Earlier this month, BrewDogThe company, once a leading example of the securities crowdfunding industry, was sold as it entered administration.
BrewDog leveraged multiple platforms to raise growth capital for the craft brewery once valued in the billions. As BrewDog expanded into the US, it used the Reg A exemption to raise funds from US investors while building bars (first in Columbus, Ohio) to pursue its grassroots business approach.
James WattCo-founder of BrewDog, sent On LinkedIn he “Heartbroken for all our brilliant capital vagrants who didn’t get a return on their investment. And I’m heartbroken that I devoted the best 20 years of my life to something that didn’t result in the ending we all wanted.
Watt shared that part of the problem is that they are expanding too quickly and diversifying too aggressively; Things he would do differently today.
Commenters on the post questioned Watt’s sincerity, asking:
“If you care so passionately about them getting a return on their ‘investment,’ why haven’t you made sure the stock goons get paid at the same time you do?”
BrewDog’s 38 pubs in the UK and Ireland are now closed. Approximately 500 people lost their jobs.
Tillray Brands, a US-based firm, secured most of the assets for just $33 million. Tilray has since acquired bars and other properties in the United States. For now, the brand will continue.
The BrewDog adventure highlights the challenges faced by any early-stage company trying to balance growth with profitability. In this case, investors, especially retail investors, made little profit; This underscores the risk associated with a small, private firm.
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