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Beer for punks, irreverent and brilliant
James Watt and Martin Dickie were bored of the industrially brewed lagers and stuffy ales that dominated the UK beer market. Sat in their local Scottish pub, they decided the best option was to brew our own. In April 2007 BrewDog was born.
James Watt and Martin Dickie were bored of the industrially brewed lagers and stuffy ales that dominated the UK beer market. Sat in their local Scottish pub, they decided the best option was to brew our own. In April 2007 BrewDog was born.
Both only 24 at the time, they leased a building in Fraserburgh, got some scary bank loans, spent all their money on stainless steel and started making some hardcore craft beers. They brewed tiny batches, filled bottles by hand and sold their beers at local markets and out of the back of our beat up old van.
Since then, the company has grew rapidly, but holding on to its irreverent mindset.
Watt himself is known for explosive, bombastic proclamations in the press: His press releases include “F**k the rules” announcing the launch of his new business book and an update on BrewDog’s crowdfunding campaign that quotes him as saying: “We’ve not just broken a record, we’ve smashed through it with a monster truck”.
But in person, when we meet to discuss his new entrepreneurial advice book “Business for Punks,” Watt is softly spoken, cheery, and pretty harmless. The closest he gets to swearing is saying “balls.”
Beer for Punks
“I just wanted to outline our off-the-wall, slightly anarchic approach to business so other people could see what we’ve done and realise that you don’t have to do what you’re supposed to do, you don’t have to follow the status quo, and you can do things on your own terms,” he says, explaining his motivation for writing the book.
“Before I set up the business I was captain of a fishing boat. I’d never done a business before, I’d never been involved in business. We didn’t know how things were meant to be done so we went ahead and did things on our own terms, in our own way, and almost inadvertently created a whole new approach to business along the way.”
BrewDog was one of the first breweries in Britain to pioneer a new wave of hoppy, American-style “craft” beers and its Punk IPA is one of the most popular and recognisable brands of British craft beer.
Watt and co-founder Martin Dickie became two of Britain’s most successful entrepreneurs in recent years, building a network of bars across the UK, and and then looking across the world.
Watt likes to talk up his “anarchic” approach and chapters of his book include “Finance for visionary renegades,” “Marketing for postmodern dystopian puppets,” and “Sales for postmodern apocalyptic punks.”
But look past the flowery language and the advice in the book is pretty level-headed stuff — keep an eye on the bottom line, know your customers, and make sure staff are happy.
“The startup phase, finance, the bit about staff, company culture, finding time — all these things can apply to almost anyone in any business,” he says.
While Watt may not have run a business before BrewDog, but he’s clearly been keeping an eye on things, pointing to Apple, Zappos, and Danish restaurant Noma as good businesses based around a “cause” in the book.
BrewDog’s passion is good beer. Watt says: “As a company we focus on two things — our beer and our people. We have done some sort of high-octane, risky, edgy, marketing things but they’ve all been done to increase peoples’ awareness and understanding of good beer.”
But how “risky”, “edgy”, and “anarchic” is BrewDog these days? It’s beer is stocked in huge supermarkets like Tesco, Sainsbury’s, and Waitrose.
“Our mission is to make other people as passionate about great beer as we are and we can’t do that if we don’t have the means to get the beer into people’s hands,” Watt says. “We’re about getting people excited about beer and do to that we need to get beer to market by any means possible.”
Equity for punks
BrewDog pioneered the idea of equity crowdfunding in the UK, launching its first “Equity for Punks” campaign on its website in 2009.
Watt recommends crowdfunding to entrepreneurs, saying: “We love the Equity for Punks model. We’ve now raised over £20 million ($30.5 million), we’ve got a community of over 14,000 Equity for Punks investors who are advocates, who are ambassadors, who are principally linked to our business.
“We just love the fact that our business is owned by people who love fantastic beer as much as we do.”
