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Entrepreneurs often reflect their companies.
That is definitely the case with Matt Phillips, founder of Phillips Brewing and Malting Co.! Phillips rejoins the podcast to dive deeper into the unique brand he has built over two decades, how and why he started a craft brewery while others were shutting their doors, and what the future holds for British Columbia’s biggest small brewery.
The Entrepreneur Podcast is sponsored by Connie Clerici, QS ’08, and Closing the Gap Healthcare Group, Inc.
Transcript
Eric Morse
You're listening to the Entrepreneur Podcast from the Western Morrissette Institute for Entrepreneurship, powered by Ivey. My name is Eric Morse and I will be your host for this episode. Entrepreneurs often reflect their companies. That is definitely the case with Matt Phillips, founder of Phillips brewing and malting company. Last fall, Phillips joined me as the guest speaker at the Ronald D. Schmeichel Speaker Series, during Global Entrepreneurship Week to discuss how and why he started a craft brewery as others were shutting their doors, the company's unique brand identity, and why after two decades, he decided to begin a new chapter for the company and his personal entrepreneurial journey. So we're gonna get to a little bit around the creativity, because I think it's a big part of the identity of Phillips Brewery and Matt. But I really want to start with the question I always start with was, you know, was entrepreneurship, always in the cards? Is this something that you knew you would be doing at some point? Or did this come a little bit later?
Matt Phillips
Yeah, definitely not in the cards. You know, I grew up in, I grew up in Nova Scotia. And I have all sorts of early memories of my parents friends talking about the evils of corporation and the evils of business. And no, certainly entrepreneurship wasn't an aspiration of mine. In fact, I did an undergrad in biology, and I was really interested in innovation. And, and I ended up deciding that the right path for me was actually do an MBA. And so I was gonna go to a school close to here. But I didn't, but it to do innovation management. And I remember a conversation with one of my parents, good friends, and he was just desperately trying to talk me out of getting into any sort of business direction. So no, entrepreneurship hasn't been a focus of mine, I would argue even now that, you know, despite having started a business, I don't think I identified as an entrepreneur starting a business identified more as a brewer. And I would, I would actually only say recently that, you know, I've just will fast forward to probably the end of my Phillips story and say, I've just gone through a bit of a, an ownership transition. And I got a call from a friend of mine, working in another brewery, and he said, "well, congratulations. Now you're really an entrepreneur, because you're not really an entrepreneur until you have an exit." So I guess now I know, I get stuck with that badge. But no, it was never something that I aspired to be.
Eric Morse
And, I know a little bit of the early days stories, I don't, I don't know all of it. So I'm interested to hear like everybody else, some of this, but I know, you were having a good time in the Okanagan in the 90s, early 90s. And you were brewing with another company. Many of you aren't old enough to know, but a lot of the craft brewers in the later 90s really went down. And a lot of them were closing. And it was about that time that Matt said, You know what I should do, I should go out on my own and start my own brewery. Because I don't know why you decided that that seemed, in the midst of everyone closing, what was it that that spoke to you to said, now's the time for me to get going on this venture.
Matt Phillips
No, when you put it that way. Whether they say the brain doesn't start or stop developing until you're 25, I think maybe I pushed that a little bit. I was 27 when I started the brewery. And at the time, I what I you know, really what drove me was number one, yeah, I kind of had aspired to open a brewery and back then all the breweries that that were in BC, we're more or less making four different flavors. And you know that everyone have a blonde, everyone have a dark, everyone have a pale ale. Some people would have a lager. But that was about as experimental as they got. And, and I was pretty excited about beer. And I'd seen all sorts of other things in different places. And I thought it was a real hole in the market to do some niche stuff. And despite the fact that everything's closing, I think it's kind of actually an opportunity, because there really wasn't a lot of creativity in the market. And equipment was was really cheap. It was kind of the end of the business cycle. And, you know, gear was selling for five to 10 cents on the dollar. And I thought to myself, you know, I've worked for a couple of breweries, every one of them had had their dreams crushed by the owners basically, or, you know, the Brewers had these great ideas. And I remember one of the breweries, I was working at Whistler. We had, you know, I think the best beer we made at the time was it's called a headless lager. It's kind of a full rich, you know, lager and As the owners decided we needed to have a light beer. And I think now in our cycle of acceptance of craft, you could probably do that. But you could not do that in 1997. And, and so I got tasked with massacring our lager by trying to figure out a way to deaerate water and add it back into make it just not as good, lighter and less pleasurable. And that was kind of how a lot of breweries were being run back then. And then there was this real disconnect between the ownership and the craftsman. And so I saw this opportunity to, to kind of jump in there and make niche beers. And because equipment was so cheap, I thought, you know, there's only really, you know, if I get to try to do this on my own in a way that I can have a control over the creative process, I know that I can't have outside investors, I know it's not going to go well. I've seen that play out in three breweries at this point. So if I'm ever going to do this and have control, today's the day, this gear won't be around and cheap forever. And so. So what I did is I wrote a business plan. And
Eric Morse
That's a good thing to say today.
