The times they are a-changing in craft beer. In particular, the age of the founder-managed brewery is fast fading.
The model of a homebrewing, boot-strapping entrepreneur running a multi-million dollar business “bigger than they would have imagined in their wildest dreams” is, by necessity, evolving.
For a start, brewery founders are getting on a bit, and probably want more spare time to chill out with a beer and a nice ocean view.
But the market created by the founding fathers of craft is also getting awfully competitive. Sales are not easy to come by.
In some instances, such as at Sierra Nevada and Bell’s, the torch is being passed literally to the next generation. But in others, brewery founders are hiring career managers. Breweries have gotten to the size at which they need to be run like a serious business, and the occasional founder is questioning his qualifications to do that.
(Quote Greg Koch of Stone Brewing, when he announced he was looking to hire a CEO to replace him, “How did I qualify to be CEO of…a company of more than 1,100 people? I was here first!”)
Stone hired MBA and ex-management consultant Dominic Engels as CEO; Brooklyn Brewery promoted MBA and ex-management consultant Eric Ottoway to CEO; New Belgium just hired MBA and ex-management consultant Steve Feccheimer as CEO; and at Boston Beer, co-founder, Chairman, MBA and ex-management consultant Jim Koch is looking to replace MBA and ex-management consultant Martin Roper as CEO with…well, who knows what kind of resume he or she will end up having.
To get under the skin of what it’s like to come in and run a revered craft brewery, I turned to my good friend and ex-boss (he was Brand Director for Guinness at Diageo when I was Senior Brand Manager [note: I still consult for Guinness and Diageo as my client]), Doug Campbell. He’s one year into the gig as President and General Manager at Brewery Ommegang in Cooperstown, upstate New York.
(Doug, by dazzling co-incidence, happens to be an MBA and ex-management consultant.)
“When I worked in Guinness Innovation, probably almost a decade ago, I decided that to have more than a shred of credibility I should probably learn to brew. So I started homebrewing, and the first recipe I ever attempted was a clone of Ommegang’s Abbey Ale,” Doug told me, as we strolled the bucolic beauty of Ommegang’s grounds during the annual Belgium Comes To Cooperstown festival.
“I’ve since told Phil, our master brewer, that my efforts were probably quite far short of his exacting standards, but not enough to put me off the original,” he said.
Doug moved to Ommegang, one of the country’s first and still finest Belgian-inspired breweries, after managing the Guinness and Ketel One Vodka brands in the US for Diageo. As my interview below reveals pretty thoroughly, he’s a through-and-through beer lover. But on top of that, Doug’s background is almost laughably blue chip.
A bachelor’s in International Relations from Princeton (sorry, the Woodrow Wilson School of Public and International Affairs at Princeton University) followed by three years’ strategy consulting at Marakon Associates, followed by a stint in venture capital, followed by a joint MBA and Masters in International Relations from Wharton at the University of Pennsylvania (yes, two Ivy League schools) and Johns Hopkins. And then a 12 year stint at Diageo, the British premium spirits and beer maker.
How does a man with this resume find life in sleepy Cooperstown, population 1,800, known almost exclusively for being the home of the Baseball Hall Of Fame?
“I love it!” Doug exclaimed. “My wife and I have been asking ourselves why we didn’t move to a small town years ago. The people in Cooperstown have been so welcoming, and the kids [Doug has three, aged 4-10] are having a great time.”
“Ommegang was founded in Cooperstown for a reason,” he continued. “It’s beautiful, it was affordable, it’s on the site of an old hop farm, and it’s next door to one of the largest tourist destinations in the state.”
While Ommegang is not technically the oldest Belgian-style brewery in America, it’s perhaps the most authentic.
Founded in 1997 by husband-and-wife Belgian beer importers Don Feinberg and Wendy Littlefield, from the outset the brewery was funded by Brouwerij Duvel Moortgat, the 150-year-old maker of Duvel and a host of other Belgian beers. In 2003, Feinberg and Littlefield sold their stake to Duvel Moortgat, who went on to buy Kansas City-based Boulevard Brewing Co. and Paso Robles, CA-based Firestone Walker Brewing Co., forming Duvel Moortgat USA in the process.
