> Oh!

>> What else?

>> Wait a minute. You make socks?

>> That's our businesses.

>> Socks that start businesses is our tag line.

>> So what we did is we created the one-for-many business model. And how it works is one pair of socks can help fund multiple startups.

>> 20 percent of the proceeds of the sales from our socks are loaned to entrepreneurs in developing worlds.

>> When they've successfully started their startup, that money is repaid and it goes to the next entrepreneur, the next entrepreneur, and the next entrepreneur, thus creating a sustainable loop.

>> That's a great idea.

>> It is.

>> It is a great idea.

>> What are the margins on socks?

>> We manufacture the socks in China, and they are shipped over. And they are about $2 when they land here.

>> So how much are you selling them for?

>> Yes. So these are $24 socks.

>> Okay. You charge $24 for these socks?

>> We -- we charge $24 dollars.

>> For one pair.

>> Are you kidding?

>> Is that a lot?

>> That's crazy high.

>> Where do you have them in right now?

>> Right now we are just selling online. We actually launched the sales of our socks two weeks ago, and we sold over $32,000 worth of socks.

>> Wow.

>> Are you suggesting there is more value in creating a company that gives 20 percent of -- right off the top, which I think when I finish the analysis is going to be at least half the profit, why would I do that? Why wouldn't I just keep these two things distinct?

>> Which is why he'll never be a partner in your business.

>> I doubt I will be, but --

>> I hope that he will be a partner in business.

>> No. But what's the premise of why you become a better sock company giving half your profits away?

>> So it just moves people to actually buy more. Yes, you could buy socks absolutely everywhere. But we don't sell socks. We sell this concept that we will actually, you know, inspire you to make loans to entrepreneurs. And now, you know, with our two weeks of sales, that more people will buy our socks than any other socks because they know that --

>> Why wouldn't they just give money to [inaudible]?

>> It's not about socks, is it? It's about people who are looking to help, and it's just one way to do it. They are going to get the socks and wear it almost as a badge, but really it's about helping.

>> Okay. I think -- I think we get it, and so here's my position. When I invest in an investment, what I try and do is be very prudent about it and make as much money as I can and take a portion of my profits and I give it to charity and help other entrepreneurs. You have tried to blend both business models, and I don't agree with it at all. I'm out.

>> Okay. So just on that note, Kevin, so it isn't 20 percent. It's -- we put it so that we've created the business model first as if it was just a retail company, without the donation or, you know, without a charitable cause or a loan cause. And then we've added that up on top. So what that is, is just inspiring people to buy more. Like we first wanted to make sure we have grown a sustainable business.

>> But I think you're too early to be starting to give 20 percent off the top. A sustainable business is something that's gone over a year or six months or nine months of huge sales, and then I don't have a problem with that 20 percent.

>> I don't necessarily agree it's not sustainable because you're only giving away the moneys as you get them on the top line. And you've premium priced. You more or less have the consumer carry that burden.

>> What I have a problem with is I have no idea what it's worth. Like I have -- I have no idea whether this is worth $500,000 or $200,000 or 700,000 because you're two weeks in.

>> But what we're doing here is we're giving you the opportunity to invest in us. This is going to be huge, and it is going to be successful. And it will never be the chance, you know, to be valued at such a low price.

>> Can I ask you a question? What do you think you're going to do in year one?

>> We think we're going to do 500,000 in sales. Minimum.

>> What you guys have framed very well is what most new entrepreneurs are thinking about, which is a completely new way of going to market. I like what you're doing. I think you're way overvalued right now, so I would give you 50,000 for 25 percent. And I think that's a really good deal based on two weeks of sales.

>> I would love to, you know, discuss it with --

>> Hold on. I will offer you the $50,000 for the 10 percent that you offered up, but I want a 7 percent royalty until my money is paid back.

>> Until your money is paid back. So if it's paid back in 30 days?

>> That would be very exciting for me. I would be very excited about that, and you would be my new business heroes.

>> And you'd stay at 10 percent equity.

>> And I'd stay at 10 percent equity.

>> Okay. So you have two offers now. Jim, what are you doing?

>> You know, I just think you're not sustainable yet. So I'm out right now. The only way I'd do it is I'd loan you the money. And, at 50 grand, it's not worth it for me. So for that reason I'm out.

>> You've got two offers.

>> Arlene, we would absolutely, you know, love to work with you. However, you know, at this point just being so early, 25 percent is just -- is just way too much equity to give away. David, we really love your offer, and we would love the opportunity to work with you.

>> 7 percent is fair, though. Yeah. We've got a deal.

>> Well done, you guys.

>> Love the socks.

>> Good luck.

>> What do you think, guys?

>> When I see you on the corner selling colored socks for four bucks [laughter] --

>> Very nice [inaudible].

>> Hey, how are you doing?