America's craft beer market is booming — sales rose 18 percent by volume in 2014 to 22 million barrels, according to the Brewers Association — and military vets are in on the action. Military Times recently set out to meet some of them and to find out how they're making the beer business work.
14TH STAR BREWING CO.
St. Albans, Vermont
Snapshot: Estimated $5 million capital investment; $2.5 million in sales with forecasted doubling of growth each of next two years.
- Tribute Double IPA. Golden color, citrusy hops, dry finish. ABV (alcohol by volume) 8.4%
- Maple Breakfast Stout. Includes 100% pure Vermont Maple Syrup, local St. Albans honey and coffee. Dark and delicious. ABV 6.8%
- Valor Ale. Hoppy amber ale. Portion of sales support Purple Hearts Reunited, returning medals of valor to the servicemen and women who earned them. ABV 5.4%
- Golden Wheat. A slightly sweet ale with dry finish. ABV 6%
Steve Gagner listened to naysayers warn that most businesses fail as he launched his 14th Star Brewing Co. in northern Vermont a few years ago. He shrugged it off, saying, “That’s OK, we’re not going to fail.”
“We had a plan, and we were determined to make it work,” Gagner said.
Gagner, a major in the Vermont Army National Guard, is a full-time professor of military science at Norwich University. He has served in infantry, armor and quartermaster units, and even had a tour as operations officer for a weapons of mass destruction unit.
His overseas tours included Iraq, Afghanistan and Korea, and it was during a deployment that he began formulating his brewery concept. Born in Highgate, Vermont, on the border with Quebec, Canada, he launched his business in St. Albans, a small, scenic city on Lake Champlain about a dozen miles south of his boyhood home. Vermont was fiercely proud of being the 14th state admitted to the union, and Gagner honors that history in his brewery’s name.
Deployments take a toll, and like many military members, he missed a significant number of early milestones with his young family. The connection to family is evident around the newly-expanded brewery, built from a converted old bowling alley.
The massive stainless steel brewing tanks are named after his kids and the children of his brewmaster, Dan Sartwell. “They remind us of why we’re doing this … helping improve the community where we raise our kids and where they’re educated,” Gagner said.
Business is soaring. Gagner plans to begin bottling and canning on site soon, and a new taproom is pulling in customers. His beers are sold in many local restaurants and bars. Distribution is growing throughout Vermont and recently expanded into Boston.
Gagner's entrepreneurial advice: Active-duty troops, reservists and veterans should be confident when they consider making the leap into entrepreneurship. “Soldiers, or anyone else coming out of the service, who are willing to work harder and not be denied, will be successful,” he said.
VETERAN BEER CO.
Snapshot: Distribution in seven Upper Midwest states from Minnesota to Wisconsin; annual sales of about 20,000 case equivalents; seven full-time employees, 19 part-time employees — all veterans. All companies in the supply chain are required to have a “veteran first” hiring policy.
- Blonde Bomber. Apollo and Cascade hops with hint of citrus and touch of wheat. ABV 5%
- Freedom Road. Hints of caramel and black malts, with Cascade and Hersbrucker hops. Bold and earthy aroma. ABV 5%
- HOOYAH! IPA. Tomahawk, Chinook, Magnum and Cascade hops duking it out. ABV 7%
Headquartered in the Windy City, Veteran Beer Co. operates out of three locations in the Upper Midwest. It is the 2012 brainchild of Navy veteran Paul Jenkins. Jenkins, a Naval Academy graduate, left the service in 1995 and began working in the private sector. He founded Bancroft Architects and Engineers, which counts among its clients the Veterans Affairs Department.
Jenkins began to believe that too many veteran employment programs were just so much lip service and wanted to start a business that truly placed veteran employment above all other considerations.
He and fellow founding partner, Marine veteran Michael Banzer, a friend from the Annapolis days, created a benefit corporation or "B-Corp." This means the company must put its social mission of hiring veterans above company profits. Only about 200 such corporations exist. Jenkins is president and CEO, while Banzer is chief financial officer.
“We run it as a for-profit, but we have to put our mission of hiring vets above our profit,” Jenkins said. “Plus, the first 10 percent of everything we produce goes to veterans’ charities. We look for charities that make a difference in the areas where we sell beer.”