I asked Doug how the Duvel USA set up works.
“Boulevard, Ommegang and the portfolio of imports is sold through one sales force, which is Duvel USA,” he explained. “Firestone Walker has its own sales force, although as you saw today [we’d just been drinking at the Firestone Walker stand at BCTC] we’re all very close. But particularly on the brewing side, all three breweries are frequent collaborators. All the brewers go as one team on hop selection. And of course, all the operations teams visit Belgium pretty often too.”
I was also curious what kind of an impact being part of the triumvirate had on everyday operations.
“We’re in a hyper-competitive market,” Doug said. “And I’m one phone call away from Steven Pauwels and Jeff Krum at Boulevard; David Walker, Adam Firestone and Matt Brynildson at Firestone Walker; Hedwig Neven and the brewers at Duvel; all the way up to Michel Moortgat, who is the fourth generation of his family to own a brewery. That to me is a serious competitive advantage.”
As we sat down with pours of Ommegang’s Witte, gold medal winner in the Belgian-style witbier category at last year’s GABF, I asked the big question. Why are there so many professional managers leading craft breweries nowadays, and what will that do to the industry?
“That’s a big question, and it probably has several potential answers,” Doug replied. “In the main I think it’s a function of the oddball nature of the market for beer, which is actually only approaching normalcy now in my view.”
“The craft beer market has not been “normal” for about 20 years. The consumer was so starved of high quality, high end brewing that, as the idea of craft beer caught on, you could pretty much sell anything so long as it was of a good enough standard,” he said. “That’s highly unusual.”
“The market is normalizing more now, and you therefore see the hallmarks of a more competitive market,” he continued. “I hope this doesn’t sound too self-serving, but in a really competitive market there’s a greater need for managers with a more rounded skill set. And I think people like me can be helpful to preserve the legacy that the founders of craft beer have created.”
Fair enough. But one presumes simply hiring a commercially experienced business school graduate doesn’t cut the mustard. What will mark out the good from the also-rans in the new generation of brewery managers?
“The tension between letting brewers pursue their art to perfection and the need to make a profit needs careful management. At the end of the day, any brewery has to be a functioning commercial enterprise,” he answered. “I will say that to be a good general manager of a craft brewery, you need at the least to have empathy for what your brewers are trying to achieve. You can be the best business operator in the world, but to help a craft brewery succeed you also need to have – and be able to understand the vision of – a great brewer.”
10 Questions To Educate The Drinking Classes with Doug Campbell, President & General Manager, Brewery Ommegang
- Can you describe what your company does in one short sentence?
I’m proud to say Ommegang makes some of the world’s most beautiful beer.
(We certainly have one of the world’s most beautiful breweries.)
- How long have you worked here?
About one year.
- How and why did you come to be here?
My personal story started as a fan but then through serendipitous connections ended up with me working here.
I was at a point of transition with Diageo, having just started a new role, when this opportunity sort of fell into my lap. A friend who knew the business told me they were searching, and he knew how much I liked their beers and thought I would be a cultural fit.
Leaving New York City for a pretty remote corner of upstate New York was a transition, but opportunities like this only come around once or twice in a lifetime and I can honestly say I haven’t looked back.
- What is your daily routine?
I commuted to New York City for over a decade, and things are a little different nowadays!
I’ll usually get some thinking time in at home over a caffeinated beverage, a little exercise and then the world’s best commute: an 8 mile drive or cycle down county road 33 to this little farmhouse brewery that I still can’t believe is my office.
Whether the mountains I see on the way in are purple in the fall, steely gray in the winter or a lush shade of green as they are right now, I’ll always take a moment to pause and draw inspiration for the day ahead. Not to be too cheesy about it, but we are blessed with our surroundings at Brewery Ommegang.
