Earlier this morning, sister publication CBD reported that Harpoon vet Rich Doyle has started a private investment fund-backed venture to offer resources to growing craft brewers. Dubbed “Enjoy Beer,” its “Founding Brewery Partner” is none other than New Orleans’s 160,000-barrel Abita (whom the rumor mill had been marking for a deal for some time; they recently completed a $30 million expansion to take them to 400,000 barrels capacity).
Enjoy Beer’s private investment firm is San Francisco-based FFL, which manages more than $4.5 billion in assets and has made investments in more than 30 businesses to support their growth strategies. The firm reportedly has “more than 15 years of experience supporting growing businesses by partnering with strong management teams, providing capital and offering operational expertise,” per announcement released this morning.
We got Rich on the horn to tell us more details about the interesting new venture, which entails the probability of eventually going public. That’s “not just a goal,” Rich told BBD. “It’s the way that an organization like this can come together and avoid from having to sell to a strategic [partner]. That’s why it’s important.”
ON HOW THEY CAME TO TALKS WITH FOUNDING BREWERY PARTNER, ABITA. “I’ve known David [Blossman, Abita chief] for a long time; we served on the BA board together,” said Rich. “I’ve known him since the ’90s. When I was in New Orleans, I’d come out and see the brewery. So I think that’s one thing.”
But then “toward the end of last year, it became apparent to me that a lot of things were happening pretty quickly in the industry. There were craft brands that were finding dance partners, so to speak. … So, I had this concept of what I wanted to do. Then I met the FFL people, and they are ideal partners for what I wanted to do: They’re growth-oriented, well capitalized, operationally focused. They add a lot to the party. And I really liked them. And they supported my ideas 100%.
“So the combination of sort of having that piece of it, and realizing that I better get going, I picked up the phone and started to talk to people. Sorta like, ‘hey I just want to make sure you know this option is available so you don’t start dancing with someone else … and the music stops.'” The option is one he’d wished he’d had as a brewer.
“David was one of the people I talked to,” Rich said. It turned out that “this is something he really believes in, and he wanted to be a founding partner. He sees the power in it. Again, he’s a really good guy, really good operator, really runs a great brewery. And he’s in a dominant position in a growing part of the U.S.”
THE (FAR-FLUNG) TEAM. The company is based in Boston because Rich is, but FFL is in San Francisco, and the new company’s employees are all over. Visit EnjoyBeer.com and you’ll see that their starting lineup includes Ninkasi vet Jessica Jones, an operations whiz. She’s their new CMO and director of strategy.
“My two colleagues – we’re adding to our team – one lives in Washington State and one lives in Oregon,” Rich said. “We don’t know where all the partners are going to be. We’ve gotta be flexible from a location standpoint. We’ll have a location in Boston, and people all over the U.S.” Of course they’ll meet often, particularly at events like Craft Brewers Conference.
Board members currently include David and Rich, as well as FFL executives. The investment firm’s operating partner and Enjoy Beer Board member Bob Eckert was chairman and CEO of Mattel, and also the CEO of Kraft. “He just adds a wealth of experience,” said Rich. “We were at his house last week in L.A., Manhattan Beach, we had a great meeting about what we’re doing here.”
They’re currently seeking a VP of sales strategy and execution — “an industry vet; someone who has a lot of experience, who can work across different breweries, on both execution and strategy.”
WHAT THEY OFFER THAT OTHERS CAN’T. Their model is novel, said Rich, because “you get the help, collaboration and expertise of people who have been in the business for a while, who are accomplished. And who give you a fresh set of eyes on your business and your brand. And whose job it is to be strategic. … We can think of things that often people don’t have time to think about. … So we provide a level of activity that doesn’t exist, and is really kind of a luxury.
“And secondly, I think there’s a sense of determination where the company can go. Often you bring on a partner and its, ‘well maybe this partner is going to sell to a strategic buyer.’ We’re looking to eventually be a public company. The people who are going to run this company long term are the brewers.
“So, I’m an investor in Enjoy Beer, FFL is an investor, the Abita owners are investors. So maybe, if and when we become a public company, people can stay or go depending on what their personal financial needs are. But in terms of managing the business going forward — again, it’s an independent company that’s run by brewers. That’s the long-term view. And having me there as someone who has been in the seat [of these guys] is helpful … in a lot of ways, to give what I would have wanted [when he was in their shoes].”
MORE ON THE PUBLIC COMPANY ANGLE. In a loose way of speaking, the eventuality of being public would put Enjoy Beer in a space where “you can kind of be your own strategic [partner], if you will. You sort of buy yourself … you can grow and have access to capital, that’s why it’s important.
“And while sometimes people look at being a public company as — ‘oh there’s disclosure, scrutiny, regulatory hurdles, expense’ — there’s also liquidity and you don’t have to sell to someone you don’t want to sell to.
“Would that be a fun company to own a piece of? ‘Enjoy Beer’? I think so,” Rich said.
DOES EVERYONE HAVE TO SELL A STAKE? “We’re not a consulting firm per se,” said Rich. “So I think, we’re not partners unless we’re partners. We say ‘partners in brewing,’ and part of it is shared ownership, and so really what we’re talking about is basically people becoming partners in Enjoy Beer.” What the transaction is like depends on the partner brewery at hand. But “common ownership is part of the model.”
WHO MIGHT BE THE NEXT PARTNER? Will they announce more partners this year? “We’re actively interested in talking to prospective partners, we welcome that,” said Rich. “I think the timing of when something would happen … this company was formed in the Q1 of 2015. So what we’re doing today is much quicker than I would have ever thought. Is the next partner going to be a year from now? Six months? I don’t know. Because … the timing isn’t up to me, it’s up to when the timing is right for the partner.”
SO WHO ARE THE RIGHT BREWERY CANDIDATES? Potential brewery partners would be considered, first and foremost, for the people running the business. “You need the people who want to collaborate. Like-mindedness, that’s number one. The number two [factor] is people that have had demonstrated success, and are looking for additional resources to grow their business. And remain in their business.
“And who kind of want to be able to compete on a regional or super-regional level but need national scale, and the resources to do that. That’s what we’re trying to provide.”
They’re looking at companies both smaller and larger than Abita, but not startups: The top 75 or so craft brewers. “We’re not an incubator kind of a company,” said Rich. They seek “growth companies that are accomplished and would collaborate.”
SO — HOW BIG WAS THE ABITA STAKE? We had to ask. “All of the shareholders in Abita are now Enjoy Beer shareholders,” Rich said. “And basically both the Enjoy Beer group of investors, including me, and the Abita people — they both own big stakes in the company. It’s not like one group owns 99% and one owns 1%. Both groups own a lot of the company. Its definitely a partnership.” Further, “David and his team remain in tact, running the business, they’re here to help.
“The other thing is, if you think of the math and of what happens when you have multiple partners contributing their shares into a partnership like this, peoples’ shared percentages are going to adjust every time there’s a new partner, anyway.”
It’s a new world out there. More as it comes in.
Until tomorrow, Harry
“Imagination is more important than knowledge…”
– Albert Einstein
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