Jake Keeler and Michael Dawson Leave Northern Brewer

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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!

It's not necessarily new news, but maybe it's been hush-hush?

http://www.bizjournals.com/twinciti...ewery-suppliers-land-investment.html?page=all
bizjournals said:
Chris Farley launched Northern Brewer Inc. in 1993 when he was 18 years old, and built it into one of the nation’s 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 firm’s expertise. Entrepreneur’s 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 I’m 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.
Midwest’s sales are up by double digits this year compared to 2010. The company doesn’t disclose revenue.
 
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.
 
Wow, I'm late to the party on this one. I was a semi-regular watcher of BTV, and really enjoyed Dawson's deadpan delivery and sense of humor. He and Jake will be missed, but at least we can enjoy their blogging exploits. I appreciate that Chip gave his 2 cents here at HBT.

I also noticed the NB flat-rate shipping that disappeared. Harumph! It all makes more sense now, though.
 
Have to say, when not buying at my LHBS, I always supported Northern Brewer because I was a fan of BTV and Jake & Michael. Between just finding out (I'm late to the news!) they are gone, the whole "private equity firm" deal and the removal of flat shipping...I don't see any reason for me to buy from them anymore.
 
...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.
 
Jake Keeler posted on Twitter than Dawson got a job as a Brand Manager at Wyest.
 
What's wrong with the private equity firm? A better-capitalized shop that specializes in operational improvements is usually considered a plus.

I think for me tho - this case doesn't make sense. As I read it (granted I'm tired) they have their fingers in 2 other pies. Office supplies and marketing products.

I know people like to think that if you can run a sandwich shop you can run a car company (so to speak) but from what I've seen here and elsewhere, the dropping (essentially) of BTV, Jake and Dawson and Chip all leaving and dropping flat rate shipping - it's been overwhelmingly negative. I've yet to talk to anyone who says they'll NOW do business with NB due to the changes. Routinely it's been "I'll still buy but shop around" or "I won't buy anymore".

Homebrewers and the industry have always had this kind of "family" feel to it - we're emotionally invested in one another's successes and stories - NB doesn't feel like that anymore.

I used to shop there exclusively - mostly because guys like Dawson were answering my questions via facebook and BTV. Now I comparo shop and have yet to come out ahead with a NB cart vs Midwest, Rebel Brewer or LHBS.

And make no mistake - I'm not anti-big business, (the company I work for could literally buy NB 170 times over) just that from the outside looking in and speaking to other HBs - this one didn't make sense.
 
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.

That's a good point, but if I'm not mistaken, Dawson was also high in the marketing department for NB. Seeing as NB relies heavily on marketing compared to say, Midwest, I don't know if he'd be one they'd look to get rid of.

I'm not saying NB changing hands didn't play into this, but NB opened a new store in Mpls and updated the old store in St. P. Around the same time as this changing of the guard happened. They also seem to have increased the number of employees on the floor at both. Doesn't sound like budget cuts were at the top of this new firm's list.

I dunno, personally, I've been enjoying Chip's blog. Dawson and Keeler have new blogs too that are good reads, but Chip is diving right into the heart of what we love; beer and food. I really don't care about the "why's", it sucks to see BTV become a thing of the past, but I think all three dudes still have a lot to contribute to the home brewing community.
 
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.
 
I could be wrong in my assessment . But I believe the Minneapolis store opened a few months before the equity firms arrival and the departure of these guys was about 6 months after. Timing is very odd. Adding salespeople really means nothing, as a marketing director's(Keeeler I thing was in this position) cost is an order of magnitude higher. Also who leaves a good job when they do not have a new one waiting?
 
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.

Can you post the links? Love to follow them
 
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!
 
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!

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.
 
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.

Agree - though I will not change a recipe just because myLHBS does not have something - then I order from NB. Also, equipment purchases I always do for NB. I'm in MN, so given the options online I always go with NB.
 
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