BREAKING | Brooklyn Brewery Partners with 21st Amendment and Funkwerks for Joint Sales and Distribution

Brooklyn Brewing acquires minority share in 21st Amendment and Funkwerks

This post has been updated to include quotes from 21st Amendment and Funkwerks

More breaking news this morning following the heels of Short’s minority share acquisition by Lagunitas announcement. Brooklyn Brewery has announced via it’s blog, a joint partnership agreement with San Leandro, CA’s 21st Amendment Brewery and Funkwerks out of Fort Collins, CO acquiring a minority investment in both companies. The three way partnership was crafted to create a shared platform for national sales and distribution which takes effect January 1, 2018.

Through this new connected network, the trio of breweries will already be able to reach 38 states via a team of 70 sales members and 90 brand ambassadors while still remaining independently owned however for Funkwerks founder Brad Lincoln, consumers won’t see any major immediate changes.

“The plan for Funkwerks is to not grow in a big way over night. We came together to better service our current relationships and demands. We don’t have any plans to build a new facility any time soon, the plan is to grow organically,” said Lincoln. Last year Funkwerks produced 6,000 barrels, which was a 70% growth from its previous year.

However, for semi national brands like 21st Amendment and Brooklyn Brewery, this alignment allows both to immediately fill market gaps where they don’t currently have the bandwidth or footprint to reach.

“This partnership revolves around the platform,” said Nico Freccia, co-founder of 21st Amendment. “It’s an elegant way for like-minded independently breweries to band together to grow and compete and strengthen our brands without selling to the big guys.”

brooklyn 21st amendment funkwerks — Image Courtesy of Brooklyn Brewery

While specific details of the minority investment have not been disclosed, a few items are clear. First, the minority shares acquired are below 25%, which means all breweries will remain independent. Second that 21st Amendment and Funkwerks will still independently maintain control of their respective breweries. Third, according to Freccia Brooklyn and 21st Amendment will immediately begin taking advantage of the partnership to grow within each other’s markets through sale and production assistance. “Brooklyn will be able to start brewing and selling beer on the West Coast,” noted Freccia.

And finally that the new formation does intend to grow its ranks. In a statement released via Brooklyn Brewery’s blog it states, “The three partners will co-develop annual sales & marketing plans and together look for additional beverage companies to join the fun.”

It is also unclear what the role of Japan’s Kirin Brewing will play in this partnership, as Kirin Holding Corps. acquired a 24.5% share of Brooklyn Brewery in October, 2015. Of note, that 24.5% share falls just below the 25% designation placed by the Brewer’s Association which defines breweries as independently owned.

“Each of us brings something different to the table,” adds Dave Wilson, President of 21st Amendment. “From the diverse beers we produce to our unique perspectives, origins and brand personalities, we’re thrilled to band together with Brooklyn and Funkwerks and bring great beer to more craft drinkers across the US.”

“What attracted Funkwerks to this platform is gaining access to a large and well-trained sales team and top-quality brewing skill,” said Lincoln. From there we get to stay independent, control our destiny, and focus on doing what we truly love to do make creative, compelling, and delicious beers.”

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Full press release listed below:

Brooklyn Brewery, 21st Amendment, Funkwerks Announce Joint Sales & Distribution Platform

The Brooklyn Brewery (Brooklyn, NY), 21st Amendment Brewery (San Leandro, CA) and Funkwerks Brewing Company (Fort Collins, CO) are launching a new sales and distribution platform effective January 1, 2018. The combined sales organization includes a field sales and key accounts team of 70 salespeople and 90 Brand Ambassadors covering 38 states.

“The changes in the competitive landscape demand creative new go-to-market strategies” says Robin Ottaway, President of Brooklyn Brewery. “We consider ourselves incredibly fortunate to have found partners who share our passion for beer, want to remain independent, and hold a long-term view.”

“The three breweries and sales teams really fit together well,” says Dave Duffy, VP of Business Development for Brooklyn who’ll lead the new platform. “We’re aligned where we need to be, complementary where we need to be, and have a lot of domestic and international territory to grow into together. We can’t wait to start adding value to our retail and wholesale partners in a compelling new way.”

Brad Lincoln, co-founder of Funkwerks, adds: “What attracted Funkwerks to this platform is gaining access to a large and well-trained sales team and top-quality brewing skill. From there we get to stay independent, control our destiny, and focus on doing what we truly love to do- make creative, compelling, and delicious beers.”

Brooklyn Brewery has made minority investments in both 21st Amendment and Funkwerks in support of the partnership. The three partners will co-develop annual sales & marketing plans and together look for additional beverage companies to join the fun.

“American craft brewers need to stick together and find new ways to meet the challenges of the 21st Century marketplace,” said Brooklyn founder Steve Hindy. “We are excited to work with 21st Amendment and Funkwerks to ensure the spirit of independence that built the craft beer revolution continues to lead that revolution.”

Funkwerks and 21st Amendment were represented by First Beverage Group and Spencer Fane LLP in these transactions.