CRAFT BEER & CIDER AT THE NEXT LEVEL Craft Brewer In < 5 Years TOP 50 A ROUND
Aug 19, 2015
CRAFT BEER & CIDER AT THE NEXT LEVEL
Craft Brewer In < 5 Years TOP 50
A ROUND
INTRODUCTION This document will offer an introduc3on to Mine Sha6 Brewing,
including our plan, beers, ciders, growth, facili3es, team, and mission.
DEAL SUMMARY
Team– Ours is a team of pioneers and master brewers who helped forge the art of craft beer in America by producing beloved brews of award-winning quality that have stood the test of time and become part of the landscape.
Market–Craft Beer is up 22% from $14.4B in 2013 to $19.6B in 2014, with long-term, double-digit growth forecast for years to come. Cider is projected to quadruple by 2017.
Products– Expert Craftsmanship, Extraordinary Beer & Cider. Through an unwavering commitment to quality and consistency, we strive to produce outstanding beer & cider that reflects the rich heritage of our region and meets the highest expectations.
Source: Demeter Group, Farlie Turner, Mintel, BA
Brand– The Mine Shaft brand is resonating locally and nationally with consumers as well as distributors. Distributors and brokers are cold calling now to get MSB product.
Consumers– Craft beer and cider drinkers are consuming more, exploring the category, and choosing craft beer and cider over value beers and wine.
Investors– Investors will be investing $9.4M in A Round equity. Investors receive 8% Annual Preferred Interest. In recent recorded transactions, strategic investors have paid multiples of 12X to 20X in the Craft & Cider industry.
Goal– To become the fastest growing brewery by 2016 and a nationally recognized Top 50 brewery in under 5 years.
Exit– Have investors out in five to six years. Private Equity, Acquisition/Strategic Partnership with Major Players, Regional Players, and IPO.
TOP 50
Mine Shaft Brewing’s Black Card Club Membership offers exclusive access and opportunities like no other beer or wine clubs, including: First access to limited production beers and ciders at the brewery. Special opportunities to purchase exclusive releases. Advance notice and special pricing on brewery events, including head brewer dinners. Pre-sale all-access purchase opportunities for our Summer Concert Series and other events. Discounts on dining and merchandise. Dedicated Concierge Service to assist with purchases, event information, dinner reservations and information about our beers and ciders. Exclusive opportunities for dinner along with game/event tickets with our athlete ambassadors: NHL, MLB, MLS, PGA, Olympic Medalist. This is exclusive access meant to create lifelong memories.
WHAT MSB INVESTORS ARE SAYING ABOUT THE OPPORUNITY
“After drilling into the concept and plan with Tim and his team and helping in drafting the deal structure I decided to invest and even got my family to invest too. This is an outstanding team with substantial relevant operating experience and a differentiated plan for entering the craft beer/cider space. The craft beer/cider market continues to grow rapidly with plenty of opportunity remaining for new brands like MSB.”
Alan, Investment Professional, NYC Private Equity Firm “MSB has really stood out to me as a best-in-class opportunity. From a management team with deep, relevant experience to a comprehensive marketing and business plan, and a product that is already in high demand, this is as close to can't miss as you can get. I can't wait to see this come on-line and let the numbers support what I'm confident will be the successful byproduct of a well-vetted strategy.”
Dan, CFO of Global Bulk Raw Materials Trading and Logistics
MSB TEAM’S LONG HISTORY IN CRAFT BEER
Mine Shaft Brewing's passionate team has worked in the beer category, specifically the craft space, since the 70's. Leveraging our experience in the super premium, premium, premium light, sub-premium, malt liquor and flavored malt beverage categories, our brew crew has been involved in the development and introduction of both specialty and seasonal brews, including brewing, packaging, marketing and sales. To this day our team continues to brew world class, award- winning beers. Below are some of the craft brands and beer brands with which our group has been involved.
THE HUGE MARKET OPPORTUNITY
“The whole (U.S.) cider category is only 0.2% of the beer market and in England and Ireland, it’s 15 to 20%. There is so much upward traction
for the category, it’s almost mind numbing.”
$1B+ Rapid craft facility expansion is needed By 2020
Craft beer jumps 22% from $14.4B in 2013 to $19.6B+ in 2014
Beer is a $100-billion-a-year industry (based on U.S. sales).
U.S. hard cider sales are projected to quadruple by 2017.
Source: Farlie, Turner & Co., Demeter Group, Forbes
LANDSCAPE -‐ BIGGER IS BETTER
“If you’re not a top 50 craft brand, you’re less than a $10MM business. The Real fight in this industry is on-shelf. You need to get as big as possible now, but you need to do it prudently.” -Craig Farlie, Farlie, Turner & Co.
