WatchHouse, a specialty coffee shop that aims to top entrenched players, has raised over £7.189 million on Crowdcube. This is the second funding round on the crowdfunding platform. WatchHouse previously raised over £2.8 million in 2022; thus, the total in online funding now surpasses £10 million.
WatchHouse is raising equity capital at a pre-money valuation of around £39 million. In 2022, the company raised growth capital at a pre-money valuation of £15 million. As of today, 1396 investors have backed the securities offering, which is in overfunding mode.
The offering is a bit of a hybrid, as the offering page explains:
“There is £220,000 of EIS available for Crowdcube investors which will be allocated on a first come first served basis. The Company has already secured £500,000 as new investment alongside the crowdfunding element and these funds have been reflected on the progress bar of the pitch. Any funds raised above £1.98m will be a combination of primary non-EIS eligible shares and secondary shares determined by the round size and appetite. Any secondary shares will be satisfied by shares from the directors. All shares being purchased have the same economic rights.”
EIS is a valuable tax exemption for investors that provides significant benefits for investors backing he firm.
WatchHouse reports that it generated £3.5 million in revenue during Q1 of 2024. Currently, the company operates 18 locations in the UK and the US, with more in the queue. It also offers a direct-to-consumer service to cater to the at-home market.
WatchHouse says big coffee chains (think Starbucks) lack “authenticity, ethics and quality.” We couldn’t agree more. The coffee shop market is estimated at £4.9 billion in the UK and $45.8 billion in the US. Watchhouse reports that it is “scaling rapidly.”
While this funding round just closed, WatchHouse is collecting info if they list a future round.
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