Laws are changing on the state and federal levels such that brewers will soon be able to tap into a previously untapped source of capital: passionate customers. Once the SEC finalizes JOBS Act Title III, small businesses will for the first time be able to sell shares online to the general public. This innovative financing model pioneered by BrewDog in U.K. (where it is legal) should have significant impact on breweries of all sizes in U.S as a means to raise disruptive capital and engage customers. Breweries will now be able to provide passionate customers with a chance to buy in and share in ownership experiences. What kind of impact could this have on craft beer industry? Let's just use next week's Great American Beer Festival as an illustration.
Beginning on October 10, nearly 50,000 craft beer enthusiasts will descend upon Denver to engage and sample beers from 600 breweries. Once Title III goes into effect, these 50,000 enthusiasts will represent a new pool of capital for startups and expansions. Assuming an average investment of $5k per attendee (individual's investment cap will depend on income calculation), nearly $250M in capital will be walking around next week's festival. Just as importantly, these 50,000 attendees represent an army of brand advocates waiting to be activated. This is no small matter given the increasing competition over shelf space.
Connecting breweries with this grassroots capital source is what we are all about. As an associate sponsor of this year's GABF, we'll have an exhibit for the purpose of spreading the message. Be sure to stop by, say hello and learn more! In meantime, join our growing community while we build out our platform and wait for final regulations.