Blue & Green Communications
Blue & Green Tomorrow aims to be the fastest-growing, most widely-read online magazine in the UK for sustainable investment and living. Having had 512,000 unique readers in 2014, Blue and Green is already generating revenue and operates within a market worth over £78b in the UK alone. Led and advised by industry veterans, Blue & Green seeks to capitalise on the trend for sustainability to become mainstream.
Blue & Green Tomorrow aims to be the fastest-growing, most widely-read online magazine in the UK, covering sustainable investment and living, with 512,000 unique readers in 2014. Our research suggests that our typical readers are professional, affluent, 25-54 and well-educated with a strong interest in sustainability.
Our principle business activity is online publishing about sustainability.
Our online publication is designed to build a readership, creating content for events and vice versa. Our research and the online behaviour of our readers creates valuable insight on the state of sustainability locally, nationally and globally.
We operate in a market worth £78bn in the UK alone, which our research suggests includes over 26 million consumers and 4,595 companies.
We are seeking Investment to fund key personnel, technology development which will include an enhanced website and apps, and hard hitting marketing to grow our audience.
Your investment will allow Blue & Green Tomorrow to put in place the ingredients to capitalise on the significant media opportunity we have created.
The opportunity is based on the following:
· Fee income from sustainable companies that wish to speak to our 7.5 million annual readership
· Commission income from sustainable products and services promoted to our readers
· Fund commission from an independently managed global sustainability fund with assets under management of £119m by mid-2018
We do not envisage another fundraising round through the sale of equity and therefore this will almost certainly be the only opportunity to invest in Blue & Green Tomorrow. We are proud of our growth in readership and know that this reflects the rising interest in sustainability from consumers, investors and organisations.
Our objective is to encourage sustainable investment by writing about as wide a range of engaging topics of possible (switching to renewable energy, booking responsible travel and shopping ethically) and then addressing the issue of investment for those not initially engaged in the investment debate.
By the end of 2015, we aim to have secured our status as the leading sustainability magazine in the UK, with a growing global audience, generating average revenue per user (ARPU) of 2p from commission and 14p in fee income. By 2018 this will be 39p commission per reader and 25p in fee income.
Fee revenue took off in 2014, and this growth came in advance of commission-generating partnerships being in place.
We now have 40 of these partnerships in place and 17 more pending, with an average commission of £25, but ranging from £1 to £218. Examples of our partnerships are Alliance Trust, Ethical Superstore, Good Energy and Riverford Organics.
Our marketing objective is to grow our readership. This is essential to generate commission and secure fee income. We propose to spend 22% of the investment raised to increase our readership from just over 500,000 to 1.4 million by the end of 2015.
Marketing acts as a multiplier to organic growth for a content business through:
- Organic growth from content SEO
- Apps for mobiles and tablets
- Increased email marketing
- Digital media network
- Financial adviser directory
- International expansion
Our primary audience is the socially-aware, environmentally-conscious, digitally-connected consumer. We will generate revenue per user from commission but also fee income from the businesses that serve them.
The sustainable consumer and investment market is significant. It is growing rapidly. Latest figures show that sales of ethical products and services grew by 6% (2013) when the UK economy grew by only 0.6%. The ethical market is now worth just over £78 billion. [http://www.ethicalconsumer.org/portals/0/downloads/ethical_consumer_markets_report_2014.pdf]
We know that the market remains highly fragmented and lacks a truly effective media voice to encourage take up of sustainable products and services amongst any but the most committed. We believe that Blue & Green Tomorrow can be that voice and route to market.
“A more budget-conscious green consumer has emerged out of the economic downturn. Whilst the majority agree that they try to be environmentally-friendly because it is the responsible thing to do, nearly half admit that being greener saves them money. Today’s savvy shoppers place more responsibility for doing good for the environment on retailers and brands, and corporate green initiatives could become a point of differentiation from competition in the near future.
