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KIDLY

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Connecting modern parents with unique and inspiring kids products.

107%
 - 
Funded 26 Apr 2023
£1,000,024 target
£1,105,497 from 279 investors
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Business overview

Location London, United Kingdom
Social media
Website www.kidly.co.uk
Sectors Clothing & Accessories Digital B2C
Company number 07672877
Incorporation date 16 Jun 2011
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Investment summary

Type Equity
Valuation (pre-money) £19.1M
Equity offered 5.35%
Tax relief

EIS

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Business highlights

  • Over £50 million gross sales to-date
  • 190,000 active customers (last 12 months)
  • Over 1 million orders shipped since launch
  • Our own brand, KIDLY Label, accounts for 40% of units sold
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Key features

  • Secondary Market
  • Nominee investment min. £28.81 +
  • Direct investment min. £20,000.00 +

Idea

Introduction

When our founder, James, had kids he found shopping for them outdated and uninspiring. With his 15 years helping ASOS bring fashion into the digital space, he believed the modern parent was ready to shop in a new way.

Launched in 2016, KIDLY is a modern store for 0-5s offering design-led & genuinely useful products, all wrapped up in an effortless experience, from website to door.

We started offering 3rd-party brands. Then, in 2019, added our own collection of quality, modern, must-haves - KIDLY Label - focusing on thoughtful design & planet-friendly materials.

KIDLY Label now has 250+ options, an army of fans & drives our highest repeat rates. It’s our most-loved brand, accounting for 40% of all units sold.

We believe the time is right to accelerate KIDLY Label’s amazing potential, while rationalising the other brands we offer, keeping only those that truly complement our own.

The goal of this strategy is to position the business to achieve sustainable profitability, from which we then aim to scale.

Substantial accomplishments to date

2016

- Launched in May.

2018

- Both our IE and US websites opened and reached 17% of revenue in the quarter before the pandemic.

2019

- Launched KIDLY Label with seven options of our Ribbed Legging.

2020

- KIDLY Label launched into footwear, first with the Rain Boot and then the Jelly Sandal, which has now sold over 100,000 units.

- We welcomed our first institutional investor, Hargreave Hale AIM VCT.

2021

- We added Toys and Feeding to our range, winning 2 industry awards for our Folding Bucket & Spade Set and our Sensory Nesting Balls.

2022

- Launched KIDLY Unlimited, our free-delivery-for-a year service.

- We received our 1 millionth order.

- Winner of Best Online Retailer of Preschool Products at the Progressive Preschool Awards.

- Launched KIDLY Label on Next.co.uk.

2023

- We passed £50m in gross sales since launch*.

- KIDLY Label reached 250+ options.

- KIDLY Unlimited passes 10,000 paying subscribers.

- Launched our first crowdfund to help accelerate the growth of KIDLY Label

Monetisation strategy

We sell things for kids from our website directly to our customers. Currently we sell a range of 3rd party brands that generate 75% of our revenue*. We also sell our own label, KIDLY Label, which accounts for 25% of revenue*.

Our strategy is to grow the mix of KIDLY Label. It is our most loved brand and it achieves a 65% margin (that's profit we make versus the price we pay, after any customer discounts or markdowns), versus a 43% margin achieved by the 3rd party brands.

We sell to UK customers via kidly.co.uk and recently reopened kidly.ie for our Irish customers, after a covid-enduced hiatus.We also have a kidly.com, which serves US customers. We closed this for the same reasons as Ireland, but hope to re-open it again soon.

We recently were approached by NEXT to sell KIDLY Label via their platform. We launched our first range with them in November 2022 and hope to introduce some other strategic wholesale partners soon.

*Revenue data from unaudited management accounts.

Use of proceeds

We aim to use your investment to accelerate the production and growth of the KIDLY Label range, targeting a 250% increase in revenue in the next three years.

We aim to grow our capability to increase its footprint, with more strategic retail partners alongside NEXT.

We intend to invest £500k in brand marketing to increase our UK awareness beyond paid marketing channels.

Key Information

Share Class

Kidly has 6 classes of shares: A Ordinary, B Ordinary, C Ordinary, D Ordinary, E Ordinary and F Ordinary shares. All investors in this round, including Seedrs investors, will be receiving interests in F Ordinary shares.

