About two weeks ago, I tasted my first BrewDog beer: the 5 AM Red Ale. Robin ordered it first, inspiring the entire table to join in, and no one regretted her decision. The beer poured deep amber in color, and the flavor maintained a neat hop-malt balance all the way through. Rather than elaborating further, I will provide BrewDog’s description, which is a bit more complicated: “Jump in and you’ll find berry bouncing off marmalade clashing with caramel cosying up to chocolate buzzing off spice sizzling with toast laced with lychee and colliding with biscuit.” In fact, the 5 AM Red Ale was recently named the World’s Best Amber Ale at the 2014 World Beer Awards.
I already want to try another BrewDog offering, and it’s not just because the beer was so tasty. Indeed, the Scottish brewery just announced the launch of its Development Fund. After partially funding BrewDog by selling equity through its own Equity for Punks campaign, co-founders James Watt and Martin Dickie have allocated £100,000 of their profits each year, as well as their time and expertise, to support other craft breweries as they start up.
In this case, “time and expertise” includes featuring Fund recipients in BrewDog bars as well as introducing them to sales networks. Watt and Dickie also plan to assist with sourcing ingredients and buying brewing equipment, as well as provide access to BrewDog’s beer laboratory. For the investment, BrewDog takes a small amount of equity in each start-up brewery, allowing the businesses to grow together.
BrewDog selected two breweries as its first Development Fund recipients: Brew by Numbers (“BBNo.”) from London, and Curious Audacious Products (“CAP”) out of Stockholm. Brew by Numbers has asserted that its mission is to create “exciting and forward-thinking beers with a focus on quality and drinkability.” The co-founders emphasize research, experimentation, testing and tasting in their work. CAP focuses on “playfulness, experimentation and [the] sheer joy of brewing beer,” reflected in their irregular releases of “I’m Curious,” one-of-a-kind-and-never-to-be-seen-again creations. CAP’s beers feature whimsical sketch drawings of a skull smelling a flower, a musical instrument with a face, a monkey holding umbrellas in the rain, and a whale decked out in a top hat, cane, and pipe.
Given the crowding of the craft beer market, at least in the U.S., it will be interesting to see whether – and where – this business model catches on. For more established breweries, it is a unique way to “pay it forward,” while maintaining interest in a new business that might help their own business grow. At the same time, if start-up breweries are willing to give up a small share of their businesses, it increases the likelihood that they will invest in quality resources from the start, to create more innovative and quality products for a growing international market. As part of that international market, I will continue to support these collaborations, partnerships, and business models that foster such healthy competition with a methodical – but pioneering – spirit.