It Will Take a Stoner Savant to Lead the Craft Beer Revolution

The Gospel according to Tony Magee.

The Lagunitas founder inside the North Lawndale industrial complex he is transforming into a brewery   Photo: Anna Knott

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Tony Magee is singing, but on a recent weeknight the crowd at Riverview Tavern in Roscoe Village hardly notices. They are talking, drinking, watching an NBA playoff game—anything but paying attention to the disheveled middle-aged white guy who is finger-picking old blues tunes on a classic Martin. Once he finishes his last song, he puts the guitar down and stands there alone. A few uncomfortable minutes tick by.

Slowly it dawns on the bearded young men scattered about the bar that the music has stopped. One by one, they migrate toward the man of the hour, excitedly asking him for autographs and to pose for pictures. (His appearance is part of a series of Chicago Craft Beer Week events.) They may have rather watched the game than listen to Magee the Roving Bluesman, but now they’re lining up to greet Magee the Craft Beer Celebrity, founder of the renegade Lagunitas Brewing Company. “You want him to be nice—and thank God he is,” says Samuel Evans, a partner in Chicago’s startup Ale Syndicate Brewers, who’s patiently waiting.

One reason for the adulation: Even in the eccentric universe of beer brewing, Magee, 53, is as unlikely a corporate chieftain as they come. An Arlington Heights native who dropped out of Northern Illinois University to play in a traveling reggae band, he drifted for much of his 20s, eventually settling in Northern California.

He plodded along in the printing business for several years while he tried to find his real calling. Then he saw how much fun his younger brother was having making beer at a pub in Portland. One homebrew kit later, Magee was crafting beer in his kitchen and then, in a year, delivering kegs of his own special high-alcohol concoction to bars near his house. That was 1993. Two decades later, he’s still designing his own beer labels, playing blues guitar semiprofessionally, smoking weed with his employees, and clinging to his regular-guy reputation. And he has managed to turn his company into one of the largest, fastest-growing, and most irreverent specialty beverage makers in the country, with $65 million in revenues in 2012, Magee says. From 2011 to 2012, the number of barrels shipped—a key metric in the beer industry—rose 46 percent, more than double the growth of any of the top 10 U.S. craft breweries (see sidebar at right), according to the trade group Beer Marketer’s Insights.

Magee is determined to become a threat not only to the industry’s two Goliaths, Anheuser-Busch InBev and Chicago-based MillerCoors—which together account for nearly 75 percent of the U.S. market (see sidebar at right)—but to any beer company that he deems as operating under less-than-pure ideals. “Craft is like porn,” quips
Magee. “You know it when you see it.”

As the demand for more robust American beers grows, and as the beverage regulation laws become friendlier to startups, Magee suddenly finds himself surrounded by an explosion of professionals—and hobbyists—who can produce unique ales that rival those of the original maverick craft producers like him. The one thing no one seems able to replicate is, well, Tony Magee himself, a plainspoken Everyman whose rebellious personality has become inextricable from his brand. Lagunitas remains a quirky family enterprise, controlled not by stockholders or venture capital firms but by its founder, who retains the majority interest and isn’t shy about flaunting it. (Individual investors include the company’s Petaluma landlord and a local veterinarian, but they own small shares, says a company spokeswoman. And while there is an advisory board of three, it has no voting power.)

“Well, I control the company, you know?” he declares. “So it’s pretty simple like that. It’s not like there’s all sorts of investors who have some idea that they want things to be different. Those guys are pretty demanding and unforgiving, and you don’t mess around and take adventures with their money. But for us, it’s not like that at all. We just do stuff. We want to be smart, and careful, but once something seems clear, it’s usually pretty clear.”

For example, last spring he used his rambling, uncensored, and thus wildly popular Twitter account to announce to his 15,000 or so followers that he was “gonna make a little bit o’ NorCal right there in the City of Chicago.”

Fast-forward to 2013: Magee is laying the foundation for the largest craft beer empire in the United States by developing a 300,000-square-foot complex on an industrial stretch near 16th Street and Western Avenue in North Lawndale. The facility, which should be fully operational by March 2014, will have an initial capacity of 600,000 barrels, though it will take a few years to ramp up production to that point. That’s more than the output of all the other Chicago craft breweries combined, according to analysis of a recent report from the Colorado-based Brewers Association, an independent trade group.

“I’ve spent 20 years holding back the reins but always feeling like the horse would go crazy if I just let it,” Magee confesses. “This is the first time we’re going to let the reins forward.”

That’s exhilarating and a little scary, both for Magee and for fans of the craft beer scene, which is known for its small, independent producers as much as for its hoppy, adventurous beers. And while Magee’s plans appear to conflict with a core tenet of the craft scene—that scrappy little breweries are awesome and big corporate breweries are not—enthusiasts of flavorful beers with ironic titles and offbeat labels seem willing to give Magee a chance.

“If somebody [from craft brewing] is going to get really big and become a pillar of big brewing in this country, then [Lagunitas] are the people you want to win,” says Gabriel Magliaro, founder of Half Acre Beer Company in Lincoln Square. “If Tony’s at the helm, I think it’ll probably stay weird on some level.” That endorsement also points to the greatest challenge facing Lagunitas: to maintain the brewery’s freewheeling culture and reputation while operating at a scale that more closely resembles that of Big Beer.

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5 months ago
Posted by JMarkDodds

Great to see such exciting injection of character, personality, originality and Right Stuff into the Big Beer arena.

There's a seriously burgeoning demand for a Tony Magee / Lagunitas in the UK - for sure some people will argue that such influencers already exist - but here the market is stitched up and contrives to keep Big Beer IN and Small Brewers in niche sections of supermarket aisles and out of bars and pubs up and down the country.

Here The People want these beers in our bars but getting a good selection and enough volume of good Craft into the hands of punters remains largely like 'Top Shelf Publications' - out of reach of most of the population. This is because in the UK the majority of pubs are owned by Tied pub companies - pubco's - who abuse the ubiquitous British Tied Beer contract to restrict the number of brands their leasehold publicans are allowed to stock. In the process of restricting the supply chain to Giga Brewers' bland beer the pubco's (many of whom have no brewing interests) add a handling charge or 'commission' on wholesale supply prices which doubles the price to the publican and makes thousands of pubs not economically viable while the pubco's make hundreds of £millions out of the efforts of their thousands of hapless tied tenants.

Put simply this means the majority of British pubs cannot stock Craft beer without breaking the terms of contract with the pubco's who are asset stripping the nation of Our pubs while keeping innovation and evolution in the pub sector at bay.

Until this situation is broken by legislation or Revolution, no Tony Magee will ever be able to storm the bastion of Big Beer in Britain.

If this perversion of the Free Market is of interest to people in the U.S. more can be found out at the Fair Deal For Your Local campaign website here: http://www.fairdealforyourlocal.com/

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