The money BrewDog raises is going to be put towards everything from expanding its network of bars to opening a beer-themed hotel in Scotland and breaking into the “craft” spirits business. But BrewDog is still, and always will be, a beer company, Watt says.
“I don’t think it is more than just beer,” he tells me. “The hotel tacks on to the hospitality side of our business and we’re not looking to open a chain of hotels, we’re just looking to open one hotel up in the north east of Scotland.”
He adds: “I think the spirits tacks on nicely if you look at people like [US craft breweries] Anchor Brewing, Dogfish Head, Rogue, New Holland. With a beer, we’re more than 50% there to making a fantastic tasting spirit and we just want to do some more experimentation in that space. But the company is very, very much about beer.”
Watt says he and co-founder Martin Dickie would never sell the business to one of the big brewing conglomerates.
That’s not to say we wouldn’t exit at some point but there’s no plans at the moment,” he says, “and if we did, instead of selling to a bigger company, it would be a management buyout or to release some more equity to our Equity for Punk holders.”
But then it all went wrong.
In 2020, BrewDog became the world’s first carbon-negative beer company and one year later, the company received its BCorp certification but also came under scrutiny after some employees accused the company of having a toxic work culture. BrewDog responded with an independent culture review and lots of new actions, for example, the creation of an Employee Representative Group.
A new start. A new blueprint.
In 2022, BrewDog released its new BrewDog Blueprint offering a nice glimpse into their new business practices and plans.
It was reported that the company received more than 1,000 job applications in the 10 days after the publication of the blueprint.
Here are some of the initiatives driven by the new blueprint:
“Our Hop Stock programme will ensure that we are all in this together as we build the future of BrewDog.”
- Founder James Watt is giving away 5% of his BrewDog stake (worth around £100m) to its employees.
- This means, 3.7m shares in BrewDog will be distributed evenly amongst all employees with each team member receiving approximately £30,000 per year in shares over the next 4 years.
“We want to create a radically new business model for hospitality – one that firmly puts the people who make the real difference in our bars, those who look after our customers every day, at the very core of what we do.”
- Each BrewDog Bar is going to share 50% of its profits evenly with team members.
- Profit share allocation is based on hours worked – so General Managers and bar crew share in the profits in the same way.
- Financial details will be shared fully transparent with all team members, every month
“With the BrewDog Alumni Club we want to formally recognise the contribution that all of our former team members have made and also thank them for their efforts.”
- Free to join alumni club for all former team members.
- Benefits include amongst others a lifetime discount of 10% in all bars and on the online shop, a free 12 pack of beer every December and an invite to a yearly alumni social event
- Employees get 4 weeks full paid leave – beyond their normal holiday allocation for every 5 years of service.
- No-one can join the company for a salary higher than 7x of what the lowest full-time salary at Brewdog is.
Mental Health First Aiders
- By the end of 2022, 10% of Brewdog staff will be qualified as mental health first aiders.
- A monthly wellbeing lab covers topics from men’s mental health to menopause.
- A crew-led Diversity, Equity and Inclusion forum meets weekly to drive actions within the company.
Carbon Negative Business
“We believe that our carbon is our problem.”
- In August 2020, BrewDog became the world’s first carbon negative beer business. The company removes twice as much carbon from the air as they emit, every single year.
- BrewDog bought 9,308 acres in the Scottish highlands that will be restored and rewilded (including peatland restoration and native tree planting). The land is capable of pulling up to 1 million tonnes of carbon dioxide out of the atmosphere.
- The project was developed in partnership with independent sustainability expert Prof. Mike Berners-Lee.
Carbon Reduction Strategy
“When we count our carbon, we count all of it; this includes all direct emissions which occur at our breweries and bars, the emissions from the electricity we purchase, as well as the emissions of our entire upstream and downstream supply chain, globally.”
- Brewdog invests close to £50m to reduce their environmental impact. Their carbon footprint has already been reduced by 20% vs its 2019 baseline, with a 35% reduction being the target for 2023.
