Shares in online mattress brand Eve Sleep soared higher on Thursday as the company signalled a move away from heavy marketing and kicked off a fundraising plan.
It comes a few months after co-founder Jas Bagnieowski abruptly left the company, as Eve admitted its strategy of expanding quickly overseas had not met expectations.
New CEO James Sturrock has now completed a review of the business and plans to focus on building deeper relationships with customers in the core markets of France, the UK and Ireland.
To fund the plans, Eve will raise £15 million of new equity. The company said it has already received support from existing shareholders at a price that is “significantly” higher than the share price.
Shares hit a high of 18.9p in early trading, a 30% rise. In mid-morning trading, the share price was 8.6% higher at 15.75p.
Eve has an exciting future aheadJames Sturrock, CEO of Eve Sleep
As part of the shift, Eve will invest in widening its product range and improving customer service rather than using high levels of marketing to drive one-off purchases.
Underlying revenues for 2019 will therefore be below current expectations.
Mr Sturrock said: “While we have revised our short-term growth ambitions during this period of consolidation and investment, we anticipate a marked improvement moving into 2020 and beyond.
“Eve has an exciting future ahead and we look forward to putting the business on a stronger footing and establishing Eve as Europe’s leading sleep and well-being brand.”
A new chief marketing officer is to join the company at the end of the year to lead a strategy of lower investment and concentrating on partnerships, PR and digital marketing.