Green consumer habits have become increasingly driven by the financial advantages they bring to the consumer. However, consumers have also come to expect a high level of environmental and ethical integrity from the brands they patronize, despite the fact that they are often unprepared to pay more for the benefits.” The Green Consumer – UK – March 2014 Mintel – Jack Duckett, Lifestyles Analyst
Credit reference agency, Callcredit’s Green & Ethical scorecard has identified 40% of the UK population across six segments who are the core targets for our readership – in that they are both affluent and ethically/environmentally minded. This is roughly 26m individuals living in 11m households. We know that they are typically 35-54, earning £50k+, AB professionals living in families [http://tinyurl.com/nc624y6].
Sustainable investment research body EIRIS identifies 750,000 people who have invested in ethical or socially responsible funds, with funds under management totally just under £11.3bn.
We have identified 4,595 companies in investment, travel, energy and retail from trade body membership who we can target for advertisers, sponsors and affiliate partners.
The Key Trend
The key trend we will benefit from is the mainstreaming of sustainability.
Sustainability still remains a niche in almost all sectors. However, as an environmentally-aware, socially-conscious and digitally-connected population acquires the spending and investing power to affect business success or failure we believe we can be at the vanguard of that shift, and will be an attractive acquisition target for a company wanting to capitalise on that shift.
Our objective is to be a top 10,000 site in the UK.
Our research suggests a significant number of our ‘competitors’ are business-to-business plays in vertical sectors: energy, investment, travel, etc. or focus on serving the existing consumer niche rather than expanding it as we plan to.
We know that ethicalconsumer.org, theecologist.org, which was recently for sale, and resurgence.org are the three main players in the consumer space and are funded by subscription and advertising. Businessgreen.com, pioneerspost.com and greenwisebusiness.co.uk are the three main players in the business-to-business space. We know that Businessgreen.com (part of Incisive Media) operates a paywall and that Greenwisebusiness.co.uk is currently on the market and a potential acquisition.
We are currently in discussions with a title above us in the rankings to merge forces.
We see our key difference is that we are aiming to grow the market by reaching the unconverted and our ambition is to be a global media outlet with an emphasis on investment. We believe our funding model is unique in this space but tried and tested elsewhere.
Simon Leadbetter, FRSA LinkedIn
Simon has an abiding passion for sustainability and ethical business. Previously he was an interim trouble-shooter and Chief Marketing Officer in fast-growth start-ups.
Simon has many years experience in the media and financial services industry including time at Prudential, AXA and Fidelity. In 2004, he founded a direct marketing agency that worked with a range of leading companies in the media, telecoms, energy and financial services. While at Market Cluster he was involved in the creation of the Essential Intelligence series of events (Essential Mediatech, Essential Cleantech and Essential Web) and launched the online platform Cleantech Intelligence (which underpinned The Guardian’s Cleantech 100) and StrategyEye Cleantech.
- Clare Brook, CEO, Blue Marine Foundation
- Ravinol Chambers, Founder, Be Inspired Films
- Matt Chocqueel-Mangan, Founder, Vote for Policies
- John Fleetwood, MD, Ethical Money
- Professor Harold Goodwin, Professor of Responsible Tourism, Manchester Metropolitan University, www.haroldgoodwin.info
- Dr Darren Harper, Growth Coach for Growth Accelerator, www.auspexventures.com
- Nick Harrison, CEO, Founders 4 Schools
- Chris Locke, MD, National Press Publishers
- Kate Morgan-Locke, Former Guardian Media Group Director of Consumer Services
- Iain Patton, Founder and MD, Ethical Team
We are proud to say we have agreements from three individuals whom we know will be great assets to the business. As they are still in the process of leaving their current positions it is, regrettably, not possible to release their names publically at this time.
Director designate – Managing Director (London)
- Currently in a role as a director of a specialist media/data business with many prestigious financial services clients, where he has successfully managed all aspects of the sales and marketing strategy.
Director designate – Editor (London)
- A business journalist with many years reporting, writing and editing experience and now specialising in sustainability and green business issues.
Director designate – Events Director (London)
- Over 16 years of experience in the B2B media community.
