Lagunitas, Heineken, and post-craft beer

urlToday’s bombshell news via Beerpulse, that Lagunitas Brewing founder Tony Magee sold half his baby to the Dutch beer conglomerate Heineken rings more like one of Bang Snaps (aka poppers or throw-downs). A bit startling since it landed at our feet, but it’s not like Tony didn’t warn us that he was throwing one our way for the last few weeks (via his Tumblr blog)!

My 2¢ on the matter: Good for you, Tony. Now that you’ve sold 50% of your brewing company, welcome to being semi-retired.

As Mr. Magee put it himself in today’s post that is required reading before anyone says one flipping word about this matter, he’s “55 years old going on 80.” I have a hard enough time going to the market to pick up a roll of paper towels and I’m 14 years younger.

Lagunitas is America’s sixth largest “craft” brewery. It’s reportedly valued at…are you sitting down?… One Billion Dollars. Last year they brewed some 600,000 barrels. Four years ago before the Craft Brewers Conference, Tony told me that the five largest craft brewers rake in 45% of the craft segment of the beer industry. That was before Yuengling’s status was reclassified by the BA’s board members as being “craft” despite the fact that they’ve always upheld the BA’s three pillars of craftdom: being small (only in comparison to the Big Two of ABI and MillerCoors), traditional (hello! America’s Oldest Brewery), and independent (it remains in the hands of the founder’s sixth and seventh generation descendants).

Soon, Lagunitas will have a third brewing facility online in SoCal after the original in NorCal and a second in his native Chicago. And soon, they will be brewing well over a million barrels a year, which is still well below the BA’s definition of small which presently stands at 6 million bbls. However, their definition of independent is no more than 25% ownership by a major brewing concern. Heinie is a major brewing concern.

Ostensibly, this means that the next time the Brewers Association announces craft beer’s market share, the numbers will reflect lower than anticipated numbers. It will be a setback for the goal of 20% market share by 2020 because they just lost the projected million barrels that even the thousand new brewpubs and nanobreweries combined can’t account for. But don’t you dare blame Tony for pursuing the American dream. Love him or hate him–and there are plenty of folks in each camp–dude’s worked his ass off. He deserves this success. And in his astoundingly articulate, erudite, and strategic manner, the Nietzsche-esque stoner “madman” from Petaluma has neither “come too soon” nor too late. His ship arrived at the exact right time. The industry will keep sailing with and without Lagunitas, a subsidiary of Heineken International, as this just further demonstrates that we are drinking in a post-craft beer world.

Feel free to mumble in the comments below.

4 thoughts on “Lagunitas, Heineken, and post-craft beer

    • As someone directly in between the age of someone nearing retirement yet who’s not green in the work force, I can say I wholly understand the decision, wish it didn’t happen, but ultimately have better things to get upset about.

  1. My in-laws were offered a king’s ransom for their free range egg business not too long ago. Millions. The only reason they didn’t sell is because two of their kids were interested in carrying on the business. I can’t fault anybody for cashing in on decades of endless hard work. Bummer, though. I hate Heineken. Horrible beer.

    • That is a HUGE issue facing the brewing industry at this juncture. These entrepreneurs from the 80s and 90s may have succeeded in business because they didn’t have families to tend to, meaning they had MORE time to devote to the business and LESS to risk in its future. But now, they have no succession plan. Tony Magee has no kids. He has no family legacy at stake. He does, however, have another 20-50 years to enjoy and reap his rewards.

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