Matt Phillips
It was a pretty honest business plan. It doesn't mean it was good, but it was my honest plan. And I took that around to every bank in town. And I universally got the same answer, which was that this was too small to work, that breweries are big businesses and what I was, I think I was looking for 300 grand or something to start it? And they said, no, no, that's that just won't work. We've, we've seen this play out before in other industries, it's too small, you're off by a factor of 10 or more.
Eric Morse
You're in pretty good company of getting turned down by the banks.
Matt Phillips
It's right, it's a badge of honor. But while I was waiting to talk to these bankers, inevitably, they'd have all these pamphlets in their waiting room, and they'd be for credit lines of credit and visas and whatever the case might be, and so bored, sit down and read them. And, and so I just ended up grabbing these that every bank I went to, and I just randomly was having a conversation with somebody who knew about credit scores, he said, Well, you know, there's latency in the system, if you send them all in on the same day, it doesn't get registered, and they don't see that everyone else is getting the same kind of mail. So that's exactly what I did. I sent, I sent applications in and, you know, get lines of credit for five grand here and, and Visa cards for eight or 10. And the pleasurable interest rate that they charge it, which motivates you, I would say, but, you know, I didn't get 300 grand, but I got enough that I was like, Oh, I can cobble enough pieces together. And, and I know enough about welding and machining that I can build some stuff that I need to get going. And, and so it became even smaller scale from what the bank was willing to, with was that was too small. We're probably about a third of that. But–
Eric Morse
Maybe a little bit more of that. I know, there was a lot of DIY involved in getting this thing up and going. So just talk about that a little bit in terms of you're working off credit cards, you've got a low budget, machineries cheap, but you're still doing an awful lot of work just for you to get this thing off the ground. Sure, yeah.
Matt Phillips
No, I was doing it as a one man show and one young man show at that point. And so yeah, I was able to cobble together some, some pieces that you know, were fairly inexpensive, but there were some things like cooling that was going to be a problem and bottling and labeling that was going to be problematic. And my, my business model was only to do large bottles of really esoteric beers. So you know, some of the problems were solved, for example, the canning machine or sorry, the bottling machine, because back then craft beer didn't come in cans. Bottling machine was something I was able to cobble together just with you know, a bunch of off the shelf pneumatic, pneumatic cylinders and pieces and some mild steel, which is not the preferred way but cheap. And things like refrigeration, I found that there was a hunter that lived in the next village that had a meat locker. So I bought that off of them and moved it on site and was able to put you know, build it up a little bit bigger and put some tanks in that, and so found, I found ways and, it was, it was really cobbled together, it was in a 1300 square foot industrial Bay on the second floor of a building which, never ideal for beer because it tends to go down. But, you know, I ended up trying desperately to avoid a building permit because I had a very tight timeline, I got possession of this building in June. And I needed to have beer on the shelves by the end of August to, to make rent. And so, it was incredibly tight, and would never have worked if I had any, you know, only because I was so ignorant of everything that needed to happen, did it work, if I had known what needed to happen. And I was just doing it to spite the process, it would totally fall fallen flat on its face. But because I was so ignorant, it worked out beautifully, to the point where, you know, as I decided that I couldn't core through