60K BARREL (BBL) CAPACITY DAY ONE
MARKET SHARE EXAMPLE COMPETITIVE LANDSCAPE
MSB 60K BBL
70%
25%
5%
Multinationals - Craft beers continue to erode legacy share
National and Regionals - Aggressively investing in future
market share
3000+ Small Brewers- Will be left behind and will continue fighting for an ever smaller share of the pie as larger
Craft brewers take market share
IT IS All ABOUT PERSPECTIVE
All in a day’s work for the seasoned MSB team!
DISTRIBUTORS WANT MSB NOW
Scott Stiltz Craft Brand Manger for M & M Distribution, UT / Coors Brands …
“If MSB was producing now M & M would want you in UT, WY, NM
We do not see anything like MSB from other new craft players let alone existing craft players”
Dane Carlson, President of Carlson Distribution of UT / Miller, Sam Adams…
“MSB can take 35 to 45% of the local market in year one with Carlson.
MSB Ales alone could do 200k cases the first year ”
John Sadowsky CEO of Atlas Distribution, MA
Miller, Sam Adams…
“Love everything about MSB, Team, Branding, Packaging, Lines”
200K Cases = 14K BBLS
A Majority If Not All IniDal Capacity Will be Accounted for By the Time MSB Opens
MSB BRANDING
While CRAFT sells product, the BRAND creates an acquisition target.
We are building a brand, not just a craft.
“An eye-catching label that makes a brand instantly recognizable from 10 to 20 feet away is a plus, while one with too many tiny details might appear as nothing more than a colorful blob.”
Curtis Mann, Craft Buyer Raley’s Bel Air Nob Hill Foods NorCal
“Beyond the quality of the liquid inside the bottle, strong packaging and labeling, the eye-catching face of a brand, is becoming paramount as a means of standing out on shelves tasked with propping up more and more craft SKUs than ever before. If you’re not seen, you don’t exist.”
Ian McLean, Founder and Creative Director McLean Design BevNET FBU (Food and Beverage University)
DIFFERENTIATION SETS MSB APART
GOOD DESIGN IS GOOD BUSINESS
MSB CREATES AN ASPIRATIONAL PLACE IN CONSUMER’S LIVES AND HEARTS
BRANDS THAT OUTPERFORM COMPETITION ON
THE PRODUCT INTRINSIC LEVEL WIN THE CATEGORY
Southeast Perspective View - Open Space Side of Building
Northeast Perspective View - Parking Side of Building Entrance Perspective Close Up
Southwest Perspective View - Open Space Side of Building
MARKETING FOCUS
Brand Development: Packaging Design
Website Development: CMS, SEO, Email Club
and SMS
Social Media: Facebook, Twitter, Pinterest, LinkedIn,
Tumblr
Public Relations: Press Kits, News Releases,
Story Shopping, Blog Postings, Investor Relations
Promotional Products: For purchase Online and at the
Restaurant store Consumer Give-a-ways
Promotion At Events: Beer Festivals, Community
Activities, On- and Off-premise Tastings, Industry
Competitions, Trade Shows, Partner Promotions
Merchandising Support: banners, posters, taps, price
cards, neck ringers, glassware, wearable's, coasters, static clings, distributor incentives &
samples
Traditional Advertising: (limited) - Focus on
organic brand growth through Social Media and
brewery visitors
SALES STRUCTURE Communicate Emotion & Trust, The Only Way to Win is to be Talked About
ONE NATIONAL DIRECTOR NINE REGIONAL MANAGERS
Regional Sales Managers and State Sales Managers maintain national and key customer
relationships directly.
STATE AND MULTI-STATE SALES MANAGERS Vary by region from 3 to 9 State Sales Managers
depending on density or population in region.
INSIDE SALES AND SALES SUPPORT TEAMS Reports to National Sales Director and assist
Regional Sales Managers & State Sales Managers with adding new accounts, servicing existing accounts and appointment scheduling and
confirmation.
SALES TARGETS Distributors / Retailers / Consumers
Sales people are value added consultants.
PAC ALASKA
ROCKY MOUNTAIN PACIFIC
SOUTHWEST SOUTHEAST
CENTRAL PLAINS
GREAT LAKES
NORTH-ATLANTIC
MID-ATL
ATHLETE AMBASSADORS Athletes provide distributors, retailers, and consumers brand awareness through
Autograph Signings, Social Media, Contests, and Give-A-Ways
NHL George Paros - Montreal Canadians Victor Stalberg - Nashville Predators Devin Setoguchi - Winnipeg Jets Zach Parise - Minnesota Wild Torrey Mitchell - Minnesota Wild Ryan Malone - Tampa Bay Lightning Drew Stafford - Buffalo Sabers Trevor Lewis - LA Kings Pavel Datsyuk - Detroit Red Wings Chris Draper - Detroit Red Wings Dylan Olsen - Chicago Black Hawks Joseph Pavelski - San Jose Sharks Jamie McBain - Buffalo Sabers * Athletes comp is part of the option pool. ** Players may be traded. *** May add NFL, MLS, PGA, Ironman & NBA Athletes. **** This page is a sampling of MSB Athletes.
