Crowdfunding the Next Generation of Craft Beer

Over the past 2 years or so, start-up breweries have taken to crowdfunding websites such as Kickstarter and IndieGoGo to help fund their craft beer dreams. With varying degrees of success, new breweries have used these websites to attempt to raise money from their local communities, which would sidestep the lengthy and sometimes difficult process of getting a bank loan. Tons of companies and indie projects have turned to crowdfunding recently, but there’s an even newer trend emerging: niche crowdfunding websites.

Whereas websites like Kickstarter and IndieGoGo are more widely recognizable to the general public, they service a broad range of projects. Niche crowdfunding websites seek to crowdfund only one type of industry on their website, bringing all of the fans and potentially interested customers to one website that fits their interests.

Which brings us to CrowdBrewed.com, a niche crowdfunding website that is focused solely on the craft beer industry. Whether it’s a new brewery, homebrew supply store, beer store, or even a hop farm, 100% of the crowdfunding projects on their website have something to do with the craft beer industry.

I’ve been helping them with some of their social media marketing, and was able to sit down with CrowdBrewed’s CEO Travis Benoit recently to ask him a few questions about his company and why it has the potential to become a big player in the craft beer scene.

Why did you decide to start CrowdBrewed.com?

I have always been passionate about beer, and more specifically craft beer. I think it is important to be passionate about what you do for a living as it helps quite a bit with regard to waking up in the morning.There are also a number of breweries that go undiscovered due to a lack of funds. I want to be able to help them get the funding and bring their brand and flavor to the masses.

Help people out who may still be confused – what is crowdfunding in your eyes?

In technical terms, crowdfunding is a financing method that involves funding a project with relatively modest contributions from a large group of individuals, rather than seeking substantial sums from a small number of investors. The funding campaign and transactions are typically conducted online through dedicated crowdfunding sites, often in conjunction with social networking sites like Facebook and Twitter. 

Why do people contribute to campaigns?

People (the crowd) contribute to campaigns for many reasons, but usually it’s because they want to be involved in what the campaign is doing or because they want the perks or rewards that are part of the campaign. The “why” is always a very complicated answer, but we can all relate to the fun and excitement of being a part of something new and interesting. The fact that our projects will contribute to the end product of delicious craft beer is even that much better!

What made you think about niche crowdfunding?

There are over 9,000 registered domains referring to crowdfunding and many crowdfunding portals with a vast scope and no direct focus. I believe niche market crowdfunding is the wave of the future. Craft beer has increased to its highest levels (number of breweries and brew pubs) since the 1800s. The numbers are growing exponentially. There is no other crowdfunding portal to our knowledge in the world that is currently “live’ and focused solely on the beer industry. Our goal is to be the go-to for all things craft beer related.

What makes niche market crowdfunding stand out from the pack?

First of all if, if you are 100% focused on one particular market, you become an expert. We’re also focused on bringing craft beer enthusiasts to our site that will have an interest in our projects. If 100% of the web traffic has even a small interest in craft beer, then our projects will see the benefit as their backers and funders will share their love of craft beer. 

What kind of projects could benefit from CrowdBrewed.com?

Brewers and beer lovers looking to connect and to expand their favorite beer line or products are using CrowdBrewed currently. In addition to just breweries, CrowdBrewed supports the entire ecosystem of beer. CrowdBrewed welcomes any subset to the industry, such as hops farms, craft beer gardens, craft beer festivals, bottling plants, and even pubs that support craft beer. We all know that the craft beer community is one of the best and most supporting in the world, so CrowdBrewed was designed for craft beer enthusiasts to support one another, build a presence, and get project funding. From homebrew kits to mobile apps and games, there’s a place for every craft beer related project on our platform.

What makes a successful crowdfunding campaign for craft beer?

To be truly successful, projects must have a unique product, a pre-planned strategy, strong social media networks along with PR & press outreach. That’s not to say that home runs can’t be hit by doing just one of those activities listed, but it really does help to have all of them working in conjunction for your project to be successful.Crowdfunding platforms aren’t stores with aisles and aisles of people browsing. We’ll do a lot of work to bring craft beer lovers to the website, but we are also mainly a portal for those seeking funds to connect with donors in exchange for cool, edgy, out-of-the-box rewards.

Social media is also an important outlet to the world. I can’t stress enough the importance of social media and networking in crowdfunding. All it takes is one person to spread your brew and brand like a virus; customers are the people that keep the lights on – reach out to them, send mailers, keep them informed. They are your biggest and most loyal fans.Also, don’t underestimate the power of a video for your campaign. It shows the human side to your business, brand, product, and brew.  Statistics show that campaigns with videos a largely more successful than those without – even if it’s made with just a smartphone. 

Why do you think that many businesses now prefer to rely on crowdfunding?

Bank loans are very hard to come by since the market demise of 2008. The number of bank closings and consolidations over the past four-plus years makes loans much harder to get. Bank loans require collateral and exceptional credit, which we all know isn’t as easy as it sounds. Crowdfunding gives those with limited access to necessary capital the opportunity to seek funding from the public directly as opposed to relying on banks as the primary source for funding. The main advantage of crowdfunding over traditional funding is that it does NOT have to be paid back and that the investments made are done so either out of the goodness of someone’s heart or in exchange for an item, product, service or “reward.”

What’s your advice to those looking to start a company or brewery?

Do your research and follow a plan! Plain and simple. Write a business plan and follow it step by step. Devote and immerse yourself 100%. Starting a company is a 24/7 job so be prepared to work more than you have ever thought possible. Get ready to be a salesperson or learn the skills quickly regardless of what area you are going into. Lastly, always have a fully thought-out contingency plan in case life throws you a curveball so that you are able to get back on track to plan A without losing your vision. And of course, part of that plan should be to use CrowdBrewed to help fund your craft beer business!