Making plant-based eating fun and accessible for a flexitarian, environmentally-conscious generation.
- Winner of 2 Great Taste awards & shortlisted for multiple others
- Online orders increased by 9x during COVID-19 lockdown
- MVP eCommerce platform fully operational with strong margins
- Investment conditional upon Future Fund funding - see Key Terms
Learn more about convertible loan campaigns.
At The Brook, we want to show the world how incredible plant-based food can be.
We believe that living an environmentally conscious lifestyle shouldn’t be associated with sacrificing the things you enjoy, but simply finding new ways to enjoy them instead.
Born out of a number of award winning restaurants, opened in Surrey and London, The Brook is a plant-based food business that has raised over £400,000 to date, winning a number of industry awards and receiving national media coverage in the process.
In recent years, the popularity of plant-based and flexitarian diets has grown significantly on chilled and frozen prepared food by consumers looking to reduce their meat consumption.
We have now launched an MVP eCommerce platform that allows ‘build-a-box’ subscriptions as well as single purchases and enables people to experience the highest-quality plant based recipes, developed over more than 6 years, without having to leave their home.
Substantial accomplishments to date
Our other achievements include:
- Over £400,000 raised across two campaigns on Seedrs
- Awarded 2 great taste gold star awards
- Shortlisted for Future Food Awards 2019, Great British Food Awards 2019, World Food Innovation Awards, 2019 and Free From Food Awards 2020
- Listings secured with Co-op, Dobbie’s and Fenwick
- 2018 Time Out Winner: Best Restaurant in Hackney (after only 3 months)
- Over 12k social media followers eCommerce orders increased by 9x in D2C during COVID19 lockdown)
- Transitioned fully to outsourced manufacturing, significantly reducing overheads
- Launched trial branded freezers in 2 locations
Our innovative recipes are tried and tested, developed in a professional restaurant kitchen and loved by thousands plant-based diners and meat-eaters alike over the years.
Our range provides plant-based goodness throughout the whole week; from grabbing a quick lunch in the office to throwing an impressive dinner party. We’re also one of the few plant-based food companies offering indulgent desserts as well as a range of juices and even cooking sauces, setting us apart from similar brands in the space.
We have already made inroads into the retail sector with notable listings including CO-OP, Dobbie’s and Fenwick’s. And we have already held advanced discussions with a major UK pub chain which we expect to resume by the end of the year. Our immediate focus, however, is to rapidly scale our D2C channel and build our growing community.
Our eCommerce platform enables customers to build their own box of 8 plant-based dishes and have it delivered regularly, straight to their doorstep. This is a recurring subscription that customers can cancel at anytime, with free UK delivery, which costs £45. That is equivalent to £5.63 per meal.
Sample Selection - Alternatively, for customers that want to get a flavour of our food without committing to a subscription, they can order a sample selection of 8 dishes for £50, including free UK delivery (£6.25 per meal).
The Brook’s meals are also available to purchase from a number of retail outlets (both independent and major). We soon expect to boost our retail offering with our cold-pressed juices and lentil-based cooking sauces.
And on the foodservice front, we are still in discussions with a well-known UK pub chain, with over 900 locations, about adding our plant-based meals to their menu, designed to cater to the demand that they’ve seen from diners across the country.
Use of proceeds
We are raising £350,000 to invest in our eCommerce operation and scale our customer acquisition.
40% Team - We want to hire key roles across sales, operations, marketing, and digital commerce.
40% Marketing - We are busy refining and scaling our digital acquisition efforts to find the most cost-effective and productive channels through which to build our community. We also want to boost brand awareness by working closely with brand ambassadors and leverage the growth of plant-based/flexitarian lifestyles in mainstream press and social media.
20% Web Development - As we scale our digital acquisition strategy, it’s massively important that we improve the customer experience on our website in order to make sure that the onboarding journey is as smooth as possible.
The company has the following outstanding loans:
£143,000 loan from an institution at an interest rate of 3% per month. The loan is to be repaid on 2 October 2020.
The funds raised from this investment round will not be used to repay these loans.
Seedrs is supporting companies who are intending to apply to the Government backed Future Fund. You can read more about the Future Fund here: https://www.seedrs.com/learn/blog/the-future-fu....
In order for a company to be eligible to seek matched funding from the Future Fund, this investment round must be on the convertible loan terms that have been prescribed by the Future Fund for this purpose. These terms differ to our normal ‘advanced subscription agreements’.
Given this product differs from most campaigns on Seedrs, we urge all investors, including regular Seedrs investors, to read the information below and ensure you understand the terms in full before making your investment.
1. Key terms
You will see a term sheet attached to this Campaign in the Documents section which sets out the key terms of the convertible loan and you can see the full document prescribed by the Future Fund here: https://www.british-business-bank.co.uk/ourpart....
A summary of the key terms is set out below, but should be read in conjunction with the term sheet:
Interest: 8% per annum, non-compounding. On conversion events, the company can choose to repay the interest or convert it to equity (generally without the discount). See the Term Sheet for more details.