All share classes other than the C Ordinary shares are voting. F Ordinary shares and E Ordinary shares have an EIS compatible 1x non-participating preference (see below). The share rights are otherwise the same across all share classes.

On an exit or liquidation, F Ordinary shares will first receive their investment back from the proceeds, following which the E Ordinary shares will receive their investment back. The remaining proceeds will then be shared between the other share classes pro-rata to their holding. F and E Ordinary shareholders can convert their shares into D Ordinary shares on demand ahead of an event, so they will be able to benefit from the growth in the Company if a pro-rata distribution of the liquidation or exit proceeds would provide a better return for them.

Convertible Loan

The company has the following outstanding convertible loans, which may convert to equity after this round and dilute existing shareholders:
A £900,000 convertible loan from Hargreave Hale AIM VCT PLC, with the following key terms:
Interest rate: 10%
Conversion trigger: the loan and interest will convert on:
• the election of the investor
• the election of the Company, provided it has reported profit after tax in the previous financial year
• a Company exit (IPO, asset or share sale)

Conversion price: will be the lower of:
• £20.23; or
• a price determined by:
• an IPO opening or listing share price
• the share price of the previous funding round before immediately prior to conversion; or
• a trailing EV/Sales ratio of 2.3x applied to the previous financial year

Share class: Ordinary D or E shares
Repayment terms: the CLN plus interest will be repayable by the Company on:
• the Company being wound up / becoming insolvent etc.
• the date being 5 years from payment of funds (paid in two tranches between April and July 2020)

A £1,500,000 convertible loan from Hargreave Hale AIM VCT PLC, with the following key terms:
Interest rate: 10%
Conversion trigger: the loan and interest will convert on:
• the election of the investor or
• a Company exit (IPO, asset or share sale)

Conversion price: will be the lower of:
• £28.81; or
• a price determined by:
• the post-money fully diluted share price calculated by applying a 2.0x EV/Sales ratio to the actual net revenue for FY 2023 (y/e 31 Mar 2023)
• the lowest price per share at which equity is issued pursuant to a subsequent funding round prior to such conversion;
• an IPO opening or listing share price or the price per ordinary share determined by an Exit Event (other than a Listing), less a discount of 20% for each ordinary share.
Share class: F Ordinary Shares or, at the election of the lender, any other class of Shares in existence on a Conversion Date.
Repayment terms: the loan plus interest will be repayable by the Company on:
• the Company being wound up / becoming insolvent etc.
• the date being 5 years from pa

Payment Plan

The company currently has a payment plan in place with a logistics provider, with an overdue balance as at 31.03.23 of £125k. Payments against the account are expected to be up to date by the end of May.

Funds from this round will not be applied towards this payment plan.

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. 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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If you successfully purchase a share lot of this business, you will be granted access.

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Only shareholders can access this page

If you successfully purchase a share lot of this business, you will be granted access.

Buy shares

Only shareholders can access this page

If you successfully purchase a share lot of this business, you will be granted access.

Buy shares

Investing involves risks, including loss of capital, illiquidity, lack of dividends and dilution, and should be done only as part of a diversified portfolio. Please read the Risk Warnings before investing. Investments should only be made by investors who understand these risks. Tax treatment depends on individual circumstances and is subject to change in future.

This campaign for KIDLY has been approved by Seedrs Limited (trading as Republic Europe) ("Republic Europe", "us" or "we"), as of 31 March 2023 as a financial promotion. Republic Europe is authorised and regulated by the Financial Conduct Authority with firm reference number 550317. In approving this campaign, Republic Europe has concluded that the information, taken as a whole, is "fair, clear and not misleading." This means that for factual statements we have reviewed evidence of their accuracy, and that for aspirational statements we believe they are phrased appropriately in light of their speculative nature. You should note that in the case of factual statements, the evidence we review is provided by the business, and we do not audit it, which means that we may not be able to identify forged or altered evidence. You should further note that in the case of aspirational statements, the nature of the type of businesses presented on the Republic Europe platform is such that they are likely to have high ambitions, and we may approve statements that convey those ambitions even where we do not believe, or we do not have a view on whether it is likely, that they will be fully realised. The pre-money valuation and investment sought in the campaign are those set by the business: they are not reviewed or established by us, and the valuation is not an independent view of what the business is worth. Given the nature and type of businesses presented on the Republic Europe platform, it is possible that the business has very little cash remaining prior to receiving this investment, and the investment sought may be necessary for the business's on-going existence.

