The Audacity of Hops: The History of America's Craft Beer Revolution (60 page)

For Greggor in particular, it was a sweet move. Born on the south English coast, he spent much of the 1960s as a teenager in Singapore, where his father was attached to the British army. Greggor found it a rather dreary, paternalistic place, and his youthful eyes gazed thousands of miles away to San Francisco, to where everything seemed to be hip and new and cool in that swinging decade. He missed the sixties in San Francisco by about fifteen years, working instead as a civil engineer, including a stint in pre- and postrevolution Iran, where he was briefly taken prisoner by the Khomeini regime and forced to bribe his way to safety. After that ordeal, he left engineering for marketing, earning an MBA in the early 1980s and finally arriving in San Francisco in 1984 to visit a college buddy. The friend suggested a local beer that Greggor might like: Anchor Steam. It was, as for so many people, Greggor's first encounter with American craft beer. He tried other brands as they crossed his path in the next twenty years, but it was never something he thought much about. He and Foglio were liquor guys, with encyclopedic knowledge of the brands and the family-owned businesses that distilled them.

They made their first big move with the Griffin Group in October 2008, when they bought control of Preiss Imports, an importer with a wide array of liquor and liqueur labels, mostly high-end, produced by thirty-five concerns. The acquisition could not have come at a worse time: a month before, Lehman Brothers had collapsed and dragged the global economy into recession with it. Few investment bankers were throwing fifties around for celebratory bottles of single-malt. The group began to lose money, recovering only as the economy did and just in time for its first foray into craft beer—Scottish craft beer. Greggor and Foglio bought a minority stake in BrewDog, a small brewery started in 2004 outside of Aberdeen that was best known for making some of the world's strongest beers with cheeky names like Speedball, a nod to the heroin-and-cocaine cocktail. BrewDog, with the capital infusion and Greggor on its board,
quadrupled production and expanded its distribution. The onetime liquor kingpins had a taste for a beer.

Which is how they ended up sitting in Harris's in July 2009, with Maytag; John Dannerbeck, Maytag's nephew and a top executive with the brewery; and John Fisher, an investment banker who Maytag, Foglio, and Greggor all knew. The quintet quaffed Anchor Steams at the bar before heading to their table and getting down to business. Greggor and Foglio had an idea for a so-called Center for Excellence, based in San Francisco—a sort of consultancy that would cull from the worlds of craft beer and artisanal spirits and include their own varied portfolios. What did Maytag think? They talked about it, and one thing led to another, and it turned out that Maytag was thinking of selling his iconic operation.

The possibility of Anchor's sale was an open secret by 2009. Maytag had put out feelers as early as 2005, though he was not necessarily pleased with the responses he was getting. Some suitors hinted that they would move Anchor out of San Francisco, to a cheaper location—a deal breaker for Maytag, who saw the brewery as a creature of the city, the two inextricably linked. He was also worried about the employees, some of whom, like Mark Carpenter, had been with the brewery for decades; a takeover by another craft brewer might mean a wholesale housecleaning. Either scenario would mean the end of what Maytag had built into not only San Francisco's most famous brewery but also its largest manufacturing business.

Like the rest of America, San Francisco had seen its own manufacturing cliff-drop. In 1990, the sector employed 29,000 people in the city; by 2009, the number was 9,356, with the biggest drops coming just after the turn of the century. Anchor's approximately fifty employees meant something more than just great beer. So a months-long dance, initiated by Maytag, began after the steak dinner. Greggor and Foglio were outside the American craft beer movement, though very much inside the Bay Area. Moreover, they had experience with liquor, and Maytag had started a distillery in 1993, producing brands like Old Potrero whiskey, named after the San Francisco neighborhood where Anchor was located. By April 2010, Maytag, Greggor, and Foglio were ready to make a big announcement.

“These are the right guys,” Maytag said during an interview on National Public Radio on April 30, 2010, a Friday. The news had been out since that Monday: the Griffin Group would buy the nation's oldest craft brewery for an undisclosed amount. At eight in the morning on the thirtieth, Maytag and Greggor had met at the Mariposa Street brewery to commence a mild PR blitz. A caller to the NPR show, the pair's second radio appearance of the morning, echoed the sentiments of many when she worried aloud that the sale meant
the end of Anchor as nearly two generations of consumers had known it. Maytag tried to assuage those worries, reminding listeners that Griffin was not a big company, that it was highly specialized, and that he had talked to several other suitors over the past five years and found them wanting—but not Greg-gor and Foglio. He also modestly placed himself on a continuum that now included the new owners: “The brewery has had many, many owners over the years. It has been in six locations in San Francisco…. The brewery has had a long, colorful history in San Francisco.”

Greggor, for his part, acknowledged the likelihood of a modest expansion in production from the current 86,000 barrels annually and certainly in distribution. While Anchor had reached into forty-nine states as well as Canada, Japan, and parts of Europe, according to Greggor, “a lot of people tell us they just can't find it the way they used to be able to find it. Our task is to get the beer into more people's hands.” As for what would happen to the recipes and the craftsmanship behind Anchor Steam, Liberty Ale, Anchor Porter, and other groundbreakers: “I feel an utter sense of awesome responsibility in looking after the Anchor beers. And to follow in Fritz's footsteps is very alarming, I must admit.”

It was as amiable a public handoff of an institution as one could hope for. Still, the movement Maytag was so essential in spawning fretted for days afterward. The very scope of the debate over Anchor's future showcased how far the movement had come in Maytag's nearly forty-five years at the brewery's helm. When he took it over in 1965, no media noted the shift. For years afterward, the only attention came from local newspapers, from the odd allusion in a Charles McCabe column in the
Chronicle,
or from beer writers like Fred Eckhardt, who visited from Portland in the late 1960s, camera in hand, to see this curiosity. Now it was dissected in terms of business and social contexts—from what it meant to make a foodstuff locally to what it meant for San Francisco's employment picture to whether the new owners would relinquish the trademark to “steam beer”—that would have been unimaginable to the twenty-seven-year-old Maytag.

