Saturday marks the five-year anniversary of InBev reaching a deal to buy Anheuser-Busch. In that time, much has changed at the iconic brewer.
Nearly all the old leadership is gone; now the top bosses are in Brazil or Belgium or New York. Budweiser is flying off shelves in Sao Paolo, but not so much in St. Paul. TV ads are more sophisticated, less sophomoric. Bud Light Platinum and Black Crown are the new big thing.
But in St. Louis, maybe the biggest change is simply this: Thousands of people who used to go to work at A-B every day no longer do.
Some chose to leave, with a buyout or nice stock bump. Some left with a pink slip. Either way, they left the world’s largest brewer at an unusually fertile moment in the business, a time when thousands of craft brewers across the U.S. — more than a dozen in St. Louis — have opened their taps.
Today there are lots of places to take talent honed on Pestalozzi Street and use it to help build something new.
That’s another side of the story of the 2008 merger .
In the last few years, people with skills developed over decades at Anheuser-Busch have scattered across the beer industry. Some were snapped up by middleweight rivals like Pabst Brewing or big craft players like Deschutes. Others put up a shingle as consultants or launched their own bid to fill an industry niche . A few have jumped from the world’s biggest brewer to the ground floor of the craft world, buying a small brewery or launching their own.
Last week, the Post-Dispatch caught up with a few, to talk about life after Anheuser-Busch.
Jim Gorczyca, O’Fallon Brewery
The smell of boiling malt filled the warehouse-turned-brewery in an O’Fallon, Mo., industrial park Monday morning. Country music blared while a schoolteacher on a beer-making summer apprenticeship filled quarter-barrel kegs of IPA for the busy holiday weekend.
It’s a long way to here from the executive suite on the ninth floor of One Busch Place, but it’s a trip that Jim Gorczyca is glad he has made. After 25 years — and seven cities — climbing the corporate ladder at Anheuser-Busch, Gorczyca is building something from the ground up in his hometown.
A little more than two years ago, Gorczyca left his job directing convenience store sales for A-B InBev and bought a majority stake in O’Fallon Brewery, a mom-and-pop craft brewer that was on the ropes financially. He partnered with its founders, Tony and Fran Caradonna, and brought some Big Beer business savvy to their small operation. That meant a tighter focus on marketing and branding efforts, investments in equipment — like an automatic keg-filler — and a switch to A-B’s wholesaler network.
It has paid off.
O’Fallon’s on pace to sell more than 13,000 barrels this year, double its volume before Gorczyca took over. It’s aiming for 15,000 next year. The company has added employees, and Gorczyca is looking for a new building, something big enough to move all O’Fallon’s production in-house instead of contract-brewing in Wisconsin. That’ll save on trucking.
The craft beer wave gave Gorczyca the chance to go out on his own — something the A-B lifer says he’d always had in the back of his mind — while staying both in beer and in St. Louis. And, while he was part of the team that led A-B InBev through the post-merger transition, the takeover gave him both the incentive and the financial resources to do his own thing.
“I would never have looked outside if it had been the old management group,” he said. “And if I hadn’t, I wouldn’t be here now.”
Tim Schoen, Brew Hub
The craft beer business is in boom mode now, but Tim Schoen saw the potential of the industry two decades ago while an executive at Anheuser-Busch.
In the mid-1990s, Schoen ran Michelob brands for A-B from the brewery’s headquarters in St. Louis and oversaw new products, which included upstarts like ZiegenBock Amber, an American-style amber lager sold in Texas.
“I caught the bug back then for craft beer, and I knew the trend would go there,” Schoen said.
Schoen, who lives in Chesterfield, began working for an A-B-owned distributor in his hometown of Louisville, Ky., in 1980. During his nearly three decades at A-B, he held more than a dozen jobs in sales, brand management and media. He had ascended to vice president of global sports and entertainment, responsible for key sponsorships for the country’s biggest beer brands, including Budweiser and Bud Light, when he left A-B in 2009.
Schoen resigned in the wake of InBev’s acquisition of the company, driven by an entrepreneurial spirit to start something new.
Three years ago, Schoen began devising plans for Brew Hub, a company based in Chesterfield. Schoen, its CEO, envisions building multiple facilities around the country where craft brewers are provided sales, marketing and distribution help in addition to brewing their beer outside of their core markets.
Brew Hub ultimately plans to have a network of at least five facilities, including one in the St. Louis area.
