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Big Drop Brewing

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A world-leading alcohol-free craft brewer. Brewing beer so good, you won't miss the alcohol.

116%
 - 
Funded 9 Nov 2022
£2,200,000 target
£2,567,494 from 448 investors
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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
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Investment summary

Type Equity
Valuation (pre-money) £14.2M
Equity offered 15.26%
Tax relief

EIS

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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
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Key features

  • Secondary Market
  • Seedrs nominee min. £44.74 +

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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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 webpage has been approved as a financial promotion by Seedrs Limited ("Seedrs"), which is authorised and regulated by the Financial Conduct Authority. It is not intended to be a promotion of any individual investment opportunity and is not an offer to the public. The summary information provided about investment opportunities on this webpage is intended solely to demonstrate the types of investments available on the Seedrs platform, and any investment decision should be made on the basis of the full campaign. Full campaigns are available to investors who have become authorised to invest on the Seedrs platform. All investment activities take place within the United Kingdom, and any person resident outside the United Kingdom should ensure that they are not subject to any local regulations before investing.

Seedrs does not make investment recommendations to you. No communications from Seedrs, 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. Seedrs 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 Seedrs, 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 £14,230,179

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

There are 5 types of investment pitch available on Seedrs.

  • Equity
  • Convertible
  • Fund
  • Cohort
  • Secondary

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.

Seedrs nominee

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

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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 Seedrs Nominee). 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.

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