Since the end of 2019 up to and including May 2020, I have held my position in Mindful Chef via the Seedrs Secondary market greatly expanded and I am now invested in four figures. In this case, I think it's actually true that you can still buy startup shares at a price from the past - while the startup has evolved significantly. The current share price of £0.42 per share is loud Seedrs from December 2018, so more than 1.5 years old. Companies House (the UK business register) reveals through Mindful Chef that the startup made a loss of around £1.6MM for the fiscal year ended 2018. A May 2020 Financial Times article put the company's turnover at £16MM a year. The company's rating Seedrs (based on the current share price of £0.42) is quoted at £23.3MM. Thus, the price-to-sales ratio is less than 1.5. Really cheap in my opinion. Especially when you consider that the Financial Times article mentions that the number of customers has increased by 450% since the end of March. I do not assess the exact percentage in more detail, since inaccuracies compared to reality can be found too often in the press. What is certain for me, however, is that annual sales should total over £35MM by the end of 2020 due to assumed growth (doubling annually) plus corona effects. So at the end of the year, based on the current valuation, we would have a turnover multiple of less than 0.7x (valuation 23.3MM with turnover 35MM). An absolute snapper from my point of view. With others Seedrs Startups are often called up with sales multiples of more than 10 (e.g. 1MM annual sales and 12MM company valuation).
VC participation & search for new funding
In 2019, English venture capitalist Piper took a stake in Mindful Chef with an investment of £6MM. This was done at the same valuation as it was now possible to buy on the Seedrs secondary market in May 2020. This means that the concept and the team have additional credibility for me, since Piper certainly carried out a detailed due diligence (examination of the company) in his own interest before the investment. Additionally reported The Grocer also in May 2020 that Mindful Chef is currently planning a new round of capital and is looking for £25MM funding for this.
My conclusion on Mindful Chef
In my view, the opportunities clearly outweigh the risks. Should the new funding round of £25MM be successful, investors can expect the share price to roughly double or triple in the short term. Being able to invest in 2020 for the evaluation of 2018 is a real stroke of luck for this startup, which is developing very successfully. Of course, as always, there is also the risk of insolvency and thus a total loss of the capital invested.