Red Letter Days

In 1989, Elnaugh founded Red Letter Days, one of the first UK companies to sell experiential gifts, such as motor racing days, hot air ballooning and health spa days.^[4][2] She could not get a bank loan at the time, so friends and family contributed £7,000 to the budget.^[3]

The company grew to an £18 million annual turnover and led to Elnaugh being a 2001/2 finalist in the Veuve Clicquot Businesswoman of the Year and Ernst & Young Entrepreneur of the Year.^[5][3]

In 2005, the company went into administration, and the remaining assets and inventory were bought by her fellow Dragons' Den entrepreneurs Theo Paphitis and Peter Jones.^[6][7] ITV1's Tonight programme criticised the business model of Red Letter Days, which included unpaid suppliers and disappointed purchasers. The programme suggested that the company failed to escrow or earmark supplier payment equity, using it instead as working capital.^[8][9] However, Elnaugh blamed Red Letter Days' bankers,^[8] and stated that the decision to go into administration was made to minimise job losses at the company.^[10]

Dragons' Den

In the mid 2000s, Elnaugh joined the BBC's reality series Dragons' Den.^[4] She was one of the five investors ("Dragons") in the first two series of the show, being the only female dragon at that time.^[11] During her tenure on the show, she made five agreed investment offers^{[citation needed]} – in Grails,^[12] Le Beanock,^[13] Snowbone,^[14] Elizabeth Galton^[15] and Bedlam Puzzles.^[16][17] After Red Letter Days went into administration, between the filming and release of the second season, her "position became untenable" according to Elnaugh, and was replaced in the third season by Deborah Meaden.^[18][19]

After Dragon's Den and Red Letter Days

In 2005, she was head of a company called Easyart.^[2] The following year, she produced a double CD pack consisting of "positive business thinking", The Life Changers, with hypnotherapist Glenn Harrold.^[18] In her book Business Nightmares - When Entrepreneurs Hit Crisis Point (2008), she wrote of her Red Letter Days experiences.^[20][1] The Evening Herald's reviewer said "A novel and more original approach to the jaded "how to get ahead in business" manuals, even for the casual browser, Business Nightmares makes for a surprisingly entertaining and accessible read."^[21] Elnaugh founded the digital publishing and marketing platform Source TV in 2013.^[1] Her book Prosperity was published in 2016. She described it as "a summary of Rachel's key teachings around money, flow and abundance drawn from her years as a business mentor".^[1]