Writing nearly two weeks after the announcement, Don Russell, the longtime beer columnist for the
Philadelphia Daily News,
first listed Maytag's accomplishments with Anchor: first porter since Prohibition, first barleywine, the IPA precursor that was Liberty Ale, the revival of the Christmas ale tradition. Then he tried to convince himself that the new owners (“money guys with big-alcohol DNA”) would maintain the same standards, quoting fellow beer writer Jay Brooks, who had lunched with Greggor and returned this assessment to
Oakland Tribune
readers: “I think fans can rest assured that the brand will be in good hands that have no intention of messing about with it.” Still, Russell wrote:

Maytag's departure is a harbinger of broader generational change. Much of the American microbrewing revolution was built on the strong, idiosyncratic personalities of visionary, risk-taking homebrewers who turned their hobby into a thriving industry. Instead of advertising on TV, they connected with their customers, one by one, by sharing their stories and personally pouring samples. Today, the brewers are the brand. So, you can't help but think: What happens when they're gone? Remember, Pete Slosberg sold his trendsetting Pete's Wicked, and it caved; the founder of America's first brewpub, Bert Grant, retired, and his brewery disappeared.

Other ownership structures had changed in the craft beer movement with continuity maintained. Rhonda Kallman had left Boston Beer, and it remained by far the nation's number-one craft operation. Paul Camusi had been bought out of Sierra Nevada, and it was number two. Miller had come and gone as a fifty-fifty partner in Shipyard Brewing in Portland, Maine. Myriad investors, partners, cofounders, and so forth had moved out or moved on from different breweries and brewpubs. Companies had survived, even thrived postchange, introducing new brands and altering distribution.

Perhaps the biggest example was the merger cinched in the summer of 2008 between Widmer Brothers and Redhook, forming what they called the Craft Brewers Alliance. It still included not only principals from both northwestern breweries, like Kurt and Rob Widmer as well as Paul Shipman from Redhook, but also Anheuser-Busch, which owned more than 30 percent of the new company. Around the time of the Anchor announcement in 2010, the Craft Brewers Alliance announced it had absorbed Kona Brewing for $13.9 million, the same Kona run by Mattson Davis, who remained as CEO, and still headquartered on the western edge of Hawaii's Big Island. There were grumblings about Big Beer's fractional involvement, faint echoes of Jim Koch's pre-shakeout cries of “Budhook” after Redhook's initial partnership with Anheuser-Busch. Otherwise, all three breweries remained among the biggest sellers in the industry, suggesting that whatever the feelings about ownership changes, consumers had voted approval with their wallets.
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The terms of the Anchor deal, shrouded in secrecy as they were by the two private sides of it, seemed immaterial to the dissection. We might extrapolate
from Anchor's 2009 production numbers and distribution that the deal's value was surely in the seven figures at least. Moreover, the Brewers Association in 2010 placed Anchor at number twenty on its annual list of the top fifty craft brewers. Kona, which merged into the Craft Brewers Alliance for $13.9 million around that same time, was number thirteen. Lastly, the Griffin Group took as a partner on the distillery side Berry Bros. & Rudd, the United Kingdom's oldest wine and liquor merchant, finally closing the deal announced in late April on August 3. From that day forward, Maytag was out of the office, making a clean break with the day-to-day operations, though retaining the title of chairman emeritus. Greggor named Mark Carpenter Anchor's brewmaster, succeeding Maytag.

One reason the worry of obsolescence perhaps hung over the Anchor deal was that Maytag had never tried to grow really big. He had briefly considered an IPO during the mid-1990s to raise capital—it was the thing to do, after all, and an Anchor IPO would have undoubtedly been one of the hottest of the era—but he eventually decided against it, worried that investor demand would force moves he didn't want to make. Instead, he came to revel in eschewing too much growth, preaching a gospel of Small Is Good that seemed downright heretical, especially during the go-go 1990s, before the bust. “At Anchor, we're trying not to grow,” he told the Craft Brewers Conference in 1998. “Small is beautiful. At our brewery, one time we all just left—we all went to Europe, and studied wheat beer; deducted the whole thing.” With the flamekeeper of such a self-restrictive ethos exiting stage left, and the industry growing once again in terms of sales, production, and number of operations, why not worry that a lot about the oldest craft brewery was about to change—and not for the better?

The people who knew the most about running craft breweries were not worried. Most of Maytag's peers were as surprised as consumers by the announcement, though they welcomed Greggor and Foglio, especially after they insisted they would keep Anchor in San Francisco. It was a testament to the godfatherly role Maytag had so long played so well. “I didn't think at this point he was ready to move on,” Ken Grossman told the
San Francisco Chronicle,
perhaps recalling his revelatory tour of the Eighth Street Anchor location thirty-one years before. Tony Magee at Lagunitas reached out to Greggor and Foglio early on. If there was anything he could do, Magee told the new owners, don't hesitate to ask. This collegial spirit of the movement was another legacy of Maytag's, along with something else now, as Don Russell put it at the end of that column fretting the end of Anchor Brewing as the world knew it: “I'd like to think this is Maytag's final accomplishment: a legacy that encourages change.”

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Anheuser-Busch's ownership stake did technically remove all three breweries from the Brewers Association's definition of a craft brewery. By 2012, the renamed Craft Brew Alliance was the ninth-biggest brewery in the United States, right behind New Belgium and ahead of Gambrinus, which had absorbed BridgePort.