Between 6pm and 6.30pm Wellington and Auckland based contract brewing brand the Yeastie Boys raised $505,019 on Pledge Me, selling 12.5% of their company to 212 investors. They reached their goal of $350,000 just before the 20 minute mark and hit 500k bang on half past six.
That's half a million dollars in half an hour.
This money will be used to fund an expansion in the UK market. While the Yeastie Boys have been active in the UK; including showcasing one of their beers, Gunnamatta, at the JD Weatherspoon's Real Ale Festival in 2014 in over 900 pubs. Rather than brew in New Zealand and send beer to the UK (which requires a 2 to 3 month window) they will be brewing at Brew Dog in Scotland which will allow a shorter turnaround and will mean that the costs of getting the beer to market will be about 30% lower. They will also be teaming up with 8 Wired, Tuatara, Three Boys and Renaissance who will market NZ beer collectively as the Kiwi Craft Beer Collective.
To aid the growth in the UK market, Yeastie Boys founder and creative director Stu McKinlay will be basing himself in the UK.
I talked to Sam Possenniskie, the other half of the Yeastie Boys, at Golding's Free Dive where they launched the campaign. Just minutes after they hit their goal of $500,000 he exclaimed "Holy shitballs," acknowledging that the last half an hour seemed like a dream, "I feel like I'm about to wake up and have go through it all again because it doesn't feel like it's actually possible."
Shortly after, he became more realistic: "Now the real work starts, that's the scary thing."
Pledge Me chairman, Nick Lewis, said that he believes the launch is "good for the country," and "validates the whole crowd funding concept." The Yeastie Boys launch is particularly important for Pledge Me as it is the first larger business (other than Pledge Me itself, which raised $100,000 for its own expansion in November 2014). "It took us 24 hours," Lewis said, "and it took Yeastie Boys 30 minutes. So, clearly, they are way ahead of us." He believes that it is especially important for other New Zealand entrepreneurs and that it should give them real hope.
Lewis acknowledged that crowd-equity funding is harder than it looks. "It's not a cheap, certainly not a free option to evaluate: you have to spend a lot of time writing a business plan; you have to go through the process of creating financial statements; forecasts...." but that said, other entrepreneurs "should absolutely take a careful look at it." He went on to say that "what's not obvious is the huge amount of effort and preparation they did to get to this point." He likens an equity campaign to a meal in a fancy restaurant saying, "95% of your time is getting ready and the last 5% is cooking... ...that's what happened today; we just saw the cooking."
As for Pledge Me, Lewis intends to grow the crowd equity platform's credibility. "The first job for us is to get more 'Yeastie Boys' through!" After this success, Pledge Me is looking at creating a secondary exchange so that share owners in businesses funded via this model can trade them.
Anna Guenther, CEO of Pledge Me said that raising that much equity in so little time was "super amazing," going on to say that it shows just how powerful having a crowd is. This was followed by several "Oh my gods!"
While it is a little too late now, their offer document still makes exciting reading.