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Barrel & Stone Limited is seeking to raise £300,000 in return for 6% equity.
Summary
Barrel & Stone is an artisan Pizza company founded in 2015 to provide a quick, simple and cost-effective food offering service to partner hospitality venues.
Why Barrel & Stone? The team like pairing food and drink, hence ‘Barrel’ for beer and ‘Stone’ for artisan baking. Partner sites mimic this combination, with smart, local establishments serving fantastic drink to compliment Barrel & Stone’s delicious Pizza. Utilising a strong brand concept, smart model and exceptional ingredients Barrel & Stone stays true to its passion.
Key facts:
- Barrel & Stone uses its partners’ premises and staff to sell delicious, hand-crafted Pizza with zero set-up cost for the partner, and minimal set up costs for Barrel & Stone.
- The minimal cost of site set-up enables rapid expansion and roll-out of the business, increasing coverage and brand awareness.
- Partner sites commit to a three year rolling contract with Barrel & Stone, who then provide the oven for the site, training and ingredients (which are purchased via the Company’s online B2B platform).
- Each oven creates c. £6.5k net profit per annum from a total installation cost of c. £3k, making Barrel & Stone’s payback on the oven about six months.
- In addition, Barrel & Stone make a 50% net margin on sales of ingredients to partners.
- In its first year of trading, Barrel & Stone has already agreed to a partnership deal with Greene King Plc to roll-out a minimum of 140 “cherry-picked” sites, and are in discussions with other micro-breweries and hotel chains to help drive further growth to the 250 site target after four years.
Further information can be found in the ‘Investor Presentation’.
The Company is seeking to raise a total of £300,000 in return for 6% equity in the Company (a pre-money valuation of £4,700,000 and a subscription price of £4.70 per share). The total raise consists of £150,000 of SEIS eligible and £150,000 of EIS eligible investment. Investors will therefore receive a combination of SEIS and EIS eligible shares in the ratio of one SEIS eligible share to one EIS eligible share. Investors will therefore receive an effective tax relief of 40 per cent.
The minimum subscription amount is £5,000 or such other minimum subscription as the directors and Asset Match may determine from time to time.
The Company has a single share class and investors will be issued shares that rank pari passu with the existing share capital.
Use of proceeds
The Company intends to use the funds raised to meet expansion plans and to drive brand awareness and additional marketing.
Expansion: Barrel & Stone has recently agreed a partnership deal with Greene King Plc to roll-out a minimum of 140 sites and are in discussion with micro-breweries and hotel chains to help drive further growth to a target of 250 sites after four years. The funds raised will be predominantly used to purchase the requisite number of ovens to meet these expansion plans.
Marketing: The remaining funds will be used to drive brand awareness and increase marketing activity. Barrel & Stone plan to drive its brand regionally by conducting more frequent site visits, increasing the current level of marketing, improving marketing materials and using strategic advertising.
Barrel & Stone is a young and growing business, and the Board’s attention is fixed on achieving its growth targets and potential. Opportunities for either a full and partial exit for shareholders may come along from time to time, and these will be considered on merit and in the best interest of shareholders.
As Barrel & Stone continues to grow it will likely become an attractive acquisition target for large food and beverage operators such as: (i) pub groups like Greene King, Mitchells & Butlers and Punch Taverns; and (ii) restaurant and hospitality groups like The Restaurant Group and Whitbread.
M&A activity in the sector remains strong, with Grant Thornton reporting that the value of completed deals in Q1 2016 was up 11 per cent. on Q1 2015. ASK Italian, Zizzi, Pizza Express, Giraffe and Las Iguanas are among the casual dining chains that have been acquired within the last two years. Most recently, in September 2016, Famous Brands acquired Gourmet Burger Kitchen for £120m at an FY15 EV/EBITDA multiple of c. 17x.
Financial sponsors (venture capital and private equity groups) are also active in the sector with a number of houses either supporting new chains and brands or consolidating the sector (such as Bridgepoint).
