About Riot Foods
Riot Foods is a new generation food business with an unshakeable commitment to producing wholefoods that taste great, are free from harmful ingredients and accessible to mainstream consumers.
Through our CleanPaleo and Poppy + Olive brands, we package real food in an attempt to make following a genuinely healthy lifestyle enjoyable and convenient.
We want to lead the revolution against "non-food" ingredients, and bogus nutritional information.
We want you to be a part of the revolution!
When we developed our first humble cereal in a brown paper bag and offered it to the boutique supermarkets, they were instantly supportive of the concept of whole foods and the unique offer that we could provide.
Then there were the “doubters” & “nay-sayers” – the financiers, the agencies and the competing big brands:
“The world does not need another cereal manufacturer or biltong supplier”
“There are too many protein products and suppliers in the market”
“Paleo is a flash in the pan, a fad – and what will your business have to offer after that?”
Paleo is one of the pillars of what we know as whole food. The food that is healthy for you to eat, based on your genetic makeup and gut related bacteria. In principle “whole food” is food that has
- No added flavours
- No refined sugars
- No preservatives
- Minimally processed
- As close to nature as possible
Riot Foods brands were the early starters in the food riot – and we are still here with increasing products and market share. As a result, we need to setup a second manufacturing facility. We manufacture tasty whole foods under trusted and recognised brands that our wise customer base finds tasty, nutritional and convenient.
To date the current shareholders have invested approximately $3.8 million to develop Riot Foods to this exciting position.
It’s the crowd who have helped us prove the nay-sayers wrong. Now we want to invite our crowd in to support us further. This is the opportunity to make this your business too!
About our Team
Ryan Kamins - CEO / Director / Founder Galvanizer & Instigator
Ryan studied Commerce and Law at the University of Canterbury (Undergraduate), and currently oversees and manages the running of all aspects of the business. As the founder, the passion and drive is endless! Say no more!
Arthur Green - Director / Brand Ambassador Instigator
Art’s bachelor degree in Food Nutrition counted for little during his stint as New Zealand’s first ‘Bachelor’. Art has established a respected following as one of New Zealand’s leading fitness and wellness ambassadors. He’s committed to combatting mediocre nutrition and helping people lead a healthier lifestyle.
David Craig - Investor / Brand Manager Master Forger
David’s background is in marketing and design management. He has extensive FMCG experience and has worked on both ‘sides of the fence’ – working for the likes of multi nationals such as Cadbury and founding his own company (Sequent) that helped blue chip corporates deliver their brand and retail vision into the market place.
Tim Holt - Sales Manager Master Trafficker
Tim has recently joined the Riot Foods team with extensive experience in market leading FMCG companies (Unilever, Nestle, Frucor, Beiresdorf, Foodstuffs NI) in roles including National Sales and Marketing Management to CEO. Tim brings a strong result driven focus in competitive and complex environments combined with a high level of commercial astuteness to the Riot Foods business. Tim is responsible for driving Sales strategy across New Zealand and Australia.
Marilyn Howard - Operations Manager & Finance Enforcer
Marilyn has extensive experience in operational and financial responsibilities across a wide variety of businesses.
Jamie King - Production Manager Rabble-rouser
Jamie is a founding employee. Standing side by side with Ryan through the early days when setting up factories was a real challenge. His elbow grease and dedication has seen him develop to a management position.
We are selling up to 17.8% in Riot Foods Limited to our crowd at a pre-money valuation of $4.6 mil. Shares are priced at $0.27 each and the minimum investment amount for any one investor is $500.04 (1,852 shares).
Types of shares on offer
The Constitution provides for two classes of shares: Ordinary Shares and Investor shares The Crowd are being offered Investor Shares, and Ordinary shares for those who invest $150,000+.
The investor shares are non-voting but will have the following rights:
Non-voting shares do not give the holder the right to vote in relation to any resolution of Riot Foods, except on a proposal that will affect the rights attached to the Investor Shares.
Non-voting shares will give the holders:
- The right to an equal share in any dividends authorized by the board
- The right to an equal share in the distribution of surplus assets of Riot Foods
Investor shareholders have no rights to vote on removal or appointment of directors.
The ordinary shares are voting shares and have full voting rights attached.
You can read more about the rights attached to ordinary and investor shares in our constitution.
What we're raising the money for?
