Batch Brewing Co.
- Type: Retail
- Total Round Size (min): AUD$500,000
- Total Round Size (max): AUD$1,500,000
- Price per share: AUD$1
Batch Brewing Co.
Batch Brewing Co. is now accepting investments!
- Fees Paid by Issuer: 6.00% of funds raised (average)
- Cooling-Off Rights: 5 working days
- Company: This offer is for direct equity in Batch Brewing Company Pty Ltd
For more information please see section 3.2 of the Offer Document.
Investments up to $999 receive: 5% discount for life in-store and online, early access to events/products and a unique investor keyring.
Investments between $1,000 and $2,499 receive: 10% discount for life in-store and online, early access to events/products and a unique investor keyring.
Investments between $2,500 and $4,999 receive: 15% discount for life in-store and online, early access to events/products and a unique investor keyring.
Investments between $5,000 and $9,999 receive: 15% discount for life in-store and online, early access to events/products, a unique investor keyring and free brewery tours for you and 3 mates (max 2 per year).
Investments between $10,000 and $49,999 receive: 15% discount for life in-store and online, early access to events/products, a unique investor keyring, free brewery tours for you and 3 mates (max 4 per year) and a custom Batch mechanic jacket with your name.
Investments between $50,000+ receive: 15% discount for life in-store and online, early access to events/products, a unique investor keyring, free brewery tours for you and 3 mates (unlimited) and a custom Batch mechanic jacket with your name. You also receive a We Brew with You experience: learn all about the process of creating a beer from start to finish.
Batch Brewing Overview
Founded in 2013, Batch Brewing Co. is an Australian craft brewery with a focus on unique, handcrafted, small batch beers with deep community inspiration. We brew and release new limited release beers regularly, each with its own unique combination of flavours. These exciting beers complement our award winning line up of sessionable core brands including an American style pale ale, American West Coast style IPA, nitrogenated milk stout, kettle soured ale with passionfruit and dragonfruit, and an Australian style pale ale.
We operate out of two venues in Sydney’s inner-west, with a main production brewery and tasting room in Marrickville, and an R&D and experimental brewery and tasting room in Petersham, the latter of which is in cooperation with Solotel, one of Australia’s leading hospitality groups.
With a passionate team of over 20 beer enthusiasts, whose backgrounds include the drinks industry, finance, entrepreneurship and the arts, we are perfectly positioned to grow Batch Brewing Co’s presence wider across NSW before accessing untapped interstate markets.
- Strong Traction to Date, Ready to Scale
Since inception, we have already grown to a substantial brewing operation through our two venues in Sydney and wider distribution. Despite COVID-19 related shutdowns, we generated an impressive $3.3m in revenue and sold over 345,000 litres of beer in FY20, representing growth over FY19 of 5% and 7% respectively. The business is now ready to scale nationally, starting with greater wholesale access and additional venues in NSW, before expanding further interstate.
- Deep Community Connections
Our brand has amassed a loyal and engaged following of 30,000 community members across social media, with strong ties to local businesses and organisations in Sydney’s inner-west. We focus on creating community hubs at our venues.
- Growing Distribution Network
In addition to our venues at our production brewery and small batch R&D facility, we distribute through a wide network primarily across NSW and ACT, with a minor presence in VIC and WA, as well as direct to consumers online.
- Impressive Industry Achievements
At Batch, we have achieved some of the highest honours of the craft brewing industry. We were ranked 3rd in NSW in 2019, and 5th in 2020 according to a Beer Cartel survey. We have also had beers featured in the GABS Hottest 100 craft beers on a number of occasions.
- Talented & Experienced Team
The Batch team were some of the earliest to the craft brewing scene in Sydney and bring a wealth of experience. Key figures in our 20+ team bring experience from a range of sources including Lion and J.P. Morgan, and some Batch alumni have gone on to start many key brands now prevalent in the Sydney beer scene.
- Ready to Take Growth to the Next Stage
After developing a successful brand and loyal following, Batch is now ready to scale. As the first phase, we are raising capital to rollout into new cities in NSW. This will operate as a hub and spoke model, focused around our Marrickville production site where we will feed a series of branded venues and wholesale customers. Longer term plans include building an additional large scale brewery, as well as new venues to bring our Batch Brewing Co. ethos and sense of community to more Australians.
- Emphasis on Sustainability & Giving
We understand that a lot of raw materials are used to brew the beer you drink, from water and electricity, to hops and cereal grains. That's why it's part of our goal to minimise the impact we have on our community, the land and the air. We limit “beer miles” by carefully sourcing raw materials, the bulk of which come from a regenerative farm in the Riverina. We use carbon offset schemes for vehicle fuel and electricity, we recycle and repurpose much of our waste, and have a solar array powering our refrigerated storage and offices. We are also heavily involved in the community and contribute to charities nominated by customers and staff members.