- A Bioplant was commissioned that will recycle and reuse most of the company’s wastewater. The plant will also generate green gas to power the brewery and delivery trucks.
- CO2 recovery by capturing the CO2 produced by the bioplant and during beer fermentation is planned.
- All of BrewDog’s UK business is already wind-powered, and all other global businesses purchase green electricity. Some, like BrewDog’s Australian brewery is solar-power driven.
- BrewDog is in the process of swapping out all of the company’s delivery vehicles to low-carbon powered alternatives.
- At BrewDog bars it’s also all about switching to eco-friendly consumables, building local brewing sites to shorten the supply chain, reducing waste, carbon footprint labeling, and 50% vegan and veggie menus, amongst other things.
While it hasn’t been an easy ride, Brewdog is back, still popular, still growing. But seeking to balance its irreverent style with a more responsible one too.
Business for Punks
Watt’s book Business for Punks bottles the essence of Brewdog an accessible, honest manifesto, including mantras like
- Cash is motherf*cking king … Cash is the lifeblood of your company. Monitor every penny as if your life depends on it—because it does.
- Get people to hate you … You won’t win by trying to make everyone happy, so don’t bother. Let haters fuel your fire while you focus on your hard-core fans.
- Steal and bastardise from other fields … Take inspiration freely wherever you find it— except from people in your own industry.
- Job interviews suck … They never reveal if someone will be a good employee, only how good that person is at interviews. Instead, take them for a test drive and see if they’re passionate and a good culture fit.
Here is a longer list of the best moments and messages from the book, delivered in typically provocative yet inspiring style:
- At BrewDog we reject the status quo, we are passionate, we don’t give a damn and we always do something which is true to ourselves. Our approach has been anti-authoritarian and non-conformist from the word go.
- Ultimately for a crew to be effective leadership needs to come from the top down, the bottom up and everywhere in between.
- Michael Jackson led to Martin and I deciding to take the plunge, follow our dreams and start our very own craft brewery. Michael, upon tasting one of our home-brewed concoctions, told us to quit our jobs and start brewing beer. It was the last bit of advice we ever listened to.
- Rip up those stuffy old text books, reject the status quo, tear down the establishment and embrace the dawn of a new era.
- The decisions you make during your business’s formative months will define your place in the world. They will be the most monumental decisions you will ever make, shaping your fledgling business in ways you cannot yet imagine. So you’d better buckle up, hold tight and step up to the challenge. You will need to make sure your ideas, and their realization, are nothing short of awesome.
- Businesses fail. Businesses die. Businesses fade into oblivion. Revolutions never die. So start a revolution, not a business.
- Your biggest challenge from day one is to give people a reason to care, and that reason has got to be your mission.
- The market for something to believe in is infinite. You need to give people something to believe in.
- If money is your motivation then you need to be the greediest, meanest son of a bitch on the planet to make a business work. Solely money-focused businesses do exist, but I don’t like being around them or their people.
- Assume no one will care, assume no one will give a damn, assume no one will want to listen. Then figure out how to make people want to care about what you do. If you can’t, then your business is doomed.
- Twenty-first-century consumers increasingly want to align themselves with companies and organizations whose missions and beliefs are compatible with, and enhance, their own belief systems.
- Advice is for freaks and clowns. The thing about being driven is you need to know your own way.
- The only thing you learn from mistakes is that you are not good enough and that you need to get better.
- Don’t follow when you can lead.
- Be a selfish bastard. Seriously, you have to be. If you’re not 110% up for it, no one else is going to give a damn. So dance to your own tune and do it your way. Make crafted products you love, create environments you want to hang out in and give the kind of service you’d love to receive yourself.
- Choose a business partner as wisely as you would choose a spouse.
- The power of any brand is inversely proportional to its scope.
- Planning is merely glorified guesswork. Long-term planning is a vain, self-indulgent fantasy. Don’t waste your time.