What we've done so far
Over the past 3 years, we've gone from being a supplier to niche health and grocery stores whilst making product in the evenings at a rented bakery, to supplying over 250 major supermarkets and producing from our own gluten free manufacturing facility. You can now find our products in online and brick and mortar retailers in countries such as the USA, Australia, and Singapore.
Having achieved revenue of $1.4m in FY17 (up from $860k in FY16), Riot Foods is forecasting revenue growth of 50% to $2.1m in FY18, and is forecast to generate sales of $7.4m and positive EBITDA of $121k in FY20, with significant continued growth in sales and EBITDA through FY22.
To achieve our growth strategy we will be focusing on the following 5 marketing objectives:
1. Extend the distribution of existing products through our existing retail channels in NZ
2. Extend the distribution of existing products into major retailers in Australia
3. Establish a presence in the petrol and convenience channels in NZ and AUS
4. Continue to build our brands through existing and new export markets
5. New Product Development - Launch a consolidated portfolio of further products and brands
Risks and Challenges
Stage of the business – we are young lean business. As a result, we’ve had to become adept at learning and responding to challenges. However, to take us further ahead, we have enlisted the support of specialist consultants and service providers to surround our leadership team with the resources to make informed strategic decisions and hold us accountable to the targets that have been set.
Stage of the market – the market for health and wellness foods in New Zealand is still developing and while demand is strong, we need to be considered and deliberate in the categories and market segments we target. Failing to do this will leave our brand stretched and open the door for established brands to sweep in and capitalise on the opportunity.
Affordability – 79% of consumers perceive healthy foods to be expensive and 52% believe that these foods are lacking flavor (Mintel). While our food philosophy and product development experience gives us the tools to address the later, we need to ensure we are working towards creating a product portfolio that delivers health and wellness foods at an accessible price-point.
Foreign Exchange – currency fluctuations are a factor in our business. At this stage, one of our risk management tools is the natural hedge where the import costs for ingredients are offset by our exports to Australia and the US.
Budget – Given our growth trajectory, it is difficult to forecast financial performance and cashflows accurately, especially longer than 12 months out. Our inputs are largely commoditised ingredients which fluctuate in price, and as we enter new export markets, our sales forecasts remain uncertain. To mitigate budget risk we have invested significant time and resource into financial modelling, and accuracy has greatly improved utilising the experience of our new Australasian sales manager. Our financial model is based on what we expect is reasonably achievable in revenue terms, and expense items are modelled accordingly.
New markets – the export markers we have identified remain largely untested and this presents uncertainty in the level of earnings we will generate from these markets. We have aimed to mitigate this uncertainty as best we can but engaging external advisors (Katabolt) and spending significant time and effort researching and assessing which markets to enter and when.
Staff retention / key person – key person risk arises from the fact that Ryan has been with the company since day one, and has been the driving force behind the growth of Riot Foods to date. We may mitigate key person risk and wider staff retention risk by way of employee share incentives.
From a brand perspective, Art’s role as brand ambassador is a key reason for Riot Foods has strong brand equity and such a loyal following of consumers. The risk of Art parting with the company is largely mitigated by his ownership share in Riot Foods.
IP – IP risk is minimal. There is no significant IP involved in our operations other than the manufacturing know-how we have developed. Our custom-built facility (WFM) presents a barrier to entry for competitors as a result of the capital outlay it would require to replicate such a facility.
Competition – We have no direct competitors in the pure Paleo Brand space. Large NZ breakfast manufacturers have unsuccessfully tried to launch Paleo products, however large food brands contradict themselves by trying to promote both their existing ranges, as well as free-from products. Furthermore, we believe it would be extremely hard for a competitor to make a cheaper alternative that still tastes good.
Scale-up – there is minimal risk that we grow too fast for our existing operation arrangements. The majority of our ingredients are major commodities. Our extended manufacturing facility will have significant capacity with the ability to increase capacity with further capital spend. There are risks related to timing in the set up of the additional manufacturing facility. This will be mitigated by senior management close involvement in the project.
Note from PledgeMe
We have completed a Veda check on the company and their directors, as well as a google check. There were no adverse findings.
Happy New Year - Biltong Range into BP
12:11PM Mon 15/01/18 on Riot Foods
Happy New Year to you all!
After a hectic silly season we are thrilled that the campaign is now at just under 25% of it's target. Thank you to all who pledged over the holiday period.
