Calagione Discusses LNK Investment, Long-Term Vision at Brew Talks CBC


About six months ago, headlines were suggesting that Dogfish Head was struggling to grow as fast as its competitors.

While other top 20 craft breweries like Lagunitas and Ballast Point were in the midst of double-digit growth and billion dollar valuations, Dogfish Head was coming off its slowest year of growth in 18 years — something that founder Sam Calagione himself had articulated in an email to Brewbound and other trade publications.

Calagione chalked up the company’s drop into single-digit growth to a refusal to discount, a dearth of new market entries, and an extended search process for its new vice president of sales, which, he said, strained the company’s relationships with distributors in 2015.

And the slower growth was coupled with a September announcement that Dogfish would sell a 15 percent stake to private equity firm LNK Partners. Some industry observers wondered about the future direction for Dogfish Head.


Speaking to a crowd of 300 beer industry professionals at last week’s Brew Talks meetup, held on May 4 at World Café Live during the 2016 Craft Brewer Conference in Philadelphia, Calagione provided some context.

“It was intentional,” he said of the single-digit growth, and not the sign of an established craft brewery on the verge of facing death by a thousand cuts.

“We made a choice going into 2015 that we were going to take some methodical steps when it came to finding the right people to fill some really important seats in our company and also when it came to looking at our pricing structure, when it came to looking at our distribution network. 2015 was really just a year of thoughtful, internal reflection,” he added.

Calagione said he was proud of his company’s performance in 2015, and that he was excited about the future.But optimism comes easy for Calagione. For years, he’s beaten the drum of craft beer on behalf of what he calls “true indie craft brewers,” and championed the continued success of small brewery startups.

Nevertheless, there are more causes for concern in 2016, and not just for Dogfish Head. Thousands of new breweries have made it more difficult for Dogfish, and others, to retail wholesaler and retailer attention. Increased brewery investments, meanwhile, have changed the competitive landscape as have deeper forays into the space by the world’s largest beer entities.


As he and other Dogfish executives looked around, it was apparent that “beer geek brewers” were no longer pulling the strings at some of the country’s top craft breweries.

“We thought — maybe this is the right time to have somebody that comes from industries with massive players, that understand that competitive moment — that can be an awesome voice on our board,” he said.

Calagione said the environment was enough to cause him to begin seriously entertaining the idea of bringing on a financial partner, but only one that would be okay with acquiring no more than 15 percent of his company — one that he eventually found in LNK.

Now, with fresh investment and new business acumen in hand, as well as rebranded packages expected to hit the market soon, Calagione is confident that Dogfish will continue to thrive despite competitive headwinds.

“It feels good to be an underdog again,” he said.

Complete video playback of the conversation is available below.