Healthy food group secures ‘Vital Ingredient' for 11 new stores
Healthy fast-food retailer Vital Ingredient is set to more than double in size creating up to 150 new jobs in central London, after securing a £2.75 million finance package from Santander Corporate & Commercial's Breakthrough programme.
The company, run by entrepreneurs Alex Heynes and Paul Oberschneider, plans to use the funding to establish 11 new sites across the City and West End of London - taking the number of outlets from 11 to more than 20 over the next year. The expansion will create around 12 - 15 new jobs per outlet.
Vital Ingredient was set up by Alex Heynes in 2001 as a healthy alternative to traditional bread-based fast food. Customers are able to build their own meals from a selection of fresh ingredients and the food is made to order in the store, in line with the company's "Eat Your Way" concept. The chain specifically focuses on speedy service and low calorie, healthy ingredients in areas of the capital with busy lunch and breakfast trade.
The concept quickly took off and Alex opened a further four sites over the next ten years. In 2011, financier and property entrepreneur Paul Oberschneider partnered with Alex, helping with finance and creating the infrastructure and business plan to expand, adding four additional stores by the end of 2012, and two more in January this year. This latest funding consists of both traditional lending, but also £1.25 million of growth capital finance from Santander's Breakthrough programme.
The Growth Capital investment provides mezzanine-based finance at a low rate which helps bridge the gap between angel and equity investment, helping to fill the recognised investment funding gap for UK companies of less than £10 million turnover.
In addition to opening new stores, Alex is also looking to establish a new central distribution unit to help reduce purchasing costs, and reduce the space requirements in retail units. It will also allow the company to buy in a wider selection of special ingredients. New Grab & Go products are under development, including salad wraps, super salads and raw veg pots. The company will also shortly be launching a new online site for corporate customers, offering deliveries and a platter menu.
Alex Heynes, Founder and Managing Director of Vital Ingredient, said: "We are really excited about this next stage of our development. Our continuous growth throughout the tough economic climate in recent years is testament to the resilience of our business strategy and offering, which provides busy professional Londoners with healthy eating alternatives that enable them to get good food fast.
"Trying to access finance that allows you to invest in your business is hard for a company of this size. Typically investors either want to take a slice of your company, or are only offering to new ventures. Santander's Breakthrough programme offers us a real alternative, allowing us to top-up what we could access through traditional bank finance with funding based on our future success."
Steve Pateman, Head of Banking at Santander UK, said: "We are delighted to have been able to support Alex and Paul with their growth ambitions. At Santander we are committed to supporting small companies achieve their aims and become stronger and bigger companies. Only by enabling small business owners to expand and grow their businesses, will they in turn be able to create the jobs and demand to drive forward UK economic growth and dynamism. That is why we created the Breakthrough programme, to provide smaller companies with both the finance and support they need to help them achieve this growth."
The Growth Capital loan is part of Santander's Breakthrough programme which aims to support fast-growth small businesses to help them accelerate their growth potential. As well as funding, Breakthrough offers companies access to trade missions, business masterclasses, networking events and support in areas such as finance and marketing.