Author Topic: Raising Funds for Startup Brewery  (Read 1232 times)

Offline ryovich

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Raising Funds for Startup Brewery
« on: January 25, 2017, 11:09:23 AM »
We are a brewery in planning trying to raise funds to help with the startup costs of the brewery and taproom.  We have a location with an intent to lease and a great business plan and marketing plan.  We are planning to begin demolition/remodel of the space in the next couple of weeks and will be submitting our TTB license paperwork at that time, so we are looking at an opening date in the Fall of 2017.  We have currently sold 20% of the equity in the company and are looking to sell an additional 15%-20% to reach our total investment goal.  I have exhausted all of my resources searching for investors looking to become part of our investment community.  Any suggestions as to where I could post my information to gain more traction with investors looking for a small share of the growing craft beer market? 

Online kramerog

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Re: Raising Funds for Startup Brewery
« Reply #1 on: January 25, 2017, 01:26:01 PM »
If you are a member of the AHA, you can access the 2015 seminar "Panel: Taking Homebrewing to the Pro Level, From Concept and Design Through Opening" and the 2014 seminar "Top 10 Legal Mistakes Start-Up Breweries Make" which both discuss raising funds legally.  There are also books on going pro that most likely discuss raising funds legally.
« Last Edit: January 25, 2017, 01:30:41 PM by kramerog »

Offline Ellismr

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Re: Raising Funds for Startup Brewery
« Reply #2 on: January 25, 2017, 07:01:31 PM »
Have you looked into the Small Business Administration process.  Coupled with a KickStarter initiative. 


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Offline majorvices

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Re: Raising Funds for Startup Brewery
« Reply #3 on: January 26, 2017, 05:17:07 AM »
Finding investors is certainly not easy, but on the hand they may be right under your nose. Our biggest investor (who also owns the largest share of the company, though not larger than the four original founders together, which is nice.) We stumbled across him by chance at a lunch meeting with our banker. We had been in business, mostly self funded, for about 3 years and the chance meeting was a fortune 500 company founder who recognized the logo on our shirt and said "That's my favorite beer!" He also happened to know our banker.

From there we used his networking to raise more funds for our last expansion (we are on track to brew over 5000 bbls this year with a potential capacity of about 15,000 that would be sales and work crew dependent.) There's no way I would have been able to raise this much money on my looks and beer alone.

The second largest investor was a long time friend and neighbor of mine I just decided to get the balls up to hit up. Of course, he's also a multi millionaire so I knew he could afford it.

Aside form the main investor, the other investors all do this more as a hobby than anything thing. Some place to bring friends, clients, etc and receive special treatments. My friend investor told me he's not really doing this to make money, but if he does that's just great. But obviously he realizes that investing in a brewery in a risky endeavor with low yield on return.

The keys to our success were: 1) We already had a product in the market place that was well received. 2) We proved we could successfully run and grow a business by ourselves. 3) We showed we could help rejuvenate a depressed section of town.

In our case this was 3 long years of hard work and very little to no pay (especially for me since I was the brewer.) Lots of investors simply won't invest in a business that hasn't proved it can be successful except in concept.

I don't know if this helps you any but my point is you may have to start out smaller than you intended (we started out about 3 bbls) and struggle a lot more than you ever imagined (I seriously almost lost my marriage of 20+ years opening this brewery) to get the investors you need. There is money everywhere, but  rich people didn't generally get rich by being fools and you have to give them a reason to want to risk their money with you when there are so many other options out there with such a higher yield.
« Last Edit: January 26, 2017, 05:19:23 AM by majorvices »

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Re: Raising Funds for Startup Brewery
« Reply #4 on: January 26, 2017, 09:27:07 AM »
If you are a member of the AHA, you can access the 2015 seminar "Panel: Taking Homebrewing to the Pro Level, From Concept and Design Through Opening" and the 2014 seminar "Top 10 Legal Mistakes Start-Up Breweries Make" which both discuss raising funds legally.  There are also books on going pro that most likely discuss raising funds legally.

Can't stress agreement with this enough. You can get yourself and your business into an enormous amount of problems soliciting investments unlawfully.
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