Fresh coffee delivery start-up Pact Coffee has launched an equity crowdfunding campaign on Crowdcube in a bid to raise £1m to fund rapid growth plans.
Pact, which sends coffee through the post roasted, ground and shipped within seven days, is inviting customers and the general public to invest in the business from as little as £10 on the online crowdfunding platform for a total of 3.85% of the company’s equity.
The Bermondsey-based venture, founded in 2012 by Stephen Rapoport, who sold Crashpadder.com to Airbnb the same year, wants to use the investment to expand into at least two European markets, supply offices and launch further products.
Pact will offer top investors a lifetime of free coffee, expert coffee classes and limited edition product in return.
It raised 5% of the total, £57,000, within 24 hours of launching the month-long crowdfunding campaign, with the investment shared between 348 individuals.
Pact has previously secured more than £5.6m in institutional funds from MMC Ventures and Connect Ventures, and angel investors Taavet Hinrikus (TransferWise), Ian Hogarth (Songkick) and Rowan Gormley (Naked Wines).
Its financial projections show sales growing from £3.4m now to £95m by 2018, but losses ballooning £1.9m to £9.2m over the same period.
Rapoport, founder and chief executive, said Pact was a fast-growing business and its financial projections were in line with its “enormous ambition” and a mission to make coffee “a force of good”.
He said: “We could choose to break even today, but would sacrifice growth rate and damage the business as a result. Our gross profit, and more, will be reinvested into growth initiatives so that we can scale significantly.”
Pact had “incredible, close relationships” with its customers and “excellent customer economics” as a result.
“Fundamentally, it’s direct customer relationships that makes these projections sustainable,” Rapoport added.