Setting up a food and drinks brand sounds so energetic and go-getting. But it can be exhausting and overwhelming when you really are starting up. Worry not, says Elisa Roche, who has canvassed all the experts, founders and CEOs she meets on, and off, the FML Career Conversations podcast to offer their best advice, including what they wish they’d known at the beginning and where to find that cold hard cash.
We hope this is the ultimate 360 guide for our student community and for anyone thinking of a career change into the F&B space, and we’ll be keeping it up to date with any new recommendations all the time so please get in touch if you can support our community in any way. Or if you want to offer us early share options!
Dealing with ‘the fear’. You’ve got this.
First, let’s get your head in the game.
You’ve had the big idea. Perhaps you’ve even got a physical product. Your Mum and the neighbours love it. So why are doubt and procrastination creeping in?
STOP! Says leading psychologist and student expert Rachael Alexander.
“Even though you’re passionate about starting your own business, it can feel overwhelming. To overcome procrastination, list the fears (often known as excuses) which are stopping you from acting. Mindset fears, such as failure, disappointment, rejection, and even a fear of success may be sabotaging you.
“Some say fear stands for ‘False Evidence Appearing Real,’ meaning the negative outcome you think will happen often doesn’t. If you feel stuck, write a list of the actions you need to take, then identify the fears which are stopping you.
“Go easy on yourself! You are entering unknown territory. But feel scared and do it anyway, reassuring yourself that you can handle whatever happens. This is how a confident and resilient mindset develops.”
Rachael Alexander is a Spiritual Growth Coach and author of You’ve Got This – A guide to student wellbeing at university & beyond.
But is my idea any good? Welcome to market research
Market research is checking out who you are selling to and what they want before you sell to it them and making sure there is a need or want for your product in the first place. You’ll also be looking at any competitors in the space to make sure you have a Unique Selling Point (USP) and that you are well priced to sell.
There are lots of companies offering paid-for market research. But when you are starting out there is so much you can do yourself and most of it is free.
- Start a Facebook, Quora, Reddit or LinkedIn poll asking friends, families and connections to be brutally honest with their answers.
- Check out the comments section on competitors’ social media platforms for insights into what customers are loving and hating. People are increasingly using social media to complain directly to Customer Services now, instead of calling or emailing, so comments are often public.
- Similarly, look at a site called Trust Pilot for honest reviews about competitor companies; both good and bad.
- Offer an incentive in return for opinions. You could set up a five minute online survey using tools like Survey Monkey and, in return, those who take part get a first time discount code or some future incentive to say thanks.
- Do the basics. Go around supermarkets or shops where you would like to be stocked one day and see what makes the shelves and why. Look at any similar brands that are already on sale to make sure yours offers something more or something different. This will stand you in good stead when you finally get meetings with buyers and they will appreciate that you spent real time on their shop floor.
- Offer samples when you are ready and ask for feedback. Sometimes it good to offer food and drinks products to chefs and kitchens first. They usually accept deliveries at around 7 to 7.30am so get there early and leave a note telling them you are new and would love their feedback when you come to pick up the boxes in a few days. Or you could ask to set up a samples stall at a food fair or market.
Show me the money
Money makes the world go round and you won’t start your business without it. At Food Matters Live, a lot of founders we speak to got their start at the Bank Of Mum and Dad, or using savings or pay-outs after quitting existing well-paid jobs. And while there’s nothing wrong with taking all the help you can get – and a third of businesses start this way – we don’t want anyone to feel left out or disheartened. There are many other great ways to drum up money, especially if you fall into a certain age group or demographic. Crowdfunding is still hugely popular and there are some lower risk bank loans too, which usually come with great perks and benefits.
How much money will I need?
Most founders we speak to started their business and got a physical product developed for 10k. While it can be done for less, we think you should make this your rock bottom if possible. Wherever you’re getting your money from, you’ll need to know exactly how much you want to borrow and work the money into your business plan before applying or asking for the cash.
What about the paperwork?
If borrowing, you will usually need at least two supporting documents that prove who you are, such as a passport, driving licence, bank statements and/or utility bills. And your company registration number if you have listed at Companies House. This will also come into play when setting up the bank account for your business.
What if my business will only trade at certain times of the year?
If your business is seasonal and you have borrowed money, make sure you take out a loan that gives you the flexibility to pay off more in high season than when business is slow.