the floor to put plumbing in, and so I built a concrete retaining area with a little sump pump in it. And I remember one day getting knock on the door, and it was the building inspector. And he goes, "What are you doing in here?" And I said, "Well, nothing, I'm just making this concrete floor on top of the floor, it doesn't need a building permit." And he kind of shook his head, and we had a good chat. And he goes, you know, ordinarily, "You totally need a building permit for everything you're doing here is totally not illegal or not legal. But I'm just going away." And so, you know, I think if I wasn't so, honestly naive, I don't think I would have got away with it. But that's kind of how things started. And so it started a very manual small system, and started out making making these esoteric beers. And to be clear, esoteric at that time, I had a raspberry wheat, which has since, I think come and gone in favor. But an espresso stout and an IPA, IPAs were really exotic back then, there was only two others in the market. So now that would be a pretty standard beer, but at the time, it was kind of experimental. So that's what launched and then of course, you know, there's always hiccups along the way. I had been in the industry and had fairly good contacts with suppliers. But when I went to package my beer again, with that deadline of having beer on the shelves by the end of August, one of the critical things that you need to have to put beer in bottles is bottles. And there was a bottle shortage. And so I called up my normal supplier. And they said, "Oh, yeah, no, we can get those to you in November." Well, that's not much good to me, and called up all the other suppliers. And I got November, December, January kind of answers. And so I was able to track down the manufacturing plant, which was in Portland, Oregon, which is, I don't know, seven-eight hour drive away, and a ferry away. And I was able to talk to a guy there who was sympathetic to my cause. And he goes, "Well, you know what, we do have some in the back. And as long as you don't tell anyone, I'll sell them to you. Just come on down, and we'll load them up for you." So I went and I rented a five ton truck. And, you know, drove down. And this was before 9/11, just before 9/11, actually. So the border was a little more porous. They didn't ask as many questions about some guy just running down, down the I-5. And so I got there. And of course, my truck was six inches too short. So we couldn't load it. So he said, "Listen, go to the hardware store down the road, buy some dunnage and come back, we'll boost your truck up and you'll be the last guy I load tonight, because everyone else says dock appointments, but we'll get you in." And there's a huge dock, there's probably 32 docks there, and this warehouse was multiple city blocks and interaction. So came back, and I walked around and, you know, no busy vests or anything like that back then. You just toured the, toured the warehouse and toured the glass plant, was pretty cool little day, and saw all sorts of cool bottles that would later be important in my business, but, but it was able to get going and made rent. And for anyone who's entrepreneurial, rents not that important, they'll wait. Lesson learned. But, but we managed to make rent, and that was kind of how things got going.
Eric Morse
Being a good guy, and just friendly and nice, it has something to do with this, plus probably a little bit of luck in terms of people opening doors and willing to work with you when, clearly you're just getting going.
Matt Phillips
Yeah. I think being honest in your desperation, is sometimes an asset. Yeah, people, people empathize with that for sure.
Eric Morse
For sure. You know, I think this we'll get to some of the things we've been talking about, especially around the branding stuff. So the brand you've created under Phillips brewery, it's fresh, it's fun. When did you decide this was the avenue to go, like a conscious decision? Or is it just an expression of you and kind of what you wanted to do in this industry?