The Batch Story
Batch Brewing Co. was originally conceived as an idea in 2011, before becoming a reality in 2013. Founders Andrew and Chris found themselves in a chance conversation about craft brewing in Australia. The pair felt the market lacked creativity and transparency, and they wanted to build a place for the community to come and experience all the flavours that small scale craft brewing had to offer in a fresh, inclusive, socially responsible environment where creativity would be celebrated. Andrew was working with some of the largest alcohol brands in the country at Lion, while Chris was homebrewing outside of his day job with a leading investment bank, J.P. Morgan.
The two were among the first pioneers of Sydney’s now buzzing craft beer scene. Taking a uniquely American perspective and combining it with Australian community values, Batch Brewing Co. was born. We are a brewery that puts its community at the centre of its decision making, releasing a new beer every five days on average, to please all types of taste buds. We have made a point of drawing inspiration from responsibly sourcing new raw materials to continue to create new flavour experiences with a sense of place, while supporting suppliers who also share in our vision of an inclusive and sustainable economy.
With limited external investment to date, we have grown Batch to its current position thanks to high quality, unique beers and a loyal community around the brand. With a main production brewery and a small batch R&D facility, a distribution network covering three states and ACT, and direct retail to an engaged community, we are primed to capitalise and expand further across the country.
As the next phase of growth, we intend to continue to strengthen Batch's NSW presence through a series of new taprooms in key locations fed by our Marrickville and Petersham facilities and contract brewing partners. The additional taprooms will not only expand our direct customer presence, but will also underpin broad awareness to support wholesale sales. We are in the process of assessing potential locations that will maintain brand ethos, optimise impact in the community and maximise distribution potential.
We then intend to implement a “hub and spoke” production and venue model in additional locations in order to expand our reach interstate capturing a new audience while maintaining Batch's high quality levels, brand values of community, and sustainability goals.
The mix of the small scale R&D facility and larger scale production breweries will enable the various venues to have access to bespoke flavours giving each venue its own personality and ability to bond with its local community, while also giving us efficient production of more popular beers served at all venues. As well as our own beers, the venues will serve a carefully curated list of other drinks from partner brands, as well as simple food options designed to complement and elevate the beer experience. Like siblings from the same family, each venue will have its own identity as defined by the employees and customers, while sharing common Batch values.
The Australian craft beer industry hit $842m in sales in 2020, and there are estimated to be around 1,000 craft beer breweries in Australia.
The continued growth is characterised by passionate craft beer makers and home brewers, together with more discerning beer drinkers and consumers who are demanding a more distinct, flavourful and higher quality product. This has increased focus on drinking for flavour and authenticity as well as drinking local and building personal relationships with preferred brands. The trend is evident of a long term shift in consumer tastes, which is driving an expected increase at a CAGR of 7% over the next five years to $1.2bn by 2025.
The sour beer market is expected to fuel rapid craft brewing growth driven by increasing local demand for the products. On top of our sour beer capabilities, our innovation through new and different styles, raw materials, recipes and flavours, such as our focus on the nitrogenation of beers, will help us to lead the shift in market direction.
Recent craft beer M&A has been driven by the traditional beer and alcohol players trying to capitalise on market growth and adding a number of brands to their portfolios. Multinational alcohol giants such as Carlton & United Breweries and AB InBev have made a number of acquisitions of successful craft breweries including Balter, 4 Pines, Pirate Life, Green Beacon and Mountain Goat.
Why Equity Crowdfunding?
We have always prioritised our community and key stakeholders at every stage of our journey. We plan to continue to respect this ethos and believe a network of individual Australians who can interact with the brand daily will be a more powerful force for good than a small group of institutional investors. Through our hub and spoke model funded by passionate beer people, we will continue to deliver high quality beer with unique flavours and not be forced to play the high volume, commodity beer game dominated by the foreign owned brewing conglomerates.
In 2020, Batch’s original pool of 10 “angels” were given the opportunity to sell their positions through private transactions at a 285% increase in value. While a handful did take that deal, most investors are staying on, a testament to the our management team's vision and ability to execute.
Key Team Members
Andrew has always had a passion for beer, which started over 20 years ago. Andrew’s brother was the general manager of a Baltimore based microbrewery called Baltimore Brewing Company, which produced a series of German inspired lagers and ales. Andrew worked there as an assistant brewer after university before moving permanently to Australia. After arriving in Australia, where the beer scene was in a much different place, Andrew started working with James Boag’s in sales to get a more solid understanding of the local beer market. He then moved into marketing roles with James Boag’s and then to Lion where he worked across several brands like XXXX, Boag’s, Bud, Becks, and others.