- Act, don’t plan.
- Constraints are just advantages in disguise and opportunities to be innovative and imaginative. Cherish constraints. Embrace them.
- Be very wary of external agencies and partners. They all speak a good game and promise the earth but at the end of the day they have no reason to care as much as you.
- Living the punk DIY ethic means not relying on existing systems, processes or advisers as this would foster dependence on the system.
- You need to be an independent, an outsider, a nomad, a libertine. You need to be completely self-sufficient and not rely on anyone for anything. If a skill set is important to your business, then you better learn it and learn it fast.
- You need to create pull to be sustainable. And you don’t create pull through sales.
- Everything you do is sales and all of your employees are selling all the time. Act accordingly.
- Pretty much all you need to do for people to hate you is to be successful doing something that you love.
- When you manage to get the Holy Grail of other businesses copying you, whilst others are hating you, you know you have hit a home run.
- Eighty per cent of all new businesses fail. And they always fail for financial reasons. The more you understand the numbers the less likely they are to crush you and your dreams.
- Comfort zones are places where average people do mediocre things. If you are even the tiniest bit comfortable then you need to push harder.
- The lifeblood of your business is cash. If you can’t manage a cash flow, then you can’t run a business.
- Spend every last dime as if it actually was your last and ensure that your team spend every single cent as if it were their own.
- It was about empowering the change-makers, the misfits, the libertines, the community, the frustrated, the independents, the punks. Together we can, and will, change anything.
- There is a huge difference between making a sale and actually being paid for that sale.
- If you price down you down-sell everything, and there’s no going back.
- You need to defend your price point like a junkyard Rottweiler.
- The best way to decide how to allocate your cash and resources is to fully comprehend the opportunity-cost implications of every possible decision you could make in any situation.
- Everything you and your business does is marketing. Modern brands don’t belong to companies, they belong to the customer.
- Anything that you do, anywhere in your business, which is not completely aligned with your mission and your values is like a tiny little suicide.
- Today the only way to build a brand is to live that brand. People want to feel like they are buying into something bigger than themselves. Your brand must give them that opportunity.
- For a stunt to really work then it needs to be intrinsically linked to your mission and you already need to have a really strong following and a credible brand.
- Whatever type of business you are in you need to start building a community and start turning customers into fans.
- The biggest mistake you can make is actually caring what people think. To hell with opinions, conventions and consequences. It is all just a game.
- We hate bad beer so much that we are on a permanent campaign to destroy as much of it as we possibly can.
- Chasing someone else’s perception of cool is one of the stupidest mistakes it is possible to make.
- Having a target market and explicitly marketing to them is a sure-fire way to patronize and alienate pretty much all of the intelligent population.
- There are only three very simple things you need to know about sales.
- Focus on the product.
- Be open and honest.
- Don’t compete on price.
- Sales are merely the by-product of being great elsewhere.
- If you can’t get your staff to fall in love with your business, you haven’t got a chance in hell of a customer to even consider liking it.
- Any great business today is built on these simple yet enduring and all encapsulating pillars. The three pillars are:
- Company culture
- The quality of your core offering
- Gross margin
- Studies show that employees working in a company with a strong company culture are more than twice as effective as employees working in a company with a weak culture.
- The things that apply to your business externally are just as important, if not even more so, inside it.
- People mimic the behavior and beliefs of their leaders so make sure that you, and the people leading your business, live and breathe the behavior you want to perpetuate.
- It isn’t enough for people to know what their business is doing. They have to know why it is doing it.
- Companies need to wise up and max out. Smart companies realize, rather than minimizing wages, it is infinitely more productive and profitable in the long term to look to maximize engagement, loyalty, retention and productivity.
- Culture has to be a priority from the get-go and it has to start with the founders and then flow from the early employees.
- Working on your company culture is actually a much more effective form of marketing than pretty much all traditional marketing mediums combined. Culture is marketing. Culture is brand. Culture now resonates much more with consumers than advertising does.