Matt Phillips
I think it's an expression of our company. And it's been iterative. If you saw our first kick at the can, it's dramatically different than what, where we are now. So it's changed over time and it's developed over time. But I think it really reflects our Identity well, and, and that identity has been one that's been gradually formed, mostly informed by who, who works at the brewery. So, you know, when I started, it was two years before I could hire somebody, two and a half years or whatever. And the first guy that I hired, was in a band, and he played bass. And, we were all of a sudden growing, and, you know, two months after I hired him, like, "Oh, God, I need somebody else. Do you know anyone that's, you know, pretty fun and would fit in here?" And he goes, "Oh, yeah, my buddy Ron, they're both named Bell but, and their not brothers, but they both played a band together." And he goes "Yeah, yeah, Ron will fit in well here." And so Ron came and started working with us, and, and then we needed another person. And so I think of the first seven employees, five are musicians. And so all of a sudden, we had this kind of seed of music planted in the in the brand, and more and more musicians came in to, you know, drop by and have a beer, and we get to know them. And you'd go "Yeah, you want to work here? Sure, you'd be great." And so, you know, to the point, where if oh, God, maybe five or six years in, we had more bands playing out of the brewery than we had people working in it, you know, they were in two or three bands together, or whatever. And so music became a really important part of our, of our culture and our identity. And, and then likewise, art has been a part of our history. And, and, and so early on, I was at an art show, and I met, basically, our art director. And, and so his name's Sean O'Keefe. He's a super talented guy. And I was chatting with him. And he goes, and it turns out that he worked at the t-shirt shop that I was using anyway for our screen, screen printing. And so we got to know each other and, and I asked him if he would do some work for us. And so he said, "Yeah, I'd love to." And so he, in the first couple of iterations, he did what I told him to. And then, and then after that, the art got really good. He, you know, he, you know, after a bit, he's like, you know, I think, I think this would work and, and so we ended up having a really good relationship where he was able to find ways to express what we were, you know, the creative vision of the beers. And and it became a very symbiotic relationship. And so he became, yeah, this is Shawn's work, Shawn still does all of our work, and has an office next to mine. He's, he's one of the coolest guys I know. And, besides you. And, and so Sean, Sean really started to inform that that graphic element of the brewery and the same kind of thing happened, where he's like, you know, my friend needs somewhere to exhibit Do you mind if we put up a show down in the in the tasting room? Like, yeah, that's a great idea. And so we became more involved in the art community as a result. And, and so, you know, I think really where I'm getting to on this, Eric, is that our brand is an expression of, of the inside out. And that makes it really easy. It's not a contrived expression, it's an authentic expression of who we are as a company. And, and so from an alignment standpoint, it makes it really easy and authentic for us too. You laugh when I say, cultural alignment, but, but it does, it makes it so much easier if everyone that works there has a similar kind of interest and identity, then, then that really comes through in the brand and how we present ourselves publicly and how the sales rep talks to customers. And so I think the boxes are kind of an expression of the whimsy that that we try to foster at the brewery.
Eric Morse
If you get a chance to read a can, I mean, it's it's like reading a graphic novel. It's, it's fun, and I think it is aligned and a big part of the brand. It's awesome.
Matt Phillips
Yeah, you know, we've always thought that, you know, beer can be creative, but beer has to be fun. And, and so the way we talk about it is, we try to, we try not to be pretentious, we try to be organic, and and, and try to, you know, have some some humor in it. Take the piss out of ourselves a little bit sometimes. But, you know, I think there's a real danger of being too serious about something that's really there to, to entertain, and to be a part of a social experience.
Eric Morse
Cool. Thanks, Matt. I'm going to take you back just a little bit. We talk at university and I think the general consensus around talking about entrepreneurship always tends to be positive, right? This worked, those are the folks that we talked to. And you're, you know, also an example. But but we don't, we don't often cover kind of the tougher times and the things that went wrong. And those moments when you had to decide, is this worth it? Right. And so I remember, I think it was our podcast, we were talking about, you're standing there with an empty box, a shrink wrap. And what am I doing? And I, just take us through that story. Like, how does an empty box and shrink wrap lead you to, I'm done? Yeah.
Matt Phillips
Yeah. Right. I love talking to you because you do so much better research than I have a memory for.
Eric Morse
My team does.