It’s worth checking out all the high street bank deals and using comparison sites. We won’t list them all here but, subject to change, we like these bank loans…
While there are now many different ways to raise start-up cash, a traditional bank loan should not be overlooked as long as the interest rates are good and you are also being offered genuinely useful extras such as networking or mentoring opportunities. We like…
Start Up Loans
Part of the ‘British Business Bank,’ these government-backed loans range from £500 to £25,000 with a 6% interest rate. Successful applicants get 12 months of free mentoring too, as well as help building a business plan and the loans can be paid back over five years. The company recently teamed up with The Open University to offer a raft of free online courses, everything from mental wellbeing to bookkeeping.
This is a bank loan that has been specifically created to help newcomers. They will want to see your business plan, you must be 18 or over and the loan will be dependent on a credit check but you could find yourself with a loan of between £500 and £25,000 with a fixed interest rate of 6.17% . With every loan comes bespoke mentoring and access to exclusive offers and opportunities from the Virgin Group, plus you can join others in an online community that’s great for asking questions or attending free masterclasses.
In layman’s terms this is usually some high roller with money to spare who wants to take a financial risk in an area they truly believe in, usually a start-up. In return they will want a stake in the business. It’s classic Dragon’s Den vibes. Also known as seed investors, a good angel will be truly invested in every sense, offering their network of contacts and mentoring advice too. A ballpark figure for angel investment is between £10,000 and £15,000, thought you may find someone with a much larger wallet. We like…
An online platform specifically designed to connect investors with start-ups and small businesses who want to raise small to substantial amounts of cash and who, eventually, want to offer share options and go public. They will help you put together your investment pitch and then, when it’s ready, send it out to their network of more than 4,000 interested parties. Most people pitching are looking for a minimum of £50k, so a business hoping for less, say £15-20k, could attract interest. The initial enquiries into the value of your potential business cost nothing. If your investment pitch looks solid, you will separately agree what percentage Envestors will take from your business before your pitch goes live but you will need to find a lawyer to draw up the legal paperwork. To apply you will first need to be registered for seed investing here.
This is a global community for those in food tech, hosting meet-ups online and around the world. They are always looking for new start-ups to invest in, but there must be a tech, science or strong, innovative sustainability angle. Go online, fill in this form and if they like you, they will put your business in front of people who are waiting to invest and they’ll shout about you on their social channels. Perfect for any start-ups with a scientific or innovation twist. They are especially interested in futuristic sustainable efforts, such as meats grown in labs or honey made without bees.
Lending platforms and peer-to-peer
Peer-to-peer lending, known as P2P or ‘social lending’ in the financial world, enables individuals to obtain loans directly from other individuals, usually cutting out any financial institution as middleman. Sometimes property or valuables are offered as collateral, against a P2P loan to ensure that if things don’t work out, the lender always gets a return. And if you take out a P2P loan, you will usually face what is a called a ‘hard credit check,’ which is fine is you have a strong credit score but not so good for those trying to build credit history as it does leave a mark on your credit record for up to six months.
As such it is EXTREMELY important to research anyone claiming to be a reputable P2P lender. Financial sites like Fourth Way and Smart Money People keep an up-to-date database of P2P companies they have reviewed, both with their own scores and those of real users.
Most peer-to-peer lending sites seem to focus on those wishing to invest in property, especially in buy-to-rent properties, but there are some good ones out there for other new business owners too.
This was one of the first P2P lending companies founded in the UK and it scores consistently good, high customer reviews for both short term and longer term loans. It has developed impressive technology, allowing it to vet new customers in seconds, without the need for a hard credit check.
As of June 2022, a loan of £10,000 over 5 years would cost you £234.99 per month at a representative 15.4% APR.
This P2P has a great track record in helping those setting up businesses who eventually hope to expand into foreign territories or sell abroad. They have fantastic links with the Department for International Trade and strong links with Australian trade bodies too. It is the only FCS regulated P2P, making it tougher to qualify for one of their loans, but more secure than many other P2Ps if you do.
Grants, awards and accelerators
Do you have an idea for a Social Enterprise? This could be a business that aims to improve your local community, for example providing jobs for people from minority, disabled or difficult backgrounds or helping people get back into work after time away raising children or after dealing with illness or even using local suppliers only? Other examples of social enterprises include schemes to rehabilitate youth offenders or ex-prisoners. An amazing social enterprise that we loved hearing about is The Dusty Knuckle Bakery. Elisa met inspiring young founder Max Tobias on the Career Conversations podcast in May 2022.
