Tag Archives: Innis & Gunn

Fanboy investors put £50m into UK craft breweries: but is that money down the drain?

A total of £50m has been raised in the UK over the past four years in crowdfunding efforts by more than 40 different craft breweries, and half a dozen craft beer retail operators who have tapped tens of thousands of – overwhelmingly male – investors.

More than half the money raised went to just one company, BrewDog, the maverick Scottish brewer, recently valued at almost £1 billion, but other big beneficiaries of the remaining £23 million raised include Chapel Down Group, owner of Curious Brew, which gathered a total of £5.66m; Camden Town Brewery in North London, which raised more than £2.75 million from 2,173 investors via Crowdcube before being sold for £85 million to the international giant AB Inbev in December 2015; Innis & Gunn of Edinburgh, which raised £2.2 million from almost 1,800 investors; and the Wild Beer Company of Somerset, which brought in £1.8m from just over 2,000 backers.

The money is continuing to roll in: Redchurch Brewery in East London recently closed its second fundraising drive through the crowdfunding platform Crowdcube, raising another £433,000 from 688 investors to add to the £497,000 it brought in last year. Also on Crowdcube, The BottleShop, a craft beer importer and distributor with, currently, three bars of its own and plans for more, has just closed its own equity crowdfunding campaign with £403,000 in funding from more than 380 investors

Top 10 UK brewery crowdfunding efforts

But how many of those investors will ever see a decent return on their money, other than the warm glow of owning a small slice of the maker of their favourite beers? With three quarters – 18 out of 25 – of the companies involved for which financial records have been published reporting losses for their last financial year, the answer is likely to be: “Not many, and even then, not for quite a while”. The UK’s financial watchdog, the FCA, warns in the section on crowdfunding on its website: ” It is very likely that you will lose all your money. Most investments are in shares or debt securities in start-up companies and will often result in a 100 per cent loss of capital as most start-up businesses fail.” Earlier this year the Guardian quoted figures from the Insolvency Service showing that 19 drinks manufacturers went sternum to the sky in 2014, 23 in 2015 and 24 in the first nine months of 2016.

Continue reading Fanboy investors put £50m into UK craft breweries: but is that money down the drain?

Best-selling business advice from a BrewDog

As the only beer writer on the planet with an MBA (probably), it falls to me to give a business school-style review on behalf of beer drinkers to Business for Punks, the just-published “how we succeeded and how you can too” guidebook from BrewDog co-founder James Watt.

Not that any review is likely to make much difference to the book’s popularity: it is already the number-one best seller in the “entrepreneurship” section of Amazon’s UK website, and in the top 350 best-selling books on the site overall, despite only being published last week. The book, it appears, is as popular as the beer.

Thanks, James we get the idea
Selling like hot … um … ale … James Watt and book

Business manuals from stars of the American craft brewing scene have been popping up like mushrooms in the past few years: Ken Grossman of Sierra Nevada, Steve Hindy of Brooklyn Brewery, Sam Calagione of Dogfish Head, Tony Magee of Lagunitas, Steve Wagner and Greg Koch of Stone Brewing and Jeremy Cowan of Schmaltz have all written books about how they started and grew their businesses, Calagione has a second book out in December, Off-Centered Leadership: The DogFish Head Guide to Motivation, Collaboration and Smart Growth, and Jim Koch, founder of Samuel Adams, has his “how I did it” book out in April 2016 .

Britain’s craft brewers have been slower to get their experiences on paper: maybe they’re too busy brewing. It’s not as if we lack an audience for how-to-be-a-successful-brewer books: large numbers of people apparently want to brew commercially. Some 200 new breweries have opened in the UK in the past 12 months, and the country now has more than twice as many breweries per head as the United States: 1 to 38,000, against 1 to 80,000. More likely, we lack the “superstar” brewers that the US has, people whose name on the cover will attract the buyers. I doubt that Watt wrote the book and sought a publisher: much more likely that someone at Penguin Random House approached Watt with the idea

Watt, of course, and his fellow founder of BrewDog, Martin Dickie, are among the very, very few candidates for “star brewer” in the UK. More than 6,000 people turned up to BrewDog’s annual general meeting in Aberdeen in June. Six thousand people. In Aberdeen. Admittedly this is not so much an AGM as a beer festival-cum-love in, with something on the order of 40,000 pints of beer consumed. But there isn’t another brewery in Britain that could hope to attract that level of support. And as Pete Brown once pointed out, when even his Stella-drinking mother in Barnsley has heard of BrewDog, you know you’re looking at a powerful brand.

So: what’s Watt’s book like?

Continue reading Best-selling business advice from a BrewDog

The woodbegoods

There’s an odd feeling, like you’re doing something slightly illegal, when drinking and discussion beers that would have been poured down the drain by every generation of brewers before this one for being irredeemably faulty. But 21st century brewmasters have discovered the flavour found in wood, and declared it good.

Unlike wine-makers, especially many white wine makers, and distillers, especially whisk(e)y distillers, brewers who have used wooden fermenting vessels and wooden casks always made it an axiom not to have any influence from the wood apparent in their beers. Wood flavours were fine in chardonnay, or scotch, but not in IPA or porter.

Oak for casks, vats and brewing vessels was sourced from places such as Russia and Poland that were known for growing wood that would not impart any flavours to the beer. Casks were lined with “brewer’s pitch”, vats were scrubbed down so that when stock ales, porters and stouts were being matured in them, no tang of the timber would come through into the beer. Once fermenting vessels began being lined with metal, and steel and aluminium casks came in, wood flavours disappeared as a worry.

The introduction of wood flavours as a desirable characteristic, in the UK at least, was a serendipitous discovery springing from the wish of the Scotch whisky distiller William Grant in 2002 to add to its range of “cask reserve” whiskies, all finished off in casks that had previously held other alcoholic drinks, such as sherry or rum. Grant’s wanted a beer to fill casks with and enable it to make “ale cask reserve” whisky once the beer had been emptied out.

Dougal Sharp, then of the Caledonian brewery in Edinburgh, designed a malty, estery, sweet, not very hoppy beer he and Grant’s felt would give the casks a good foundation for maturing whisky in. The beer was aways meant to be thrown away once it had been in the casks long enough to impart flavour to the wood that could be absorbed subsequently by the whisky. But workers at Grant’s distillery sampled the beer, and liked the oaky, vanilla flavours it had picked up from the new wood so much that instead of disposing of it they started taking it home …

Intrigued, Sharp tried putting the beer into a blind tasting at the brewery, where it scored a consistent nine out of nine with the tasters. The “tweaked” version of their original brew for Grant’s that Dougal and his father Russell launched in 2003 as Innis & Gunn Oak-Aged Beer has been so successful subsequently it has effectively launched a completely new category in the UK marketplace – wood-aged beer.

Which is why I was at Thornbridge Hall in Derbyshire last Monday for the Zythographers’ Union’s latest seminar, tasting different styles of beers aged in different ways in different types of cask, and listening to Garrett Oliver of the Brooklyn Brewery, John Keeling of Fuller’s in London and Dougal Sharp himself talk about their wood-aged beer experiments and experiences.

Continue reading The woodbegoods