General Atlantic’s Post

News that Athletic Brewing raising another $50million for growth plans now gives them an amazing $800 million valuation which is double of what it was two years ago. My question is why would Athletic give up more equity albeit a "small" amount, if doing a straight calculation the $50million raised at $800 million valuation, don't know if pre or post-money, but for easy math say its 6.5% equity they gave up on this round. A CNBC post, Bill said they did $90million in revenue in 2023 so for simple math at an $800million valuation so about a 9x multiple on revenue which is VERY high for a beverage brand where 3-4x is a lot and typically a 2x multiple. Bill also mentioned in 2023 they sold over 3 million cases so revenue of say $30 case using the $90million. One would assume at this point Athletic could easily get a $50 or $100million loan at say 7-9%, so why would you give up more equity? I understand early on when starting a new business its a gamble if you will succeed so the old adage of "play with other people's money" when you are a start-up, but at this point I wouldn't consider Athletic a "start-up". In the interview they said Athletic is at 19% US market share of the US NA beer market. Stats I could find, the top 5 US NA beers had $246.7 million sales & a total US NA beer market of $368.7 million in 2023 or 67% of the total US NA beer market. Statistia 2023 US NA beer stats of: Heinken $77.45 million (21% share) Bud Zero(ABinBev) $55.44 million (15%) Athletic $51.83 million (14%) Busch (ABinBev) $33.61 million (9%) O'Douls (ABinBev) $28.37 million (8%) NOTE: if combined all of ABinBev's NA lines would be the leader at $117.42 million (32% share) What is interesting is that 33% of the US NA beer market are "other brands". So while not the duopoly like in hard seltzer where the top 2 brands have 80% market share, you do still have 5 NA brands at 2/3 of the market. The question is if the top 5 will gain market share as the overall US NA beer market grows if they can keep pace with the NA beer segment growth. I see O'douls losing ground, but the other 4 gaining or maintaining their current market share. I expect the NAs from Corona & Guinness to gain share especially on-premise as both brands begin to focus on this channel as they primarily focused on off premise early on. On premise for NA beer I think is where the market share will be gained or lost as NA brands negotiate contracts (which is legal in most states with NA). Also, whichever NA brand can safely execute NA draft will dominate on-premise is the white space right now. https://lnkd.in/eRU3QJtu

London UK, 10th May 2024 – Kopparberg and Budweiser Brewing Group, a proud part of AB InBev, today announced an agreement for Budweiser Brewing Group to distribute Kopparberg products in the UK on-trade, effective from 28th May 2024. The move will allow Kopparberg to tap into Budweiser Brewing Group’s extensive on-trade distribution network and enhance the brewer’s market-leading Super Premium portfolio in the on-trade. Kopparberg, made in Sweden, is the largest Super Premium flavoured cider in UK off-trade sales*, and currently has 18.5% market share of flavoured cider in the UK on-trade**. Kopparberg is synonymous with authentic Super Premium flavoured cider. The brand is often credited with the establishment of the flavoured cider category in the UK over twenty years ago and is now sold in more than 30 countries. The distribution agreement will allow more on-trade outlets in the UK to offer Kopparberg in both packaged and on-tap formats for consumers to enjoy. Flavoured cider products distributed by Budweiser Brewing Group in the UK will continue to be brewed by Kopparberg in Sweden true to the brand’s heritage. Kopparberg will continue to steer the brand strategy and marketing. The addition of Kopparberg aligns with Budweiser Brewing Group’s focus on the Super Premium segment. Super Premium brands are driving growth in the flavoured cider segment. Premium Fruit Cider grew +5.6% in the volume versus previous year in the UK on-trade.*** Budweiser Brewing Group’s President Brian Perkins signed the agreement with Kopparberg owner Peter Bronsman on 26th April. It will take effect in the on-trade from 28th May 2024. Brian Perkins, President, Budweiser Brewing Group said: “We are proud to already offer world-favourite cider brands to consumers in the UK with Magners and Orchard Pig and are confident that making the much-loved Kopparberg more widely available in the on-trade will enable category growth and provide more choice for consumers alongside the rest of our portfolio. The Super Premium flavoured cider segment is exciting and making this famous Swedish brand more available in the UK on-trade will create even more value for customers and consumers.” Peter Bronsman, CEO, Kopparberg said: “We are proud and excited to partner with Budweiser Brewing Group to add our Kopparberg Cider, one of the best-selling cider brands in the world, to their extensive on-trade distribution network in the UK. This agreement will help us to drive category growth and improve availability of the UK’s most-loved cider brand for consumers to enjoy.” The agreement pertains to the full UK on-trade except select venues, where Kopparberg will continue to distribute directly. Source: * NielsenIQ Discover, Volume HL, Total Cider, Total Coverage, MAT WE 24/02/24 ** Nielsen CGA, Volume HL, Total Cider, Total On Trade, MAT WE 27/01/24 *** Nielsen CGA, Volume HL, Total Cider, Total On Trade, MAT WE 27/01/24 VS YA

