Fellow beer enthusiasts, stoppers by, casual readers and regular readers: What are people supposed to do? Have you ever had a girl that you longed for, pined for, died to have as your girl…only to be thwarted in that effort? (The same could be said for a girl pining for a guy.) It happened to me in high school and part of college. One girl I never got close to getting (which worked out for the best), the other I married (which is really working out for the best). Now my pining is renewed…but not for a girl, unless you want to call a brewery a girl.
Nate and I dream, talk about, desire, muse and hope to open a brewery. The sooner the better. The only catch to the dream is making it happen. How do we go about this, how do we raise the money, how do we keep from being in debt up to our eyes? I’m enlisting the minds of people more creative and helpful than my own. We’ve been kicking around some ideas and think we are making some headway, but since two heads are better than one, I want to make numbers into factors. What do you talented and brainstorming people think? How can it be done?
Obviously, this is a more self-interested post than usual, but we have an indulgent group. Remember that disappointed longing? Me, too, and I don’t ever want to feel it again…let’s get this thing going in a few years from now.
I would think that working in a brewery would give you inside information that most people don’t have access to. What do the business people there say?
I thought this tutorial from Jersey’s Flying Fish brewery was an interesting read from someone who has done it.
https://www.flyingfish.com/fishtales/business1.cfm
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The sad fact is that you can’t realize your dream without being in debt. Whether you are paying a loan to a bank or making concessions to an investor, you’re going to have to pay in some way. I know that Sun King just got off the ground here in Indy using private investors that they had personal relationships with. I would imagine that this would be the least painful way to go, but I know I don’t have any friends (or even friends of friends) with that kind of money.
I remember hearing the magic number to start a small brewery was $250,000, but I’ve slept since then and don’t remember how they arrived at that sum. I do know that they Sun King guys cut their equipment costs in half by buying used stuff.
Sam Calagione from Dogfish Head wrote a book on how he got started (Brewing Up a Business), so there’s another resource.
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Yeah as Howard mentioned I was going to reference Sam’s book that he wrote. But I’m pretty sure unless you have money there isn’t much of a way to start a business with out debt.
I’m no guru with things like this but I too think an investor is probably the better way to go but may not be the easiest. You have to find an investor that really believes in the product. I think banks are more likely to give the money away but the risks may higher with them.
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I asked a local small brewer how he got his start and he told me that he did have to go through a lot of hoops to get some initial financing. Start off by writing a good business plan. You probably won’t be able to afford brand new equipment for your brewery so start looking for regional breweries who may be upgrading and see if you can get some of their used equipment to start out with.
Banks will be hard to convince to give up money these days so be sure you have a highly detailed business plan up front and study your local market well.
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Thanks to all you guys for response. We will have a nicely detailed business plan written up, so that’s a start. I’m going to try to find ways to raise money so that we can minimize our debt situation. Still, I’m holding out for the long lost rich uncle. I think Sam’s book might be a good reference point. I have a brother with a marketing degree and others who are good resources for this type of thing.
I think you might be right about the $250,000 Howard…of course, that would be a pretty small system (we’re ok with that). It’s really nice to have people chime in and give suggestions.
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Yeah, two books to get: Sam’s book and, practicality-wise, the Brewers Association book about Brewery Startups that I can’t remember the name of off the top of my head. It’s credited to Ray Daniels, but the picture on the cover is totally not him. I have an extra copy, if you’d like one.
The guys at Brooklyn also have a book that has a few insights that I found interesting, but mostly it was a “here’s our story” kind of book which, while interesting, wasn’t particularly helpful from a business standpoint. Sam’s book is better.
I’ve also been through the Siebel Institude Brewery Startup class (again, with Ray Daniels) and it was *chalk* full of good info, even if none of it seemed immediately practical for me in business-plan-writing stage.
I’m assuming that you guys and myself will pretty much never end up as local competitors, so if you want to bang around business plan ideas, I’d be very open to that.
As for money, pretty much everything I’ve ever been told is that you can’t borrow money unless you have money. Friends and family will hopefully be able to help you through part of the way. My start goal is $350,000 minimum; $500,000 would be ideal.
The guys at Brewery Finance Corp also told me to incorporate as soon as possible and get moving down the track toward getting a business plan finalized and getting investors lined up. They’re more likely to loan to people who have things well organized which seems rather obvious, but worth consideration.
So – just do it. Start doing it. Pining won’t get you toward your goal, just buckle down, make some concessions about what you’re spending your free time on, think of it as taking on another job, and just start making it work.
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Erik,
I would love the extra copy. I think you’re right…there’s nothing too it but to do it. I’m spending plenty of free time brewing, reading, and thinking about beer. We’ll see. My wife has to finish her Ph.D course work, then we’ll see about really making an effort. Preparation now is hopefully what will make it happen later.
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Seriously – that is the same thing I’m waiting on. For my wife to finish her Ph.D. Awesome.
Shoot me an e-mail with your address and I’ll send you my extra copy!
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It looks like Nate and I found the third musketeer. I can’t believe you are in the same situation with the Ph.D. Thank God we have someone to support our butts.
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Just take good notes fellas! Someday with some luck, perhaps your book will be suggested as a resource for aspiring brewers!
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We can only hope!
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I’m really jealous now; I want a sugar mama to prop me up while I live out my dreams!
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Propping her up while she achieves hers is key in this case.
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That is exactly what I was going to say.
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Thanks for all the input…been digesting it.
Erik…It would be cool to compare plans (once ours is formally formulated).
I won’t have a sugar momma like the rest…I may just have to work to jobs at the outset!
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Oh yeah, Erik…what’s your wife getting her phd in?
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English Lit. So I’ll be rolling in.. well.. books, I guess.
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Ha, nothing wrong with that. I wanted to open a books and beer business a couple of years ago. Forget the coffee shop.
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Yeah, I’ve thought about that, too. Bookstore/brewery seems like it would be right up MY alley, but I don’t know how marketable that is to the general population.
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[...] I recently revealed in discussion over at THFB, my lovely wife is working on finishing an advanced degree. Said advanced degree is most likely [...]