A world-leading alcohol-free craft brewer. Brewing beer so good, you won't miss the alcohol.
Business overview
| Location | Ipswich, United Kingdom |
|---|---|
| Social media | |
| Website | www.bigdropbrew.com/ |
| Sectors | Food & Beverage Mixed Digital/Non-Digital Mixed B2B/B2C |
| Company number | 10305828 |
| Incorporation date | 1 Aug 2016 |
Investment summary
Business highlights
- 100% CAGR revenue growth since 2017*
- Listings in selected Sainsbury's, Tesco, Waitrose and Morrisons
- More "World's Best" World Beer Awards than any other UK brewery
- Distribution in Australia and USA
Idea
Introduction
When City lawyer Rob Fink quit alcohol following the birth of his first son, he quickly realised that whilst the craft beer "revolution" had changed the landscape of (alcoholic) beer forever, alcohol-free beer had been ignored. Together with band-mate and school friend, James Kindred, they set out to create one of the world’s first alcohol-free craft breweries, making beer so good, you won't miss the alcohol!
The global alcohol-free beer market is forecast to grow at 8.7% CAGR by 2025 to become worth over $23bn.
With listings in selected Sainsburys, Tesco, Morrisons and Waitrose, as well a wide range of on-trade listings, including with one of the country's biggest pub companies, Mitchells & Butlers, we are well placed to take advantage of this opportunity.
And we're not just brewing in the UK. Big Drop also brews in Australia and the USA. Listings in national chains in those countries has allowed us to expand internationally as well.
Substantial accomplishments to date
• Quality
Big Drop has won more World Beer Awards “World’s Best” than any other UK brewery - alcoholic or otherwise.
Which? Magazine, June 2022 Winner: Best Buy Alcohol-Free Beer
“If you want a beer without the booze, this is our top pick”
The Independent, August 2022: Best alcohol-free IPA
“Big Drop is doing amazing things when it comes to changing the face of AF beer.”
• Growth
The business has enjoyed a CAGR of 100% since 2017.*
• Credibility
Of the investment sought, the majority has been provided by our lead venture capital investor, Panoramic; Mark Hunter (former MolsonCoors Global CEO and Chairman); and Bluepoint VC (Managing Director: Stefan Orlowski, former Heineken President Europe).
• Innovation
We set up our eCommerce store delivering beer to people's doorsteps in March 2020 following national lockdowns.
Two years later our customer database consists of over 14,000 subscribers.
Over the last 6 years, we have released 24 different beers.
*Based on unaudited management accounts.
Monetisation strategy
Big Drop is a mixed B2B/B2C business.
In the UK, Australia, and USA we sell through wholesalers which, in turn, sell through to retailers and the on-trade (pubs, bars, restaurants, etc). We also have direct accounts with larger customers such as Mitchells & Butlers, Ocado, and Milk & More.
Our ecommerce platform allows us a "shop window" to engage with our consumers directly and showcase our ongoing innovative range of alcohol-free beers.
Our experienced sales teams build relationships and strategies with pub companies, restaurant groups, supermarkets, and other retailers to list and grow the Big Drop brand whilst utilising the wholesale routes to market.
Use of proceeds
• Product: Further development and innovation in existing beers, recipe development and new styles.
• Sales and marketing: Maximising capabilities in our existing team and hiring new staff where the sales force does not currently operate. Funding activation and support for trade customers.
Key Information
Share classes
The Company has 2 classes of shares, A ordinary shares and ordinary shares.
The A ordinary shares carry a 1x participating preference on exit and liquidation.
On an exit or liquidation event, the proceeds will be distributed as follows:
(a) Panoramic, the company’s lead institutional investor and a holder of A ordinary shares, will first receive an amount equal to the aggregate issue price of all shares held by Panoramic (i.e. a sum equal to their total investment in the company)
(b) The other A ordinary shareholders will then receive an amount equal to the aggregate issue price of all the shares they hold (i.e. a sum equal to their total investment in the company)
(c) The remaining proceeds will be distributed to all shareholders (i.e. A ordinary shareholders and ordinary shareholders) pro rata as if all shares were one class.
The preferences above will be discounted if A ordinary shareholders would receive 3x their original investment had the distribution been split between all shareholders equally instead of applying the preference.
A 20% discount will apply if the total proceeds from the exit or liquidation exceed £32.5m and will increase by a further 20% for every £2.5m increase in total proceeds until it reaches 100% at £42.5m (meaning no preference will be payable if the company exits at £42.5m and proceeds will be distributed pro rata amongst all shareholders).
Seedrs investors will be receiving ordinary shares as part of this round as the A ordinary shares are not eligible for EIS relief.
In this round, Panoramic and Bluepoint VC will be issued Ordinary shares for their investment but to which the above preference will attach. All other investors will be receiving ordinary shares with no preference.
Outstanding debt
The company has the following outstanding loans:
1. Bounce back loan of 36,464 with 2.5% interest rate, due to be repaid in May 2026.
2. Two shareholder loans of £272,000 and $100,000 with an interest rate of 9.5%, not repayable until December 2023. The $100,000 loan has the option to convert into shares in this round, at the same share price as investors in this round.
None of the funds raised will be used to repay these loans.
Investor Perks
Please note that any discounts, rewards and/or offers listed by a company in its campaign are subject to the terms and conditions applied by that company and listed above. It is the company’s responsibility to honour such discounts, rewards and/or offers and Seedrs does not take any responsibility for them.
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