Click by click, entrepreneur builds a brewery

Staff WriterJuly 23, 2010 

  • Kickstarter is one of several websites that enable what has been dubbed "crowdfunding." It keeps 5 percent of the funds raised.

    Yancey Strickler, co-founder of the New York-based business, said since it was launched in April 2009, 2,000 projects submitted by artists, filmmakers, musicians, writers and others have been successfully funded. Another 2,000 projects are currently seeking funding, including the makers of a 50,000-pound mouse trap who need funding for their multi-city tour.

    Projects must have "a strong creative component" to get past the screening process, Strickler said.

    For more information: www.kickstarter.com

Erik Myers is funding the startup of his craft brewery the new-fashioned way - over the Internet.

An avid home brewer, Myers, 34, of Chapel Hill, is taking the plunge after talking for years about turning his hobby into a business. His vision is being fueled by more than $40,000 raised from backers - about half of whom Myers has never met. He attracted them through a fundraising drive conducted on the Kickstarter, a New York-based website that helps people raise money for creative projects.

"I've been so surprised and humbled by the way people have been so incredibly generous with their hard-earned money to support somebody else's dream," said Myers, who has been blogging about beer for more than a year. He also is managing director of the N.C. Brewers Guild, a nonprofit group that represents brewers, retailers and craft beer enthusiasts.

His dream: To brew his concoctions at various breweries, rather than investing in a building and equipment or contracting the work out. He still has to land distribution deals.

Myers, whose company will be called Mystery Brewing, is among a new breed of entrepreneurs who are turning to nontraditional sources of funding to launch ventures or buttress existing ones. In an era in which seed capital for startups is harder to obtain, and even well-established businesses can find it difficult to obtain a loan, it stands to reason that some entrepreneurs are trying new approaches.

Funding from fans

Raising money to start a brewery is such a challenge that many startups resort to some sort of public outreach, said Julie Johnson, editor of All About Beer, a Durham-based national magazine for beer aficionados. Johnsonalso is a former beer columnist for The News & Observer. The enthusiasm of craft beer lovers lends itself to such an approach.

One example: Fullsteam Brewery on Rigsbee Avenue in downturn Durham, which will start distributing its beers later this month and has scheduled the grand opening of its tavern for Aug. 13.

Sean Wilson, Fullsteam's founder and "chief executive optimist," has raised more than $1 million from investors as well as a loan backed by the Small Business Administration. A tiny slice of that funding, $7,000 and counting, came from beer lovers who give $99 or more. The money, among other things, entitles them to a "Certificate of Awesome" that will be displayed on the "Wall of Awesome" at the tavern.

"If you look at it from a pure economic, utilitarian-value standpoint, it is maybe an irrational decision," said Wilson. "But you get essentially the satisfaction of knowing you are helping out this vision of building out a brewery."

Nor would Myers' backers walk away empty-handed if his endeavor failed. He's not offering an ownership stake in Mystery Brewing to those who provide funding via Kickstarter. Rather, they get their name "featured prominently" on the brewery's website and, depending on how much they pledge, receive in return anything from a T-shirt to a personal beer tasting with a few friends. The latter requires a pledge of at least $1,000.

People who pledge money on Kickstarter don't pay unless the project reaches its funding goal. Mystery Brewing's funding goal of $40,000 already has been surpassed. As of 5 p.m. Thursday, it had raised $43,039.01; the fund-raising effort concludes today at 9 p.m.

Myers, who works in the information technology department at UNC-Chapel Hill, figures the money he has raised plus $20,000 of his own is enough to launch his unorthodox business plan, which he describes as "brewery nomadism."

Myers' sales pitch on Kickstarter stresses that, unlike conventional breweries, "no two batches of my beer will ever be the same. There will be no set product line. Instead, I'll have a constantly rotating selection of beers. Think of it as a full line-up of seasonals. If a beer is popular? Certainly, I'll make it again, but I'll tweak it. I'll always be asking myself, 'How can I make this beer even better than it was before?'"

Mike Gusefski, 28, a research scientist by day and a home brewer in his spare time, sees his $100 contribution as an entrance fee, of sorts, to the local brewing scene.

100 bucks here ...

"It's fun to be a part of the community," said Gusefski, who lives in Durham. Moreover, "I think the beer he's going to make is going to be really good."

Kevin Bray, a 28-year-old video game programmer who lives in Austin, Texas, learned about Mystery Brewing from a friend on Facebook and likewise decided to contribute 100 bucks.

Bray, who has started two businesses that failed, felt a kindred spirit with Myers after reading of his venture on Kickstarter.

"When somebody comes up with something that's different, I kind of see that and have a soft spot for it. I recognize the risk they are taking."

All About Beer's Johnson thinks Mystery Brewing has a good shot at succeeding.

The number of craft breweries in the state has zoomed from just a handful a decade ago to more than 30 today, thanks in large part to a new law enacted five years ago that lifted the 6 percent alcohol limit that previously was imposed on beer.

During that span, few breweries have closed. "I think part of that is because, initially, we had so much catching up to do," Johnson said.

She also thinks there's still room for newcomers.

"I'm thinking Erik, who already is well-known, will receive a good welcome from consumers and fellow brewers," she added.

david.ranii@newsobserver.com or 919-829-4877

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