- We have two simple rules for hiring:
- They have to be as passionate about our mission as we are.
- They have to be the right cultural fit.
- If you want your team to really rumble you’ll need to recognize their efforts. Explicitly and frequently. Leave your heartfelt praise and encouragement ringing in their ears and the impact can be off the charts.
- Unless you add amazing people to your team, you are going to spend a hell of a lot of time trying to get average people to consistently make great decisions.
- Teams tend to operate at, or close to, the ability level of the weakest team member.
- Whatever happens, good, bad or ugly, it is a direct consequence of your leadership.
- Leaders are rare inspirational beings. Managers are ten a penny; the world is full of adequately competent middle managers trapped in corporate hell.
- Work harder, think smarter and focus with laser-like efficiency.
- At BrewDog we have a fifty-fifty rule for our five directors. I and the other four people who lead our business are only allowed to spend half of our time working on the day-to-day operations of the company, on solving current challenges and dealing with existing issues and we have to spend at least half of our time working on ways to improve, grow and develop our business, on ways to drive us towards our next phase of growth.
- Look for inspiration everywhere. The only place you should never look is within your own industry. Screw what all the other clowns are doing. Ignore it, blank it out; it is of no relevance or significance whatsoever.
- Comfort zones are places where average people do mediocre things.
- You will not always get it right. But every time you move, every time you make a bold decision, it will take you one step closer to finding the path you are searching for.
- Your actions will determine your destiny.
- The more action you take, the more opportunities open themselves up to you.
- Your team should be governed by your values and your culture and not by policies and rules.
- Keep the team as well informed as possible so they can buy into the excitement of what the business is both planning and currently achieving, both of which act as a great motivator.
- Put systems in place before, as opposed to after, they are needed and put an infrastructure in place for where you want to be in two years’ time.
- Write down your five biggest problems, sit down in a room with your team, and solve them. Then on to the next five.
- Attitude is the difference between a setback and an adventure.
- So whilst the fools, rats and wannabes are massaging each other’s egos you need to be plotting your revenge. Not on them specifically, but on the system that bred such morons. You need to be quietly planning how to blow the status quo to pieces and create a whole new world order.
- You should always imagine the communication from the other party’s perspective. Put thought into what you say and how you say it.
- Don’t shout too often, so that you can make sure it truly counts when you want to roar.
- It is paramount you track at least ten of the most important performance indicators of your business monthly.
- When it comes to your management accounts you should definitely be tracking sales, cost of sales, overheads, gross margin, EBITDA and net margin. You will also need to monitor items on your balance sheet at regular and short intervals, such as debtors, creditors and, most importantly, your cash position. In addition you should track certain other KPIs (key performance indicators), depending on what is important in your business and your current focus. For instance, you should consider tracking things like: average spend per transaction, staff turnover, customer complaints, referrals, shipment accuracy, sales mix, refunds, wastage, sales growth, additional customers, online engagement or staff happiness (to name but a few). In determining which items you need to keep close tabs on it really depends on your business and your objectives.
- No measurement = no reporting = no visibility = no one cares = your ultimate demise.
- Always do your negotiation homework. Find out about the other party, what makes them tick, their likes and dislikes. Ultimately think about what’s in it for them. Then build your argument around how the deal helps them, because at the end of the day they care much more about what is in their interests than yours.
- Find a solution, structure and deal they feel comfortable with, and positive about. But one that is ultimately engineered around what you want.
- You need to provide the vision, strategy and tools to help your team achieve your goals.
- Whatever goals you’ve set, you should have a list of pint-sized systems, things which you rigorously adhere to without fail, that if consistently applied will help ensure you both achieve your goals and strengthen your brand and company in the long run too.
- Committees are breeding grounds for compromise as the tyranny of conformity rules the roost. Conformity is no place for risk and compromise is no place for innovation.
- Individual vision is always the force behind truly remarkable ideas and concepts.