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How the Seven Bro7hers Brewery has thrived during COVID-19

4 August: With a combination of grit, determination and some judicious funding decisions this Manchester-based craft brewery has kept moving forward through COVID-19.

SEVEN BRO7HERS BREWERY was created by seven siblings trying to navigate the complicated world of craft beer, with the thought that, “there must be a better way”. Each brother brings a different, unique talent to the business. The brewery, founded in 2014 by McAvoy brothers, Guy, Keith, Luke, Daniel, Nathan, Kit and Greg, is based on a love of beer that was inspired by their dad’s home-brewing efforts. 

The business has grown year on year, achieving growth of 53% in 2019 and they’ve seen a 181% increase in turnover since 2017, with 2019 revenues reaching £2m. 

Pivoting to online retail

Before COVID-19, Seven Bro7hers beers were sold in two of the brewer’s own Manchester-based Beerhouses, as well as across selected UK retailers and bar groups. Just 20% of the brewer’s revenues at that time came from online sales – but during lockdown, this rose to almost 100%.

CEO Keith McAvoy worked closely with the group’s financial controller throughout this process – not only reinventing the business model but actively exploring government funding options such as CBILS and BBILS, as well as continuing with a planned crowdfunding round through CrowdCube.

McAvoy insists that whilst the government funding process through the British Business Bank was challenging, it was a game-changer for the survival of his family’s brewery business.

“Our financial controller left no stone unturned in the bid for grants, loans, VAT deferral and furlough support, and it wasn’t a simple process,” he says. “We qualified for CBILS support (which we eventually decided against in favour of BBILS, because of the more favourable terms) and the business rate grants, which put us back into a healthy position to build our e-commerce business, and to support our closed Beerhouses through the crisis”.

Looking forward

The Seven Bro7thers Brewery is a business built on core values of simplicity, transparency, locality and family. 

According to McAvoy, “We believe we are on our way to becoming one of the UK's go-to breweries. In 2016, we began opening bars across the city and having proven our Beerhouse concept we’ve now secured a third site in Liverpool. Site number four, in Leeds, is under negotiation. We also have the opening of our partnership bar at Manchester Airport in October this year to look forward to. This is a ten-year deal.”

The family business has planned a further four Beerhouses, with each site aiming to become a go-to venue over the next two years

“We believe that the Brewhouse concept has a bright future,” continues McAvoy. “We’ve increased capacity by over 800% in five years, and yet still can't meet demand. We’ve secured deals with Co-op, we supply all Booths stores and we recently signed a deal with Ocado.”

Crowdfunding success

The business was established in 2014 when the brothers received initial funding of £45,000 through British Business Bank’s Start Up Loans company. They subsequently secured a further £628,700 of investment from 1,170 investors through crowdfunding, which allowed them to open their second bar.

This success firmly established crowdfunding as the direction the brothers would take to fund their new bar openings in 2020 and 2021.

Whilst COVID-19 has provided setbacks in many, many ways, the brothers are delighted that their Manchester Beerhouses have now reopened, with an app for table ordering and other innovations designed to keep customers safe and comfortable socialising once again.

They launched their second crowdfunding capital raise during lockdown. Initially shared only with their existing investors, the brothers then opened the offer to the CrowdCube community in the final weeks. The brothers raised £426,274 from 952 investors, representing a huge overfunding against their modest target of £50,000.

Nothing if not ambitious, the Seven Bro7hers aim to procure six new Beerhouse sites in the next two years and to expand production capability to 2 million litres per annum. 

We leave the final word to business CEO McAvoy: “This all means a huge few years ahead of us, and with a proven track record of high growth, we’re extremely confident that we can make everyone who joins our family proud of their investment.”

Find out more about the Seven Bro7hers journey in this new article featured on The Business Finance Guide, the UK’s only truly independent guide to business finance, brought to you by ICAEW in conjunction with The British Business Bank.

Get more information on support for the continued provision of finance to UK businesses during the COVID-19 outbreak here.