Emily Leadbetter – Creative Director and Company Secretary (London)
- A graphic designer producing design for brand, print and magazines off and online.
Charlotte Malone – Senior Reporter. (Nottingham)
- Joined the Blue & Green Tomorrow team as a journalist in March 2012.
Key sales drivers: The principal driver of sales is readership growth which allows us to increase reader commission, advertising rates and business fees, without increasing costs proportionally.
Other sales drivers: In addition, as we uncover what products and offers sell above expectations to our readers and where our advertisers see excellent responses, we can negotiate significantly better rates on commission and advertising.
USE OF FUNDS:
35% on personnel, specifically a Managing Director, Editor and increased journalists, designers and marketers.
35% on general administration including repayment of £31,956 debt (see below) and 26% on marketing – specifically the development of a new website, smartphone and tablet apps and ecommerce capability to capture reader data on commission deals. 4% goes to direct cost i.e. web hosting.
EXPENSES AND PROFITABILITY:
During 2014/15 we will be partly investing for growth and we expect not make a profit. We expect that this position will be reversed in 2015/16 as we generate margins of 26%.
By 2017/18 we expect our EBITDA margin to rise to 68%, as we fully exploit the scalability of our business model: organic readership growth does not equal expenditure growth, but allows for higher commission volumes and advertising rate cards.
EXISTING DEBT OR EQUITY INVESTMENTS:
Debt:We have creditors of £31,956 from an aborted event in 2014 (sponsor pulled out). This is a non-interesting bearing debt and will be settled from the fund raise, which they have agreed to as they are keen to see us keep trading and grow.
Equity and director’s loan: The company currently has £200 in equity. There is a director’s loan to the founder of £140,144 which will be converted into equity in advance of this Crowdcube fund raise.
We envisage a burn rate of £12,925 per month
Next round: There are unlikely to be future equity rounds due to the high margin nature of the business model from 2015/16. We will issue bonds for accelerated growth if needed, once we have delivered a consistent and sustainable profit margin.
The Exit Strategy
We anticipate generating strong margins from our model and we have secured EIS approval.
Our ambition is to create a global sustainability media brand, and as the business is forecast to be cash rich it should prove to be an attractive acquisition for another media corporation. We would also consider a public listing within five years.
As the team grows options will be offered and an executive team may at some point explore a management buyout. We may also pursue share buybacks at current market value where appropriate.
Our revenue streams will create a significant income opportunity and it is our ambition to launch both Blue & Green mini-Bonds and a Blue & Green fund-of-SRI-funds, so the need to raise further capital would not drive an exit.
Invest £100 and get
a limited edition, specially-designed, postcard as an expression of our eternal gratitude for your support.
Invest £500 and get
hard copies of three 2011-2015 guides of your choice – printed on sustainable forest paper stock (of course). Plus the limited edition postcard.
Invest £1,000 and get
a limited edition hardback perfect-bound anthology of the best and most read articles of Blue & Green 2011-2015, three 2011-2015 guides of your choice and the limited edition postcard.
Invest £10,000 and get
a very limited edition share offer ‘trophy’ to acknowledge fund-raising round success, the hardback anthology of best and most read articles, three 2011-2015 guides of your choice and the limited edition postcard.
Invest £20,000 and get
‘Patron’ status in all Blue & Green publications, a very limited edition share offer ‘trophy’, the hardback anthology of best and most read articles, three 2011-2015 guides of your choice and the limited edition postcard.
Tax relief is available to individuals only, who subscribe for shares in an Enterprise Investment Scheme (EIS). Relief is at 30 per cent of the cost of the shares, to be set against the individual’s Income Tax liability for the tax year in which the investment was made.
If you sell, give away, exchange or otherwise dispose of shares, tax reliefs can reduce your Capital Gains Tax bill. Your shares must meet certain conditions to qualify for these reliefs.
The availability of any tax relief, including EIS and SEIS, depends on the individual circumstances of each investors, and may be subject to change in the future. If you are in any doubt about the availability of any tax reliefs, or the tax treatment of your investment, you should obtain independent tax advice before proceeding with your investment.
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