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Benedita

Platform:
Crowdcube
Stage:
Expansion
Industry:
Retail
Location:
UK - London
Date Rated:
20/07/17
Raise:
£125,000
Equity:
12.82%
Valuation (Pre Money):
£850,039
Industry: Retail
Location: UK - London
Platform: Crowdcube
£125,000 Expansion
Valuation: £975,039
Date Rated: 18/07/17

MANAGEMENT

PRODUCT

INVESTMENT
Tax Status: SEIS & EIS

Business Summary

Benedita is a luxury kids fashion brand crowdsourcing untapped designers talent with production in Portugal. Benedita has already achieved wholesale presence in over 30 retail shops in 10 countries and is exhibiting at some of the top trade fashion shows. This round of investment will be mainly used to launch the full collection on its e-commerce platform, grow its wholesale presence and to fund the marketing strategy.

Financial Overview

Date (y/e) Dec-17 Dec-18 Dec-19 Dec-20
Sales Dec-17£79,836 Dec-18£739,680 Dec-19£1,282,208 Dec-20£1,837,046
Gross Profit Dec-17£37,671 Dec-18£390,651 Dec-19£672,796 Dec-20£986,989
GP as % sales Dec-1747% Dec-1853% Dec-1952% Dec-2054%
Overheads Dec-17£33,351 Dec-18£286,303 Dec-19£428,383 Dec-20£590,517
Operating Profit Dec-17£4,320 Dec-18£104,348 Dec-19£244,413 Dec-20£396,472
OP as % sales Dec-175% Dec-1814% Dec-1919% Dec-2022%
Closing Cash Dec-17£4,320 Dec-18£108,668 Dec-19£353,081 Dec-20£749,553

Note: This financial information has been sourced from the company on 18/07/2017. Financial data is NOT verified by Wheatfromchaff Ltd.
53%
SKILLS:
EXPERIENCE:
COMMITMENT:
Although the Founder has limited management expertise, she appears to have the right sales skills to develop the business but a marketing expert would be beneficial to complete the team.
The Founder has limited start-up and commercial experience so she will be very dependent on the support from her advisors with a marketing and software background.
The Founder is the only member of the management team but she has invested significant time in developing the brand and her salary will remain minimal until the end of 2017.
57%
MARKET:
PRODUCT:
COMPETITION:
The Childrenswear segment in the apparel industry is estimated to be worth over £130bn globally by the end of 2017 and luxury online retailers are thriving.
The company has enjoyed good press and it is increasing brand awareness with every exhibition but it is still in the process of launching the full collection on its e-commerce site.
Children’s fashion is on the rise but so too are the number of competitors. Benedita intends to differentiate itself by accessing untapped designers and offering year round replenishment.
57%
PROFITABILITY:
CASHFLOW:
RETURNS:
Benedita has a healthy profitable business model supported by sensible assumptions and intends to increase the marketing budget significantly to deliver the expected growth.
This round of investment provides enough cash to achieve break-even with limited headroom but given the flexible cost structure, the company's cash burn could be lowered if needed.
If the forecast is delivered, only investors under the SEIS scheme should expect in excess of five-fold returns but all investors will benefit from attractive rewards.


Conclusion

Investors should note that the company will be extremely dependent on the Founder as there is no other full time management in place to support her. This will represent an increasing challenge in terms of business development given the planned international expansion.

She has however achieved decent growth since inception with a minimal marketing budget and the expected increase in marketing budget should underpin the intended sales projections.

Related Links

Crowdcube Pitch

www.benedita.co.uk

 

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The Ratings we publish have been approved and issued at Financial Promotions in the United Kingdom by Wheatfromchaff in the United Kingdom who is Authorised and Regulated by the Financial Conduct Authority FRN: 751017. Wheatfromchaff Limited registered office is Kilver Court, Kilver Street, Shepton Mallet, Somerset, BA4 5NF and telephone number +44 (0) 1749 347 577. Telephone calls may be recorded. VAT No: 214 0196 49

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