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UK - West Midlands
Date Rated:
Valuation (Pre Money):
Industry: Internet
Location: UK - West Midlands
Platform: Crowdcube
£380,000 Seed
Valuation: £1,520,000
Date Rated: 06/10/17



Tax Status: SEIS & EIS

Business Summary

BrewBroker is an online marketplace for the brewing industry aiming to make beer production accessible and more profitable by providing brewing services to anyone. BrewBroker has six companies participating in the development of the MVP and over 60 breweries and suppliers who say they will register on the system once is validated. This round of investment will be used to develop and launch the platform and to fund marketing and other working capital.

Financial Overview

Date (y/e) Oct-18 Oct-19 Oct-20
Sales Oct-18£18,880 Oct-19£221,600 Oct-20£994,000
Gross Profit Oct-18£18,880 Oct-19£221,600 Oct-20£994,000
GP as % sales Oct-18100% Oct-19100% Oct-20100%
Overheads Oct-18£287,500 Oct-19£381,840 Oct-20£464,160
Operating Profit Oct-18-£268,620 Oct-19-£160,240 Oct-20£529,840
OP as % sales Oct-18-1423% Oct-19-72% Oct-2053%
Closing Cash Oct-18£161,380 Oct-19£1,140 Oct-20£530,980

Note: This financial information has been sourced from the company on 06/10/2017. Financial data is NOT verified by Wheatfromchaff Ltd.
All the key positions are filled with individuals with the required skills, although not all will be full-time initially.
The team has significant management and commercial experience and the Founders and the advisors have excellent knowledge of the contract brewing services.
The Founders have invested significant time developing the concept, they have also invested over £20k and they will be on a non-salaried basis.
The craft beer market is growing rapidly, many of the breweries lack capacity and others would be happy to share it. it will be a major challenge though to grab 75% of the market within 3 years.
The platform is still in a test environment and the MVP is not due until 2018. However, the company is generating significant interest with strong endorsements from industry participants.
The company will enjoy a first mover advantage with a platform that could help create full market transparency and provide breweries with a fast and secure solution to the capacity problem.
Given the low transaction fees, the team will need about 50% market share to achieve profitability but given the lean business model, high-profit margins are expected afterwards.
Without the campaign over-funding, this round of investment will only just be sufficient to get the company to break-even. Further funding will be required for international expansion.
Reasonable returns can only be expected if international expansion is achieved and a minimum investment of £5k is required to secure pre-emption rights to avoid dilution in further rounds.


So good so far: there are many companies already interested in participating in the platform and the management team has a large network in place to start building the customer database on both sides of the equation. Given that the platform is not live yet, potential delays or a lower engagement than expected could lead to a need for further funds before achieving sufficient traction to embark on the international expansion. Investors should note, however, that the Founders claim their forecast is cautious and an expanding market could provide even great opportunities for the business.

Related Links

Crowdcube Pitch


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