London Cocktail Club launches £750,000 crowdfunding campaign to open more bars
London Cocktail Club is tapping margarita lovers and party-goers for £750,000 after launching a crowdfunding campaign to help fund more bar openings across the capital.
The company, which counts restaurateur Raymond Blanc and Dragons Den judge Sarah Willingham among its backers, has turned to Crowdcube to raise new equity, with £135,000 raised so far.
It currently has five basement bars in the West End and Shoreditch and wants to open another three this year before eventually trebling in size to 19 sites in three years time.
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LCC's founders JJ Goodman and James Hopkins are offering both A and B shares in the business, with perks such as free cocktail masterclasses, drinks, priority reservations at LCC bars and party invitations.
Goodman said: "It’s an incredible opportunity to make our family bigger and give our actual fans the chance to be a part of it. Our core values are all about serving everybody so we loved the idea that our customers can become our investors… what better way to grow our family than to allow everyone to get involved? It was a no brainer”.
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LCC's five sites deliver operating earnings before interest, tax, depreciation and amortisation (EBITDA) of over £600,000, while its most mature bar in Covent Garden generating an EBITDA of £130,000 in the first six months of this financial year.
Each bar typically has a capital cost of £260,000 and reaches maturity in under two years. At that point a typical bar would have sales of £600,000 with a typical profit of 25 per cent, LCC said.
One the three new sites have matured, LCC expects to generate around £1.1m of cash each year, which would help fund more bar openings.