We are also extremely excited to announce that our CleanPaleo Biltong range will be available in BP petrol stations across the country from February. Petrol Stations and convenience channels are an important aspect to our business model and forecasts, so are thrilled that we now have a presence there.
For those of you who are interested in chatting to Art and myself (Ryan) around the business and products, or you have any questions about PledgeMe and the capital raise, we will be hosting a Facebook Live event at 8pm on Wednesday the 17th of January. Just make sure you follow our CleanPaleo page on facebook, and stay tuned at around 8pm.
Have a great week!
Comment on this update:
Big Developments : Campaign Extension
10:30AM Fri 15/12/17 on Riot Foods
We’ve recently had some exciting new developments which, if finalised, helps to underpin the next 5 years of our business model. This opportunity is set to begin in January/February (next month)!
Due to this huge opportunity, we’ve decided to extend the campaign and allow our crowd to be right there with us on the next stage of our journey as we execute.
There’s no doubt this opportunity has come from the help of our crowd, so thank you. Let’s all try to get the Riot even bigger over the next month and continue to revolutionise the food industry!
Comment on this update:
Share Trading and Sale Of Shares
08:28PM Thu 07/12/17 on Riot Foods
To clarify some previous questions around share trading:
An IPO would be dilutionary, as the primary purpose of this would be to raise new money. However, it may be possible for shareholders to sell down their shares as part of this offer.
Comment on this update:
We're Live and Rioting
02:39PM Thu 07/12/17 on Riot Foods
Thanks for your support so far. We are thrilled to have more and more people joining the Riot.
A big thank you to everyone who has pledged already!
We look forward to having a drink with you later today at:
5 Akiraho St
Art and myself will be there from 4pm onwards
Comment on this update:
|Maximum Shares Offered||3,703,703|
Explanation of valuation:
Riot Foods has set a pre-money valuation of $4.6 mil, based on a 2.2 x multiple of the six months of revenue (May to October 2017), annualised. In the six months from May to October 2017, revenue was $1.05 mil - expanding that out to twelve months, would be $2.1m.
The share price, and subsequent valuation is unchanged from our last capital raise in November 2017. The table on page 12 of our IM gives a relative comparison between Riot Foods and similar companies from around the globe.
|Prev Year||Current Year||Est. FY 2019||Est. FY 2020|
Company Name: Riot Foods Limited
Company Number: 5494241
Business Plan (application/pdf, 14.4 MB, uploaded 15 December 2017)
Financial Performance (application/pdf, 3.41 MB, uploaded 15 December 2017)
Financial Projections (application/pdf, 3.41 MB, uploaded 15 December 2017)
Constitution_27_Nov_17.pdf (application/pdf, 342 KB, uploaded 05 December 2017)
Certificate_of_Incorporation_-_Riot_Foods_Limited.pdf (application/pdf, 1.68 MB, uploaded 06 December 2017)
Company_Extract_-_Riot_Foods_Limited.pdf (application/pdf, 3.99 MB, uploaded 06 December 2017)
|Ryan Kamins||Galzanizer & Instigator||https://nz.linkedin.com/in/ryan-kamins-2ba30764||✔|
|Trevor Kamins||Tipster & Instigator||https://nz.linkedin.com/in/trevor-kamins-7235a217||✔|
|Robin Chemaly||Chief Regulator & Instigator||https://nz.linkedin.com/in/robin-chemaly-aa337419||✗|
Ask a Question (You must login to ask a question)
Hi there... couple of things. Once people have bought their shares, how will the trading of those shares be conducted. Usually you have a trading account and you can buy and sell whenever you want for a readily visible price. How does all that work in this case? Also, how did you determine the value of your company and the shares themselves? Cheers.Posted on 07-12-2017 by Amanda Maclaren
Thanks for the interest in the campaign. There is no current trading account or platform in place by the company, however the Board will facilitate the trading of shares should shareholders wish to do so. If the raise is successful, we will assess whether it is necessary to establish a trading account / platform to facilitate this rather than doing so via direct communication. The number of shareholders coming on board and demand for sale / purchase will likely dictate this.
In terms of Valuation, you will see in the IM that we have set this at 2.2x previous 6 months revenue (1 May 2017 to 31 October 2017), annualised, which is $2.1m. This has also been matched against a Discounted Cash Flow valuation, which puts the $4.6m valuation in the lower to middle range of that.
