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One percent of a San Diego brewery for sale
Magnetic offering small ownership stake as crowdfunding reward
Morgan McCarty wants to grow Magnetic Brewing so he can spend more time with his family.
When Magnetic Brewing opened to customers for the first time last August, it started about as small and low budget as a brewery gets. Morgan McCarty worked alone on the same 1.5-barrel system he'd assembled as a homebrewer, in a tiny industrial park tasting room that only opened after McCarty clocked out of his full-time job as an electrician.
A year in, as Magnetic barely keeps up with demand, McCarty wants to pursue his dream and take the self-funded business to phase 2, which means expanding production capacity and leaving his day job to focus on the brewery full time. This August, he launched a campaign on crowdfunding website GoFundMe.com to raise $10,000 to support the effort.
Initially, he offered what he terms a "gift card loan" — $25 contributions that he will reward in a year's time with a $25 gift card. As regular customers began requesting merchandise, he added branded shirts and pint glasses. Then, on August 15, he really made it interesting: for $6000 McCarty offered a one percent ownership stake in Magnetic Brewing.
Crowdfunding capital to build a brewery is nothing new, but using the mechanism to sell shares might be. Earlier in August, high profile Scottish craft beer maker BrewDog launched a similar campaign to raise $50 million for a brewing facility it's planning to build in Ohio. At $47.50 per share, a one-percent stake would cost roughly $3.4 million. Granted, that's a well-established brewer with a global following, but it certainly makes six grand toward growing a start up seem cheap by comparison.
McCarty didn't come by this valuation by accident. "I had no idea how to value a company so I searched online," he explains, "I ended up choosing to use Equidam.com to create a valuation report." The Dutch web company applies sales figures, assets, burn rate, location, and other relevant data to value a company's worth within a specific industry.
McCarty's modest goals for the new capital include buying extra fermenters, ingredients, and kegs — each necessary to increase production to stock his tasting room, and begin distributing to local accounts. "Bar managers and owners express interest in carrying my brand," McCarty explains in a letter posted to his GoFundMe page, "I have to tell them, 'Not yet,' because business through the tasting room alone has grown to the point that I've been having trouble keeping a selection of beer on tap."
Magnetic hired its first employee in July, allowing McCarty to extend tasting-room hours and begin work on the small brewhouse expansion. He says for the past year he's put in 40 hours per week as an electrician, 60 per week as a brewer. "With the construction job," the father of two says, "I'm gone in the morning before my kids wake up…I get home after they are asleep."
At this stage of his business, he says Magnetic will still require a 100-hour week commitment, with one valuable difference: "I'm going to be having breakfasts with my family and taking the kids to school on my way to work at the brewery."
Here's something you might be interested in.
One percent of a San Diego brewery for sale
Magnetic offering small ownership stake as crowdfunding reward
One percent of a San Diego brewery for sale
Magnetic offering small ownership stake as crowdfunding reward
Morgan McCarty wants to grow Magnetic Brewing so he can spend more time with his family.
When Magnetic Brewing opened to customers for the first time last August, it started about as small and low budget as a brewery gets. Morgan McCarty worked alone on the same 1.5-barrel system he'd assembled as a homebrewer, in a tiny industrial park tasting room that only opened after McCarty clocked out of his full-time job as an electrician.
A year in, as Magnetic barely keeps up with demand, McCarty wants to pursue his dream and take the self-funded business to phase 2, which means expanding production capacity and leaving his day job to focus on the brewery full time. This August, he launched a campaign on crowdfunding website GoFundMe.com to raise $10,000 to support the effort.
Initially, he offered what he terms a "gift card loan" — $25 contributions that he will reward in a year's time with a $25 gift card. As regular customers began requesting merchandise, he added branded shirts and pint glasses. Then, on August 15, he really made it interesting: for $6000 McCarty offered a one percent ownership stake in Magnetic Brewing.
Crowdfunding capital to build a brewery is nothing new, but using the mechanism to sell shares might be. Earlier in August, high profile Scottish craft beer maker BrewDog launched a similar campaign to raise $50 million for a brewing facility it's planning to build in Ohio. At $47.50 per share, a one-percent stake would cost roughly $3.4 million. Granted, that's a well-established brewer with a global following, but it certainly makes six grand toward growing a start up seem cheap by comparison.
McCarty didn't come by this valuation by accident. "I had no idea how to value a company so I searched online," he explains, "I ended up choosing to use Equidam.com to create a valuation report." The Dutch web company applies sales figures, assets, burn rate, location, and other relevant data to value a company's worth within a specific industry.
McCarty's modest goals for the new capital include buying extra fermenters, ingredients, and kegs — each necessary to increase production to stock his tasting room, and begin distributing to local accounts. "Bar managers and owners express interest in carrying my brand," McCarty explains in a letter posted to his GoFundMe page, "I have to tell them, 'Not yet,' because business through the tasting room alone has grown to the point that I've been having trouble keeping a selection of beer on tap."
Magnetic hired its first employee in July, allowing McCarty to extend tasting-room hours and begin work on the small brewhouse expansion. He says for the past year he's put in 40 hours per week as an electrician, 60 per week as a brewer. "With the construction job," the father of two says, "I'm gone in the morning before my kids wake up…I get home after they are asleep."
At this stage of his business, he says Magnetic will still require a 100-hour week commitment, with one valuable difference: "I'm going to be having breakfasts with my family and taking the kids to school on my way to work at the brewery."
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