Newcastle alcoholic tea firm Noveltea has welcomed another 1,000 investors after smashing its crowdfund target to raise more than £570,000.
Noveltea’s boozy tea infusions are already popular in the 海角视频, Germany and China, and co-founders incent Effroth and Lukas Passia are hoping to break the US market later this year, which it believes will be a good fit for the brand.
The company’s products – The Tale of Earl Grey, distilled with gin; The Tale of Tangier, infused with rum; and The Tale of Oolong, infused with Scotch whisky – could become a hit with Americans who have one of the biggest global markets for iced teas, including ‘hard teas’ spiked with spirits.
The pair first turned to Crowdcube in 2017 and 2018, raising in excess of the £150,000 target on both occasions.
They returned to Crowdcube last month for a third fundraising round, with a goal of raising £150,000 to fuel its American expansion plans.
Now the firm has closed the fundraiser having brought in £577,884 from 1,014 investors.
That amount equates to 7.86% equity and gives the firm pre-money valuation of £6.8m.
Managing director and co-founder Mr Effroth said: “While we were confident to run a successful crowdfunding campaign, the extend of the overfunding in the current economic climate is a huge compliment for Noveltea.
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“We are proud to welcome over 1,000 investors and supporters to our Novelteam.”
The entrepreneurial duo, who set up in the North East after meeting at university in Newcastle, famously turned down three of the celebrity millionaires on Dragons’ Den last summer, after being offered £80,000 for 30%. Days later their decision to turn down the BBC show’s Dragons paid off when their second Crowdcube campaign brought in £342,000 for around 9% of the firm.
Last November the pair were also celebrating after sealing a deal for a €450,000 investment with Dagmar Wöhrl, a leading politician, businesswoman and former Miss Universe runner-up, on the German version of Dragons’ Den, known as the Cave of Lions.
As well as looking at breaking into the US, Noveltea is also exploring the idea of floating on the Stock Exchange to get a good return for investors, or perhaps exit through an acquisition by a drinks giant.
Mr Effroth said: “We want to provide a return on investment at some point and we need to look at exit route. We could sell the company to exit, but at the same time there is an opportunity to float the business.
“Floating could be one way. It would be very exciting. But this would be three to four years from now. It would be whatever delivers the best route at the time.”