Patch Plants is crowdfunding

I’m excited about this one.

https://crowdfunding.patchplants.io/

This is your chance to own a part of Patch’s future by investing as little as £10 or as much as £25,000 alongside Europe’s leading investors.

They’ll launch the crowdfunding in four days, beginning of October.

VCs involved:

Investors include Octopus Ventures and Forward Partners, leading European venture capital funds.

The goal of the crowdfunding:

We’re crowdfunding to help fund the next stage in our growth. We’ll grow by moving into new cities, sourcing directly from growers, and improving our offering for people buying plants for their business. We want to give our plant loving community the chance to own a share in our business alongside Europe’s leading investors.

It will be on Crowdcube.

This is an interesting raise. We had this discussion:

Anyone also excited?

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I thought maybe it was some sort of indoor vegetable growing thing, but it seems like there just selling some plants in a pot to your door.

I’m kind of failing to see the selling point here?

I assume there trying to grab onto the whole don’t want to go outside and talk to people so I’ll order it online thing?

Very popular to have plants in every room these days. Even shops have gone this way - no idea how they survive with such little sunlight. My wife has used them a lot and she seems to be an early adopter with most trends.

It does seem expensive for what it is but then so does my coffee habit.

I will prob invest a little (depending on financials/ valuation) but see this as a highly speculative investment.

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Patch plants will be crowdfunding in a week via Crowdcube. Would love to know if anyone has any insights about them or have use their services. They seem to have great potential and is one of the market leader in that space. Definitely thinking about adding them to my portfolio.

Given the amount my other half spends at Patch I would say it’s a great investment :roll_eyes:

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I think that the pain point that Patch is addressing is the lack of quality information available at the point of sale for indoor plants.

People might want to green up their houses but don’t know where to start. Whilst some garden centres might be very helpful - chances are most aren’t.

Patch is taking that customer service element and education piece online by helping its consumers understand what plants would work best in peoples homes/offices and then giving them the support/tools to ensure they don’t kill their plants!

Plus garden centres are often not accessible by public transport… and even if they are who wants to carry a giant plant home on a bus or train if they don’t have a car?

It’s looking to take a massive category online. I for one will be looking to invest (valuation dependent) as they are currently the category leader and the U.K. gardening market is >£20bn.

they’re live:

Ok so after looking at the pitch deck. Their revenue is pretty good for a start up. And their margins is improving also. Ebita is -3.8M but that’s expected for high growth start ups.
Their plan is to cut out the middleman and go straight to the growers. Which means they will have to own their distribution in whatever country their growers operates in. That will increase the exposure to a lot of risk (cost) which is fine if you have the demand to back it up. My main point is do we seeing the plant online market continuously growing that it becomes embedded in people’s way of life or is this demand will be increasing for a few years then levelling off. If demand tail off a few years from now. How sustainable patch will be as a business managing the cost of their distribution channels?

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Hi Mel!

Our growers are all currently based in Amsterdam (the home of plant growing in Europe), so we are in the process of setting up a distribution centre there. From there we will be able to serve any European city we launch in!

Hope this helps!

Patch

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Ok that’s good then. I like what you guys are doing. Will definitely be monitoring the round over the coming days.

What’s your average gross markup per plant?

I’ve invested. :wave:

Best of luck with your raise @Patchplants.

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Me too. Think they’ve built a fantastic brand and believe they will go on to achieve great things.

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Yeah me too. Becoming a customer soon too as my office at work is a little dreary.

used them before, good customer service. Invested

Anyone who did not invest?

I want to put in £1000. I would appreciate contrarian views.

Perhaps slightly off topic… do they only deliver to London?

Also what do the growers use for composing? Peat or environmentally friendly compost?

Apologies all, this is just an opinion based on certain factors and metrics I use to evaluate companies that have a potential for :rocket::

Plants get delivered to offices in London. It’s an existing business.

  • This one does not tick any boxes of a scalable business. Proper “inside-out” tech stack really helps scale the non-tech part of the day-to-day (excluding having an app and a website + cloud provider), but this is just plants.

I love plants, by the way!

  • There’s no defensible IP and barriers of entry are low.
  • It’s an ancillary business—nothing against it—but it doesn’t have the same potential to increase in value as cash flows grow. In the end, if there’s an exit scenario (buyout, IPO), you gotta do a financial valuation based on future prospects.
  • Since having plants is not a necessity and the barriers of entry are low, the market size is not as big as some may think. Therefore, your assumptions about future cash flows can be overly optimistic.
  • Biological assets which are supposed to generate revenue tend to fade, because they are plants. So fixed costs can be higher and higher as the company grows and needs to grow plants.

Or maybe I don’t understand the business model.

I’d be happy to be a customer though. Plants make people happy, it’s good to be around them.

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Also, please don’t take it the wrong way, but Amazon Prime :frowning:

Very sorry Patch Plants, maybe I misunderstand the business. A dinosaur of sorts.

There’s always room for lots of businesses.

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Apologies again. I have just seen plenty of marketing material in private and public fundraising documentation and this is misleading:

If I launch a food delivery business, I cannot use the £XXbillion restaurant business as my market. It would otherwise amount to a huge chunk of a country/region’s GDP. The same way some real estate companies cannot use the entire commercial real estate market as a growth anchor or sorts.

It would be advisable to use a more realistic number here. But I understand this is great marketing and I am not in marketing. I just prefer transparency.

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