Hope this has helped youAnswered on 07-12-2017 by Ryan Kamins
Hi again - thanks for the previous answer (I can email if multiple questions are going to be annoying). So... if you guys are, in theory, going to handle the ongoing trading of shares once you've raised the amount of money you want, how are you going to set the daily price, and where will this be advertised? Will you guarantee to buy them back, or will someone have to wait until somebody puts their hand up for them? If, say, you wound up with a couple of thousand people who had bought a minimum amount of shares, you may find yourself with a full-time job taking calls and sorting out trading issues. Obviously, in the short-medium-term absence of dividends, the 'investment' is the likely increase in the value of the company, so it seems crucial that the share value be regularly assessed and that people be able to buy and sell in a timely fashion. Also, if you do consider an IPO in the future, how will that affect existing shareholders i.e. a presumable dilution in their shareholding? Sorry, that was lots of questions. Cheers.Posted on 07-12-2017 by Amanda Maclaren
Hi Ryan, can you please send me the second response that was sent to Amanda?? Many thanks, AndrewPosted on 07-12-2017 by Andrew Hibbert Hindin-Miller
Yes not a problem. As soon as I am able to reply to Amanda, I will also respond to you with a summary of the key points. Will also most likely provide an update to the campaign page around these questions
Thanks for your patienceAnswered on 07-12-2017 by Ryan Kamins
Hi, can you please help me understand the valuation? You have used 6 months revenue. Why not a full year or average of the last two years when you have this information. Also, why have you used revenue and not NPAT or adjusted NPAT? Thanks!Posted on 09-12-2017 by Belinda Skinner
Thats a really good question. Our valuation method is a typical one for early stage FMCG (Fast Moving Consumer Goods) companies. This is because in the early stages, particularly ones that also manufacture, marketing and overhead costs are high in order to win shelf space and be able to keep up with demand.
We have had valuations done using similar methodology by 3rd parties over the course of business. A lot of companies similar to ours actually base their valuation on a multiple of the next years forecasted revenue, where in our case we have tried to use an actual results method.
A useful website to see valuations of similar companies to ours is: https://circleup.com/data/
Although these have been based on transactions occurring in the USA, you can see that our valuation is on the conservative side of these comparable transactions.
I hope this has helped you? If you would like some more detail or have further questions, please send me an email to [email protected]Answered on 09-12-2017 by Ryan Kamins
The cash flow model looks flawed. For example, under the operating movements for the FY18 year it has cash inflows $951K, outflows -$2K (must be a cheap year) and then net movements of -$658K. Struggling to interpret that.Posted on 13-12-2017 by Hamish Baker
Hi Hamish – thank you for that – good pick up.
The summary model line “Outflow from Operating Activity” had picked up the wrong line off the detailed supporting model. This has been corrected. All the other lines including net movements etc are the same
Hi Riot Food,
Great Product! And great PR, especially getting Art involved.
However, I am just concerned with your sustained, long term, forecasted lost. On my calculation, you will have an accumulated lost of $3 million by the end of next year. Even if you reach maximum pledge, this will barely cover your lost for 2018. And according to your forecast, you will continue to bleed cash until 2020/2021.so basically, every penny invested until your eventual breakeven goes towards paying off debt.
How do you plan on mitigating the significant risks of negative gearing (and keeping the bank happy) while growing and expanding?Posted on 30-12-2017 by Jack Liu
Thanks for the kind words and the questions. Most of the losses you have mentioned have already occurred, and have been provided for by exisiting shareholder investment. When this raise completes, there will only be 2 months left in FY18 (10 months of losses in FY18 have already been covered by the exisiting shareholders and investors).
As you have mentioned however, there is forecast to be further losses and outflow of cash, but we have not forecast for this to be covered by debt or negative gearing as you mentioned. We plan to raise another $1m in equity in 12 months time, and this will cover the remaining outflow of cash until the business is cashflow positive.
Although we have not forecast needing any bank debt, the company may seek to do so if appropriate.
