Lagunitas founder sells half his beloved craft brewery to Heineken, explains why with a Nietzsche-quoting blog post.

Lagunitas Founder Uses Nietzsche to Explain Why He Sold Half of His Beloved Craft Brewery to Heineken

Lagunitas Founder Uses Nietzsche to Explain Why He Sold Half of His Beloved Craft Brewery to Heineken

Moneybox
A blog about business and economics.
Sept. 8 2015 7:16 PM

God Is Dead. But What About Craft Beer?

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Nietzsche, not the greatest fan of alcohol.

Wikimedia Commons

Earlier Tuesday, Heineken announced it was buying a 50 percent stake in Lagunitas, the beloved California craft brewery known for its exemplary India pale ale, and would use its distribution and marketing clout to take the brand global. Lagunitas' founder Tony Magee, in turn, published a long, Nietzsche-referencing Tumblr post that seemed aimed at deflecting any accusations that he had sold out.

A few thoughts.

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1) Obviously this extends the trend of multinational megabrewers buying up popular American craft beer names. Since 2011, AB InBev has purchased Goose Island, Blue Point, Elysian, and 10 Barrel. Now Heineken, the world's No. 2 brewer by volume, has entered the fray.

2) This is probably a good thing for beer drinkers. When AB InBev started its buying spree, it raised the concern that the macrobrewer would compromise on quality. The consensus seems to be that that really hasn't happened. Go search around message boards on Beer Advocate and you'll actually find hop heads arguing about whether Goose Island, long cherished in and around Chicago, has improved since its acquisition. This makes sense. Large brewers are trying to hold off the advance of their smaller, craftier competition, probably by establishing some brands that can be sold on the same scale as, say, Sam Adams. They're not going to accomplish that by watering down well-loved ales. Instead, they'll do it by taking a good beer and using all of their distribution power to push it into as many bars and supermarkets as possible. The upshot: Good beer continues to become more widely available.

3) This is not good for other craft breweries. Once again, companies like Heineken and AB InBev have the distribution muscle to push their products into bars and supermarkets almost at will, which leaves less space for everyone else.

4) American craft beer is about to take over the world (sort of). Last year, craft brewers exported just under $100 million worth of product. That is a) not very much; but b) a 35 percent increase over 2013. Which is to say, we're talking about a fast-growing niche market that Heineken apparently thinks it can expand.

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5) Tony Magee is a fascinating guy. It's worth reading the whole Tumblr post purely for entertainment purposes, but the Nietzsche bit is the standout section. Essentially, Magee decided he wanted to expand Lagunitas' reach globally. But he needed to find a partner. He elaborates:

There’s a pertinent Friedrich Nietzsche parable about a ‘madman’ who comes into a town square holding a lighted lantern declaring to the town that he has important news. He tells his story and the people laugh and berate him in disbelief, throwing stones to drive him off. Finally he gives up saying, ‘I have come too soon’’. He drops the lantern, the light goes out, and he departs.
I wondered if my idea of globalization for American Craft too had also come soon.

BuzzFeed's Vanessa Wong points out that, hilariously, Magee is actually talking about Nietzsche's famous "God is dead" passage. ("The madman jumped into their midst and pierced them with his eyes. 'Whither is God?' he cried; 'I will tell you. We have killed him—you and I.' ") This is weirdly apt, given his whole theory about the beer industry, which he thinks is at a bit of a crossroads now that the rise of craft has interrupted the "old order," as he put it, and needs to find new ways of doing business. Much of Nietzsche's philosophy was concerned with how to live a meaningful, joyful life in a godless world. There are parallels here, really! Building something new out of the wreckage of the old, and whatnot.

Anyway, you'll probably be able to get a decent IPA in Amsterdam soon. That's really the news here.

Jordan Weissmann is Slate’s senior business and economics correspondent.