Kitchup is the UK's first online managed marketplace for kitchen space, matching underused commercial kitchens with food businesses.
Kitchen users can find and book affordable and flexible space on-demand, whilst Kitchen Hosts get a secure and simple way to earn extra income from sharing their commercial kitchen.
Referred to as “driving an Airbnb-style revolution in London kitchen space”, our mission is to build a global network of kitchen spaces, encouraging a more collaborative and resourceful food industry.
A diverse mix of big names and upcoming food businesses have all found kitchen space through Kitchup. From helping a street food trader transition into their first restaurant, facilitating the hire of a kitchen to be aired on national television to supporting a Hong Kong fine-dining brand enter the London food scene.
What excites us most is being at the beating heart of innovation and growth in the food industry, supporting a diverse mix of businesses on their journey.
Kitchup was created to remove the high barriers to entry food businesses experience, by helping them find kitchen space that is affordable, flexible and accessible.
Traditional routes such as leasing commercial premises and buying kitchen equipment is not only expensive, costing up to £100,000, but can also come with long leases of up to 10 years. To our knowledge, online search for shared space is sparse and fragmented with basic ad listings and no transparency or trust.
Kitchup aims to change this, to not only support emerging food businesses but also a shifting food industry that is demanding flexible access. Simple agreements, vetted kitchens and no huge up-front costs. Through leveraging available assets, our aim is to enable and support efficiency in the food industry.
Commercial kitchen owners have in-demand and valuable assets may be under-utilised. We believe Kitchen Hosts are too busy to hire out their space themselves and need a trusted company like Kitchup to support with the process and reach the right people.
Substantial accomplishments to date
Whilst proving our business model with a beta platform launched in London, we have achieved great momentum and revolutionised the hiring of commercial kitchen space:
• Generated over £100,000 in value for a new kitchen economy.
• 150% average growth rate in revenue per quarter. In the first 6 months of 2017 our revenue had already surpassed 2016 total revenues.
• 2,200 active web users per month.
• To our knowledge, the largest listing of commercial kitchens in the UK.
• Top ranking organically on Google UK for a number of key search terms.
• 150% growth in enquiries in the last year (Q2 2016 to Q2 2017).
• Won Silver Award at FoodTalk Awards 2017 for ‘What’s in store- smart kitchen’ category.
We believe we have managed to establish ourselves amongst some of the big hitters in the food industry as the go-to place for kitchen space. Kitchen users include Bills restaurant, Propercorn, Great British Chefs and Deliveroo. We have also received enquiries from Harrods, M&C Saatchi and the Princes Trust. The majority of our hosts and users have found us organically so we believe there is massive potential to expand our loyal community with an improved platform and an increased marketing budget.
We have attracted some notable press coverage including being featured in the Courier 'Grow Your Way' campaign, following the story of three flourishing start-ups.
Our primary revenue stream comes from taking a 10% commission of the total hire fee set by the Kitchen Host. We encourage our hosts to provide flexible pricing plans with a daily, weekly and monthly hire fee.
We plan to expand to key cities in the UK in 2018 and then Europe to scale the business and increase revenues.
Over 25% of our existing bookings have been long-term (over a month) which provides a regular revenue stream and high Life Time Value for both users and hosts. Our plans to automate the platform should enable higher volumes of on-demand short-term bookings.
As the kitchen assets are owned by our hosts we don't need high capital expenditure to grow, keeping our costs relatively low.
A basic listing is free for Kitchen Hosts. As we develop the platform we plan to add a range of paid host upgrades such as featured listings, social media boosting and premium membership. We also see potential revenue streams for users through related services and affiliate marketing.
Use of proceeds
Since launch, we have proved our concept and established a strong network and position in the London food scene. The focus now is to accelerate our growth, consolidate market dominance and expand to new cities in the UK and beyond.
Specifically, we intend to use this investment to:
1) Build a bespoke tech platform
Applying our learnings and host/user feedback, we have plans in place to build a fully automated, software powered platform that will enable scale. This should speed up our processes, convert more hosts and users and improve customer experience.
2) Grow our team
To support the growth that the advanced platform should bring we will be expanding our team and plan to recruit technical expertise.
3) Kitchen host and user acquisition
To date we have had great success mostly through word of mouth and network effects. We intend to build on this by investing in content marketing and paid digital channels to increase brand awareness and onboard more hosts and users.
We have two key target markets:
1 ) Kitchen Hosts - those who own a commercial kitchen with spare capacity and are willing to hire it out. In particular these are:
• Cafe owners who close shop early afternoon and weekends.
• Restaurants that are temporarily vacant or have availability certain days of week.
• Schools and universities.
• Social enterprises and community kitchens.
• Catering companies who have room to share their kitchen and/or days they don't use it.
• Providers of commercial kitchens and food incubators who need marketing support to find users for their space.
2) Kitchen Users - professionals and businesses that require kitchen space for food production, development, media or events. These include:
• Food entrepreneurs.
• Street food traders, supperclubs and pop-ups.
• Online food delivery companies.
• Chefs and caterers.
• Retail products.
• Corporate events (cooking classes).
• Media companies and advertising agencies (food photography and filming).
Characteristics of target market
In the UK alone, there are over 500,000 registered food premises, presenting massive potential growth for Kitchen Hosts. 70% of the UK population would share their idle assets if it were easy or convenient, and Kitchup is the first to bring a managed solution for commercial kitchens.
Almost every food business needs a commercial kitchen and the need for flexible kitchen space is increasing due to a number of growing markets and shifting demands:
• More people are looking to turn their passion for food into a profession. Almost a fifth of budding entrepreneurs in the UK plan to launch a food-related business and 15,000 food start-ups emerge into the UK market each year.
• Food delivery market grew 10X faster than dining out in 2016 - increasing demand for kitchen space as restaurants seek extra capacity and new online-only startups enter the space.
• Globally, the sharing economy is set to be worth $335 billion in 2025, driving a shift from ownership to access with innovative young restaurant brands favouring delivery-only kitchens and pop-up stands.
Since launch, we have conducted limited budget marketing and word-of-mouth has been an effective strategy to build our loyal community of hosts and users. To grow, we intend to use digital marketing for more targeted acquisition that will lead to activation, retention and referrals.
We have distinct strategies in place for Kitchen Host and User acquisition and with an increased marketing budget, we plan to use a combination of channels including PPC, social media, SEO, PR, partnerships, email and content marketing. We also intend to launch a Kitchen Host referral scheme to build on the success of word-of-mouth.
Food unifies our community and attracts huge audiences online which we aim to tap into through effective engagement and content marketing. With the roll-out of Kitchup to key cities, we'll use digital channels to target specific geographical areas with localised content.
We intend to adopt a test and learn approach to find what drives the most cost-effective growth and adapt accordingly.
We have carved out a niche in the booming sharing economy, and, to our knowledge, are the first in the UK to provide a managed marketplace for kitchen space. Since launching, a couple of challenger sites have been set up which we believes provides further confidence that there is a big appetite for our concept.
In the UK and internationally, there are some directories of local kitchens or single kitchen provider sites - but we don't see these as direct competitors. In fact, we see them as channels for Kitchen Host acquisition.
Kitchup sets itself apart from any competitors with what we believe is a unique value proposition of on-demand kitchen space. We plan to strengthen this further through partnerships, a community focus and a sustainable ethos.
We have a strong position with top organic Google ranking, a distinctive brand and the trademarked tagline 'The place for kitchen space'. Our investment plans should enable us to capitalise on our first-mover advantage, accelerating the network effects to scale and remain the industry leader.