I typically enter through the packaging hall, I’ll poke my head into the brewhouse, then up to my desk.
Even though Brewery Ommegang is a small organization, we have an amazing array of different talents and characters who all interlink to produce something magical. Everyone in the company brings something to the table that makes us work as a whole.
I travel a fair bit, mainly to stay in touch with our distributor network. Even though we’re only 45,000 barrels, Ommegang is sold in 48 states and it’s important for me to understand the market context in all our key markets. Beer is a people business, and you have to spend time getting to know people face-to-face.
- What is the hardest thing about your job?
Market conditions hit something of a new era about 6 months before I started. There was a day when most craft breweries could count on selling everything they could make, no matter what. It was just a question of supply planning and efficiency.
Those days are gone. Helping the organization – by which I mean Duvel USA as well as Brewery Ommegang – adjust to this new age is a paramount challenge.
The other big challenge that comes to mind is somewhat self-imposed. We are a brewery that aspires to be the best in America. We have the ambition of making the best glass of beer available. Now I don’t know if we’ll ever get there. And the bar is constantly going up. But driving the organization to achieve such a lofty goal is mentally and emotionally stretching, while also great fun.
- In your view, what does it take to make it in beer?
In high-end craft beer the key is to motivate competitive performance without dampening any of the artistic intent to make the best beer in the world. High-end beer is no different to high end spirits, or cooking, or fashion, or any field in which the product is the result of a person’s passion for creating something for its own sake, not for the monetary benefits which making it confers. The trick is to create a profitable business around that passion without in any way stifling it.
My role is to cultivate an atmosphere of creativity and ambition while minding the shop.
- What is success for you?
This will sound incredibly clichéd, but standing in a bar, or at a festival, or even in the brewery and hearing somebody say that a product you have personally witnessed get made makes them happy is an amazing feeling.
I was always proud of the brands I worked on at Diageo, but I didn’t work with the people who worked on every aspect of making the products and getting them into people’s hands on a daily basis.
Brewery Ommegang is a family. Seeing the joy our beer brings to people is the reason we do it.
- If you could change one thing about the industry, what would it be?
I would like to see more breweries do what – I say with due humility – I think Ommegang has always done, which is to make new beers because they are better, not because something new has to be made.
At times in recent years, it’s felt like there’s been a lot of innovation for innovation’s sake – the sake of novelty versus improvement. Over time, I think that’s bad for the industry.
Let me answer the question a different way. As competitive pressure builds in the industry, more businesses feel the pull to make less special beer to maintain sales. I think that goes against what made craft beer successful. And I hope as many breweries as possible are able to resist that pull.
- Apart from your own, what are your three favorite beers, and why?
Actually I asked something similar to each of our brewers when I joined, and to a man they all told me it was a terrible question.
- The first beer that got me into craft was Anchor Steam. Out of both nostalgia and sheer respect for the quality of the beer, I almost always have it on hand.
- It’s not technically craft, but Rochefort 8 was a beer that made me sit down when I first tasted it. I love malt, but I prefer malt flavors when they’re very interesting and tempered with complexity.
- Guinness Foreign Extra Stout is a superb beer and also very meaningful to me.
- Where do you like to get a beer in Cooperstown?
There’s a couple! I’d probably better be careful, it’s a small town.
In terms of location, it’s hard to beat a beer at the Hawkeye Bar in the Otesaga Hotel, staring out over Lake Otsego. In the summer, that’s probably my favorite place to drink beer in the world.
Of course, in the middle of winter, you might want something cosier, and I really like a bar called Alex’s down the road, especially if Alex is actually working that night. When it’s 10 degrees below zero in the Upstate winter, there is no greater pleasure than sitting at his bar sipping a Three Philosophers until both your fingers and your spirits are warmed.
One of the best things about Cooperstown is the variety and the energy, especially as the seasons change. The town has a saying that it’s “a drinking town with a baseball problem.” There is a kernel of truth to that.