Fintech app reinventing how families save & invest for their kids' future, making it easy and affordable.
Business overview
| Location | London, United Kingdom |
|---|---|
| Social media | |
| Website | beanstalkapp.co.uk/ |
| Sectors | Finance & Payments Digital Mixed B2B/B2C |
| Company number | 05439349 |
| Incorporation date | 28 Apr 2005 |
Investment summary
Business highlights
- 12K registered users and >£5m in AUM (Assets Under Management)
- >350% growth in assets in 2021.
- Part of KidStart, an established business with turnover of >£1m*
- Experienced founders – creators of financial service products
Idea
Introduction
Despite a mass adoption of fintech amongst consumers, child savings products have been slow to catch up.
Built on an innovative 'family view' and technology, Beanstalk is changing this by making it really easy for all parents, whatever their means, to build a nest egg for their children’s future.
With our simple app it takes a minute or two for a parent to open accounts for their children or themselves. There are lots of tools to help put money away including open banking powered round-ups and instant top-ups, cashback at 2k+ retailers, friends & family gifting, and through our unique invite tool, grandparents (and others) can link and contribute directly to the child's account.
No minimum or regular contribution is required, and we charge an annual fee of 0.5% on assets.
Substantial accomplishments to date
Beanstalk is part of KidStart, a child savings-linked cashback business that has been established for 14 years and has two experienced founders with a background in disruptive financial services and products, and knowledge of the parenting market.
Investors are being offered shares in KidStart with proceeds supporting development of the brand, Beanstalk.
Since launching Beanstalk in 2020, we’ve achieved:
• 12K registered users
• >£5m of Assets Under Management (AUM)
• >350% growth in AUM (2020-21)
• 4.6 Trustpilot rating
KidStart gives us an engaged, readily-accessible audience to convert as Beanstalk users, as well as a cohort of reputable brands to market with.
KidStart has:
• more than 1.4m registrations
• 700k users who have double opt-ins to receive emails
• 176k have shopped through Kidstart's website, spending over £400m
*Based on unaudited management accounts.
Monetisation strategy
Underpinning Beanstalk, there is a unique view of family relationships and wealth which we plan to use to open up large scale opportunities in broader family wealth and intergenerational transfers.
Revenue model:
• Beanstalk charges customers an annual fee of 0.5% of assets
• KidStart charges retailers for promotional activity and collect share of affiliate commissions on shopping
• Free switch service lets us take on existing JISA & Child Trust Fund accounts
• Potential market of £5bn in existing JISA assets and £7bn in Child Trust Fund assets, plus a 5 year average of 735k new children born each year in the UK
• Additional revenue from cross sales planned for future
Use of proceeds
We’re now looking to scale Beanstalk through customer acquisition and partnerships.
The plan is to use the majority of funds (75%) on marketing, increasing spend on digital / affiliate channels that are already delivering NPV positive customers, expanding PR and adding new marketing channels to the mix.
In support, 10% will be committed to strengthening the partnership / marketing team.
15% will be spent on adding new features to the app, including additional payment options, different fund options, new savings tools and introductions to third party offers.
Key Information
Company share structure
Investors are being offered Preferred Ordinary shares in KidStart with proceeds supporting development of the brand, Beanstalk. KidStart currently has 4 classes of shares:
1. Preferred Ordinary Shares
2. Preferred Shares
3. Ordinary Shares
4. M Ordinary Shares
These shares have differing rights and do not rank equally. All investors in this round, including Seedrs Investors will be receiving Preferred Ordinary Shares.
Below is an explanation of the associated rights and exit implications of each class:
1. Preferred Ordinary shares (also known as Participating Preference Shares).
- Nominal value: £0.01
- Voting rights: entitled to 1 vote per share (equivalent voting rights to Ordinary shares)
- Dividends: entitled to receive dividends at the same rate as Ordinary shares
- Sale or liquidation event: out of distributable funds, shareholders have the right to receive both:
a) A fixed preference amount equivalent to the price paid in the round. This right ranks the same as Preferred shares and above Ordinary shares
b) A pro-rata share in proceeds after taking into account redemption of the Preferred shares. This right ranks the same as Ordinary shares
2. Preferred shares
- Nominal value: £1
- Voting rights: non-voting
- Dividends: zero dividend
- Sale or liquidation event: these shares are redeemable for £1 per share, plus any accrued/unpaid historic dividends. This right ranks the same as Preferred Ordinary Shares and above Ordinary shares.
- There are 2.948 million preferred shares in issue. They have accrued unpaid dividends of £140k. Following this round these shares will not accrue unpaid dividends.
3. Ordinary shares
- Nominal value: £0.01
- Voting rights: 1 vote per share
- Dividends: entitled to received Dividends
- Sale or liquidation event: these shareholders are entitled to a pro-rata share in the proceeds after taking into account redemption of the Preferred shares and Preferred Ordinary shares
- Please note: Options granted to management are for Ordinary shares
4. M Ordinary shares
- Nominal value: £0.01
- Voting rights: 1 vote per share
- Dividends: entitled to received Dividends
- Sale or liquidation event: these shareholders are entitled to a pro-rata share in the proceeds after taking into account redemption of Preferred shares and Preferred Ordinary shares
- Please note: these shares hold the same rights as Ordinary shares, but also include terms on the compulsory transfer if the holder leaves the company
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