In a fizz

The purveyor of “premium carbonated mixers for spirits”, founded in 2005 by Charles Rolls and Tim Warrillow, is backed by Lloyd’s Bank’s buyout arm LDC. This company has managed to do something that few before them have done: identify something that Brits are spectacularly bad at, and then profit from it.

Order a gin and tonic in a British bar and you’ll soon see what First Round is on about. What’s with the whole DIY element? First Round asked for a G&T, it did not ask to construct its own cocktail from a rather ungenerous portion of oily liquor, a tired-looking lime wedge and a bottle of tonic.

Which is where Fever-Tree comes in. Why try to change the ineptitude of the British bartender? Make bar-goers relish being handed a sweating, freshly popped bottle with their shot of the hard stuff by making it high end.

And Fever-Tree has certainly perfected the “premium” lingo. According to its website, it sources the “highest quality quinine” from the Rwanda-Congo border and then blends it with “spring water and eight botanical flavours.” The extra fizziness comes from “small ‘champagne’ bubbles” that give a “smooth, delicate texture”. So far, so five-star.

The company doesn’t just talk a good game either. It recorded average annual revenue growth of 54 percent between 2009 and 2013. Fever-Tree began trading on AIM in early November with a placing price of around 134 pence per share and a market capitalisation of £154.4 million. Within the first few hours this had bubbled up to £195.91 million, or 170 pence per share.

And shares are still fizzing. At time of writing Fever-Tree had a market cap of £208 million.

Perhaps there is something in this “mix your own” malarkey.