U.S. Olympic Athletes Valerie Fleming & Shauna Rohbock - 2006 Silver Olympic Medalists, 19 World Cup Medals, 3 World Championship Medals, 7 Track Records Billy Demong - Nordic combined skier & Olympic Gold Medalist. Demong is a four-time Olympian competing in Nagano, Salt Lake City, Torino and Vancouver. National Women’s Soccer League Leslie Osborne - Pro Athlete at Puma, TV Analyst at Pac-12. Network and Player at National Women's Soccer League Chicago Red Stars.
FOUNDING TEAM Tim Nemeckay Managing Member -‐ Tim brings to Mine Sha6 Brewery vast experience in the cra6 beer space in diverse domains like finance, sales, and consul3ng. Tim has been an entrepreneur, advisor, consultant, investor, and execu3ve of companies in Beverage, Auto, Banking, Green Energy, and Consumer Goods. Tim has had extensive involvement in successful new businesses, including capitaliza3on, business development, sales, marke3ng, branding and PR. Tim also brings a substan3al network of business rela3onships, vision, and execu3ve management. Ray Klimovitz Senior Advisor -‐ Ray is currently the President of Klimovitz Brewing Consultants, Inc. doing business in the Wisconsin area, where he acts as Alterna3ng Proprietor (AP) Brewmaster for various beverage clients. His past clients include Sleeman Brewing & Mal3ng (Guelph, Ontario, Canada), City Brewery (LaCrosse, WI), Harpoon Brewery (Boston, MA), Allagash Brewing (Portland, ME), New Century Brewing (Boston, MA), and Slammin’ Sam Beer Co. (Pinehurst, NC). Ray’s beverage experience extends into new product development, as he co-‐founded IZZE Beverage Co. in Boulder (CO), where he was responsible for product development and produc3on. Ray’s 40+ years of experience in the beverage industry started at Four Roses Dis3lling Company in Bal3more, where he held the posi3on of Whiskey Chemist. From there, Ray moved to Carling Brewing Co. in Bal3more where he was Brewing Chemist, QA Manager, Asst. Brewmaster and Brewmaster. Ray’s professional experience includes tenure at Joseph Schlitz Brewing Co (Milwaukee) and finally, The Stroh Brewery Company (Detroit) where he was Corporate Master Brewer.
John Logan CFO -‐ John brings a seasoned career as a CPA, CEO and CFO. John started an outsourcing company in 1992 that grew to $12MM in five years, and was one of the Inc. Magazine’s Fastest Growing Companies in 1997. John merged the company and became CEO in 2001, and sold his share in 2004. John graduated with a degree in Accoun3ng and spent six years with one of the "Big 8" CPA firms. Post that, he spent ten years with two large organiza3ons as CFO, and became experienced in opera3ons, mergers and new business crea3on. ScoS Rozek Marke3ng & Research -‐ Scoe has over 30 years of experience in marke3ng, market research, new product development, and adver3sing, including 12 years of experience with the Stroh Brewery Company. He was directly involved with coordina3ng the expansion of the Stroh Brand into 20 western states a6er the acquisi3on of Schlitz. Scoe was also heavily involved in the brewery’s new product efforts. As brand director for the Stroh’s brand family for three years, he managed annual marke3ng budgets of $15-‐20 MM, and was responsible for all marke3ng func3ons, such as -‐ brand planning, adver3sing, packaging, promo3ons, pricing, and research. Since 1994, Scoe has been the co-‐owner of Unisearch Partners, Inc., a custom market research company specializing in integrated quant-‐qual techniques and qualita3ve studies. The firm has been an industry leader in Super Bowl ad tes3ng for over 15 years, tes3ng SB ads for clients like Frito-‐Lay (Doritos), Anheuser-‐Busch, and PepsiCo among others.
