Letter from the Founder

Ever since going vegan in 2004 I’ve wanted to help more people eat plant-based more often: for people, planet and animals. That’s why I founded Angel Food in 2006. Angel Food is founder-led and mission-driven.

 

We focus on cheese alternatives because:

• Cheese is a key ingredient in many favourite meals
• The impact of dairy is huge – for the environment and for the animals
• Plant-based cheese has half the environmental impact of dairy cheese

 

In 2015 we launched the first plant-based cheese to be commercially made in Aotearoa. Angel Food is the leading brand in this growing sector in New Zealand and we aim to also be the leading brand in Australia in the next few years.

 

We are New Zealand’s #1 plant-based cheese thanks to our crowd: crowdfunding rounds in 2015 and 2019 enabled us to grow fast and establish our leadership position while the category was in its infancy. Revenue grew 3.5x in the two years following our 2015 raise, then another 1.4x following our 2019 raise. Two years from this raise we’re projecting 3.1x revenue growth. See our revenue projection table below. We’re excited to be going back to our crowd to support the next phase of our growth.

 

Despite a few tough years we are still #1 in retail. As a purpose-led brand this is what we want: a strong consumer brand in the retail channel is what will help us deliver the greatest impact. We’ve been around for 17 years and are still totally committed to our mission of making it easier for more people to choose plant-based meals more often.

 

Where other plant-based categories – like milks, yoghurt and icecream – are mature and crowded, plant-based cheese is still in its infancy: there is still lots of room for growth.

 

We have great distribution in Aotearoa but we’re not satisfied with that. We’ve developed great products and a great brand in a space that has a very positive impact - and we want to share it with the world, starting with Australia!

 

Alice Shopland

 

What we've achieved

Financial success - Revenue growth was between 16% and 133% year on year for the eight years prior to Covid, the greatest growth being: +$258K in FY17 and +$415K in FY21, the second year after each raise. Read more about our financial success in our Information Memorandum.

Market standing - Angel Food is not only Aotearoa’s largest plant-based cheese company, we are the most experienced, at the ripe old age of 17. We make more than 130 tonnes of cheese per year and fans can access Angel Food in more than 350 retail stores and an estimated 1000+ food service outlets across New Zealand. Read more about our market standing in our Information Memorandum.

Environmental impact - Our plant-based cheese alternatives have on average about half the environmental impact of their dairy equivalents. 

Read our full Information Memorandum here

 

Our products

 

 

We make delicious plant-based cheese alternatives for everyday enjoyment.

 

Our mission is to make it easier for more people to choose plant-based meals more often, and we reckon good quality plant-based cheese is crucial to achieving that. We often hear people saying they’d love to be vegan or eat mainly plant-based, “but I couldn’t live without cheese”. We get it!

 

Cheese is delicious and it’s a key part of many of the favourite meals many of us grew up with. Food is a deeply emotional subject because it is so intertwined with family culture and other social networks. Rather than asking people to go without those meals, or have them without the cheese, we provide plant-based alternatives which are an easy swap for the dairy cheese

 

Market Opportunity

 

1. Consumer demand for plant-based products is increasing. This is driven by a desire for more sustainable and healthier options.

 

2. The largest generation wants healthier foods which are plant-based.

 

3. Millennials and Gen Z, which together comprise 40% of the NZ/Australian population and whose spending power will continue to grow, demonstrate particularly high demand for both plant-based and healthy foods.

 

4. 70 per cent of millennials are cutting back on animal products in their diet.

 

5. Plant-based milk and yoghurt has shown strong growth to date and plant-based cheese is the last category to take off, forecast to reach $74m across Australia & NZ by 2027. (Source: Euromonitor 2022)

 

6. Until now, plant-based cheese growth has been slow, due to the taste and performance gap vs dairy equivalents. The opportunity lies in closing this gap, something which Angel Food has the ability to do. With superior taste profiles and melting performance than the competitive set, Angel Food is well positioned to lead the category growth in NZ and be a strong player in the Australian market too.

 

Strategic Growth Plan

What we're going to do next

• Prepare for launch into Australia in 2024
• Continue new product development
• Continue improvement of existing products
• Amp up our marketing
• Hire an experienced GM to lead the next phase of growth
• Maximise opportunities in New Zealand

Our Australian launch will require $1 million investment. This is the first part of that raise. We’re taking a stepped approach so we can maximise value for our shareholders at each stage.

