Trio’s Pet Project
BusterBox founders return to Spark Crowdfunding as they look to grow their dog-treats business customer base, writes Kathleen O’Callaghan
The domestic pet market is worth an estimated €10bn per annum in the UK, while in Ireland pet owners shell out c.€400m million on pet products every year. Dog owners love their pets, and with this in mind BusterBox was established in 2016 to provide a dedicated monthly delivery service targeting dog lovers who have a budget to indulge their pooches.
For a tiered, online subscription, every month BusterBox subscribers are delivered a box filled with nutritional treats, novelty soft toys, dental chews as well as other pet paraphernalia to keep the average mutt happy.
The costs involved in this service are substantial. First there are the product costs, the fulfilment and shipping costs, and the general overheads associated with the enterprise. In addition, building out such a business requires substantial investment to bring BusterBox to the attention of the target market.
Founders Gary Redmond (31), Liam Brennan (32) and Paul Carrick (32) started the enterprise and 2016 and six years on they have yet to turn a profit. The abridged accounts filing for trading company Scoobybox Ltd discloses a net loss of €158,000 for 2021, bringing accumulated loses to €301,000. Recently the company has been endeavouring to raise €300,000 through Spark Crowdfunding, after utilising that source to raise €120,000 in September 2021. The price of the BusterBox equity being offered values the enterprise at over €3m.
Based on the company’s own figures, that valuation is speculative. The financials shown to potential investors on the Spark website disclose trading losses even as sales have increased. According to the company-supplied information, revenue of €1.96m in 2021 generated an EBITDA loss of
€242,000. For 2022, the forecast is for revenue to grow to €2.67m, with the loss reducing to €192,000.
The BusterBox financials shared with Spark’s investor community show operating expenditure increasing from €823,000 in 2021 to a forecast €1,420,000 in 2022. This suggests that customer growth is strongly allied to marketing spend. As the investment blurb explains: “We are currently held back by cash flow from accelerating growth rapidly. Monthly revenues can’t support a ramp-up in customer recruitment to 3,000 to 5,000 new subscribers per month.”
BusterBox claims a current subscriber total of 9,320. The company’s ambition is to increase monthly subscribers to over 30,000 in 2023, and with further exponential subscriber growth the venture would become strongly cash positive in 2024, its projections suggest. However, it’s also clear that ongoing cash infusions will be required to scale up the business to possible profitability.
The BusterBox trio, who hail from Malahide, Dublin, had their own dogs growing up and had a good idea of what sort of products and services are popular with the pet set. “We all owned dogs and are genuinely interested in looking after pets, so that helped us to create a healthy monthly treat box for the market along with additional pieces like cooling mats, beds and car seats,” explains Gary Redmond. “We looked at the success of subscription plans such as Barkbox in the US and saw there was potential for a similar plan in the UK and Ireland.”
Barkbox, publicly listed in the
US as Bark Inc, was established in 2011 and currently has c.2.3m active subscriptions. Bark has recently expanded out of dog toys and treats, and revenue increased by 34% to $507m in the year to Mach 2022. Bark’s net loss in 2021/22 was $68m and the company never seems to have made a profit. However, annual