In today's CBD: Two of the largest Black-owned breweries, California's Crowns & Hops Brewing Co. and Full Circle Brewing Co., have struck a watershed alliance to leverage its members’ strengths and show up at market in a much bigger way. The new shared resources platform is dubbed “Circle of Crowns Beverage Group” (CCBG). The alliance “combines two leading Black-owned brands and centralizes production, sales and marketing between the two companies,” per announcement. Production will be centralized at Full Circle. Currently, the brands produce about 10,000 barrels collectively. It’s about “unlocking untapped opportunities” in the craft market, by "leveraging retail and venue diversity programs." Historically, Black suppliers have lacked the infrastructure to address these opportunities on a wide scale. CCBG also includes the historic Speakeasy Ales & Lagers brand, one of the oldest in San Francisco, and Sonoma Cider. "As you know, there's 9,000-plus breweries out there, and there's only 1% that are Black-owned," Arthur Moye, Full Circle founder, told CBD. "And I think, during a good period of the last half a decade or so, people have wanted to support Black-owned businesses. So you have major retailers reaching out to those 1%; you have distributors reaching out to those 1%; but then there hasn't been a structure by which they could significantly respond, because that 1% is mostly represented by people that don't have production facilities and can't create the margins and the economies of scale to sit on the shelves throughout the distribution networks of the chains." This starts to solve that. More here, we left the story open to all. https://lnkd.in/gsHErbeK

For those in the non-alcoholic category already, headlines about the explosion of growth at Athletic Brewing Co. have become so common it's easy to tune them out. But that would do a disservice not only to what they've accomplished as a company, but what's happening in the industry overall. The doubling of their company valuation to $800M from the last round is a testament not only to their own success, but the consumers who are driving it. Which, these days, feels like (almost) just about everyone who consumes adult beverages. Congratulations to Athletic for all of their continued success, which only serves to validate the financial value of the category, and, ultimately the understanding that non-alcoholic beverage growth is not just going to come from macro alcohol or beverage brands adding NA product lines, but from a wide swath of new players who are innovating in the market as well. It's an exciting time to be in this industry, and a healthier one as well. #nonalcoholicdrinks #nonalcoholicbeer #beverageindustry https://lnkd.in/gVP9iy5W

SHARE OF WALLET: FOCUS: THE BREWING INDUSTRY Share of wallet significantly influences an individual's scale of preference when deciding which beer product(s) to buy. In this context, share of wallet refers to the portion of a person's overall beverage budget allocated specifically to beer purchases. Various factors contribute to the share of wallet in the beer market, including brand loyalty, product quality, pricing, and marketing strategies. If a particular beer brand successfully captures a substantial share of an individual's spending on beverages, it becomes a dominant choice in their scale of preference. This often results from effective branding, positive consumer experiences, and targeted marketing campaigns that resonate with the consumer's preferences. On the contrary, if a beer brand struggles to secure a significant share of wallet, it may find itself lower on the individual's scale of preference. Factors such as high prices, perceived lack of quality, or insufficient brand recognition can contribute to a lower share of wallet for a specific beer brand. Breweries and beer companies strategically focus on increasing their share of wallet by employing tactics like loyalty programs, promotional discounts, and product innovations. By doing so, they aim to influence consumers to allocate a larger portion of their beverage budget to their beer offerings, ultimately solidifying their position in the consumer's scale of preference. Finally, share of wallet is a critical factor in shaping consumer preferences for beer, and businesses in the beer industry must understand and adapt to these dynamics to remain competitive and preferred in the market. MANKIND IS IN LOVE WITH BEER; WHO ARE BUYING YOUR BRANDS?