Jenkins leases facilities from established brewers, explaining that it’s a contractual arrangement under which Veteran Beer Company’s brewmaster, Army veteran Nate Reeves, goes to the leased location and brews beer using his company’s recipes. Jenkins said this saves on infrastructure cost and facilitates access to more of the marketplace. “Plus, we can adapt best practices seen at each location each time we brew,” he said.
The beers are pulling in accolades, receiving medals in 40 of 44 contests entered, Jenkins said.
Jenkins' entrepreneurial advice: “Don’t over-analyze it. Do it. Put one foot in front of the other, and just do it. There are a million ways to talk yourself out of it, but simply look at the target, ignore the obstacles.”
Snapshot: 30-barrel brewing system in a 28,000-square-foot facility with taproom in downtown Savannah. Approximately $3 million in capital investment (facility/equipment). Full distribution in Georgia, North Carolina and South Carolina. Ryan partners with Barrel Backers to ship beer via online sales anywhere in country where allowed. Annual sales are 2,500 barrels or about $800,000-$1 million. Sold in most military exchanges in Georgia; six full-time, five part-time employees.
- Ground Pounder Pale Ale. Medium-bodied pale ale with caramel malt, spice and citrus notes and bold, piney hop characteristics with herbal infusion of lime and crushed black pepper. ABV 4.6%
- Compass Rose IPA. Intense aromas of sweet grapefruit and pear, balanced by a fresh grain breadiness. Finishes with hints of passion fruit and orange peel. ABV 6.6%
- Rally Point Bohemian-style Pilsner. Sweet, complex malt, earthy Czech Saaz hops, clean, crisp finish. ABV 4.6%.
Army veteran Kevin Ryan and his fiancée Meredith Sutton created this company in 2012. Ryan is a 1996 graduate of the U.S. Military Academy at West Point. He spent eight years on active duty, with assignments in Alaska, Colorado and Iraq.
Ryan left the Army for civilian life in 2004 and worked for his father’s management company in the field of technocentric health care. A home brewing kit Sutton bought him in 2011 altered his career path, and within months he hatched plans to open a brewery. From the start, he dedicated his business to “honoring those who have put their lives at risk and their country and community first.”
Like many veteran-owned, breweries, a portion of revenues benefits veteran charities, preferably those that give back at least 90 percent of their revenues to the beneficiary. So far, his company has donated more than $23,000. One favorite charity is Homes for our Troops, an organization that build homes specially designed to help vets with service-connected disabilities.
Ryan’s privately-held company has 23 investors, 20 of whom are veterans. He’s primary shareholder.
Both the Small Business Administration and the Savannah Economic Development Authority helped him launch the business. At a military transition summit at nearby Fort Stewart last year, Ryan encouraged other veterans to seek similar help as they transition.
For Ryan, the best thing about being a craft brewer entrepreneur is the ability to follow your passion. “To be able to say, ‘This is my business, my creation.’ When you start a business with a group of like-minded folks, it’s a great feeling,” he said.
A brewmaster oversees production, but Ryan is involved in recipe development. He sometimes uses yeast and honey from the beehives Sutton maintains behind the brewery.
Ryan’s entrepreneurial advice: Look into franchises. Franchises provide a good route, established brand, left and right limits, and training.
Colorado Springs, Colorado
Snapshot: Produces up to 3,000 barrels of beer annually, making it one of the largest craft breweries in Colorado Springs; nine full-time employees, five are veterans.
Distribution to about 200 locations throughout southern and central Colorado (south of Denver). Sold on military installations. Annual gross sales exceed $800,000 or about 33,600 cases a year.
- Blue Nose Brown. English-style with roasty malt nose and flavor and caramel sweetness throughout. Finishes slightly dry and toasty. ABV 5.8%
- Devil Dog Stout. Bronze Medal Winner, World Beer Cup 2014. Foreign-style stout also called island stout. Coffee and chocolate flavors and aromas. ABV 7.1%
- Howitzer Amber. Sweet malt dominates. Toffee notes toward the middle. Finishes with sweet malt and mild hop earthiness and peppery spiciness. ABV 6%
- SGT. Pils. Classic American-style pilsner. Brewed with a fair amount of corn, fermented with German lager yeast. Malty with mild hop bitterness. ABV 5.8%
- Doolittle IPA. Balanced. Not too hoppy. Malty backbone with floral, fruity notes in the nose. ABV 6.9%
Todd Baldwin admits to feeling a little lost when he left active duty as an Army field artillery officer in 2009. Transition to civilian life was challenging, and he says it wasn’t until he threw his full energies behind creating Red Leg Brewing Co. in Colorado Springs, Colorado, that he felt inspired.
