Two of the BBC’s “Dragons” – judges on a talent show for start ups – have invested some of their own cash in a cute little product called “Seabung”. It’s a rubber thing, shaped like a plunger but working in reverse. You push it down through one of several holes in the bottom of a normal boat – the one your poop goes out of, or the water for your engine comes in through – when you want to repair or maintain the shut off valve, that’s the valve that stops sea water gushing up through your toilet whenever your hull slaps down back into the water after cresting a wave.
The product has a couple of issues. One of the major use cases is to stop you from having to remove the boat from the water when “maintaining” valves, but pleasure boats come out of the water regularly for all sorts of maintenance tasks. One of the Dragons doubted it would work, and there are simpler cheaper alternatives such as simple bits of wood, which are the usual remedy in an emergency, and some valves might not be compatible anyway – such as any with a grill over them. These challenges are not of any interest at all to the Dragons though (namely Deborah Meaden and Kelly Hoppen). They didn’t ask about these issues but they were sure they wanted to give it a “punt”. What gave them the confidence to invest their own cash in a product they knew little about?
Well, the dollar signs flashed in their eyes when the entrepreneurs mentioned they would seek to get safety legislation changed to make their product compulsory. That, of course, would mean they don’t have to persuade anyone if it would work, or persuade anyone that they really needed it, they would have to buy it anyway. The “punt” they were taking was that if the proposed change in the law was achieved the Dragons would get 10% of the profits each. A more brazen attempt at crony capitalism has never been seen.
This was rent seeking of the highest order and it was totally OK by everyone on the show. The mind boggles at how often such things must happen. It is not that a bribe was offered to politicians on national TV, but that changing laws to make your product compulsory was discussed as an attractive business strategy with no discussion at all of whether a such a move was ethically appropriate. In these circumstances how long will it be before someone on the project (an employee, PR man, a shareholder etc) decides it is in their interests to offer a bung to a politician? The Dragons concerned should certainly think twice before donating to any political parties in the near future!
Thank you BBC for a very clear and accessible demonstration of something libertarians have been talking about for decades.
LATER: You can watch the episode online.