Something Good’s Brewing:
Entrepeneurial Spirit and the Rise of Small Breweries
A Harvard Business School grad decides to abandon the traditional career path to pursue his dream in 1984. He enters a previously unexplored market, and heralds the dawn of a new era of consumerism. Who is this man? Some tech mogul? A pioneer of the .com boom? In fact, this man is Jim Koch, the founder of the Boston Beer Company, whose most famous product is none other than Samuel Adams Boston Lager.

In 1979, just before the beginning of the Boston Beer Company, there were only 44 breweries in the United States. Since Koch, who has served as the prototypical example of the founder of a “startup” brewery, more than 3400 breweries have started up in the US. The spike in the number of microbreweries, the fastest growing sector of the beer industry, reflects holistically this entrepreneurial spirit. Jim Koch may be the most readily recognizable figure in this world of beer-success, but other great stories, like that of Manjit Minhas, reflect the same type of entrepreneurial thought. Manjit Minhas, along with her brother, in 2001 started up a small brewery that suddenly blossomed, allowing Minhas Brewery to turn into the 10th largest brewery in North America by 2006.

What does beer have that allows it to be such a great vehicle for the aspiring entrepreneur? For starters, people love beer. Beer is the world’s most widely consumed alcoholic beverage, which ensures some level of demand for one’s product immediately. Secondly, there aren’t too many barriers to entry to become a brewer. Besides putting in the proper paperwork to obtain a license from the government, most of the equipment and ingredients that go into producing the beer is relatively cheap and easily attainable. All that is left to the start-up brewer is to formulate their own recipe to make their product stand out. This is why one sees a plethora of labels and breweries in one’s local spirits shop. This contrasts with producers in markets with massive barriers to entry, such as computer chips. Intel and AMD dominate the market, and it would be rather difficult for a sole individual or small firm to enter it.

At the heart of the successful entrepreneurial endeavour is the marriage between a creative idea and a knack for business. Beer serves as the perfect medium for the entrepreneurial spirit. If one has a creative idea (i.e. a new recipe for the perfectly hoppy beer) and can successfully run a small business (like managing staff, resources, and motivation), then financial success will come. Brewing has the perfect skeleton to cloth with an entrepreneurial idea. But what ultimately makes people like Jim Koch or Manjit Minhas succeed isn’t just their inventive, new beer; there are probably dozens of craft-breweries with the “perfect” formula. What has allowed them to succeed is their inherent talent at managing a company, realised through managing breweries.

  • Richard

    I agree. A wise businessman in the Caribbean named Sir Kyffin Simpson always said that the key to success is progression and humility, and clearly he’s done very well for himself as a self made man!

  • John Andrews

    The Airgain IPO launches this week, and they’re a one-brand company.

    Some investors don’t think it’s a good stock though:

  • Cincinnati World Cinema

    Well said, Joe, and worth rereading on a regular basis! Another advantage of small-to-midsize city living is pace and competition. Living in NYC, LA and SF entailed a hectic pace, hallmarked by capital S striving, as one realized there were a ton of others doing what I do. Spending so much time in one’s car in SoCal meant much less time for quality pursuits and pleasures. A smaller pond with relaxed pace allows one to savor life and special moments.

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