Republic Europe does not make investment recommendations to you. No communications from Republic Europe, through this website or any other medium, should be construed as an investment recommendation. Further, nothing on this website shall be considered an offer to sell, or a solicitation of an offer to buy, any security to any person in any jurisdiction to whom or in which such offer, solicitation or sale is unlawful. Republic Europe does not provide legal, financial or tax advice of any kind. If you have any questions with respect to legal, financial or tax matters relevant to your interactions with Republic Europe, you should consult a professional adviser.

Tax Relief (SEIS)

This business is eligible for SEIS relief - providing qualifying investors with income tax relief of 50% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Tax Relief (EIS)

This business is eligible for EIS relief - providing qualifying investors with income tax relief of 30% of their investment and certain other tax reliefs. Tax treatment depends on individual circumstances and is subject to change in future. Click to learn more.

Valuation (pre-money)

Valuation rounded from £19,083,024

This is the fully-diluted pre-money valuation of the business (i.e. before the new investment comes in and including issued options and other equity interests). In contrast, the post-money valuation is based on inclusion of the new investment in the value.

It is calculated as the pre-money valuation plus the amount of new investment. e.g. If Company A is ascribed a pre-money valuation of £1,200,000 by prospective investors investing £300,000, its post-money valuation is £1,500,000.

The investee business is responsible for setting its own valuation, it has not been prescribed by Seedrs.

Pitch type

Investing in a regular equity campaign is the simplest and most common way to invest in a startup. You decide which business you want to invest in, and if the campaign hits its funding target then you will become one of their shareholders. As the company becomes more valuable, so do your shares; allowing you the opportunity to share in the future success of the business.

Learn more about pitch type on Seedrs

Equity Offered

The equity offered is the percentage of the company’s shares being issued in return for the amount of investment raised.

When the amount raised is less than 100%, the equity offered is based on the target raise. Once the company has raised over 100% it is based on the total raised.

In some scenarios, entrepreneurs may accept additional direct investment after closing their Seedrs campaign. Provided this is within 6 months of the closing and on the same terms, we do not typically offer pre-emption rights on that extra investment (where you have the opportunity to invest again to maintain your percentage shareholding).

Learn more about investing and pre-emption rights.

Nominee investment

This shows if you are able to choose, when making an investment, that you be represented by, and your shareholding be managed by, the Nominee investment.

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Custodian

If you invest in this Campaign, Seedrs will act as Custodian rather than provide our standard nominee service. This is due to the fact that the business is not directly involved in the share sale and Seedrs will not benefit from any rights under a shareholder agreement. As a result, Seedrs will handle administrative tasks as we do normally, but you will not have information or voting rights, updates from the business, preemption on future fundraising, or ongoing support about business trading activity.

Learn more about Custodian here

Secondary market

This shows if the business has opted-in or opted-out of allowing its shares to be bought and sold on the secondary market.

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Direct investment

This is an option to invest and hold shares 'directly' in the company (rather than via the Nominee investment). This option is only available to those investing over the threshold amount, which is determined by the fundraising company.

If you choose to hold your shares directly, you will be responsible for any contractual or administrative arrangements with the company you are investing in.

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Payment options

We are not able to accept card payments for investments into this sector. You can pay for your investment by creating a bank transfer, using funds in your investment account or create a Pay by Bank payment. Your investment will only be completed once the funds have reached our account.

Business Involvement

This Campaign offers shares for sale in business that is not directly involved in this Campaign or the sale. As a result, the Campaign and post-investment experience, including investor rights, will differ from a business-led campaign on Seedrs. Most notably, the business will not engage with investors in the discussion forums both during and after the sale or provide any updates to investors.

Learn more here

Payment options

We are not able to accept Pay by Bank payments for investments into this sector. You can pay for your investment with a card payment, by creating a bank transfer or by using funds in your investment account. Your investment will only be completed once the funds have reached our account.

Drawdowns

This campaign offers the ability to pay for an investment by drawdowns.

Security Token

A security token is a digital asset that represents ownership or other rights. It is a digital form of traditional investments. In the future, you may be able to trade your investment through compatible exchanges.

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