Dear Client:   

If you haven’t noticed, Chicago-born Funkytown Brewery is just about everywhere right now.

They were at GABF a couple of weeks ago with Boston Beer, having won the most recent Sam Adams Brewing the American Dream Brewing & Business Experienceship. 

And just last week, co-founder Zack Day, along with his longtime friends and co-founders, Rich Bloomfield and Greg Williams, were profiled in Crain’s Chicago Businesses’ 40 Under 40.

“Just four of Illinois’ 302 craft breweries are Black-owned, and that includes Funkytown,” the story said.

The brewer seeks to change that dynamic. Funkytown aims to produce high-quality, palatable beer that targets underserved groups such as Black people, women, and Hispanics, the founders told CBD in a recent check in.

Funkytown has had its beers in the market for about two years now, officially as of October 2.  They currently distribute to Chicago, northern Indiana (with Indiana Beverage), and Wisconsin (focused on Milwaukee and Madison metro, with General Beverage) with over a thousand accounts in those territories combined.

Expect to hear more from them. The brewery is moving and shaking, working on opening their own flagship taproom in Chicago (hopefully by next fall, but: “You know Chicago,” they say).

The Sam Adams American Dream gig has so far provided them with increased exposure and mentorship opportunities, but some of the partnership’s most important cornerstones – an upcoming collaboration brew, plus access to capital through a Boston lending partner – have not even kicked in yet.

We dug in with the guys for more.

“This year it looks like we’re on pace to brew about 1,600 to 1,700 barrels,” said Richard. That’s up 100% over 2022.  

In Chicago, they self-distribute through Pilot Project, the local incubator which helped them start up. It’s more than a contract brewer, they say. 

Pilot Project has its original incubator brewery in Chicago and a much larger production facility in Milwaukee, where the majority of Funkytown beer will be produced.   

“They have the infrastructure to help upcoming breweries” who may lack capital, said Greg. “They support with production, canning, and distribution [needs]. They have a sales team to help push your brand. You have a marketing team as well as the PR team, so that infrastructure is deeper than just a contract brewer.”

Zack added that Pilot Project has allowed them to be “authentically ourselves,” whether via reflecting “culture, fashion, music, movies, things of that nature …  the ability to come in and just be ourselves allowed us to just fully bloom and blossom.”

“WE WANT TO MAKE BEERS FOR THE NEW BEER DRINKERS.” Ask Funkytown what makes their model different, and they’ll answer that they strive to make “high-quality, palatable-tasting beer, low on bitterness, low on astringency.”

As the ambassadors of craft beer at family and friend parties, the brewery founders describe a common theme: people were intrigued by the aroma, but the taste was often too bitter. Those insights help inform their products. 

They describe their flagship, 5.5% ABV Hip-Hops And R&Brew Vol. 1, as  “really juicy on the nose, aromatic wise. And then we brewed it with orange zest. So it’s really, really good, really palatable, and malt forward.” 

The point is, they’re making beers for the new craft beer drinkers, “specifically brown folks, Black folks, women included as well. And we figured that the best way to get those folks into this space, is [to] create an on ramp,” says Zack. 

Even in their future plans, they want to be in the communities where their target consumers can access them.  

If that sounds like a taproom-led model to you, you’re right. 

TAPROOM-LED STRATEGY. They’re already pursuing opening a flagship taproom in Chicago. “Next steps are first getting our own flagship taproom in the city of Chicago,” says Richard.

“And we want to approach the multi-taproom strategy. So we would like to have more than one taproom. Each taproom is going to be a different experience, from the look and feel of it, and have a little bit more of the surrounding locality built into it so that we’re able to build that relationship with the community.”

DISTRO PLANS. When it comes to distribution, they’re in three markets now. The plan is to “deepen our concentration in those markets rather than continuing to expand,” says Richard, “and just have the opening of taprooms assist with us jumping into new markets and being that foundation, that anchor,” to support outside markets.  

ON THE SAM ADAMS EXPERIENCESHIP. We also wanted to dig into the Sam Adams experienceship. We wondered about its breadth and benefits.  

“We’ve gotten a lot more publicity here locally as we’ve been on a couple of daytime TV shows,” as well as written press too, said Richard. “And what that did was just generate more interest from the general population and some of the retailers out here.

“So that’s been great.” 

But some of the partnership’s most impactful benefits haven’t even started yet. That includes the formal mentorship program, and a collaboration brew that could potentially be distributed beyond Funkytown’s own footprint. 

And perhaps most importantly, Funkytown will also work with one of Boston’s lending partners, Accion, to help them with capital needs. 

Make no mistake: Craft needs brewers like Funkytown to succeed just as much as the brewer wants to succeed itself. 

It’s not lost on the Funkytown founders that craft growth has slowed. Indeed, in the latest set of Circana data that just hit, to 10/8, the overall craft segment is down slightly in dollars, and down almost 5% in volume YTD in multi-outlet and c-store. 

“I think we all know that craft beer doesn’t have the same growth as it once had in the previous decade,” says Richard. “But there’s a lot of opportunity there if you open up the market to other groups.”

GREAT LAKES BREWING HITS NYC THIS WEEK

Great Lakes Brewing Company is officially expanding distribution to New York City this week, partnering with S.K.I. Beer Distributors. 

The brewery’s foray into the NYC market coincides with the brewery’s 35th anniversary as well as the launch of its annual seasonal Christmas Ale, which will be available in NYC alongside several of its main offerings, like Edmund Fitzgerald Porter, Vibacious Double IPA, and new Midwest IPA, per press release. 

It also comes at a time when the brewer is expecting to see low single-digit growth at year’s end (at least per our check in with GLBC this summer [see CBD 07-25-2023]), driven in part by Vibacious, GLBC’s first year-round IPA, which quickly became their no. 2 on-premise brand.

Expanding distribution into NYC marks “a significant and strategic step” to expand GLBC’s distribution in New York, where it has served the state for decades. As part of the NYC launch, GLBC will host “several kickoff events throughout Manhattan, Brooklyn, and Long Island.”

“We’d been distributing to the state of New York, but never found the right solution for NYC until now,” said Chris Brown, GLBC VP of sales. “We are excited to finally bring our brands to the biggest city in the U.S. and introduce our powerhouse portfolio to the city that never sleeps.” 

As for partnering with S.K.I. Beer Distributors, Chris said the distributor “was the choice that made the most sense to us” due to S.K.I.’s “energetic sales leadership and portfolio fit” that will “drive our business in a highly competitive market for years to come” and “finally bring Great Lakes beer to the five boroughs and Long Island.” 

Today’s release notes that GLBC is distributed in 14 states and Washington D.C.

Until tomorrow,

Harry, Jenn, Jordan and Bianca

“We can have facts without thinking but we cannot have thinking without facts.” – John Dewey

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