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Equity for Punks is, as the name suggests, an unconventional business model for raising capital where shareholding has never been so exciting, innovative and inclusive. In 2007, James Watt and Martin Dickie, spurred on by the saturation of mass-market beers and the absence of high-quality tipples on the market, began fermenting their own. Think two 24 year olds – bored with the same dull ales and beers being offered in the same dull pubs, day in, day out. Welcome BrewDog.
BrewDog, the fastest-growing food and drinks company in the UK, is gaining momentum via powerful promotion and innovative financing strategies. The annual Zolfo Cooper Profit Tracker list displays the UK’s top 50 eating and drinking out companies with the fastest growing profits over a three-year period. This brewery and bar operator beat competitors such as Soho House, Leon, Loungers, Nando’s and Jamie’s Italian to land the coveted first place on the list. BrewDog has transformed into top dog by achieving profit growth on a compound basis over this time period of 193.3%.
Making craft beers, courting controversy and pioneering new ways to raise money – BrewDog is not your run of the mill brewery and has grabbed global headlines over the last six years. In an industry gasping for a new take on old tradition, BrewDog has set about challenging beer and business stereotypes in the UK. Whether producing the UK’s strongest beer, winning awards or introducing innovative crowd-funding schemes, publicity has come thick and fast.
Over the last few years, BrewDog’s offerings have included an 18.2% alcohol by volume (ABV) Tokyo stout and a Tactical Nuclear Penguin beer weighing in at 32% ABV. The launch of the record-strength 41% Sink The Bismarck! beer was introduced a short while after German brewer Schorschbrau took the strongest beer title with its 40% strength Schorschbock. To put the percentages in context, Sink the Bismark! is over eight times the strength of your average continental brand such as Heineken.
Next up – The End of History beer – with an intoxicating 55% ABV. The beer, formerly known as the world’s strongest beer, has had an instant impact, not least because of its potent strength and creative advertising. With only 12 bottles ever produced, something had to mark its arrival, and the bottles were photographed inside seven dead stoats, four squirrels and one hare. Animal campaigners were angered, and BrewDog yet again came under fire for going that extra mile and taking beer to another level. Promoting excess or merely pushing boundaries?
Whatever line you take, one thing is for sure – BrewDog is here to stay. The company is winning awards time and again, including a gold medal for Paradox Grain and Hardcore IPA at the World Beer Cup in 2008 and 2010 respectively. BrewDog also picked up the 2008 Prince’s Scottish Youth Business Trust Young Entrepreneur of the Year Award and the 2009 Scottish Entrepreneur of the Year Award. It also won the Young Business Leader of the Year in the 2011 Scottish Leadership Awards. With the successful mix of craft beer and hipster marketing, more awards are sure to come Brewdog’s way.
BrewDog established itself with ‘punk’ values that carry over to its finance model. Rather than go down the traditional routes of huge bank loans or venture capital, BrewDog has chosen the punk path. In 2009, Watt and Dickie took a gamble, and won, by launching the innovative Equity for Punks scheme, which saw them become a PLC and sell shares online. From two shareholders in 2007 to 6,567 in 2012, this is business at its best.
“Equity for Punks is, as the name suggests, an unconventional business model for raising capital where shareholding has never been so exciting, innovative and inclusive.”
Throwing away the old manual for business investment, Equity for Punks is replacing it with a more accessible system that allows investors to share in the sweet success of BrewDog. Initially hoping to raise £4 million by January 22, 2014, (after raising £1 million in just one day, this offer may well close soon) they offered an equity share for £95. This includes a £10 beer voucher and varying discounts depending on the size of the investment. To put this lifelong offer into perspective, buying one case of beer a month, you should expect to receive a 100% return on a £95 investment in just over a year. Plus, you get an invite to the BrewDog AGM – think more along the lines of a party than your average business meeting – where you can say cheers and enjoy your investment.
The thriving success of this business is not only dependent on an understanding of people’s changing attitudes to what they drink, but also to where they drink, and the numerous BrewDog Bars scattered around the country cater for this shift. Operating in five continents with an impressive 200% growth year on year, BrewDog has changed the way you can do business.
I will drink to that.