I hope this helps your queries JackAnswered on 31-12-2017 by Ryan Kamins
Good evening, can you please advise the remuneration of senior staff. Does Art Green get paid by Riot Foods for promotional work?Posted on 09-01-2018 by Brian Green
Thanks for the question. Yes, shareholders / directors are paid for their time. For founders like Art and Ryan, until now this has not been at fair market value as there has been elements of sweat equity, but fair market value (based on role, responsibilities, value etc) will be the rate of pay for all staff going forward, whether they are shareholders or not.Answered on 10-01-2018 by Ryan Kamins
Hi guys, if we invest and you don't meet your 600k target. What then?Posted on 23-01-2018 by Alex Liddle
That's a good question. Although we are confident we will still get there, unfortunately that situation will mean that you will not receive shares in the company. As a business we will seek alternative financing options and look at our less aggressive growth models to improve our profitability in the short to medium term. For those like yourself who are passionate about becoming a shareholder, you've just got to convince your mates to get on board and get us over that line!
Followers of Riot Foods
Beverly Old2017-12-30 13:18:28 +1300
Beverly Old has pledged on 4 campaigns
Beverly Old2017-12-30 13:02:47 +1300
Beverly Old has pledged on 4 campaigns
Sasha Wood2017-12-29 21:28:25 +1300
Sasha Wood has pledged on 4 campaigns
Hayden Wood2017-12-29 21:19:46 +1300
Hayden Wood has pledged on 6 campaigns
Samantha Mills2017-12-29 13:36:17 +1300
Samantha Mills has pledged on 2 campaigns
“I wish to update my cc details should this proceed - I will substitute my new debit card details which attracts air points for any spend.”
xjianz2017-12-23 16:50:07 +1300
xjianz has pledged on 4 campaigns
Sam Talbot2017-12-22 21:19:11 +1300
Sam Talbot has pledged on 2 campaigns
Amy2017-12-22 16:33:19 +1300
Amy has pledged on 4 campaigns
Yil2017-12-21 21:12:18 +1300
Yil has pledged on 2 campaigns
“A very exciting time ahead! Looking forward to see you guys succeed :)”
Esme Bell2017-12-21 08:22:29 +1300
Esme Bell has pledged on 2 campaigns
“Looking forward to what the future holds ”
Mark Colley2017-12-19 21:18:38 +1300
Mark Colley has pledged on 1 campaign
“Keep up the awesome work guys - excited to be a small part of the journey! Cheers”
Andy Robilliard2017-12-19 17:32:44 +1300
Andy Robilliard has pledged on 2 campaigns
Ashlee Lennon2017-12-19 11:09:48 +1300
Ashlee Lennon has pledged on 2 campaigns
Jimmy Zhou2017-12-19 10:27:43 +1300
Jimmy Zhou has pledged on 1 campaign
“Good luck Ryan and team”
Hamish Smith2017-12-18 16:48:55 +1300
Hamish Smith has pledged on 2 campaigns
“Great company and good people. Looking forward to seeing what comes next! H”
Alan Cole2017-12-18 14:06:11 +1300
Alan Cole has pledged on 2 campaigns
Brad2017-12-16 08:39:43 +1300
Brad has pledged on 6 campaigns
Anastasia Boyd2017-12-15 12:02:58 +1300
Anastasia Boyd has pledged on 5 campaigns
Beverly Hollister-Jones2017-12-13 22:09:10 +1300
Beverly Hollister-Jones has pledged on 2 campaigns
“Great being involved in this company. Products fantastic.”
Patriot Investment Group2017-12-11 19:13:35 +1300
Patriot Investment Group has pledged on 4 campaigns
Jay Barot2017-12-10 20:37:39 +1300
Jay Barot has pledged on 2 campaigns
Ian Featherstone2017-12-10 16:54:56 +1300
Ian Featherstone has pledged on 2 campaigns
“Great to invest in a movement, brand we believe in and CAN EAT :-)
Lets do this!”
Cassie2017-12-10 16:51:12 +1300
Cassie has pledged on 2 campaigns
James Ray2017-12-10 11:56:57 +1300
James Ray has pledged on 4 campaigns
Rick Samson2017-12-09 16:23:06 +1300
Rick Samson has pledged on 1 campaign
margot raglan2017-12-09 10:48:06 +1300
margot raglan has pledged on 2 campaigns
“I have been following your progress, tasting and loving your products and am thrilled to be a part of your company development.. go for it!”
Toni McColl2017-12-08 21:09:34 +1300
Toni McColl has pledged on 2 campaigns
Naomi Walker2017-12-08 15:09:04 +1300
Naomi Walker has pledged on 2 campaigns
Tim Peat2017-12-08 13:44:43 +1300
Tim Peat has pledged on 2 campaigns
Roy Younge2017-12-08 08:12:51 +1300
Roy Younge has pledged on 2 campaigns
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