Equity crowdfunding pioneers BrewDog & their crowdfunding movement - Part 1

This week is part 1 of our deep-dive into the pioneers of Equity Crowdfunding. Let’s get under the bonnet of their early years…

BREWDOG was founded in 2007 by Martin Dickie and James Watt. The story goes that they were sick of ‘the stuffy UK beer market… so, aged just 24, they decided to do something about it.’

They then did the start-up thing in the craft beer market for a couple of years. Tried to get listed in various stores and didn’t. Managed to get the best publicized small bank loan in history, and carried on. Even at this stage their penchant for gaining earned media attention was evident. The loan was used to brew the UK’s strongest ever beer. It got attention, and when there were efforts to ban it by regulators, it got even more attention.

In 2009 things get interesting. This was the beginning of their Equity for Punks journey. We ran our first equity crowdfunding campaign in 2015, so as you can imagine, BREWDOG was somewhat of a cult figure in our heads. Their first campaign raised £570K through 1300 investors, and was, I believe, the spark that lit equity crowdfunding globally. After this they continue to court the media by brewing the world’s strongest beer (32%!). And they were learning fast. The first bar opened in 2010, in Aberdeen - James’ hometown. They also cite at the time:

“A slightly different reason to celebrate: brewing a 55% abv beer and packing it in roadkill, making it the world's most expensive ever beer (it seemed like a good idea at the time).”

Their second equity crowdfunding campaign in 2011 - Equity for Punks 2 - raised the bar to a £2.2m campaign, through 5,000 investors. Oh yeah, and in between they drove a tank down London’s Camden High Street!

So, I assume you can see the pattern here at this stage. PR rather than paid media. And it worked for them. By the end of 2013 they had opened 13 bars in total, and had run Equity for punks 3 which raised £4.25m in investment through 10,000 investors in 22 countries. The founders also started a TV Show called BrewDog TV and opened their first international bar in Stockholm - launching it with a funeral for generic beer. And they managed to pull every possible bit of publicity out of a knockoff bar that opened in China.

The BrewDog founders, especially Watt, are very much marmite characters. Some love them and some absolutely don’t. On one hand they have used this to their advantage, which you have to admire. Of course this approach is not for everyone. For instance, not everyone would think of sending a ‘new "protest beer" which is said to mock Russia's laws on gay "propaganda" to the Kremlin.’ They did, and hey presto it gained huge media attention.

And this is their major talent. If we look at their progression to this stage, we can see that they had two major advantages. One - they were riding the crest of a craft beer wave that was running across the western world. For example, in 2023 Retail dollar value was estimated at USD 28.6 billion, representing a 24.5 percent market share in the US….and craft brewers directly employed 191,421 people in 2023, according to brauwelt.com. I think anyone above a certain, ahmm, age will know what I mean. There was an influx of new brands into the market over a decade or so. I think that has probably slowed a little now, as the world catches up.

And two - their ‘balls’ and eye for finding and doing newsworthy stuff. It’s very first principled thinking. What will gain attention, especially in that industry. I think they have been absolutely brilliant at it.. Akin to Paddy Power, Southwest and Ryanair’s ability to do so. That is their real strength. Exaggeration is definitely part of that. Many question whether the ‘early days of hardship’ stories are real, such as Watt saying he had no money to buy a coffee in the airport on a trip home, so he had to barter for an apple. But it gained them notoriety either way. Martin Dickie has kept a much lower profile and is currently CEO of BrewDog Distilling Co since last year.

By 2015 the company had 44 bars and equity for punks now had brought in 32,000 shareholders. And the founders were throwing an eye west, towards North America. Or specifically towards Columbus, Ohio, and their first entry into the American Market. We’ll take a look at that Odyssey in next week’s chapter.

But before we finish here, a final word on that early phase. It was a movement in every sense of the word. The word punk is defined:

“a loud, fast-moving, and aggressive form of rock music, popular in the late 1970s.

"punk had turned pop music and its attendant culture on its head"

Obviously this was chosen for a reason, and well selected at that. And this has been the mantra since day one. They have much to thank for it, even if they eventually kind of died on their sword…more on that next week. I read James Watt’s book called Business for Punks some time ago. And true enough it’s a very different read to most business books. And that’s what we can learn here. If you want to engage the Crowd, it has to be a movement of sorts. Big or small doesn’t matter. And that takes bravery, as well as putting yourself out there. Every movement needs a face. That’s why, I think, the blockchain crypto/tokenization push has faltered. Partly because people don’t get the Why right. And partly because the projects are hidden behind keyboards, and without a face, hence without trust. For the next phase, I think founders will have to come out from behind their keyboard to rebuild that trust.

Next week we’ll delve into the more recent years of the BrewDog’s movement, and what lessons we can learn.

Hopefully you continue to get some value from the newsletter. Thanks for reading and please pass it on to anyone you think will benefit. Feel free to email with any suggestions or feedback. [email protected]

Until next week, and chapter 10, Go n-éirí leat!

Derek.