 

Read our full Information Memorandum here

Proposed use of capital

• Marketing – Increased investment in marketing to ensure the total target consumer audience is reached with sufficient frequency to support their shift through the funnel towards trial. ($55,000 - $200,000)
• Innovation – increased investment in new product development projects, including but not limited to raw materials and factory trials, and packaging design and development. ($23,000 - $50,000)
• People – funding to support hiring 1) a General Manager to increase internal sales and management capability, freeing up existing resources to better focus on marketing. 2) An additional product development resource to speed up innovation progress to drive revenue growth. ($112,000 - $150,000)
• Working Capital ($10,000 - $100,000)

Financial Information

Profit & loss

You can read our profit and loss assumptions in our full investment document here.

Balance sheet

Share offer

We are offering up to 15,106 shares at $33.10 each which will equate to a total of 9.8%* of the shares in Angel Food Limited. The minimum individual investment is $331 for 10 shares.

All Angel Food shares are voting shares and have full voting rights attached. You can read more about the rights attached to shares in our Constitution

Read more about our share offer, and view our Capitalisation Table, in our full investment document here.

 

Our team

ALICE SHOPLAND - Founder and Managing Director

Alice founded Angel Food in 2006. She’s steered the business from tiny beginnings in an obscure segment to nationwide distribution and leadership of a growing category. She is currently general manager, and is also responsible for sales and marketing.

 

COLIN WOODS - Director

Colin is Alice’s husband and has been involved in the business since 2011, doing everything from working at trade shows to packing orders to building shelf-life testing cabinets - and helping to map out the future of the business. He’s a musician, a scientist and a PhD student.

 

JUSTIN MAHER - Innovation & Technical Manager

Justin joined Angel Food in early 2021 with a broad background in food technology and QA roles, and he is now one of Aotearoa’s leading experts in plant-based cheese technologies. As well as developing new products he is responsible for liaising with our manufacturer, food safety/QA, and controlling costs. He’s an artist and keen squash player.

 

EVITA GROET-PAIRAMA - Supply Chain & Accounts Manager

Evita joined Angel Food in 2019 as a part-time admin assistant and rose quickly up the ranks to become a senior member of the team, overseeing Two of her three beautiful children have been born during her time with Angel Food. Evita is an ethical vegan and keen foodie.

 

AVALON HEWITT - Accounts Admin & Customer Support

Avalon joined Angel Food in early 2021 while doing post-grad study. She’s now working as a music therapist but continues to work part-time for Angel Food because of the variety it brings to her work life. Avalon is also learning te reo, sings in a band, and is a champion cheesecake maker.

 

MATTY SHONE - Sales Coordinator & Admin Support

Matty joined Angel Food in mid-2022. He’s the vital glue in our daily processes - he makes sure, for example, that orders get to where they’re supposed to be when they’re supposed to be there. Matty is a keen gamer and aspiring dead-pan comedian with his own Twitch stream.

 

Governance

The Angel Food Board comprises Alice Shopland and Colin Woods. They are supported by an informal network of high-experienced advisers including Anna Subritzky, an experienced FMCG consultant acting in an advisory capacity.

 

Read our full Information Memorandum here

 

Risks

• Another community outbreak of COVID-19 - we lost significant amounts of stock in the first outbreak and now keep a much tighter rein on stock levels, which reduces this risk (and helps cashflow). We are also now experienced at pivoting in these situations. If another outbreak impacts our ability to function as normal, we will take advantage of any government assistance offered.
• Key staff leaving - one of the benefits of growing the business is growing the team, to reduce the depth of our reliance on individual staff members. We work hard to make people feel like valued members of the team. Our processes and intellectual property are thoroughly documented for the sake of robustness.
• Increased competition in the plant-based cheese market - we are well-established as New Zealand’s original and leading brand of plant-based cheese alternatives. We will continue to protect that reputation and grow the market with innovative R&D. Being a founder-led, mission-driven brand sets us apart from our competition.
• Changes in the Australian market mean it is no longer best export market for us - we see Australia as the natural next step but are watching developments closely and observing other market opportunities in case we need to change our plans.
• Cost of goods increases - invest time in maintaining a list of alternative sources/alternative ingredients which we can switch between when price rises occur.
• Cashflow challenges - this raise is the first part of a total $1million raise to support the growth in NZ and a strong entry into the Australian market. $400k is required this financial year. If this raise achieves less than that figure then we would bring forward the next funding round.

 

Note from PledgeMe

We have completed Equifax checks on Angel Food and their Directors, as well as Google and Insolvency checks. There were no adverse findings.

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