The Growth Capital investment, available through Santander’s Breakthrough programme, provides mezzanine-based finance at a low rate which helps bridge the gap between angel and equity investment.
Chaophraya, which currently has restaurants in Leeds, Liverpool, Manchester, Sheffield, Birmingham and most recently Glasgow, has secured £2.4 million of growth capital to open a new restaurant in Edinburgh in November as well expanding the Leeds restaurant and opening another new site at the start of next year. Each new site will create about 30 local jobs as well as having a knock-on effect on the supply chain.
The first Chaophraya restaurant was opened in Leeds in 2004 by the company owners Martin Stead and Kim Kaewkraikhot. The restaurant’s authentic Thai food and focus on service and the customer experience was an immediate success and Martin and Kim have since rapidly grown the business. This has included branching out with the “ChaoBaby” brand which is designed specifically for shopping centres. There are currently ChaoBaby restaurants in the Trafford Centre and in the Meadowhall shopping centre.
Martin Stead, CEO at Chaophraya, said: “We have been steadily growing our businesses since establishing our first restaurant eight years ago. The quality of our dishes and the overall “Chao experience” has meant that our customers have not lost their appetite for eating out despite the difficult economic conditions over the past few years.
“Our aim is to take the Chao experience to as many cities as possible but we had reached a stage in our lifecycle where accessing further finance to invest had become problematic. However, Santander’s growth capital investment enables us to borrow against our future success without having to give up a slice of the business. It’s great to see a bank thinking outside the box to create something this innovative.”
Steve Pateman, Santander UK’s Head of Banking, said: “We are delighted to have been able to invest in Chaophraya. Martin and Kim have a great business model and have developed an excellent and well respected brand. Their exceptional growth story is testament to their strong management skills, hard work and customer centric approach – and it is these characteristics that make Chaophraya an excellent fit for the Breakthrough programme and our Growth Capital Fund. I look forward to following their story and seeing where the next stage of their journey will take them.”
The Growth Capital loan is part of Santander’s Breakthrough programme which aims to support fast-growth small businesses to help them accelerate their growth potential. As well as funding, Breakthrough offers companies access to trade missions, business masterclasses, networking events and support in areas such as finance and marketing.
Chaophraya also benefitted from a marketing masterclass with TEAM Saatchi to learn first-hand how marketing can help boost sales and support growth. The session, organised by Breakthrough, took 13 small companies to Saatchi & Saatchi’s head offices in Central London to take part in a range of individual workshops and group sessions delivered by TEAM Saatchi experts.
Attendees were given the opportunity to develop their core brand positioning and create a marketing and communications strategy to help them fulfil their growth plans.
Martin added: “The Masterclass with Saatchi was a great chance for us to hear from industry experts and actively engage with them about particular challenges affecting our company. Meeting other businesses during the day also proved highly beneficial as we were able to discuss lots of inspirational ideas and different perspectives.”
Chaophraya will also benefit from a graduate intern through Santander’s new internship programme, launched in collaboration with Santander Universities and its 58 university partners. The programme, which will place 500 university graduates in placements with SMEs, aims to encourage entrepreneurialism and promote the benefits of working for an SME amongst graduates, whilst also providing smaller businesses with an injection of talent not always easy to obtain by companies with limited administration resources.
Chaophraya was advised on this deal by Yorkshire-based accountants Garbutt & Elliott.
Garbutt & Elliott’s Managing Partner Russell Turner said: “Chaophraya’s growth and success to date has been amazing. Martin has developed a business model that is based on quality, attention to detail and focuses on maximising customer experience. We’ve worked closely with Martin to fine tune the business model and develop a roll-out strategy that is manageable and properly funded. Having an in-depth knowledge of Martin’s business and his goals is key to giving valuable advice, especially during these challenging economic times”.