Matt Phillips
Your team does, oh yeah. And we recently underwent a process of trying to document our history, and I totally forgot this story. So thank you, I'll add it tonight. Yeah, so you know, I talked about my business plan being inspired at the time of authorship and completely questionable in hindsight, it turned out the market for specialty beers in 650 mil bottles at that time was not infinite. Fact fairly limited. And so while I was able to pay rent and keep on top of the the Visa cards, the business wasn't taking off by any stretch of the imagination, it was, it was tough sledding. You know, so I would get up. First thing I do in the morning is I would start packaging, usually, that would take five or six hours, then I go out, and I would deliver beer and do sales calls, usually get home around eight o'clock, I'd start brewing, I'd finish off about one o'clock in the morning. And then I do it all again the next day. And so I was burning. Actually, I wasn't burning, I was burnt out. And, and layered on top of that when you're making beer. Good beer is very stable. But if, if you have a bacterial problem, it's not very good after a couple of weeks, and the equipment I had purchased was really difficult to clean. And so I was getting sporadic bacterial infections, and I'd have to dump batches. And so here I am trying to, trying to keep things going. And really didn't have enough hours in the day to do everything as it was. And on top of that, I was dumping batches and having to, you know, redo them. Great expense, and also time expense. Emotionally, it just crushed me, I just couldn't do it anymore. And so then after got five or six of these batches in a fairly short amount of time, a few months, I think it was two in a row that had happened. I was done. I couldn't do it anymore. And, I threw in the towel. I called my dad and I said "Dad, I you know, I can't do this anymore. It doesn't make any sense. I'm working all the time, I was making more money working for somebody else. Just I can't handle this anymore."
Eric Morse
Fourty dollars on the next box of saran wrap was too much.
Matt Phillips
Well, that's exactly what the breaking point was, I was wrapping a skid and I ran out of shrink wrap and, and years before, the way that I would do things is I would bottle all my beer, I'd rent a one ton truck and I had to deliver it to Vancouver for distribution. So I put all the naked bottles in this truck, and then I drive to the ferry. And I'd have the early dock appointment. So I'd have to get the seven o'clock boat, which meant that if I drove there the night before, I could sleep in the parking lot. And I would label all my bottles when I got there. And then in the morning, as I cross in the ferry, I get them all labeled and deliver them. But there wasn't room to wrap the skids in the truck. So I would just drive carefully. And then one day I was driving to the warehouse and I had someone step out in front of me and I had hit the brakes and there was a tidal wave of beer that came out the back of this truck. And about about a quarter of my load made and all the way there.
Eric Morse
If only you had cans.
Matt Phillips
Yeah, or shrink wrap right? Anyway, so shrink wrap was kind of, they wouldn't receive beer from me anymore without shrink wrap. And I was on my last, I was through a box of shrink wrap, which would take about three or four months to get through and it was about 40 bucks. And I just went why, you know if I buy another box of this, it's another four months sentence why this? This is the time to throw in the towel. Not totally rational but that was my that was my thinking.
Eric Morse
You'd call your dad to say "I'm done."
Matt Phillips
Yeah, I called dad, "Hey, I'm out." And he, dad's very supportive. He said, "It's probably the right call. It's about time, you're, you're two years in and about 18 months late and realizing that." And, and so I went to bed and I woke up the next day and, God I can't quit this yet. The models just broken. And so I, kind of, the first thing that came to mind was when I was in Portland in August 2001, and saw, you know, walk through this, this huge warehouse, in the very back corner, they had these stubby bottles. And, I don't know if any of you remember stubbies, but beer used to come in these bottles that were not too big, but not too tall, but they had a very short neck on them, rounded shoulders. And that's what I remember my dad drinking beer and, and by the time I was of drinking age, legal drinking age, they were phased out. But they were, you know, for me still nostalgic. I remember my dad, you know, and sitting on his lap watching, you know, seeing one of those. And so seeing them in the warehouse, I was like, oh my god, those would be amazing. And so I had asked even when that first time, like are those for sale, "no they're, they're spoken for." And I'd called a couple other times in the intervening couple years and nothing. And so the first thing I did when I woke up that morning is, I called the guy at the warehouse that originally set me up. And I said any chance and he goes "Funny you should call, I was going to call you today, they've been released." And I said, "Put my name on them, we're we're going down this path." Because what I had realized is I needed to have something as a higher volume product to make it work. And so we ended up, it was still me, and to a degree, Shawn, my graphic artists at the time, ended up kind of going well, you know, we should do a nostalgic brand with it. And so we kind of started going down the rabbit hole of the history of BC trying to find a brand that wasn't in use that might suit that bill. And so we found a brewery called Phoenix, and Phoenix was once the largest copper mine in in, I believe the British Commonwealth or something, and it was in the interior of BC around Greenwood. And it had, had a strike, and they shut the mind down and had a town and a brewery and everything. And then during the Second World War, they needed copper. And so they they made an open pit mine of where the town used to be. And so pretty sure the brewery was no longer, I thought we're okay, we can use this one. And so we came up with a retro graphic package and, and you know, it worked really well it kind of caught the imagination. The other piece of that though, is to make that kind of beer, I realized we needed a different kind of tank, and one that wasn't easily obtained at that point. And so I called up a guy I knew, who knew how to stainless weld, and he taught me how to, how to weld and fabricate tanks. So we started making tanks on the loading dock. And to the point where we basically were financing by building to selling one and sticking beer in the in the other one. And so we kind of got into this, this secondary line of fabricating tanks, which, you know, ended up being a big part of our identity in later years. But a little footnote on Phoenix, it turned out that there were multiple Phoenix breweries in BC, and one of them was actually kitty cornered to where we are now. So everyone assumes that that's the brewery that we named it after. And I tell them it, it totally was.