Forget the buzz, Athletic Brewing is redefining the beer game—without the booze. The biggest nonalcoholic beer brand in the U.S. has just closed a fresh financing round that values it at a staggering $800 million—double its valuation from just two years ago. Founded in 2017, Athletic Brewing has quickly outpaced competitors like Heineken and Budweiser to become the top nonalcoholic beer brand in U.S. grocery stores. The secret to their success? - A brewing process that mirrors traditional beer-making but keeps alcohol levels incredibly low - Their lineup includes everything from IPAs to Lagers and Ale’s, catering to a growing market of health-conscious consumers - As consumers, especially the younger crowd, cut back on alcohol, nonalcoholic beer has become the fastest-growing segment in the beer industry, hitting a $20 billion market valuation in 2023 - Notable backers include: J.J. Watt, David Chang, and Lance Armstrong Last year, Athletic Brewing exceeded $90 million in sales. And with the value of the non-alcoholic beer market projected to be $40 billion by 2033, the company is poised to lead the charge, proving that you don’t need alcohol to have a good time. 📸: Spencer Platt / Getty Images

Athletic Brewing Co. is now valued at $800 million! And they just secured another $50 million in equity financing. Hats off to Bill Shufelt, John Walker and their team. How were they able to do this? 1. Surging Ahead in a Growing Market: Athletic Brewing leads the nonalcoholic craft beer market with over 19% U.S. market share and is driving 32% of the category’s growth, ranking as the 10th largest U.S. craft brewery and 20th overall.   2. Strategic Growth and Expansion: Committed to promoting health and wellness, Athletic Brewing is set to double its brewing capacity in the U.S., responding to increased consumer demand for healthier beverage options. 3. Health Trends Driving Change: Over 40% of Americans, particularly millennials and Gen Z, are reducing their alcohol intake, boosting the popularity of Athletic Brewing’s enjoyable, high-quality nonalcoholic options. 4. A Future of Innovation and Leadership: CEO Bill Shufelt is focused on transforming drinking culture and expanding the occasions for enjoying nonalcoholic beer, setting new industry standards that distinguish Athletic Brewing from traditional beer giants. What do you think is the primary driver behind this disruption in the beer market? #athleticbrew #nonalcoholic #sober #beverageindustry #beverage

Congrats to Athletic Brewing Co. on their $50M raise at an $800 million valuation. Bill Shufelt has built an impressive company and is leading the non-alcohol beer segment. A lot of people asked me if Athletic Capital invested in this round. We didn't. Here are the 3 reasons why: 1. Valuation - Despite Athletic Brewing being a fast growing, category leading brand, the valuation doesn't make sense to me. Private equity investors usually target investment returns of 3-4x. At an $800M valuation, that means that Athletic has to grow to $2.4-$3.2B company. This would make it approximately the same valuation as publicly traded Samuel Adams. Beyond its namesake beers, Samuel Adams also owns Truly, Angry Orchard, Twisted Tea, and Dogfish Head. It does $2B/year in revenue compared to Athletic's ~$100M in revenue. I'm doubtful Athletic will generate $2B anytime soon to reach the revenue required for a 3-4x return. 2. Market Size - Athletic Brewing owns ~20% of the non-alcohol market, which means that the total market for brewer's revenue is ~$500M (the market size is larger if you account for retail revenue, which is ~2x brewer revenue). If Athletic holds onto its 20% share, the non-alcohol market has to grow 20x for Athletic to reach the revenue of Samuel Adams. I am doubtful that the market grows 20x anytime soon, as the alcohol market goes through fads every few years (remember Smirnoff Ice... Lime a Ritas... Hard Ciders... Hard Root Beers... Hard Seltzers...). Non-alcohol beer is having a moment due to a post-covid hangover, but history says that it will not last, and won't grow 20x... 3. Market Share- Even if the non-alcohol beer market grows 20x, I am doubtful that Athletic Brewing holds on to its 20% market share. Unfortunately, Athletic Brewing is viewed as a craft brewery. The largest craft brewery in the US is Yuengling, and it owns ~10% of the craft industry. There is a long tail of ~10k craft brewers that make up the other 90% and consumer preference tends towards local breweries. All of these local breweries can make non-alcoholic beers, and many are now starting to because they see Athletic making money. This will lead to increased competition and declining market share as local breweries grow their offerings. My guess is that Athletic will have less than 10% share of the non-alcoholic beer industry in three years (and the industry will be smaller than expected). For these reasons, I don't think that Athletic's valuation grows much further. Maybe someone like Dr. Pepper/Coke/Pepsi buys the company for $1 billion to put a toe in the beer cooler, but I don't think they can justify much beyond this. Therefore, I don't think this round was a good investment opportunity. Let me know if you think my reasoning is flawed and we should have invested. https://lnkd.in/gqWMB2vG

