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Castore has raised roughly £150mn from a trio of investors, boosting the British premium sportswear maker’s firepower as it looks to expand its brand on the global stage.
US merchant bank and investor The Raine Group led the funding round, said Castore on Thursday, backed by New York and Tel Aviv-headquartered Hanaco Ventures and venture capital firm Felix Capital.
The fundraising, the largest in Castore’s history, values the company at £950mn after taking the new money into account, according to a person with knowledge of the matter.
Castore is looking to accelerate its growth in global sport following a wave of sponsorships with elite teams across football, Formula One motor racing, cricket and rugby.
“We’ve now got 50, give or take, team partners around the world,” co-founder Tom Beahon told the Financial Times. “We’ve proven that we can help them grow their merchandise revenues. We offer those guys something that Nike, Adidas, Puma are not able to . . . We genuinely can take that next step and try and become a truly global brand.”
The 34-year-old started Castore in 2016 with his younger brother Phil, driven by the “entrepreneurial intuition” that there was an opportunity to serve teams outside of the Real Madrids and Bayern Munichs of this world.
The fundraising demonstrates the company’s evolution since the brothers’ parents remortgaged their home to provide start-up capital. The Beahon brothers remain Castore’s largest shareholders.
Castore makes kit for elite athletes but also operates online stores for some of the world’s biggest sports teams. The company competes against larger rivals such as Adidas and Nike but also the likes of US billionaire Michael Rubin’s Fanatics, an ecommerce group valued at $31bn last year.
Beahon said the money could help Castore as it seeks to help teams connect with fans and increase merchandising revenues, as competitions such as the English Premier League and F1 grow in popularity around the world. He also has his eyes on new partnerships in markets such as the Americas and the Middle East.
Castore has opted to remain a private company rather than list its shares.
“The private capital markets have clearly evolved significantly in the last decade, which gives entrepreneurs and founders a genuine alternative to the public markets,” said Beahon.
“Whilst I would never rule anything out — there may well be a time that floating is the right option for us — we do think that for now having private shareholders gives us . . . the ability to think longer-term, which is really important, rather than in quarterly increments,” he added.
Castore, which has created more than 500 jobs, predominantly in the north of England, is a “proudly British brand”, but Beahon warned that the US seemed a more hospitable environment than the UK for entrepreneurs.
“There’s an excitement, there’s an ambition, there’s a willingness to want to help entrepreneurs that I think it’s fair to say in recent years hasn’t necessarily been the case in the UK, which is a real shame,” said Beahon.
Castore has collaborated with Scottish tennis star Sir Andy Murray, an early shareholder, on the AMC range; entered football through a tie-up with Scotland’s Rangers FC; and established a presence in the English Premier League through the likes of Newcastle United. It also has partnerships with McLaren Racing and F1 champions Red Bull, the England cricket team and German football league leaders Bayer Leverkusen.
However, the company’s growth has raised expectations and scrutiny, including criticism that the kits it provided to Aston Villa football club retained sweat and water, inconveniencing the players.
“Whenever you’re dealing with elite athletes as Castore does, there are always challenges,” said Beahon. “We responded really quickly to that challenge. We hopefully solved it very quickly, hopefully a lot quicker than our larger competitors would’ve been able to.”
A person close to Castore said the company expected to generate more than £200mn in revenue and more than £35mn in earnings before interest, tax, depreciation and amortisation in the financial year to the end of January 2024. It reported ebitda of £16.6mn on revenue of £115mn in the year ended January 31 2022.
Early backers included New Look founder Tom Singh. Mohsin and Zuber Issa, the owners of Asda, also own a stake.
Additional reporting by Laura Onita and Arash Massoudi
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