Magmatic, the Bristol firm behind the successful Trunki kids’ ride-on suitcase, has received a £3.92m injection of growth capital from the Business Growth Fund (BGF), which has taken a minority stake in the company and a seat on its board.
The deal takes to £30m the total growth capital invested by BGF in the South West and South Wales, although Trunki is the first Bristol-based company to secure investment.
BGF’s investment will fund new product development, accelerate international sales and support development of t
he Trunki brand through above-the-line marketing.
The firm expects to create around seven jobs over the next year as a result of the investment, taking staffing at its Bristol head office to 37.
The former chairman of toy group Hamleys Stuart Rose will join the Magmatic board as non-executive chairman. Mr Rose, who is also a former managing director of The Body Shop, was introduced to the firm by BGF through its Talent Network.
Magmatic started trading in 2006 when designer Rob Law, pictured, launched its original ride-on suitcase product. Famously turned down by Dragons’ Den, the company now sells its products in 2,500 stores across the UK, as well as 97 countries overseas.
It is on track to sell its 2millionth Trunki soon and expects to achieve revenues of £10m this year.
Trunki has won a number of awards including the 2012 SME of the Year at the National Business Awards. Rob received an MBE for services to business in 2011.
The Trunki portfolio has steadily expanded and now includes the BoostApak (car seat/back pack), PaddlePak (water resistant character back pack), Travel ToyBox (ride on toy box), SnooziHedz (travel pillow and blanket) and a range of accessories. The company holds license agreements for Gruffalo, Moshi Monsters and Lotus.
Most of the company’s manufacturing is outsourced, although it acquired a factory (Magma Moulding) in Plymouth in December last year to supply its ride-on suitcase product in the UK.
Trunki is a market leader in the UK and significant growth opportunities for increased product sales exist overseas, particularly in China, Japan, Germany, France and India.
Rob Law said: “We’re delighted to have BGF as a partner to help rapidly grow our business and enable us to build Trunki into a truly global travel brand for children’s travel gear.
“The fundraising process attracted high level of interest and offers from some significant private equity investors. It was hugely rewarding to see Trunki – a company which I and my team have created – so highly regarded. BGF’s long-term view with no stipulations over exit and access to their talent network was instrumental in my final decision making process.
“We believe travel is about new experiences, creating memories and making every journey just as enjoyable as the destination. With BGF on board, we can deliver more products to a wider global demographic more quickly and smoothly ensuring parents and children can get set and go on any adventure.”
BGF regional director Paul Oldham added: “Trunki has pioneered a new children’s travel product category and over the last seven years has very successfully developed its position as the UK market leader. Rob and his team have recognised that there is a real opportunity to grow the business further by expanding its range of unique products and by exporting them to overseas markets. They have sought our help to accelerate this and we are delighted to be working with them as a partner and minority investor.”
HSBC’s Bristol and Bath commercial team has separately provided a comprehensive finance package to support Magmatic’s growth and which marks the start of a new banking relationship with HSBC.
Nick Stork, HSBC Bristol and Bath Area commercial director, said: “Trunki has an innovative product range, a strong management team and a clear strategy for future growth, including overseas expansion. It is exactly the type of company we are keen to support at HSBC and I look forward to working with Rob and his team in the coming years.”
BGF’s investment team included Paul Oldham, Ned Dorbin, Alex Garfitt, Edwin Davies and David Colclough.
The advisers to the transaction were:
Trunki: Corporate finance – Shaw & Co. (Jim Shaw, Alastair Halcrow and Myles Hamilton), legal – Veale Wasbrough Vizards (Nathan Guest and Omar Srouji), tax – KPMG (Simon Jones and Martin Flanigan)
BGF: Financial due diligence – PwC (Tom Ayerst, Christopher Tilley and Mark Comer), legal – Burges Salmon (Richard Spink and Claire Porter-Bryant)