𝘿𝙧𝙤𝙥 𝘽𝙚𝙖𝙧 𝘽𝙚𝙚𝙧 𝘾𝙤 𝙥𝙪𝙧𝙘𝙝𝙖𝙨𝙚𝙨 𝙛𝙞𝙧𝙨𝙩 𝙗𝙧𝙞𝙘𝙠𝙨-𝙖𝙣𝙙-𝙢𝙤𝙧𝙩𝙖𝙧 𝙗𝙧𝙚𝙬𝙚𝙧𝙮 😍 🍻 Alcohol-free beer specialist Drop Bear Beer Co. | Certified B Corp™ has acquired the brewery and assets of fellow Welsh brewer Tomos Watkins. The Swansea-based business raised £1.9m from a combination of private investors and crowdfunding to fund the acquisition and make upgrades to brewing equipment on site. Co-founder Joelle Drummond MA (She/They)🌈 said the “watershed” purchase of Drop Bear’s first physical brewery would enable it to produce up to 25 million cans of its alcohol-free brews a year. They said owning production and packaging of Drop Bear’s beers would increase profitability “10-fold”, giving it more funds to spend on sales and marketing efforts. Tomos Watkin’s two full-time staff members have been retained, and Drop Bear plans to continue to produce the brand’s beers alongside its alcohol-free offer. “We’re really passionate about keeping independent Welsh breweries alive,” Drummond said. “We’re in the situation at the moment where we’re seeing breweries close constantly, so we saw this as an opportunity to save one.” “It’s great to have a more diverse portfolio of businesses. Most of the growth in alcohol is currently being driven by people who drink but don’t have alcohol all the time, so this enables us to target our customers both when they are and aren’t drinking.” Production at the new 16,000 sq ft site would begin “within the next three weeks” to enable Drop Bear to scale up ahead of an official launch in January. From then, retail expansion is on the agenda as the brewer looks to build on its 200-store footprint across Co-op in England and Tesco stores across the UK. “The number one place that people are discovering alcohol-free is still supermarkets,” Drummond said. “So retail is really key for us. “We’re also looking to do more beer in keg format, and export – which has been really important for the brand.” Drop Bear Beer Co is also stocked nationally on Ocado and Amazon. Its range comprises Tropical IPA, Yuzu Pale Ale, Bonfire Stout, and New World Lager variants, all of which have an abv of 0.5%. 

Molson Coors to Invest £100m in UK Brewery and Beverage Network Molson Coors Beverage Company has unveiled ambitious plans to inject over £100 million into its UK brewery and beverage infrastructure over the next five years. This significant investment aims to enhance capabilities, increase efficiencies and support the company's growth in the UK market. Fraser Thomson, Chief Supply Chain Officer for Western Europe at Molson Coors, emphasised the strategic nature of this investment, by stating that: “This plan is an investment in our future, giving our people and brands the tools to fulfil our potential in the UK market while making strong progress against our sustainability targets". Key components of this investment include upgrading brewing capacity and packaging capabilities at Molson Coors' major UK facilities, notably the breweries in Burton-on-Trent and Tadcaster. The Burton brewery will benefit from a new 24-tonne high-speed can filler, capable of filling an impressive 120,000 cans per hour. Moreover, the packaging keg lines at Tadcaster and Aspall Cyder House will also undergo enhancements. Molson Coors is also directing resources towards Sharp's Brewery in Cornwall, supporting new and existing ale brands such as Doom Bar, Solar Wave Hazy and Twin Coast. This builds on previous investments, including a recent £13 million expansion at the Aspall Cyder House and a £21 million investment in a new canning line in Burton. Molson Coors' focus on upgrading its facilities reflects its commitment to meeting market demands and advancing sustainability goals. Furthermore, the company's growth in the UK market is highlighted by the success of its brands, particularly Madrí Excepcional. Thomson described Madrí Excepcional as “the country’s fastest-growing major beer brand in both volume and value sales” in late 2023, reinforcing the need for expanded brewing and packaging capacity. In sum, this substantial investment by Molson Coors is not only about modernising its infrastructure but also about empowering its workforce and ensuring environmental responsibility. Thomson added: “This is a landmark moment in our history as we evolve to meet the demands of our growing portfolio and bring new innovations in the years ahead, while continuing to reduce the impact our business has on the environment”.