Ask the Collective
The questions independent drinks founders ask most — answered. Distilled from years of community knowledge so the good stuff never disappears in the feed again.
What is the best route for first-time fundraising in the drinks industry: crowdfunding platforms, angel investors, or other structured equity?
For a first fundraise (typically £300k), **angel investors from your network are the strongest option**, particularly if you can offer EIS/SEIS tax relief, which is attractive to high-net-worth individuals given the sector's risk profile. **Key tactics members recommend:** - **Start with low-hanging fruit** — identify super-fans of your product, stockists where your products perform well, and their owners/directors (Companies House is a goldmine for finding directors and shareholders). These warm relationships convert far better than cold outreach. - **Leverage your network for warm introductions** — ask people in your existing network if they can introduce you to potential investors with mutual connections. Never discount anyone; some biggest investors have been unexpected. - **Build momentum with early commitments** — getting your first few backers is psychologically and practically crucial; each commitment builds confidence for the next. - **Crowdfunding platforms (Crowdcube, Seedrs) are premature at this stage** — they work better in later rounds (2nd, 3rd, 4th) when you have significant traction and retailer distribution. Crowdfunding typically tops up a round rather than filling it; members report 80%+ is usually pledged off-platform already. - **Apply the relationship filter** — only take investment from people you'd have a drink with and could maintain a relationship with if things don't work out. Avoid problematic friends or family dynamics. **Expect rejection:** You'll get many no-replies and outright nos, but persistence pays. Ask for introductions even when someone can't invest themselves—they may have valuable connections in their network.
What share structure and preference rights are allowed under EIS eligibility rules?
EIS (and SEIS) eligibility has strict rules around share structure—any preferential shares will invalidate your relief entitlement. **Key requirements:** - Avoid any preferential share classes entirely. Members emphasise this is non-negotiable: "anyone wanting that relief cannot have shares that are preferential in anyway." - Standard ordinary shares with proportional voting rights are required. Most sophisticated investors will not accept non-voting B shares anyway. - In practice, early-stage investors typically hold under 1% of equity, so proportional voting rights won't meaningfully dilute founder control. **Bottom line:** If you're targeting EIS investment, keep your cap table simple with a single class of ordinary shares. Don't introduce preference rights, liquidation preferences, or non-voting structures—these are common in later funding rounds but incompatible with EIS relief.