The Manitoba farmers seeking to market hulless oats as a rice substitute have a pledge in hand for a $250,000 investment from the owner of Boston Pizza International.
Scott Sigvaldason, co-owner of Wedge Farms at Arborg, Man., promoted his product to a panel of Canadian venture capitalists in Wednesday night's episode of the CBC TV program Dragons' Den, where four of the five panelists passed on his offer of a 20 per cent stake in the company's "Rice of the Prairies" for $250,000.
Sigvaldason, accompanied by a chef who at that point had worked with the product for three months, brought cooked samples of the product for the panel.
Sigvaldason had already taped the Dragons' Den episode but was bound not to reveal its outcome when he was interviewed by Grainews editor Jay Whetter for the magazine's Oct. 5 cover story, available for reading this week on AGCanada.com.
Rice of the Prairies, also called "Cavena Nuda," is made from AC Gehl, an oat variety bred by Agriculture and Agri-Food Canada's Vern Burrows. Wedge Farms has marketed the product to a handful of Manitoba food retailers but is focused on the foodservice sector and has so far placed the product in 42 Winnipeg restaurants and hotels.
The remaining Dragon to invest in the oat product is Virden, Man.-born Jim Treliving, chairman and owner of Boston Pizza International, who countered with an offer of $250,000, but for a 50 per cent stake in the business.
When Sigvaldason countered with 30 per cent, another Dragon, Venture Communications owner Arlene Dickinson, told him she was "a little disturbed, frankly, that you didn't listen to the guy (Treliving) who's got all the restaurants and all the ability to get your product out there into the marketplace."
Founded in Edmonton in 1964, the Boston Pizza chain has over 325 restaurants across Canada. plus over 50 Boston's The Gourmet Pizza locations in the U.S and Mexico.
"There's an opportunity in front of you with someone who can really, genuinely help you because of the industry they're in and the ability to get you scaled very quickly," Dickinson said. "That's worth something, and I'm not sure you're understanding the value of that."
However, she urged him to talk over Treliving's offer with one of his partners, who agreed that placing Rice of the Prairies in Treliving's restaurants could cut Wedge Farms' marketing costs considerably. Sigvaldason returned and accepted Treliving's offer.
One of the four Dragons who declined, SoftKey Software founder turned mutual fund chief Kevin O'Leary, had said he saw the product as "a giant marketing problem, with the solutions unknown.
"You've got to convince farmers to grow it. You've got to convince consumers they want to eat Cavena Nuda. You've got to convince chefs and the food industry that they want to pay a little bit more. And the amount of money required to get people to say, 'Honey, get me some Nuda tonight' -- that could be a large amount of money."
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