Case study: Snowflake Gelato raises £678K from 257 investors via CrowdcubeAug 16, 2023
Client: Snowflake Gelato
Campaign target: £500K
Final amount raised: £677,713
Overfunding %: 135%
Number of investors: 257
Pre-money valuation: £12,873,363
Final equity transferred: 5%
A passion for artisan gelato has driven 10 years of growth. Snowflake is now an international brand trading in three countries, with system-wide revenues of £4m in 2022 and an ongoing growth strategy. Awarded Great Taste Supreme Champion, they crowdfunded to support their expansion.
- Group revenue of £4m up 74% on 2021 (EBITDA +£4k)
- Second international location opened at Qatar airport in November 2022
- Held residencies at Harvey Nichols, Selfridges and Bicester Village.
- Former CEO of ITSU is on Snowflake’s executive and advisory board
Founded in 2012 with a passion for artisan gelato, Snowflake has created a buzz around London for its award-winning gelato and sorbetto, lovingly made by their team of talented chefs. Launching on Crowdcube in March 23, Snowflake Gelato raised over £677K from 257 investors, overfunding to 135% of their min target.
Snowflake has grown into a very strong brand, with multiple retail locations and a big team. This meant they had the time and resources in-house to dedicate to making the campaign a success. We interviewed Asad Khan, CEO and co-founder of Snowflake Gelato for his experience of crowdfunding.
What was the best bit?
For Asad, engaging with their community, and their ecosystem of customers and suppliers went very well. Snowflake’s suppliers were quite keen to support the raise, and they achieved £90K of investment from their valued supplier network. “Allowing our customers to be part owners” was a real plus point for running a public crowdfunding campaign, Asad said.
ISQ worked closely with Asad and the team to engage their store customers, by creating table talkers in stores and generating QR codes on posters for direct access to the pre-registration page and then the live campaign page.
During the campaign, the Snowflake team organised a live Q&A webinar with Asad, where potential inventors could drop in and ask questions about the opportunity. Asad said this really “helped to get investors over the fence.”
What were the key challenges you encountered whilst crowdfunding?
Even though the business has been trading for 10 years+, one of the challenges for Snowflake was its small customer database. As you might expect, ice cream trade is predominantly in-store and not online. Whilst Snowflake launched an online database and began collecting customer data a few months before the campaign started, unfortunately, it was still in its infancy and just wasn’t strong enough to push out enough marketing content to generate the volume of potential investors onto the campaign. However, £677K raised is still a very good fundraise considering their limited customer data, and their pre-registration list certainly helped get them over the line.
Another key challenge was the general time it took, Asad said that “it’s a lot more work than people expect and one of the most exhausting things I’ve done!”
Do you think you could or should have done anything differently?
It’s easy with the gift of hindsight to say what you should have done differently, Asad provided a few things looking back that he wished he’d done:
- Pushed harder and longer during the pre-registration stage, sending more emails to promote the upcoming campaign,
- Worked harder to secure more meetings with potential investors,
- Dedicated 1-2 staff members with fully cleared diaries to work on the campaign.
With this in mind, Asad shared his top tips….
Asad’s Top Tips for new crowdfunders?
- Plan ahead - it's a longer process than you think, it’s a long and engaging cycle so give yourself 6-9 months to get funds in. Give yourself the cash flow runway and plan it.
- Build a customer database - it’s really important in order to engage your community digitally.
- Set aside time - clear your diary once live, and don’t plan a trip away either during or just before the campaign.
- Use Linkedin - it’s all about the numbers and Linkedin has lots of potential investor opportunities
What benefits of Crowdfunding have you enjoyed?
Asad said that for them, “having suppliers more engaged” was a real benefit of running a public crowdfunding campaign. Being on Crowdcube gave the Snowflake brand visibility and validation, that they wouldn’t have got otherwise, which really helped in conversations with some of the bigger ticket investors.
There are also a lot of marketing and branding benefits that come with having a successfully overfunded crowdfunding campaign, “it just sounds good!” Asad said.
What is next for your team/growth?
As Snowflake grows beyond London, to the north of the UK and continues its international expansion, funds will be invested in marketing and upgrading its in-store experience. Asad and the team are also seeking to launch a dedicated innovation hub.
With summer in full swing, we’re definitely looking forward to a few Snowflake ice creams soon!
Author: Steph Yeates, Operations Director, ISQ