What is Equity Crowdfunding?
Officially known in Australia as crowd-sourced equity funding (CSF), equity crowdfunding allows private companies (and public unlisted companies) to source funding by offering a stake in their business to public investors.
Companies who undertake equity crowdfunding are usually in a ‘growth’ phase of their journey. This means we believe we have a great business model, a product people love and a plan in place to grow from our initial groundwork and market share. In inviting the ‘crowd’ to become shareholders, we want our beer fans and customers to be part of our success and story!
Why are Your Mates Crowdfunding?
Your Mates Brewing Co. has grown tremendously over the past 4 years. A couple of big accolades for our business include:
Our team of 2 (Hep and McGarry) has now grown to over 40 teammates!
Our output has grown from producing less than 50,000 litres a year, to over 750,000 litres in the last financial year alone.
Your Mates has earnt over $16M in revenue in just the last 3 years.
In this time, Your Mates has earned $1.1M EBITDA over the last 3 years.
We are extremely proud to have self-funded all of this growth (even through Covid) and maintained a positive cashflow.
We’ve always recognised this next phase of our business expansion will require a great deal of capital investment. So over the last two years, with guidance from our team of expert and highly-experienced advisors, we’ve been proactively planning for this moment. We believe that equity crowdfunding will benefit our FMCG business and our existing/future shareholders the most over a traditional capital raise.
What are the benefits of Crowdfunding?
Your Mates has acknowledged the benefits of an equity crowdfund raise over a traditional capital raise at our last two Annual General Meetings. Unlike our initial investment round, a CSF raise allows individuals to invest as little as $250. This allows a large number of smaller investors the ability to have a tangible stake in the company, which will naturally increase our brand awareness and future sales.
Why are Your Mates expanding again?
Your Mates' success has surpassed our most optimistic projections and the popularity of the brand has blown our expectations out of the water. When we took on investment 4 years ago and constructed our dream brewery, we did not anticipate that we’d run out of beer so quickly. Yup, it’s a good problem to have, but it's still a problem we need to fix!
With careful forward planning and an amazing opportunity arising next door, we are currently in the middle of building a state-of-the-art facility to keep up with customer demand and ensure Queenslanders don’t go thirsty well into the future.
This is perfectly timed for Your Mates as we execute our sales strategy and take advantage of the momentum that the brand has gained over the past 4 years
How much will the company be looking to raise?
Our maximum subscription is $2,250,000. This will enable the company to fully execute the second stage of the expansion project as well as invest in improvements to our existing Brewpub. We will also be looking to open up other Brewpub sites in South-East Queensland over the next 12 - 24 months.
What are the funds being used for?
The first stage of the expansion project is estimated to cost approximately $2,000,000. Your Mates will be funding half of this amount through asset finance and half will be funded by the crowdfund investment. The remainder of the funds will be channeled towards accelerating our investment into additional Brewpubs throughout Queensland and bolstering our sales and marketing team. A more detailed breakdown will be available in the offer document.
How much will the company be valued at?
Details around the company valuation, share price and available shares will be made available in our crowdfund offer document. This will be accessible when the investment goes live on October 18.
How does ROI work with Equity Crowdfunding?
Equity Crowdfunding investment is a little like planting an avocado tree. You plant it, and then wait 10 years for it to bear fruit. Investing in private and unlisted companies is typically a medium to long-term investment. Shares in the companies who raise through Birchal cannot be easily transferred or sold as they are not traded through public exchanges (i.e. the ASX). Due to this, your shares are generally considered to be 'illiquid' so you may not be able to sell your shares quickly if you need the money or decide that this investment is not right for you.
However, there are numerous possible circumstances that may create an opportunity for you to "exit" your investment (i.e. sell your shares) or otherwise receive returns, such as:
A trade sale of the company to another company (selling to the big boys).
The company proceeds with an Initial Public Offering (IPO) and listing on a registered stock exchange (e.g. the ASX).
The company organises a buyback of the shares.
A private sale of your shares to another person.
The company pays shareholder dividends.
The options available to shareholders will be mentioned in our company Offer Document at the time of investment, but we can’t guarantee that any of the above options will occur. Our intention is that our company value will have significantly increased in the event of an ‘exit’, so when that time comes, hopefully your shares will have appreciated!
The legal disclaimer we have to put in:
You may lose your entire investment, and you should be in a position to bear this risk without undue hardship. Even if the company is successful, the value of your investment and any return on the investment could be reduced if the company issues more shares. Ask questions, read all information given carefully, and seek independent financial advice before committing yourself to any investment.
Can I see your financial statements?
Our crowdfund document will have the last 3 years of our financials presented in a Profit & Loss Statement, Cash Flow Statement and Balance Sheet. We will also be providing the first quarter figures of this financial year to showcase our performance.
How do I invest?
Please head over to the Your Mates Birchal page as soon as the EOI campaign goes live to express your interest. Links to these pages can also be found on the Your Mates website and social pages.
How much can someone invest?
As a retail investor (i.e. anyone over the age of 18), you can invest anywhere from $250 to $10,000 within a 12 month period in a company and in exchange you'll receive securities in the form of ordinary shares.
If you are looking to invest more than $10,000 in a company through CSF, you will need to provide evidence of wholesale status at the time of your investment. This is completed through your accountant in the form of a written statement confirming your financial position. More information can be found on the Birchal link below.
When does the investment round open?
The Expression of Interest round will open on Tuesday the 27th of September. This round will showcase our crowdfund video and give people the opportunity to express interest in the business.
The actual investment round will open on Tuesday the 18th of October and finish on Thursday November 3rd (potentially sooner if full subscription is reached prior to this closing date).
How many additional investors will there be?
We are unable to determine exactly how many additional investors there will be, but we estimate in the hundreds.
Will shareholders have voting rights?
Yes, each shareholder will have one vote for each share held.
Will there be company discounts / rewards associated with my investment?
Yes, the company will incorporate a rewards based policy for investors in a tiered system. This information will be provided when the offer document goes live on the 18th of October.
Will shareholders be able to receive dividends?
Yes, all shareholders will have a right to receive any dividends declared and paid by the company.
Will this be good for the Your Mates brand?
Yes, the Your Mates board strongly believes this will be a positive move for the business. Many individuals who haven't physically seen the expansion of our brewing facility would probably perceive Your Mates as a small Sunshine Coast brewery that has an awesome marketing team, and brews a great beer (we don’t disagree), but this does not detail our extensive market share.
This campaign will showcase our business growth, milestones, accolades and financial performance over the last 4 years. We believe this is an ideal opportunity for us to demonstrate to our followers how effectively our hospitality and manufacturing business has been operating over this time period.
Are you guys excited?
The electricity in the air at the Your Mates headquarters is real (in all 3,000 square meters)! We have just moved our entire canning line over and have been non-stop brewing and packaging our beers to prepare for what we believe will be the busiest summer of our existence. We are so pumped to provide this opportunity to all of our mates (old and new) and proudly highlight why we believe this is an amazing investment (besides the frothy discounts).
Any other questions?
We’re more than happy to answer any questions you may have, but please ensure that you read through the above information first and visit the birchal website for further information and necessary items to tick as a potential shareholder in Your Mates Brewing Co.
Please visit the website below for more details around our CSF.
We have already had thousands of enquiries about joining the journey, and we will unfortunately be unable to talk to everyone we would like to. If the above information does not answer your questions, feel free to send an enquiry across to email@example.com
Cheers to good beers!
CSF Warning: Always consider the general CSF risk warning and offer document before investing.
Always consider the general CSF risk warning and offer document before investing.