The Board would also consider an IPO subject to the Company’s size, market conditions and other factors.
Barrel & Stone has submitted its application of plans to raise money and the deal structure of the fund raise to HMRC. Barrel & Stone has also received advance assurance from HMRC following this application stating that the proposed fundraise is likely to qualify for Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS) tax reliefs.
Tax relief is available only to individuals who subscribe for shares in a Seed Enterprise Investment Scheme or Enterprise Investment Scheme. SEIS relief is at 50 per cent. of the cost of the shares and EIS relief is at 30 per cent. of the cost of the shares. Both are to be offset against the individuals' Income Tax liability for the tax year in which the investment was made.
If you sell, give away or otherwise dispose of shares, tax reliefs can reduce your Capital Gains Tax liability. Your shares must meet certain conditions to qualify for these reliefs.
Please visit the HMRC website for further information on SEIS and EIS tax relief.
The availability of any tax relief, including EIS and SEIS, depends on the individual circumstances of each investor, and may be subject to change in the future. If you are in any doubt about availability of any tax reliefs, of the tax treatment of your investment, you should obtain independent tax advice before proceeding with your investment.
This summary should be read in conjunction with all documentation made available on this site. Please read the supporting documentation carefully before making any investment decision.
You are reminded that investing in early stage and unquoted businesses involves risks, including illiquidity, lack of dividends, loss of investment and dilution, and it should only be done as part of a diversified portfolio. Asset Match is targeted exclusively at investors who are sufficiently wealthy and sophisticated to understand these risks and make their own investment decisions.
If you have registered with Asset Match as a shareholder of a company on the platform, you are reminded that you will need to certify that you are either a High Net Worth, Certified Sophisticated Investor or Self-Certified Sophisticated Investor.
Instructions
- If you are interested in investing, please email us via dealing@assetmatch.com, confirming how much you are looking to invest and we will send you a completed application form to sign. Alternatively, you can download the form from the 'Overview' tab and complete the relevant sections yourself. Please return the completed form along with a cheque (made payable to Barrel and Stone Limited) to:
Carolyn Collins
Ledgers Accountancy Services Limited
15 Sedgmoor Close
Flackwell Heath
Buckinghamshire
HP10 9BH
T: 01628 525995
Company no: 7023132
If possible, please email us a copy of the form to dealing@assetmatch.com, so that we can register your investment and update this page. If you have any queries, please do not hesitate to contact us.
Russell Hardiman Business and Strategy Director, Co-founder
Previously worked in the central London property and investment market for almost 20 years and for several HNW family offices. As well as working within the Investment/Development divisions of some of London’s premier real estate firms. He ran his own successful property development and investment firm based out of Cape Town and London before diversifying into F&B in 2013.
A passion for food led to the opening of his first restaurant in 2013 and the birth of Barrel & Stone soon after. Utilising a wealth of contacts and natural drive, he is responsible for the growth and direction of the business. Russell and fellow director Mark Davenport have funded the business to date.
Mark Davenport Operations Director, Co-founder
Previously worked in the IT arena for the last 20 years, working on complex IT projects as a technical and commercial lead. He has established effective sales teams, across the UK, as well as Ireland, Belgium and the Netherlands.
Mark brings his business development and operational skills to the Barrel & Stone board, with responsibility for all operational elements including the automated on-line systems, which allow the business to be extremely efficient as the operations will scale with the growth of the Company.
Mark Wilkie Creative Director, Co-founder
Owner and Creative Director of The Narrative agency; Mark has a unique depth and understanding of customer experience. His attention to creative detail is unprecedented, telling the story of a product through dramatic design and consumer engagement.
Mark has been the creative inspiration behind some of the worlds most successful brands, such as: Liberty, Harrods, Prada, Boodles, Ganjam, Diptyque, Red Bull, Veuve Clicquot, Fornasetti, Camper & Nicholson, Rocco Forte, Orient Express, John Lobb and Zoffany.