*Pseudonym, more detailed Info Available upon request
James Weinberg Opera3ons -‐ James brings 13 years of materials / purchasing manager experience from The Stroh Brewery Company. He purchased over $600 MM annually in packaging materials for eight domes3c breweries. He brings procurement, inventory control, package development, and service levels with 25 major suppliers. He was responsible for the total logis3cs of all packaging materials including price nego3a3on, produc3on quan33es, inventory control, warehousing, and graphics coordina3on. Carson Jackson* Head Brewer -‐ Carson has been professionally brewing as Brewmaster for one of the na3on’s top cra6 breweries, and has been awarded several medals at the Great American Beer Fes3val for his outstanding work in the field. Carson currently leads a team overseeing all aspects of cra6 products, and acts as technical manager and project manager for a canning opera3on and an automated brew house, with mul3ple fermenta3on vessels. Carson is responsible for the integrity, quality and 3mely produc3on of all MSB: Beers, Ales & Ciders. Diego Rivera* Area Sales Manager -‐ With over 6 years of account management, marke3ng, promo3ons, and sales experience in the beer and outdoor industries, Diego brings immediate access and an established rela3onship with the big six AB wholesale distributors here in Utah and several outdoor sports rela3onships. Diego currently manages a revenue base of over $5M.
FOUNDING TEAM Bernie Pekor Overseas Sales Advisor - Bernie brings in 16 years of Stroh Brewery experience including Project and Pricing Analyst, National Retail Sales Administration (Puerto Rico), and International Sales and Marketing. Bernie developed and executed sales strategies in Asia, Europe, Australia/New Zealand, Middle East Asia, Africa, Latin America, and the Caribbean. He’s managed international sales reps, and planned, directed and coordinated marketing efforts. He expanded private label products in Japan, Taiwan, South Korea, and Brazil, and established a joint venture with Rajasthan Breweries, resulting in the first foreign beer to be sold in India. Martin “Marty” Ruffalo Packaging Advisor - Marty’s career has spanned over 30 years in the beverage packaging sector. He held several senior management positions for over 18 years with Ball Corporation - North America’s largest producer of aluminum beverage packaging. These roles included Senior VP - Sales and Marketing for both Ball Beverage can and plastic bottle divisions. Prior to Ball Corp., Marty was the Operations Controller for the Stroh Brewery Can Division in Detroit for 8 years, where he was responsible for the planning of both the financial and manufacturing functions of this multi-plant operation.
Leslie Burnes Brand Management Advisor - Leslie brings in vast experience with New Product and Branding, including 10 years with Stroh Brewery and 4 years with Walt Disney. Leslie started her career with Stroh Brewery in pricing and worked her way up as Corporate Pricing Analyst, Field Pricing Analyst, Associate New Products Manager, and then Senior Associate Brand Manager, where she was responsible for marketing functions for all the new products.
She supervised new product introductions from initial concept through to the market launch. She developed and implemented brand advertising, creative and media plans, national consumer promotion plans, and regional refund programs. She managed design and production of package graphics and merchandising materials.
Dan Jankowski National Sales / Distributer Relations Sales Advisor - Dan brings over 30 years of outstanding industry management experience to Mine Shaft Brewing. Dan worked for over 17 years for Stroh, Schlitz, and Miller Coors as a district, zone, and unit sales manager.
In addition, Dan also worked on the distributor side of the business for 18+ years in positions ranging from Sales Manager, Director of Sales/Operations, and General Manager.
Ed Benfield Consumer Research Advisor - Ed has over 30 years of experience as a professional market researcher on both the client and the supplier sides of the business. He is an expert in consumer research and an accomplished focus group moderator. Ed has been the co-owner and president of Unisearch Partners, a custom marketing research and consulting company since 1994. He has 13 years of direct beer research experience as the manager and director of market research at the Olympia Brewing Company in Washington, and the Stroh Brewery Company in Michigan, and has served major clients in the beer industry during his entire 20 years with Unisearch. Jay Stevens Athlete Liaison / Marketing, Event Management Advisor - Jay brings on pro athletes as product ambassadors into retail, distributor, and club channels. He is also a Firefighter Paramedic for Unified Fire Authority, and the goalie for the Utah Grizzlies. Charlie Whittington Key Accounts / Business Development Advisor - Charlie brings in multiple years of experience in the regional and territory sales, and has been a top achiever in all his previous sales management roles. In addition two Charlie's 7+years on professional golf tours. Richard Burnes Brand Management Advisor - Richard brings over eight years of experience with Stroh Brewery. He spent four years as Pricing Analyst (Corporate Pricing), an additional two years as Associate New Product Manager (New Product Development), plus three more years as Associate Brand Manager for the Stroh’s brand.
LEGAL & ACCOUNTING
Karl Israelsen Carman Lehnhof Israelsen LLP Salt Lake City, UT http://www.clilaw.com Steven Bowers Welzien / Bowers Certified Public Accounts Park City, UT http://www.wb-cpas.com
For more information, please contact: Tim Nemeckay
[email protected] 954-295-5032