The Grow IT awards could be for you. This registered charity provides start-up awards from £500 to £5,000 for anyone who has a business less than a year old and who is over 16. They also have ‘Scaling up’ awards for businesses that are less than four years old that now want to grow, these awards are from £5000 to £15,000. Each award comes with a team of experts attached; coaches, mentors, financial advisors and continued opportunities to learn more about business.
Are you a young, uk-based SME seeking to change the food system with a fantastic idea for sustainability and looking to raise between £50k to £2m in the next 12 months? Try the FREE four-month accelerator programme from the Be the Earth Foundation with access to funding, mentoring and incredible experts from all around the world. The UK charity has arms in Brazil and South Africa. Each summer it chooses up to 15 businesses and offers them access to capital, an immersive retreat, a live pitch day and community building in a special four-month programme.
Sessions, a platform that empowers founder-led food brands to develop and rapidly scale their businesses, has been announced as the official partner of the 2022 British Street Food Awards. Sessions is on the lookout for the next great brand and through their sponsorship of the BSFA’S new ‘Future Food Legend’ award, they will provide one lucky competitor with a four-week intensive brand development programme.
If you’re working on innovative products that involve baking then consider applying to the Batch Ventures fund for equity and free support. If you’re offering a healthier product that can challenge mainstream brands and be accessible to lower income families, then consider applying to the Good Food Fund for a full programme of support and mentoring (free of charge).
Black business founder? Thrive with Sainsbury’s is a new, free 16-week programme designed to support five Black-led brands on their journey from start-up to supermarket shelves. In partnership with Foundervine and Mission Ventures, Sainsbury’s will provide essential funding, practical support and expert mentoring. Applications for 2022 are open until 16th August, to apply, go here.
Reputable crowdfunding platforms
Want to stick it to ‘The Man’ and build something from scratch, backed by a community that believes in you from the off? Crowdfunding could be your route in. But before launching your campaign, look closely at the competition to make sure your offering is different. Look at a few different sites and pretend you are an investor looking to lay down some cash. Perhaps you can be the only new F&B brand on one site where, on another, you would one one of many.
Don’t offer vacuous bonuses or novelty gifts unless that’s your brand’s tone of voice. Instead, offer something useful like the option to turn early Crowdcube investment into share options down the line, or a VIP discount card that share holders can use on your products. GRIND coffee did this and they are now worth £22million. We like…
Venture capital funds are pooled investment funds that manage the money of investors who seek stakes in start-ups and small- to medium-sized businesses with strong growth potential.
The big fund to know about in food & drink is JamJar, but it’s for those who have already made some headway with their F&B business. Started by the multi-millionaire founders of Innocent smoothies, JamJar has £100million in the bank and aims to take on 10 small to medium businesses each year to fund, mentor and help them to grow via their incredible network that spans everyone from food and drinks suppliers to supermarkets and creative design teams to huge pr firms. The JamJar track record is pretty special, they originally funded Oatly, Smol and Deliveroo.
To qualify, you’ll need to be after a big investment and have big ideas. You should be looking for a minimum of £500k and have already assembled a small team. The third criteria is that your idea must have a positive angle, be it sustainability, creating jobs or spreading an important message.
The legal stuff/the paperwork
If you are lucky enough to have found the route you want to take to find your business, it’s worth checking out a site called Seed Legals to help you put the legal paperwork in place. As well as being legal experts in business, they have lots of guides on fund-raising and a certain amount of content is free to view so make use of it.
Networking groups, events and other support
The Food & Drink Forum (for Midlands based grads). A not-for-profit advice and mentoring platform to help grow small businesses. They can help right from the start, even with things like borrowing kitchens and equipment or with market research.
Young Foodies , a huge nationwide community for food start-ups, offering mentoring, networking funding advice, workshops and training. Anyone can join on a free trial period then it’s from £37.50 a month. They’ve helped launch brands from Pip&Nut peanut butter to Little Moons.
Jumpstart, North West, Affordable loans, networking and advice for individuals and start ups in Coventry and Warwickshire.
Bread & Jam Festival, Almost every young founder we meet cites the Bread & Jam festival and its accompanying Facebook group (The Food Hub) as the ultimate supportive networking event for newcomers into the Food & Drinks space. Holds online and in-person events throughout the year and offers chances for start-ups to pitch to buyers at huge retailers.
The Food Exchange by Enterprise Nation The foodie arm of this online, nationwide networking group for UK businesses, The Food Exchange hosts masterclasses and online virtual food expos featuring excellent speakers. It sometimes offers opportunities to pitch to buyers too.
