Revenues expand 32%; starting at 2,880 barrels, it now produces 75,000
PETALUMA – Boasting more than 32 percent growth last year and revenues topping $20 million, Lagunitas Brewing Co. has proven itself as one of the area's rising business stars.
The company invested about $5 million in expansion in recent years, and it is poised to continue a speedy upward climb.
Despite its current success, the south Sonoma County brewery known for its unique labels and hoppy malts only recently became profitable. Launched in 1993, music composer turned entrepreneur Tony Magee said it took about 12 years of serious work and investment to survive and eventually reach break even about three years ago.
Lagunitas' Controller Robin McClain said in its first year, sales limped along at about $102,000, and four years later it was clear some kind of cash infusion would be needed to continue. So Mr. Magee called on his friends and neighbors, who invested about $1 million between 1998 and 2002, becoming partners in the business.
Today, the company is more than 25 times its original size, growing from about 2,880 barrels of beer in its first year to a total of about 75,000. The brewery is broadly recognized among beer connoisseurs, and barrels are shipped nationally as far as Texas and New York City. In addition to opening the company's first on-site taproom and restaurant, upgrades to the production facility allow the capacity for making up to 250,000 barrels annually.
The company began construction of the new tasting room and "beer sanctuary" in June, and a grand opening is planned this fall, though the site is currently open to visitors while construction continues. The space is on the same location as the Lagunitas offices and brewery and includes an indoor tasting room near a large, shaded stone courtyard. After the official opening, the facility will host regular live music, special events and food service.
Ron Lyndenbush, who has worked for the company since its beginnings and calls himself the resident "beer weasel," said even during difficult times the team never lost sight of its vision: brewing Northern California's tastiest beer.
"I would say the quality of the beer comes first, and having fun is a close second," he said.
Though Mr. Magee admitted he might not have taken the leap if he knew what a challenge the business would become, it was clear in a recent tour that he adheres to the same product-centered philosophy.
Even after 15 years, the company founder still spends most days at the mammoth Petaluma factory, writing recipes, consulting with brew masters and planning the next big event, be it the beer circus or the famed "skunk train."
He recently guided a tour of the upgraded facility more like a kid with his new train set than a successful businessman, extolling with excitement miles of hoses, titanic steel barrels and a manic-fast labeler. He talked briefly about company financials but described in precise details his new bubbling, Bolivarian brew containers and a row of enormous tanks with "enough beer to drink one six-pack a day from the age 21 to 75 and never finish," according to Mr. Magee.
He said it will take about 10 years to reach the 250,000 barrel capacity and after that he will be happy "to stop growing for a while."
Lagunitas currently brews seven varieties of beer year-round and about nine seasonal labels, including The Hairy Eyeball, Undercover Investigation Shutdown, a Little Sumpin' Sumpin' Ale and others.