The brewery opened its doors July 4, 2013. Opening the new business was a huge challenge. Baldwin is sole proprietor, with no outside investors. He worked with the SBA, attended workshops and crafted a business plan. Attempts to get funding under the short-lived Patriot Express loan program were unsuccessful, so Baldwin and his wife financed the startup themselves, using credit card debt.
Initial capital investment was low by many business standards, about $250,000, but that’s a lot of money on credit cards. “We almost went bankrupt in the first three weeks when we couldn’t keep up with demand for our product,” Baldwin said. A unique fundraising program enabled an infusion of money from brewery customers that buffered cash flow and got them through the initial hurdles. Now, with successes under their belt, banking taps from which money flow are easier to access.
Baldwin says the number of microbreweries in Colorado is rapidly growing — about 375 statewide, with nearly 30 in Colorado Springs — but he welcomes the newcomers, “as long as they make good beer,” he said. “If you don’t make good beer quick, you’ll go out of business soon.”
His company is heavily involved in helping other veterans find success as they transition to civilian life. He mentors veterans and is a leader in a Mt. Carmel Center of Excellence networking group that now has more than 100 veterans engaged.
“Veterans make good small business owners,” Baldwin said, explaining that veterans understand how to assess risk and are mission-oriented.
Red Leg is also a founding member of an innovative veteran-owned beer alliance. Besides education and training components, the alliance hopes to increase economies of scale by leveraging group purchasing power for things such as ingredients and supplies.
Baldwin’s entrepreneurial advice: Reach out to the local SBA. Advice is often free, and sometimes it’s hard to know who to spend your money with. Talk to somebody in the business you want to enter. If it’s a brewery, talk to a brewery owner. The veteran entrepreneur community is willing to share what they’ve learned.
Snapshot: Sold about 1,500 barrels last year and looking to do about 2,500 this year. Total sales just under $1 million. Distribution currently limited to northeast Florida — five counties (including two major supermarket chains). Hopes to expand to central Florida and panhandle later this year. Available at nearby installations, including clubs, golf courses, exchanges. Ten employees, mix of full- and part-time; many veterans or still on active duty.
- Raging Blonde Ale. Malt-oriented golden blonde, Cascade and Centennial hops. ABV 5.2%
- HopBanshee India Pale Ale. Cascade, Centennial, Chinook and Columbus hops. West Coast-style IPA. ABV 6.5%
- Scout Dog 44 Amber Ale. Rich biscuit and light caramel malt backbone. Noble hop bitterness. ABV 5.4%
- Buzzin’ Bee Honey Rye Wheat. American-style, unfiltered wheat ale made with Florida honey. Touch of rye and sweet orange peel. ABV 6.3%
Former Navy flight officer Ron Gamble, who flew combat missions over Iraq in 1991 off the USS Forrestal, established Veterans United Craft Brewery in 2013 in Jacksonville, Florida. With the backing of many military veteran associates (hence the Veterans United name), Gamble began pouring his first beers in August 2014.
Gamble is also Veterans United’s brewmaster. Like many craft brewers, his initial foray into beer making came when he was given a simple, homemade beer kit. He developed a considerable brewing portfolio after leaving active duty in 1995, following a short detour in which he earned his MBA and began working in startup Internet companies. He trained at the Siebel Institute and managed brewhouse and cellar operations in both New Hampshire and Massachusetts before moving to Florida to be closer to family and friends.
He worked with the Small Business Administration’s veterans’ program experts, getting a loan to pay for some of the needed equipment. Today, he estimates brewery and taproom capital investment in a 9,600-square-foot, retrofitted commercial building at $1.5 million.
“There is a long history of service in my family. It was a key cornerstone of my life and is something I’m passion about,” Gamble said. The brewery has held fundraising events for charities such as Wreaths Across America and the Military Working Dog Association. One signature beer is Scout Dog 44 Amber Ale, named after a Vietnam war infantry platoon that used working dogs.
Gamble’s entrepreneurial advice: “You learn a lot of great things, great skills in the military that are applicable to the civilian sector. I love hiring former military — their maturity, operational skill sets just seem to be way ahead of their peers. Get some business training. The SBA has lots of great resources. Network. Reach out to vet-owned businesses. They’re more willing to help out than you may realize. You’ve sometimes got to take a step back to take two steps forward, learn a new trade or skill.