Yeastie Boys raising funds to put a keg in ground in new markets
Craft beer pioneer Yeastie Boys is seeking to raise $2.3 million from its existing shareholders to fuel its UK expansion, and open up a taproom in central London.
About 10 per cent of the Wellington-founded company is on offer. This follows a round of crowdfunding in 2015 which saw it raise $500,000 in just half an hour, to relocate to Britain.
Stu McKinlay, Yeastie Boys cofounder and creative director, told the Weekend Herald the company was hoping to raise capital from existing shareholders and from people who were on its waiting list who had expressed interest during its first capital raise. A large portion of any capital raised would fund the brewer’s growth in Britain, where the company is headquartered, along with further international expansion, he said.
Yeastie Boys brews its beer under licence in New Zealand — through Auckland brewer Urbanaut — Australia and the UK, and is looking to expand this to Germany, China, and potentially the United States. It is more interested in the research and development and experimental flavour side of craft as opposed to physically brewing its own product.
“It’s worldwide expansion in the main, but with a headquarters London-based,” McKinlay said.
The brewer plans to open its own taproom in the London BridgeSouth Bank area in the new year, and employ five local sales reps.
Britain’s craft beer market was not as mature as New Zealand’s, about two to three years behind, which meant opportunity in that market was great, he said.
“The market has become a lot more like New Zealand now where it is very competitive.
“We’re looking to get two more people on the ground for sales, we haven’t had a sales person at all in the last four years. There are a lot of opportunities in Europe so we want to get a European sales person as well,” McKinlay said.
“We’ve been here for a while and there’s been much more of a move towards local . . . although we are brewed locally, to have an actual flag in the ground in London and a venue where people can see we’re a UK business who has invested [there], is really important.”
Britain is Yeastie Boys’ primary focus for the next few years — and its biggest market.
Yeastie Boys was considered the market darling following the craft brewing surge in New Zealand, though the brand is positioned as more mainstream in Britain, with product sold in major supermarket Tesco, Waitrose and specialist wine retailer Majestic Wine.
“We sell a lot more beer here in the UK but per capita we still sell a little bit more beer in New Zealand. It is a sign of the growth in the wider industry; people have become much more interested in flavour and where their beer comes from [just as] they have about coffee and food over the last decade.”
Yeastie Boys sold 1.65 million cans of beer in the UK compared to 220,000 cans in New Zealand last year. It hopes to grow its UK sales volumes by about four times over the next three years.
“Part of our focus . . . in the UK is to head much towards the pub trade,” he said. It plans to grow sales in kegs to about 60-70 per cent of total revenue from about 15 per cent today.
Where the beer brand expands to next is dependent on the pending decision over Brexit.