James Watt as soon as hurled stuffed cats from a helicopter over the Metropolis of London in a publicity stunt designed to lampoon ‘fat-cat’ company greed. Now he is making ready a attraction offensive with the identical pinstriped ranks of financiers as his craft beer enterprise BrewDog heads in the direction of a float on the inventory market.
The blockbuster itemizing, rumoured to be price greater than £2billion, is likely one of the most hotly-anticipated IPOs amongst Metropolis buyers eager to purchase right into a premium model following the profitable float of shoe model Dr Martens.
The brewer – well-known for its guerrilla advertising and marketing campaigns – has appointed high-powered attorneys at Freshfields to assist chart a course in the direction of the inventory change, bolstering a reshaped high group that features finance chief Niall McCallum and former Asda boss Allan Leighton, who joined as its chairman and Watt’s mentor 4 months in the past.
Toast to the long run: James Watt says BrewDog will keep rebellious
Watt, chief government of the agency, says a float will give ‘long term liquidity’ to its current particular person buyers, who at the moment have a single day every March to commerce shares. ‘We’re just about working in the direction of IPO for them as a lot as anybody else. They’re the center and soul of the enterprise,’ he says, talking over Zoom from his workplace at BrewDog’s manufacturing hub in Aberdeenshire, wearing a blue and white striped jumper with a white beanie hat overlaying his shaven head.
BrewDog’s knack for grabbing headlines – together with the taxidermy ‘cat bombs’ – have given it a world following. Different stunts included making a ‘BrewDog Viagra’ beer for Prince William’s 2012 wedding ceremony taglined ‘Come up Prince Willy’ and Watt and co-founder Martin Dickie dressing up as purple gentle district intercourse staff for a crowdfunding advert.
It has loudly championed its initiatives to share earnings with staff and cap salaries for bosses at 14 instances the bottom paid employee. Annual gross sales development has averaged 57 per cent over the previous decade and it’s on target to promote 400million cans this yr.
However the previous two years have delivered shocks for an organization that had develop into accustomed to springing its personal. The pandemic at instances left its pubs abandoned – and Watt sleeping within the workplace as he was working so onerous to deal with the monetary battering.
Worse nonetheless, he acquired a scathing public assault with accusations of a ‘rotten tradition’ levelled by his personal former workers final summer time – an episode he says made him belatedly resist his personal duties as firm co-founder and boss. Watt is, due to this fact, maybe uncharacteristically coy on the timing of any IPO – at the least in the interim. Inventory market situations and the outlook for Covid curbs on bars should be proper to press the button, he says. ‘The important thing factor is getting that certainty and stability again,’ he provides, cautioning that the ultimate set off level for an IPO ‘could possibly be this yr or some level sooner or later, we’re working in the direction of it’. Corporations not often sign when precisely they may float till they’re able to checklist.
Entry to recent capital may also permit BrewDog to pursue an aggressive worldwide enlargement technique and proceed taking up established labels. ‘The highest 10 beer manufacturers are all corporations that are 100 years outdated, in what different trade does that occur?’
A float has additionally lengthy been promised for the 200,000 ‘fairness punks’ introduced on board via crowdfunding rounds because the model’s launch in 2007. Since then, the Aberdeenshire-based model has led the march of craft brewing into the mainstream: opening branded bars and accommodations at residence and abroad, and promoting in supermarkets.
A number of different craft brewers – together with Meantime and Camden City Brewery – have been snapped up by brewing giants lately. However Watt, who counts a US personal fairness agency as a minority investor, dismisses recommendations he may be caught up within the newest buyout frenzy, which is being led by personal fairness companies. ‘We have had hundreds and a great deal of inbound [takeover interest]’, together with two approaches final yr. ‘We’re very captivated with our independence,’ he provides.
However institutional buyers should still be nervous after final yr’s workers storm. A bunch of 60 staff revealed an open letter accusing it of pursuing development in any respect prices, and Watt personally of leaving workers ‘burnt out, afraid and depressing’. It seems BrewDog’s unconventional strategy had spilled over into its office tradition.
Watt, suitably contrite, says the allegations had been ‘troublesome to listen to’ and the episode provided an ‘alternative to get higher as an organization’. Covid, he says, triggered ‘some powerful individuals choices’. It shut down its 100 bars and small assortment of accommodations via a string of lockdowns and performed havoc with BrewDog’s plans.
He admits that, even earlier than that, enlargement was so speedy that ‘perhaps we did not give attention to the aspect of technique that we should always have’.
However there’s a restrict to how a lot he is prepared to grovel. ‘I believe a quote I heard about management was if you wish to preserve everybody joyful, you must give away ice cream versus run an organization – generally issues we do should not widespread.
‘And that is form of half and parcel of working the corporate, I suppose. However a few of the private components are powerful to listen to. Earlier than this I used to be engaged on a North Atlantic fishing boat. I would by no means been a CEO earlier than. I take the accountability [for BrewDog’s 2,500 employees] very critically.’
Outrageous: James Watt, left, and Martin Dickie put together to drop ‘fats cats’ over the Metropolis
A ‘interval of reflection by myself management’ adopted the criticisms – in addition to an unbiased evaluate into the corporate’s tradition by specialist Wiser. BrewDog then carried out management coaching, gave workers a pay rise and launched a whistleblowing hotline. So ought to potential buyers be involved there could also be extra skeletons within the closet? Watt says: ‘We have executed a really thorough, clear response to these points. I believe we’re now in an excellent place.’
In the meantime, Watt says he ‘doubled down’ on property investments in the course of the pandemic, swooping on cut price websites for its bars and accommodations. Big new venues will quickly open in Waterloo, London and on the Las Vegas Strip. Watt spent Christmas isolating alone with Covid in entrance of Netflix, seeing his two daughters later within the festive season. That was adopted by a visit to the Maldives, swimming with sharks. He is planning to launch a documentary this yr to bemoan the routine killing of sharks all over the world.
However, regardless of what seems to have been a interval by which he has matured, Watt insists the rising pains and the course in the direction of a Metropolis itemizing won’t imply the top of BrewDog’s rebellious picture.
‘If I believed going into an IPO would change the essence of the enterprise in any means, then it would not be a part of the plan,’ Watt says. ‘We may be a barely unconventional public firm, however we’ll proceed sporting our coronary heart on our sleeve, proceed to take a stand for the issues that we consider in,’ he provides.