San Francisco’s Speakeasy Ales & Lagers will indefinitely cease brewing, packaging and taproom operations, the company announced today.
“The brewery has worked with multiple investment banking groups and have had numerous meetings,” Speakeasy founder and CEO Forest Gray said via a press release.
A source familiar with Speakeasy’s financial situation told Brewbound that First Beverage Group, a financial services firm dedicated to the beverage industry, had worked with the brewery in 2016 to solicit investment or find a buyer for the struggling craft beer brand.
After an unsuccessful attempt to sell the brewery, Speakeasy hired another investment bank to raise debt capital, the source told Brewbound.
“One fact has become central to the process, and that is the company is financially insolvent and requires new capital to move forward,” Gray said in the release. “Whether that will happen is unclear, but I do hope the brewery and brand will persist.”
Speakeasy, which produced 33,250 barrels of beer in 2015 according to data from the Brewers Association, is the first well-known regional brewery to announce a closure in 2017. Earlier this week, Orange County’s Valiant Brewing announced that it was selling its equipment and ending operations. That company followed several smaller breweries that have closed since December, including Seattle’s Big Al Brewing.
In an email to customers, Speakeasy cited “difficulty securing capital investment and outstanding debt obligations” leading “to this difficult and painful decision.”
The brewery said its primary creditor, which wasn’t named, would determine the future of the brewery and the brand. According to the brewery’s website, it employed about 40 people.
In 2015, the company announced an ambitious $7.5 million expansion project, financed by Union Bank, that was slated to increase its production capacity from 15,000 barrels to 90,000 barrels. At the time, the company’s products were sold in 14 states and Gray had projected sales of 50,000 barrels.
Speakeasy, which was founded in 1997, has shipped its remaining inventory of beers such as Big Daddy IPA to its wholesale partners.
Just days ago, Speakeasy issued a press release for its first new beer of the year, Murky Business APA, a draft only release in its Perfect Crime Series, that was supposed to be released in its taproom on Saturday, March 18.