Monday, November 23, 2015

Anti-Merger Mania

I read this Fortune article this morning, which I found through Stone Brewing's twitter feed. It makes sense that Stone linked to the article, as Greg Koch, one of Stone's founders and its current executive chairman, has strong opinions on selling to mega brewers:
“M&A isn’t a term I use a lot. I think you mean ‘selling out,’” says Stone Brewing co-founder Greg Koch. “Some of us got into this for our passion … and wanting to fight ‘the man.’ Crazy as that may seem, there are some of us that may hold to that vision.”

Koch, who recently announced plans to step down as CEO to assume the role of executive chairman, vows he won’t sell Escondido, Calif.-based Stone, and that because of his public comments on the topic, he hasn’t been courted by big brewers or private equity firms. “They know my response would include the words ‘sand’ and ‘pound,’ ” he says.
Most corporations have a price at which they'll sell, but these are strong words. Stone understands that you cannot sell to a huge company, collect a big paycheck, and then expect to run your business as if you still own it.  

In a separate, but related story, Modern Times Beer, founded by Stone alumnus Jacob McKean, posted this humorous troll:

Modern Times' mindset is similar to Stone. 

Thursday, November 19, 2015

No Overnight Success

The $1 billion price tag for Ballast Point is still rattling through people's minds.  I'm sure every craft brewery is doing the math trying to figure a value for its business.  One thing everyone needs to remember is that Ballast Point is no overnight success.  It has been slugging it out, day after day, week after week, month after month, and year after year for nearly twenty years.  Newcomer breweries Saint Archer Brewery and Golden Road Brewing, which were recently acquired by MillerCoors and Anheuser-Busch InBev, respectively, owe their new fortunes to the hard work of breweries like Ballast Point, Stone Brewing, Karl Strauss, AleSmith, Port Brewing, and other craft beer pioneers.

The craft beer revolution did not find these brewers.  Their relentless efforts, innovation, and ultimately, great tasting, quality beers created today's craft beer revolution.  Formed in the wake of the 1980's craft brewpub collapse, they struggled through mid-1990s and early 2000s.   They did not compromise or pander to trends.  They proved to consumers that there is much more to beer than a thin, mass produced pilsners like Budweiser or a fancy European Heineken.  The shift in beer drinking didn't happen all at once,  Fifteen years ago most people had no idea what an IPA was, and if they tried one would have been shocked at its bitterness.  Today, IPA is the most popular craft beer style, and everybody wants a Sculpin.