Lancashire firm Oato is celebrating a landmark year of double-digit growth and the sale of over 30 million pints of Oato, a plant-based dairy alternative.
Oato’s impressive growth journey began in 2021 when it secured funding from the first Northern Powerhouse Investment Fund (NPIF), through FW Capital. This was used to assist the development of their bottling plant in Preston. Fast forward to today and Oato have repaid the loan in full and achieved double digit growth on the back of winning major contracts with leading UK supermarkets including Sainsburys, Tesco, Ocado and Waitrose as well as nationwide network of independent milkmen and a regional presence with local retailer Booths.
Oato was founded in 2019 by Carl Hopwood, who studied chemistry at Edinburgh University and was inspired to develop a fresh barista-grade oat-based dairy alternative to challenge the existing long-life and UHT products on the market. A cornerstone of Oato’s success has been its revival of the traditional milk round. It has created a fresh oat-based product delivered in reusable glass bottles via a nationwide network of Milkmen , helping the brand to distribute over 30 million pints since its inception. While almost all other oat dairy-alternative brands on offer are UHT, Oato is fresh and manufactured using 100% British oats at a solar-powered production facility in Preston, supporting the local economy while minimising its carbon footprint.
Carl Hopwood, Founder of Oato said: “Our journey over the last six years has been fantastic. We set out to create a product that didn't compromise on quality, freshness or the environment. Seeing Oato move from local doorsteps to the shelves of leading supermarkets is a testament to the quality of our product and the loyalty of our customers. We’ve created a product that does not compromise on taste or quality offering a creamy, fresh and tasty dairy-free alternative. FW Capital backed us at the start, and their investment allowed us to set up our own bottling plant in Preston. Today our products are available in 1000s of national supermarket stores, with 30+ million pints of Oato sold.”
Alistair Igo, Portfolio Executive at FW Capital added: “Success stories like Oato are a great example of the innovation and ambition we have across the North West. Having access to the right funding at the right time can make all the difference and I continue to be impressed by Oato’s growth trajectory.”
The British Business Bank has now launched the £660m Northern Powerhouse Investment Fund II (NPIF II) and FW Capital manage NPIF II – FW Capital Debt Finance, providing loans in the NPIF II area with a primary focus on the North West regions of Cheshire, Cumbria, Greater Manchester, Lancashire and Merseyside.
Sue Barnard, Senior Investment Manager at the British Business Bank said: “Oato’s success highlights the strength of the North West’s manufacturing sector and the long-term impact of targeted investment. As a business producing innovative, British-made products at scale, Oato has built a strong position in a growing market while creating jobs and supporting economic growth in the region. We’re continuing this work with the Northern Powerhouse Investment Fund II, ensuring Northern businesses can access the capital they need to scale and grow.”
The £660m Northern Powerhouse Investment Fund II (NPIFII) covers the entire North of England and provides loans from £25k to £2m and equity investment up to £5m to help a range of small and medium sized businesses to start up, scale up or stay ahead.
The Northern Powerhouse Investment Fund II will increase the supply and diversity of early-stage finance for the North’s smaller businesses, providing funds to firms that might otherwise not receive investment and help to break down barriers in access to finance. FW Capital will provide debt finance options from £100,000 to £2million to businesses based in the North West of England, with some flexibility to lend across the North.
