Athletic Brewing – The Successful Non-Alcoholic Beer

Bill Shufelt earned his bachelor’s degree in economics in 2005 and was a healthcare stock trader with Knight Capital in Jersey City. The billionaire Steve Cohen of Point72, a hedge firm, hired him after he earned his Chartered Financial Analyst certification. It was hectic and social at the same time. Shufelt had business dinners during weekdays, and on the weekends, he went to parties and other social functions. For health reasons, he had decided to give up alcohol. He was eager to boost his performance at work and was a huge fan of physical exercise. The lack of a drink in his hands made him feel like an outcast when he finally quit since drinking is ingrained in most cultures. In 2015, he was out to dinner with his wife Jackie when he complained that there were no non-alcoholic artisan beers. When he asked her opinion, she told him to go ahead and do it himself.

Shufelt spent the next two years reading about brewing, drafting business strategies, and looking for a brewmaster to join him. Everyone told him that he was insane to open a brewery only to produce alcohol-free beer.

He went to conventions and posted on online forums to find a co-founder who knew a lot about brewing.

On a website devoted to homebrewing, he met his future business partner, John Walker. Bill advertised for assistance in “the most inventive area in craft beer” by using language that was not quite clear. Walker, who is originally from Connecticut and worked at his family’s Madison restaurant before moving to New Mexico to become head brewer at Second Street Brewery, recalls that Bill told him, “Don’t hang up” when he phoned. Let me finish, please. It’s non-alcoholic beer.”

Walker, excited by the task and the prospect of returning to his home state of Connecticut, came back with his family.

They first experimented with homebrewing in Gatorade jugs, tweaking the recipe one element at a time. It was just two guys experimenting in a deserted warehouse.

Brewers often remove the alcohol and much of the taste from regular beers by heating or filtering them. Shufelt and Walker came up with a different plan. They changed the grains, sugars, temperature, and pH to make a low-alcohol beer that still tasted great. Walker worked on the golden brew that is now Athletic’s Upside Dawn for six months and sixty batches.

When they first proposed the concept, most of the country’s brewers turned them down because they wanted to perform contract brewing at larger facilities. They did Athletic a huge favour by assisting them. They had to change course and construct a brewery, but now they have complete control over the product’s quality.

Shufelt used his Wall Street contacts to help finance $3 million from friends and angel investors, and the group used the money to construct a modest 10,000-sq ft brewery in Stratford, Connecticut.

They launched in May 2018, and early on, business was tough. All around New England, Bill would conduct taste tests. In his first summer, he attended around sixty-five races, including triathlons and half-marathons, where he distributed free samples and spoke with participants and spectators. More than half of the races were completed by him as well. Sharing a drink with other runners who have just completed the same event added a layer of realism to the experience.

Bill met with Whole Foods’ regional buyers after persistently networking with them. That did it; it changed everything. He brought in several brown bottles that he and John had filled in his parent’s garage without labels. Yet they looked beyond the labels and gave them a trial run in seven stores. They had trouble keeping it in stock from the start, so they distributed it around all of New England. Today you can find them at stores throughout the US even in Canada, Australia, and Europe.

The company has had its fair share of rough days. Towards the end of 2018, after receiving their first national order from retailer TotalWine, Shufelt and Walker loaded a truck with fifty thousand dollars worth of beer and then fretted that some of the cans could have been spoiled. Because of the low alcohol content in Athletic’s brew, a natural preservative, even a single wayward microbe is enough to ruin the flavour.   If they botched it, Athletic would be doomed for good. The category itself could be doomed. They eventually threw the beer out, asked for additional money from investors, and spent over a million dollars on a tunnel pasteurizer to ensure consistent quality.

In situations where you would otherwise go for water, soda, or iced tea, like a workday lunch, a post-workout drink, or a road trip, Shufelt thinks beer would be a welcome addition. Several patrons utilise Athletic to help them drink less and still have a good time by rotating between their usual beverages and Athletic creations. In addition to not gaining weight. Athletic’s Run Wild IPA has only 65 calories in a 12-ounce bottle, whereas other speciality beers have more than 200. (Anheuser-Michelob Busch’s Ultra, a light beer with 4.2% alcohol, contains 95 calories.)

Several well-known craft breweries, such as Samuel Adams, have recently begun producing alcohol-free versions of their beers. Nonetheless, Athletic has remained steady, with projected 2022 sales of almost 20% of all non-alcoholic beer in the United States.   Grocery and liquor retail giants like Whole Foods and TotalWine account for the bulk of sales. More than ten thousand eateries and watering holes serve Athletic’s beer.

Online shopping is also quite popular. As Athletic’s beers are less than 0.5% ABV, the company may bypass cumbersome spirits and tax regulations and sell to customers directly through their website. The e-commerce market is developing at its own pace. They created a genuine group consisting of hundreds of thousands of users and a massive pool of information. With this treasure of data, Athletic can notify consumers through email about new beer releases, limited-time offers, and limited-flavour releases, as well as communicate corporate efforts.

For example, in 2020, Athletic made a strategic purchase of a San Diego brewery in light of the latter’s data indicating a concentration of consumers on the West Coast. Moreover, Athletic can test new beer tastes at low cost and with little effort thanks to e-commerce before committing to a larger production run. They may gauge interest in new items among consumers and make necessary adjustments before releasing them to stores.

Athletic’s two new breweries are up and running, so the company is working feverishly to get distribution in additional supermarkets, warehouse clubs, and bars around the country. Space for development exists. According to Shufelt, just 15% of bars and restaurants in the United States offer Athletic. In addition to traditional beer outlets, Athletic is exploring coffee shops, delis, pharmacies, and even vending machines as potential new sales channels.

It’s time for beer to explore uncharted territory.

Reference

https://www.inc.com/magazine/202209/doug-cantor/athletic-brewing-company-non-alcoholic-bill-shufelt-inc-5000-2022.html

https://en.wikipedia.org/wiki/Athletic_Brewing_Company

https://www.forbes.com/sites/stevenbertoni/2023/02/15/inside-athletic-brewings-plan-to-make-boozeless-beer-a-billion-dollar-business/?sh=5ca42b7c2814