Mission Kitchen The go-to for anyone in London who is looking for commercial kitchen space on an ad-hoc basis plus it also offers shared workspaces, kitchens to hire for photographing your exciting new product and lots of mentoring opportunities and advice.
Work experience with funding advice
Perhaps you’d like to work in food before launching your product? Or hear from Product Developers, the people who are experts in launching new food and drinks products?
Try Froghop, a New Product Development consultancy (NPD) with experts in all things food and beverage. They’ve started taking students on various placements over the last 2-3 years, many of them from Birmingham Uni and Sheffield Hallam. They are usually studying a food science-based course or specifically NPD and tend to stay for up to one year, fully paid.
The company MD Mel Loades does weekly webinars and has recently featured interviews with Addition Finance to chat to their audience on gaining funding for new business ventures and start ups. All of Froghop’s previous webinars are available to download for free from their website.
Aged between 18 and 30 with a great idea? The Prince’s Trust’s Enterprise Programme is free and comes with an extensive network of mentors and supporters to help advise you and create your business plan. If you are further along and now want funding, they can also help with low interest start-up loans or even grants for those who are struggling.
Futures For Women offer small interest free loans of up to £1k to help with further studies that can lead you into practical/hands-on work, eg baking, cooking, food technology etc
The Hilda Martindale Trust has a handful of £3,000 awards for women who are training or studying to work in traditionally male-dominated industries.
The Gigabit Internet vouchers scheme is worth up to £3,500 for small businesses with slow or no broadband when they are starting out
Publicity, cooking competition and TV shows
While making a fool of yourself on TV is always a risk, having millions of viewers is a fantastic free way to make a name for yourself and your brand and to pick up social media followers almost overnight. From the serious to the ridiculous, here are our picks of the best culinary TV shows or competitions to show them what you’re made of. Plus some other tips for getting noticed.
The Culinary World Cup and the Junior Culinary World Cup are the biggest cookery competitions in the world
Young Risotto Chef of the year, for chefs aged 17-23. Winners get mentored by some of the best Italian chefs in the world and could end up doing paid placements abroad.
Dragon’s Den – the ultimate small business rocket launcher.
Gordon Ramsay’s Food Stars. To register your interest, email firstname.lastname@example.org
The News. Not a TV show. We mean, the news. On TV, online, in print etc. If you see a news story that is relevant to your idea or product, jump on that ‘news cycle’ straight away. Get in touch with local papers or online news editors to tell them how your product is relevant to what’s going on in the world. Are you, for example, seeing that tomorrow, the Chancellor is announcing the budget? Get in touch with local BBC radio to offer yourselves up as a small business case study who could talk about how this will affect you. A list celebrity arriving in town? Send your product to their dressing room with a funny note that hits home. Always try doing your own PR before you get so big you have to pay for it.
Ready to showcase to supermarkets and buyers?
If you want to get stocked in high street stores, be sure to make a good first impression by being thoroughly prepared before you approach buyers. Most of the large high street brands have handy guidelines and qualification criteria that you can research in advance to make sure your product aligns with their values and is what they are looking for. We have listed the major ones below. But don’t forget the basics- actually visit and get to know the shop you want to be stocked in. Usually, they are looking for a new brand with a USP that has sustainability at its heart and that already has a loyal and engaged customer base in local shops or at food fairs.
Eventually, when you feel ready, you’ll need to approach the individual buyer for your product category eg dairy, snack bars or plant-based. LinkedIn is a great place to find names. Buyers are exceptionally busy with many people knocking at their doors, so make sure in your initial contact you provide a short but thorough explanation of what you offer and why and how your brand can drive new consumers into their stores or websites. And don’t forget, if the buyer is keen they will want to act quickly so make sure you have at least researched how to scale up if it comes to it.
For Tesco, start by registering here
For Waitrose, first you’ll need to pass this check list, then you’ll have to find individual buyers and approach the relevant category buyer.
For Sainsbury’s you can choose to be an independent new brand or apply to have your product listed under the Sainsbury’s own brand product range. If you want to stay independent, they give preference to products that will be listed exclusively with them.
Co-op works with Enterprise Foods to find new local suppliers. Start here.
Aldi has separate buying offices for England, Ireland and Scotland. You will start by talking to a buying assistant before you reach buyer level. Download the Aldi supplier starter pack here.
With Wholefoods you’ve got one shot and it all starts with a simple email so make it good:
Selling on Amazon
Amazon Launchpad puts a spotlight on your already established new start up brand and helps push your product in front of consumers. This is how Ayesha Grover from Strp’d started off. Hear her podcast here.
