My guess would be that it all has something to do with this Private Equity firm from Philadelphia that purchased an undisclosed portion of Northern Brewer, for their "operational experience"
An interesting first post...to say the least!
bizjournals said:Chris Farley launched Northern Brewer Inc. in 1993 when he was 18 years old, and built it into one of the nations largest suppliers of home-brewing and wine-making products funding that growth initially with loans from college friends and later by strong sales.
Recently, though, Northern Brewer landed an undisclosed investment from a Philadelphia-based private-equity firm, Entrepreneur Partners, which invests in direct-marketing businesses.
Farley will continue to serve as CEO and president.
The Roseville-based firm has about 100 employees, annual sales between $10 million and $20 million and stores in St. Paul and Milwaukee. It will soon open a location on Lyndale Avenue in Minneapolis. Northern also sells products online.
Farley inked the deal with Entrepreneur Partners partly to tap into the firms expertise. Entrepreneurs other portfolio companies include AmeriFile, a Marietta, Ga.-based company that markets office products such as folders and labels, and Peachtree Business Products, an Atlanta-based company that sells marketing materials and other products.
What Im really looking for is sage guidance, Farley said. These guys have a lot of operations experience.
Northern is forming a board of directors for the first time. Among the members is Steven Wexler, former CEO of Medical Arts Press, a Brooklyn Park-based publisher of forms and supplies that was sold to Staples Inc. in 2002 for $385 million in cash.
Entrepreneur Partners deal with Northern marks the second time in as many years that outside investors put money into a Twin Cities home-brewing supply business. Last year, former investment banker David Kidd and business partner Matt Estep acquired St. Louis Park-based Midwest Hydroponic & Homebrewing Supplies.
Private-equity investors are interested in home brewing partly because they see the success of the craft brewing industry, Kidd said. As enthusiasm for craft beer grows, so does interest in brewing beer at home.
The investor community has watched the growth take place in craft beer, particularly in a down economic period when regular beer sales are flat and even down. They started to look into surrounding areas [like home brewing], he said.
Midwests sales are up by double digits this year compared to 2010. The company doesnt disclose revenue.
...Between just finding out ...the whole "private equity firm" deal ...I don't see any reason for me to buy from them anymore.
What's wrong with the private equity firm? A better-capitalized shop that specializes in operational improvements is usually considered a plus.
Just has been my experience that these firms require large returns for their investments which requires freeing up cash, the easiest way to free up cash is by payroll cuts, especially higher level employees.
Shooter said:I've been following all three of their blogs since I discovered them. Keeler's is a text and picture blog only so far, brewing/beer stuff along with quite a bit about his art endeavors. Dawson's is pretty much beer and brewing related. He puts up some occasional short videos. Chip's is just getting off the ground, but I'm looking forward to future videos and am interested to see what he includes from the food side.
Before we all totally trash NB, remember they sponsor the Jamil shows for years - that gets my business if nothing else.
I do not think this is a reason to stop purchasing at NB if they have what you need at the best competitive price. I will keep on buying there almost exclusively as their St Paul store is just a few blocks away from my house, they are my local HBS. Still a great place to buy what I need for me. I never really bought from them because of BTV , but the fact that they would spend money on something like that did make me feel good about the management at NB. Do not have that same feeling any more. If you are looking for a big online place that gives back to the brewing community I would say More Beer is now way ahead of NB. If you want to support a small family bushiness always go to your local home brew shop before one of the larger online stores!
JollyIsTheRoger said:Echoing this, always support the local store unless they aren't a good place or you don't have one. There is no reason to buy online if there is a homebrew store 15 min away, even if you are going to spend a few dollars more.
Can you post the links? Love to follow them
Shooter said:
This is Chip. Come check out Chop & Brew. Things are going very well over there!
www.chopandbrew.com
Enter your email address to join: