Former Harpoon CEO launches new craft beer venture
For artisan brewers, the so-called “craft ethos” is everything. They brew for the love of beer, not for money. Their fans prize local flavor, authenticity, even quirkiness. Selling out? A cardinal sin.
But larger regional craft breweries are under pressure to do exactly that. With overall US beer sales nearly flat, mega-conglomerate “macro-brewers” are looking to the surging craft segment for growth. At the same time, regional breweries are fighting off a proliferation of smaller competitors, with 615 new breweries opening last year.
Rich Doyle, the chief executive of Boston’s Harpoon Brewery until last year, says his new company, Enjoy Beer LLC, offers breweries a middle way: the resources of a big company without the shame of getting acquired by a faceless multinational.
“I’d hate to see a great brewery make a deal with a company that swallows them up and makes them lose their character,” Doyle said. “We’re trying to get to them first.”
Using a combination of his own money and an investment by the San Francisco private equity firm Friedman Fleischer & Lowe LLC, Doyle has already made his first acquisition, Louisiana’s Abita Brewing Co. He declined to disclose the precise terms of the deal but said his company wrote checks to Abita’s investors, who in turn invested in Enjoy Beer.
Doyle’s plan is to partner with four or five additional companies with a similar profile, forming a consortium of proven craft brands that can share expertise and resources.
Eventually, he wants the Boston company to go public.
Abita, a regional brewery that cracked the list of the country’s top 15 craft outfits but needed more money to keep expanding, was an obvious target for acquisition by a conglomerate such as Anheuser-Busch InBev. President David Blossman, however, was not interested in being bought out — until Doyle called.
“We’re not losing our heart and soul,” said Blossman, who first invested in Abita as a beer-loving teenager in the 1980s and took charge of the company in 1996. “We turned down lots of other opportunities because we wanted to remain rooted in our local community and culture.”
Abita will retain its name, facilities, and staff. Enjoy Beer will give the company money to further increase its brewing capacity, and help manage those parts of the business that are not as much fun as brewing: logistics, marketing strategy, data collection, and training sales people on new software tools.
Blossman said that Abita, like many larger craft breweries, was nearing the limits of what it could achieve with an informal, do-it-yourself craft model.
“We don’t even have a chief marketing officer,” he said. “I’ve been flying by the seat of my pants and keeping track of everything in my head. I realized that I needed to put this stuff on paper and share it with other people, so we can think about a long-term strategy.”
After spending $30 million on new equipment, the company could not afford to spend much on talent. But Blossman could not stomach joining a conglomerate, which would mean giving up control of the beer and exposing workers to layoffs.
Enjoy Beer was a more palatable out.
Blossman said that he is looking forward to other craft companies joining Enjoy Beer, so brewers and sales people from each can compare notes.
The idea for Enjoy Beer was born during Doyle’s stint at the helm of a rapidly growing Harpoon. The company was transitioning from a passion-driven band of beer nuts into a corporation with national reach — simultaneously battling conglomerates and dozens of microbreweries for market share.
“We were trying to decide, after almost 30 years — do you double down and reinvest, do you partner with someone bigger, or is there another way?” said Doyle, who sold his shares of Harpoon in July.
Doyle said that Enjoy Beer is in talks with other potential brewery partners, but declined to identify them. Asked whether he would consider acquiring Harpoon, his old company, Doyle left open the door to a reunion. “Harpoon is a great company, and if they were interested in us, certainly we’d be interested in working with them,” he said. “I have longtime friendships there, and there’s no animosity.
“Stranger things have happened.”