Construction began in April on the first 50,400-square-foot brewery in Lakeland, Fla., with an initial brewing capacity of 75,000 barrels.
“It was sparked by distributors saying they needed better access to craft beer,” Schoen said. “Craft beers’ logistics and pricing and life cycles are not as efficient as mainstream brewers’. Craft brewers built their breweries on what they were doing at the time, not on what they would grow to.”
The senior management team includes former A-B executives Jerry Mullane, Brew Hub’s president, and Mark Greenspahn, vice president of operations.
Craft beer volume grew to 6.5 percent of the total U.S. beer market in 2012, and Schoen projects it’ll soon surpass 10 percent.
Schoen’s talks with brewers extend outside of the U.S. to those who want to sell their beers domestically and import U.S. craft beers. “They know consumers are looking for change,” Schoen said, “and other markets are looking for dynamic and interesting craft beers from America. It’s a global change.”
John O’Connor, OMAC Beverage Advisors
When John O’Connor left Anheuser-Busch four years ago, he really just moved across the table.
Today, O’Connor is managing director at OMAC Beverage Advisors in Chesterfield, carving a niche in the buying and selling of beer distributorships. It’s a world he plumbed for 14 years at Anheuser-Busch, analyzing and negotiating sales in their wholesale network. Now he does the same thing for all comers, running a “boutique investment bank” for the beer trade and helping to shepherd a wave of distributor consolidation.
Beer wholesaling is a small club, and O’Connor knew most of its members from his A-B days — the brewery needs to OK any wholesaler deal in its network, and they all crossed his desk there. He also knew he could represent wholesalers just as well as he did the brewer.
“I saw a niche,” he said. “I looked around at my competitors and said, ‘I could do that.’”
O’Connor said he likely would have gone independent at some point regardless of the merger, but the run-up in A-B’s stock price gave him the cushion to try. So in 2009 he quit A-B to join FirstBev, a beer industry investment firm based in Los Angeles. Then in 2011 he launched OMAC with partner Sean McClaren — hence the firm’s name — and in their first full year in business they closed 10 deals.
“Not bad,” O’Connor said.
A-B trained him well, he says, and there’s much he misses about the place, like the security and the benefits and the camaraderie of a big office. Plus the world’s largest brewer has resources that O’Connor’s three-man shop can’t match.
“At A-B we had this tremendous (mergers and acquisitions) tax guy, in house. I could walk over to his desk,” he said. “Now I call a law firm and it’s $400 an hour.”
But there’s plenty he likes about the new gig, too. His commute is down from 40 miles to 10, and he can wear flip-flops in the office. There’s no bureaucracy, either.
“We make our own decisions, and we can move very quickly,” he said.
Mostly O’Connor’s using the same skills and negotiating with the same people. He’s just his own boss now.
David Wolfe, Florian Kuplent and Jon Shine, Urban Chestnut
Like a good beer recipe, it took just the right ingredients to come together to form Urban Chestnut Brewing Co.
Florian Kuplent, a brewmaster with two decades of brewing experience, met beer sales and marketing pro David Wolfe in 2005, when they both worked at Anheuser-Busch.
At A-B, Wolfe and Kuplent saw how demand for craft beer was growing, even against the headwinds of a down economy. In 2010, Wolfe and Kuplent left the company and started putting plans together to open a craft brewery in midtown.
“If you look at craft beer from a national perspective over the last seven to eight years, there was double-digit growth,” said Wolfe, who worked for A-B for nearly 20 years in sales and marketing. “We knew there was opportunity.”
For Urban Chestnut’s head of sales, they brought in Jon Shine , who worked for A-B for a decade in field sales and marketing. “We saw the growth every day in craft beer” while at A-B, Shine said. “It’s all about the discovery of something new.”
Since opening in early 2011, the brewer that makes both artisanal modern American beers and European beer styles has quickly gained a following.
Urban Chestnut sold 3,500 barrels of beer last year and is on track to double that amount this year, making it one of St. Louis’ largest craft brewers. Next year, Urban Chestnut plans to open a $10 million second production facility in the Grove neighborhood that will allow it to produce 15,000 barrels annually while doubling its number of employees to 60. The new facility also will allow Urban Chestnut to expand barrel-aging beers at its midtown location.
“We knew when we started the company that the demand was there,” said Kuplent, who was born in Germany and received a master’s degree in malting and brewing science from the University of Munich-Weihenstephan. After helping launch a brewery in London, Kuplent worked at A-B for eight years, where he was a staff brewmaster.