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National expansion serves up £50m turnover for The Alchemist

The Alchemist, a bar and restaurant concept famous for its theatrical cocktails, is on track to achieve revenues of £50m at the end of the financial year following a period of rapid national expansion.

Founded in 2010, The Alchemist originally set up in Manchester before opening its doors in Leeds and London. The company was backed by Palatine in May 2015 and the mid-market private equity firm has supported the management team, led by managing director Simon Potts, on its national roll out.

Since Palatine’s investment, The Alchemist has grown its portfolio of 15 venues, launching into regional cities including Liverpool, Oxford, Cardiff, Newcastle and Nottingham, as well as expanding its footprint in London. This has helped turnover increase four-fold from £11.3m at the time of the investment to the £50m that is forecast in the year to March 2020. Headcount has also jumped significantly during this time, from 200 employees to over 900.

The company launched its 16th venue in Shoreditch at the end of May, bringing the total number of sites in the capital to three. There are a further four sites in the pipeline: with Brindleyplace in Birmingham, Gunwharf Quay in Portsmouth, and Embassy Gardens and Canary Wharf in London agreed.

Alongside the national expansion of the brand, Palatine has supported The Alchemist’s environmental, social and governance (ESG) efforts. The firm helped implement the ‘Currency of Kindness’ programme, which allows employees to take paid-leave to volunteer for one of eight charities, resulting in over 500 hours of voluntary work contributed every month. The scheme has also helped The Alchemist secure a spot in the Sunday Times’ ‘100 Best Companies to Work For’ for the past three years.

Other initiatives include the ‘War on Straws’, which has helped prevent two million single use plastic straws going to landfill every year, and the ‘Pound on the Bill’ campaign, which raised £37,000 for 13 different charities during the winter months by adding a discretionary £1 contribution to every bill.

Simon Potts, managing director at The Alchemist, said: “Although we had a brilliant concept when Palatine first backed us, we only operated three sites. Working with private equity has really enabled us to achieve scale and build an infrastructure that supports a business of our size. Our growth has been very much down to identifying high performing sites across the big regional cities and establishing a presence in the capital, which has put the brand in front of an international audience. A global expansion has always been an ambition for the management team, and we will be targeting overseas opportunities in the next few years.

“Working with Palatine has been an incredible journey so far. They’re different to other investors in the way that they approach ESG initiatives and have helped us to create a sense of purpose within our business that both customers and staff are bought into.”

Gary Tipper, managing partner at Palatine Private Equity and non-executive director at The Alchemist, added: “Having a solid concept is one of the fundamentals in the hospitality sector. It’s not a case of just opening your doors – you need to have a proposition that the customer wants to engage with and that’s what makes The Alchemist stand out. The business has demonstrated its ability to buck the trend in an incredibly competitive marketplace and it is showing no signs of slowing down.”

Ashleigh Smith
Article by Ashleigh Smith
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