New better burger concept seeks funding; question mark over valuation: A new better burger concept, Artisan Burger Company, is seeking seed-funding to open four sites offering handmade gourmet burgers, hand-cured salt beef and slow-cooked pulled pork burgers combined with craft beer and artisan cider before starting to franchise the concept. The company has launched a fund-raising drive on crowd-funding website Crowdcube, raising £35,360 of the £240,000 it seeks in return for 15% of the equity. But at least one would-be investor has raised a question mark over the current £1.6m company valuation. Artisan Burger Company was established in January 2013 and acquired a food truck to build brand awareness and test product by attending a number of food festivals across the UK. The trial period has allowed the company to improve recipes, create sauces and receive instant feedback from customers. The company is now ready to enter into the second phase of development for its scalable concept with an initial plan to roll-out four sites across London - and within two years will enter into a franchise model to expand across the UK. The first site is planned to open in April 2014 (subject to planning and funding). Profits will be reinvested into the business to fund growth. The company plans to open a further 41 sites across the UK via a franchise model, splitting the UK into geographic areas and is currently in discussions with a number of franchise operators with regards potential franchisee partners. Founders are Alan Berry and Rav Singh. Berry will become operations director, responsible for the day-to day-operations and menu development. Singh will become managing director and finance director. The directors expect to exit the business after five years, the most likely scenario either a trade sale or a sale to a master franchisee. The company’s pitch states: “We are passionate about food, we are passionate about the provenance of our supply chain and we are fanatical about guest satisfaction. We believe we can offer a new perspective to the gourmet burger market. Artisan are passionate about provenance, we aspire to make sure the ingredients we use are sourced from local artisan producers, so only the best, freshest and tastiest ingredients are delivered to guests. Artisan plans to offer handmade signature dishes of gourmet burgers, however unlike many of the competition will also offer hand cured salt beef and slow-cooked pulled pork burgers all featuring the ‘umami’ touch, we aim to combine this with craft beer and artisan cider. Gourmet versions of authentic street food classics have sprung up in the teeth of a recession and people in London are queuing for two hours as restaurants refuse to take bookings. Demand for quality concepts has captured the minds of savvy investors; this is backed up by a recent study carried out by BDO which comments on the renaissance in burgers and quality fast food which has given the mergers and acquisitions market the confidence to invest in the UK’s restaurant and bars sector.” One would-be investor tells the founders on the Crowdcube noticeboard: “The company is valued at £1.6m without any restaurant open. I had a look at your projections and they forecast an operating profit of 300,000 for the year 2016-2017. I doubt that your company would command a similar multiple to Byron. 8x to 10x EBIT would be more appropriate. That would give, if everything goes to plan, a valuation between £2.5m and £3m. It seems that the upside is quite small compared to the risk taken and the saturation of the market.”

McMullen lets Baroosh site to Five Guys: Hertfordshire brewer and retailer McMullen has let its Baroosh freehold bar site in Uxbridge to better burger brand Five Guys on a 15 year FRI lease. The Baroosh will cease trading today. “The bar has traded profitably since its purchase 12 years ago but the property is not meeting its potential and it is felt that a different concept is better suited to the local market,” said retail director Heydon Mizon. “Many of our team will be offered positions elsewhere should they wish to relocate.” McMullen stated it will continue to invest in its estate as a whole, build new pubs and seek out quality acquisitions, including other appropriate high street sites for the successful Baroosh concept.