Big Drop Brewing Co
- Investment sought:
- Equity offered:
Big Drop Brewing was created when City lawyer Rob Fink quit drinking for a few months following the birth of his first son. A craft beer fan, Rob was underwhelmed by the uninspiring alcohol-free beer (AF) options available at the time.
Realising that the craft beer "revolution" had left AF beer behind, he tried to find breweries dedicated to AF craft beer but couldn't. So he set up Big Drop to fill the gap. And not only are they AF, they're gluten-free, many are low in sugar and our award-winning lager is vegan-friendly.
Big Drop brews beer naturally: we use specialist brewing methods to ensure the alcohol never exceeds 0.5%. This means we don't remove the alcohol after brewing, unlike many other AF brewers. Which in turn means we don't lose mouthfeel, flavour and aroma. The result is full-flavoured beers which many can't tell apart from their alcoholic cousins.
And our award-winning range means that, whatever the reason, if you're not drinking, you can still enjoy a great beer of any style.
Three years ago, typically the only AF beers available were bland mass-produced lagers.
However, with alcohol consumption around the world falling, but with a commensurate increase in lo/no alcohol products, Big Drop fills the gap for great tasting AF craft beer.
We want to mirror the impact that craft beer has had on the world of beer but in the AF sector. The growth of AF beer has been exponential and is predicted to continue to rise: the global AF beer market is expected to reach $25 billion by 2024 and we want to make sure that a good portion of that is great quality craft beer.
We are a proud nomad brewer. In other words, we don't have a brewery. And we don't want one. We partner with reputable breweries around the world, who share our brewing values, to produce our beer.
Not only does this mean we can scale without the need for significant capex, but given our large export volume we can produce our beer locally, ethically and with a minimal carbon footprint.
Substantial accomplishments to date
Big Drop was one of the first brewers to dedicate itself to AF beer.
We continue to lead the way in defining and shaping this rapidly growing category. Our beer has won prestigious international brewing awards, not only in AF categories but against full-strength beers.
We reached nearly £900,000 revenue* in 2019 after just 3 years which is CAGR of 150%.
We have already secured £1.3m in investment from sophisticated sector specialists, including the founders of Camden Town Brewery, professional private equity investors and a variety of business angels and high net worth individuals.
We have UK off-trade listings in Tesco, Morrisons and Ocado.
Our on-trade team has gained us listings with major groups including D&D Group, Searcys, Mitchells & Butlers, Fullers, Youngs, Brunning & Price, Food & Fuel, Brewhouse & Kitchen, St Austell, Everards, Barworks, Bel & Dragon and Cirrus Inns. Together these groups manage nearly 3,000 sites which is a real opportunity for us. Our non-traditional beer product has meant that we have secured listings with retailers not normally associated with beer, including Holland & Barrett and Milk & More.
Internationally we have listings in nearly 900 stores: Albert Heijn supermarket (Netherlands), Systembolaget (Sweden), Alko, S Group & K Group (Finland), and LCBO (Canada).
With production and distribution in place for the US and Australia, we plan to expand further into those territories in 2020.
Big Drop sells beer to distributors and wholesalers. It does not, largely, sell direct to customers.
We outsource our production to breweries around the UK which means we can control quality and process with our trusted brewing partners but without the capex required to build and expand a brewery to keep up with our rapid growth.
Given our significant foreign expansion, we have put in place a decentralised production model which means 2020 will see us brew in Sweden, Canada and Australia. This reduces significantly our freight costs (a significant financial and environmental benefit).
As thought-leaders in this sector we have collaborated with reputable craft breweries to produce innovative styles, generating revenue and interest in this sector.
Use of proceeds
50% - Sales & Marketing
Our plans include the opening of an experiential taproom in London and a mobile bar for use at trade shows and events. We will recruit brand ambassadors in our large export markets, particularly Australia, US and Canada.
30% - Packaging launch and related marketing
A relaunch of our packaging is due this month and these funds will be used to launch our updated website and retain PR & marketing agencies to drive awareness of our new packaging designs and availability.
10% - Production costs
This will cover the start up costs necessary to start brewing in new markets (ie, R&D brews, upfront packaging costs and trips to oversee any production issues)
10% - Product development
We constantly innovate and will never rest on our laurels. Just as alcoholic craft breweries are constantly striving to create new and better beers, so will we. So whilst we do not want to build our own brewery, these funds will give our Head Brewer a state-of-the-art experimental brew kit to trial new styles and techniques.
* Based on unaudited management accounts
The current outstanding director's loan is £56,843. There is no interest payable on the amount and there is no particular date on which the loan is to be repaid. The proceeds from this round will not be used to repay this loan.