Over the past few years Brewdog, the Scottish craft beer company, has witnessed exponential growth. In fact, it’s been the fastest growing food and drinks company in the UK for the last four years! The company we know today earns an annual turnover of well over £50million, employs over 580 people, runs more than 76 bars and ships over 41 million bottles of beer to over 55 countries, every single year.
But how did Brewdog get here?
The company is the brainchild of co-founders James Watt, a law student, and Martin Dickie, a brewing and distilling student. The pair was bored sick of the interchangeable, indistinguishable, industrially brewed lagers that dominated the UK beer market. They wanted to fix this predicament and bring their passion for good craft beers to as many people as possible. They felt the best way to do this, was to start up their own brewery.
As the pair remarked, “We knew exactly what we wanted to do and where we wanted to go. We wanted people to feel as passionately as we do about beer. Scotland is firmly on the map for whisky and we wanted to put it firmly on the map for beer.”
It was back in 2007 when James and Martin, both only 24 at the time, decided to start brewing some industry revolutionising craft beers. They leased a small draughty building in Fraserbugh, Scotland. Took out some very scary bank loans. Then got stuck in.
For the first year, Brewdog had 2 employees, 1 dog and was only able to brew in ever so tiny batches. Working 20 hours a day, the pair filled the bottles by hand and sold the beers between local markets and the back of their beat up old van.
The beer went down well, but there was little movement or growth. For 6 consecutive months, they lost money. They were behind on £20,000 worth of payments on their bank loan. But then, finally, they caught a break.
The team had entered a bottled beer competition organised by the supermarket giant Tesco. Brewdog won first, second, third and fourth place! After winning the pair went down to Tesco’s headquarters, just outside London, and an order was placed for the co-founders beer. They wanted over 2000 cases a week to over 500 stores.
With Tesco wanting the first deliveries in four months’ time, they needed to expand – fast. In order to push out more bottles, the duo needed to buy loads more holding tanks, a proper bottling machine and more. However, James and Martin had little luck when going back to the bank to ask for another £150,000. The bank outright refused to lend any more cash due to the companies little experience, poor performance and failure to meet the payments on their current loans.
Brewdog, in typical punk fashion fought back against the man blocking their way, went to another lender… and lied. As James admitted last year “We said that our bank had offered us an amazing deal, but that if you can match it we’ll switch, and they went for it. You have got to do what you have to do.”
With BrewDog now being able to increase its brewing facilities, it was able to start supplying Tesco on time with bottles of its Punk IPA. The beer was an immediate hit, and the other UK supermarkets soon followed suit.
In 2008, Brewdog became the largest independent brewery in Scotland. It started to export to Sweden, Japan and America. However, James and Matt found themselves inside a media whirlwind. Firstly, because Brewdog just masterminded the UK’s strongest ever beer, a 16.5 % imperial stout named Tokyo. Secondly, because the Portman Group had decided to ban near all of their beers.
Despite this, the now international demand for Brewdog’s beers just didn’t seem to stop. With annual growth reaching a whopping 200%. Again, to keep up with the sheer demand, Brewdog, needed more tanks, more space and in general a greater scale of production.
To do this, in 2009, the team launched the groundbreaking investment scheme ‘Equity for Punks’.
In short, Brewdog decided to offer people the opportunity to buy shares in the company. On the topic James said: “The mental shackles that have tied down British SMEs to the staid and unimaginative traditional methods of raising funds have been untethered. We have ushered in a brave new world.”
Along with the chance for a promising return on their investments, investors have also been attracted by the perks that come with share ownership. These include invitations to parties and discounts for cheaper beer. In the first year of the programme, there were just over 1,300 shareholders, now, there are over 46,000 equity punks worldwide.
They also kept pushing the boundaries of beer by brewing the world’s strongest beer, the 32%, Tactical Nuclear Penguin. Then, shortly after in 2010, they started brewing an even stronger 55% beer that was packaged and sold in taxidermied Roadkill.
They also had an exciting year in opening up the first craft beer bar in their hometown of Aberdeen and collecting various impressive awards including a Gold Medal for Hardcore IPA at the World Beer Cup and Entrepreneur of the Year awards.
Due to the success the bar in Aberdeen, Brewdog started to open bars in Edinburgh, Glasgow and London. They also got a bit more adventurous in their advertising. They announced their arrival into London by driving around Camden high street in a military tank, projected the iconic logo onto parliament and through ‘fat cat toys’ over the city from a helicopter.
Since then they have been riding the waves of success. Opening new bars every month or so, from Brazil to Japan. Winning awards left, right and centre, for all things business and of course brewing more and more different types of rebellious beer.