At Batch, Andrew’s role is on the sales and marketing side of the business. He’s responsible for advertising campaigns, social media, and the consistent stream of 80s themed content that Batch releases. Andrew can usually be found on the ground at one of the two Batch breweries, helping out and staying in touch with the community around the brand.
An avid home brewer, Chris loves experimenting with new processes and locally sourced ingredients to create new flavours. His first home brewed beer was made in 2003 with equipment he bought with his first paycheck from the investment bank Bear Stearns in Manhattan. Chris continued to build his home brewing skillset while working in finance, developing a strong understanding of craft brewing methods and culture.
After five years in NYC, his career brought him and his wife to Sydney, Australia — now their second home. Disappointed by the lack of authentic, flavourful beers in the market he dusted off his home brewing equipment and returned to the kitchen. Passion became obsession, and a chance conversation with Andrew kicked off a journey that brought an end to a successful career in finance, and the beginning of a professional brewing career.
Chris has found his true calling in a business that combines creative expression with the agricultural economy, and led to him walk alongside some amazing individuals as they collectively pushed the boundaries of Australian beer culture. Chris also continues to apply his background in finance to the business, bringing a depth of knowledge and experience to grow and scale the company.
Chris worked in the beer industry for 6 years for Lion, discovering what it meant to put a little more time and care into designing a beer that was more than just yellow fizz. Chris had a craft beer epiphany while working with great brands like James Squire and Little Creatures. But, as they say, all good things must come to an end, and Chris sadly left the beer industry.
Before Chris left, he was able to secure a couple of old beer kegs, and after watching a few episodes of Brew Dogs, Chris decided he could get over his career change by brewing his own beer…and with that, he ventured further into the world of craft beer, and also launched his own blog, the Beer Healer.
In his professional life, Chris has since immersed himself in the world of tech start-ups with one of Australia’s fastest growing companies, LiveTiles Global.
Tom is passionate about beer, and he’s been honing his craft for over a decade. A home brewer for over 11 years with his own home custom brew kit, he then moved to the Wig & Pen in Canberra to cut his teeth professionally as a brewer. 4 years ago, he found his way to Batch as a brewer and has since worked his way into the head brewer role. At Batch, he is responsible for all things beer, and helps us to produce our core range in addition to our frequent limited Small Batch releases.
Liam first worked at Batch casually while also working for Camperdown Cellars and at the Welcome Hotel. He’s always been passionate about beer, and found his way into the General Manager role of Sydney Beer Week, helping to bring craft beer to the people of Sydney! During that time, he also became a certified Cicerone. Batch was lucky enough to get him back in 2019 and he now brings his passion of craft beer to our customers.
Ryan joined the Batch team helping to pour beers in our Marrickville tasting room. He then moved into the tasting room manager role while also starting to pick up ad hoc marketing responsibilities to help Andrew out. But his talents in this space soon became apparent and we realised we needed him in the marketing team full time! Ryan is now responsible for all of our design work including (but not limited to) our new and different labels we put out on a weekly basis. He also develops and helps to create all the content you see on social media, out and about on the streets, and in bars and bottle shops!
Scott joined the Batch team to help out with sales and deliveries, coming from a customer service background. Over the years, he’s proven himself a true salesman and has taken over the responsibility of managing our independent customers. He works with a team of merchandisers to help bring our vision and sales pull through to life. Scott is responsible for putting Batch in the local venues and stores that you love. He is key in expanding our presence in NSW and helping to bring Batch beers to more people.
For more information, please see section 2.12 of the Offer Document.
Use of Funds
For more information please see section 3.3 of the Offer Document.
Key Risks Facing the Business
For more information, please see section 2.14 of the Offer Document.
Craft brewing continues to remain a highly competitive area both locally and internationally. The Company benefits from a relatively unique model, but could lose market share if more players in the market took the approach. Large and acquisitive conglomerates present a further threat to the independent craft brewery model.
Batch Brewing has a number of key team members integral to the running and growth of the business. If one or more of these individuals were to leave the business, failure to replace them adequately may harm company objectives.
The Company is seeking to expand its operations geographically. Such activity carries inherent risks when selecting appropriate locations. If the Company attempts to compete in a sub-optimal location, this may slow down and impact on expansion plans.
The construction of new venues also presents a key risk to the business. Should construction costs blow out or if progress is delayed, the Company’s growth objectives may not be met.
Batch Brewing has created a strong brand reputation in its several years of operation. With expansion comes the risk that core brand values are diluted and lost with scale, which may impact the underlying value of the business.
The Company is particularly exposed to any COVID-19 related risks or fluctuations. While the business was able to effectively see out the pandemic, future lockdowns or outbreaks may harm business performance and expansion plans.
Batch Brewing is raising capital to fund its expansion plans. Should insufficient capital be raised, or if costs are higher than anticipated, the Company might need to raise additional capital or risk not meeting its business objectives.