Aussie wine legend Vinomofo has just closed a record $25 million funding round aimed at supporting domestic growth and international expansion.
Online wine retailer and all-round legend Vinomofo has completed its first capital raise. The company secured a record $25 million from Blue Sky Venture Capital to support domestic growth and help fund its international expansion plans. The deal represents the largest funding round secured by an Aussie start-up from solely Australian backers.
In January, Vinomofo announced it would be expanding into a range of international markets, rolling out a Vinomofo Lite offering. Co-founder and joint CEO Justin Dry outlined the expansion plans, explaining that the company would use a broad, low-risk strategy to seed multiple markets — including New Zealand, the UK, US, China and Singapore — before committing to a deeper market penetration.
While the initial expansion plans were to be internally funded, Dry didn’t rule out a capital raise.
“If we do start seeing traction in multiple markets, which we assume we will, then we may need to do a raise or something to fund that,” Dry told Power Retail.
“We already have a lot of interest in that space. There’s always conversations happening, so it wouldn’t be a long turnaround for us, but nothing yet is signed, sealed and delivered.”
Well, it appears that it has now been signed, sealed and delivered.
Vinomofo co-founders and joint CEOs, Andre Eikmeier (left) and Justin Dry (right).
Andre Eikmeier, co-founder and joint CEO at Vinomofo, says the funding will enable rapid scale for the business upon a proven and robust model, both locally and abroad.
“Vinomofo wants everyone to be able to experience good wine — that’s our mission. From what we’ve seen across the past five years in Australia, we believe that a lot of people all over the world need Vinomofo — wine lovers and makers alike, and this investment is going to help us bring our vision to life.
“Vinomofo has achieved 100 percent YoY growth for the past 12 months; we’re on track this financial year to surpass $50 million in annual revenue, and now it’s time to take our offer to the next level in Australia, and to the world,” Eikmeier said.
The company will look to expand its Australian profile and operations by using a piece of the funding to increase investment in marketing.
“We just have so much growth left here. So many people here still don’t know us, and that is feedback we get all the time, so we think it’s time that we try to reach everyone,” Eikmeier told the Australian Financial Review.
Elaine Stead, investment director at Blue Sky Venture Capital, says Vinomofo demonstrates the performance qualities sought by the fund.
“Vinomofo is a great expression of the quality of deals that come through our doors. In just five years, Andre and Justin have built a cracking business with huge scope to scale globally, which is where we come in.
“This is why we have started fundraising for a $200 million fund, as we are now coming across companies that need at least $20 million to execute on their expansion plans,” Stead said.
For Vinomofo, choosing the right backers was essential. Culture has always been a key feature for Vinomofo. “We have to live and breathe our values,” Eikmeier told Power Retail.
According to Eikmeier, Blue Sky Venture Capital has not only a good track record, but shares a similarly strong human culture, and therefore is the right funding partner for Vinomofo.
“We certainly haven’t rushed into this decision to raise. We’ve valued our independence, and our culture is at the heart of what we’ve built. When it became clear to Justin and I that a raise was the right thing to do strategically, finding the right partner was paramount, and Blue Sky emerged as a clear fit.
“We’re also really proud the entire raise was funded here in Australia, with an Australian partner. It’s a good sign for the future of our start-up and growth company ecosystem,” Eikmeier said.
While it hasn’t been revealed what percentage of the business Blue Sky has taken, it will be a minority shareholder, with Eikmeier and Dry remaining majority shareholders.
Founded in an Adelaide garage in 2011 by Dry and Elkmeier, Vinomofo has grown rapidly taking the Australian wine retail industry by storm. Vinomofo was named Best Brand Builder at the 2016 All Star Bash, and took out three ORIAs last year, including 2015 Online Retailer of the Year.