Redemption Premium: An amount equal to 100% of the principal loan amount
Valuation Cap: £4,000,000
Qualifying Equity Financing. The convertible loan will automatically convert on an equity financing raising at least the total loan amount, at the lowest share price of equity financing less the Discount or, if lower, the Valuation Cap share price.
Maturity Date: 36 months from signing convertible loan agreement.
The default position is on the maturity date is that the loan will convert to equity unless the investor majority elect to redeem.
If redeemed, the company will repay the principal together with the Redemption Premium.
If converted, the conversion price will be at the most recent funding round share price less the Discount, provided that funding round happened after 20 April 2020 and was at least a quarter of the size of the convertible loan investment. If no such funding round has occurred, conversion will be at the share price of the last funding round prior to 20 April 2020 (no Discount).Or, if lower, at the Valuation Cap share price.
Other events of default or conversion: There are various other scenarios in which the convertible loan may convert or be repaid and investors should reference the term sheet:
Non Qualifying Funding Round: The convertible loan can convert on an equity financing round which does not meet the size criteria of a ‘Qualifying Equity Financing”, at the election of the majority of investors under the loan. Please see the term sheet for how this conversion is priced.
Exit: The convertible loan will automatically convert or be redeemed on an Exit, whichever would give investors the higher cash return. Please see the term sheet for how conversion is priced and payments on redemption in this scenario.
Events of Default: The convertible loan is to be repaid on the events of default, such as liquidation or winding up. See the term sheet for more details.
2. Government matched funding
The company intends to apply to the Future Fund for matched funding on the total eligible amount invested in this funding round. Subject to eligibility criteria and the Future Fund's approval, the Future Fund will “match” the funding raised via Seedrs or other eligible sources, subject to a minimum investment of £125,000 and a maximum investment of £5m. The Future Fund is to be allocated on a ‘first come, first served basis’ to eligible and approved businesses, so there is no guarantee that a company will receive the Future Fund matched funding.
This campaign is conditional upon receiving matched funding from the Future Fund. Seedrs will not complete the investment and transfer the funds raised until we have confirmation that the Future Fund matched funding application has been approved and that the Future Fund is ready to make the investment. If the application is denied, the campaign will be cancelled and funds will be returned to investors.
Because this campaign is conditional upon the matched funding, you will see that we have reflected the Future Fund investment as part of the round. It is distinguished in pink in the progress bar of the campaign. This is to give investors an indication of the potential total size of the funding round (and potential dilution on conversion), but to also distinguish it from regular investment through the Seedrs platform.
Seedrs does not charge any fees in relation to the Future Fund matched funding, application process or for acting as lead investor with respect to applications.
3. Conversion to equity
The convertible loan agreement prescribed by the Future Fund is equity focused and favours conversion of the loan to equity as the default position.
Redemption is only available in certain scenarios and is often subject to the vote of majority of the investors. Where a vote of investors is required, Seedrs will vote on behalf of any investors it represents as nominee.
There is a possibility that the convertible loan will convert in some scenarios without the consent of Seedrs (if we do not make up a majority of investors). It is also Seedrs’ position that this is primarily an instrument for investing in the equity of the fundraising business and our default position would be to vote in favour of converting the loans to shares in the company, unless there is a clear or compelling reason not to.
As always, investors should be aware of and accept the risks involved in investing in early stage and growth focused businesses: https://www.seedrs.com/pages/risk-warnings
In addition to the usual risk warnings included above, investors should be aware of and accept the following with respect to convertible loans:
The convertible loan agreement is intended as bridge funding to a future funding round, but there is no guarantee that a company will be able to secure further funding.
The Future Fund is to be allocated on a ‘first come, first served basis’ and there is no guarantee that a company will be successful in its application to receive the Future Fund matched funding.
There is a risk that the Company may not have sufficient funds to repay the loan on the maturity date, pay interest when it becomes due or pay the redemption premium included in the terms.
Convertible loans are unsecured obligations and in the event of a winding up or liquidation event will rank behind secured creditors of the Company.
5. Secondary market
Investors will not be able to sell their interest in the convertible loans on the Seedrs Secondary Market unless and until they have converted to shares in the company (and then only subject to eligibility and the terms and conditions of the Seedrs Secondary Market).
6. EIS Relief - past, current and future
As noted above, the convertible loan instrument is not compatible with EIS requirements, so no EIS applications will be made with respect to investments in the convertible loan.
The government has confirmed that investing in the convertible loan will not impact EIS relief previously claimed on investments in the fundraising company:
“The government has confirmed that such previous investments will not be affected where the convertible loan converts into shares. Where the convertible loan note redeems, we have been alerted that the government intends to make changes to the rules to clarify that this is compatible with such previous investments.”
However, investing in a convertible loan could impact your ability to claim EIS relief on future investments into the same company. The government has not clarified the position on this and has said it is a matter for HM Treasury and HMRC.
Seedrs is unable to provide tax advice. Tax treatment depends on individual circumstances and is subject to change.