The one thing I wish I’d know at the start of setting up my business
Who better to offer advice than those who’ve already done it?
Words of wisdom from founders and business experts.
Paddy Willis, Co-founder and chairman of Mission Ventures:
“Financial projections always rely on the 3A’s – they should be Ambitious, Achievable and based on clear Assumptions. Always raise more funds than you think you’ll need as you will find that things take longer to happen, products sell more slowly and there will always be costs you’ve not considered. You should be working your Profit and Loss (P&L), not your cap table, so be sure to have a minimum 14-18 months cash runway.
“Securing angel investment is like dating: Be sure you’ve found a good match and be prepared to accept that, if you get lucky, then – like marriage – it’s for the lifetime of your business, so be careful who you choose!”
Nat Cooper, Food and Drinks start-up expert who helped grow VitaCoco into a multi-million pound brand : “I think start-ups should be really cautious of what they spend money on in the early days, it’s easy to get carried away with excitement. Plus they need to consider the old classic; Investment vs ROI* that founders so often forget in the early days.” (*ROI= Return On Investment)
Julie Waddell, founder of award-winning Moorish dips:
“People and relationships are everything. Reaching out to ask for help from people at the beginning is not only fine but essential and you’d be surprised how many people are willing to give a little advice for free. Then when you’re selling your product or service, remember you are selling to a human. Be tenacious but respect their time and their responses, sometimes a no is only a temporary no but if you push people too hard they will just shut you down. Finally, when you’re big enough to employ and work with people, be kind and be interested in them. They are what will make your business a success.”
Career Conversations guest quotes
Three lessons from Ellie Webb, founder of Caleno drinks:
“First lesson: People are very willing to help you, you just need to be brave enough to ask.
Second? There’s no such thing as luck. Yes you can have a great idea, but you’ll have to consistently work hard every day at bringing it to life. Only then will opportunities present themselves.
“Third? In business, you never ever stop learning. I love being a sponge and have a hunger to learn but it’s an ongoing process and you have to actively put yourself in those situations, it doesn’t happen by accident.”
Ayesha Grover, CEO and founder of Tiger Nut company Strp’d:
“I did an MBA and you would think that would mean starting a business would come naturally. But there are so many skills needed. Even if you don’t have a business background or you’re not the best at accounting or finance, your other talents may come into play. For example, if you’re creative then you can make your own branding or design your packaging, or if you’re in the sciences then you can develop your product. All skills are important and any that you don’t have, don’t worry, you can outsource!”
Benjamina Ebuehi, former Bake Off star turned food stylist and cookbook author:
“Don’t pigeon-hole, limit yourself or talk yourself out if it. My career started out as a hobby but I never saw it as a full time career. I studied Economics at the University of Leicester and for years I probably wouldn’t have seen how that could help me, but now it has given me more of a business mindset when it comes to thinking logically, finances and accounting. Yes, I’m creative. But I’m quite comfortable with numbers too.”
Wilfred Emmanuel Jones, aka ‘The Black Farmer’, OBE:
“Audacity is the key to success. You can’t really achieve anything in life unless you are prepared to put it out there and ask for it. People used to look at me and thought I was bloody nuts when I told them the life I wanted to have but if you are focused and passionate and don’t give up then one day somebody will say YES!”
Sophie Meislin Baron, Founder of parenting brand Mamamade and full time mum-of-two:.
“Be positive by flipping your viewpoint. Learn to welcome people saying no. Each ‘no’ brings you a little closer to the next yes. Accept that failure may be an outcome. It is very possible. But it’s not something to fear. Learn to neutralise any failures along the way so that they don’t control you or stop you from achieving the next goal and appreciate everything that you learn along the way.”
Dr James Morehen, sports nutritionist to elite athletes and author:
“Have a plan! I sit down every year and write down my goals. One thing I had from a very young age was a vision. I knew where I wanted to get to. If you have an idea of how you want your life and career to look, then you’ll be much better placed to know what path, or even which stepping stones, you need to tread on to get there.”
Rhiannon Lambert, Nutritionist and Author:
“You’ll never stop learning. Get work experience, no matter your age. There is so much to take into account when starting your business. You have to quickly get comfortable dealing with finances and spreadsheets and be aware of income and cash flow. Don’t believe anyone who tells you it’s easy or an overnight thing. But don’t let anyone put you off either, you CAN do it!”