Eric Morse
Yeah. That's funny. I think, you know, one of the things Matt, when I, what I love about you is one, I think all entrepreneurs have a bias for action, and Matt clearly does. But it's also, yeah, "I don't know how else we're gonna afford that, we're gonna build it." And you've done that kind of throughout. And I may come back to that at the end around some of the canning stuff you're doing now. But it's really been a big part of Matt is, yeah, "We can do this. Let's figure it out. Let's let's keep it moving forward." So pretty cool. So all these troubles, all this stuff, and then at some point, you're an overnight success, right? I mean, that's kind of how the rest of the world sees it. Do you remember that day when you went? Wow, maybe I have kind of made it?
Matt Phillips
Um, no. I, you know, I think when you're in the weeds like that, you don't have time? Well, you don't make time, I think is probably the better way to think about it, to think about what's happening in that, in that way. You know, I remember a time when the debts were paid off, and feeling really good about that. But you know, at the same time, we couldn't fill all orders. We were running scared, trying to keep up with things and trying not to, you know, curse ourselves by by running out. Although, to be honest, at that point, scarcity was one of our brand elements, and running out was, was a good thing from time to time, but it also pissed off our retailer. So it was kind of a balance. We didn't want to run out that much. So we were, you know, there was, we were always running scared for really for the first 10 years and then, you know, we had to grow and so we were always doubling down so it never felt like we were safe. We were always feeling like we were running and so no, no, even now, you know, we're still, it's, it's the reality of markets, right? They're always changing, and you just want to make sure that you're changing in front of them.
Eric Morse
21 years on, is that where we are?
Matt Phillips
Yeah. 22 this past summer? Yeah.
Eric Morse
And, you've decided to at least sell a stake in the business. Take us through that a little bit. What? Yeah, where is it that you decide, you know, now's the right time?
Matt Phillips
Yeah, it's a good question. I guess. I started down the path just before COVID. I think I engaged with an investment banker, got in about September 2019 or so, and started running down the path. But I pulled up, I pulled up before COVID, really kind of hit the, hit the reality phase. And it pulled up because I emotionally wasn't ready. And the idea of what was going to happen to the brewery, you know, I don't think I was comfortable for it. At the time, you know, the most likely outcome was going to be sale to a strategic, and which means, like a bigger brewery group. And I had seen that goes so poorly for so many breweries, and I didn't want an outcome that was going to be bad for the brand or bad for my employees. And bad for my heart, to be honest. After building something like this, I didn't want to see it treated in a disposable manner. And so I pulled out, and I'm like, God, I really, you know, I want to move on and do the next thing. And I can't do that as long as I own the brewery. But at the same time, I was uncomfortable with what that was going to look like. Then we went through COVID I was like, I don't care, whatever. I can't do this anymore. COVID was such a, you know, all of the fun things that happen in our brewery: music, you know, we have concert series, we couldn't do those. And when we tried to do them in ways that we thought COVID were COVID safe, we just ended up getting our asses handed to us in the public view, and subsequently just cancelled it, it's not worth trying to do this stuff. And, you know, not having staff in the brewery and, you know, all you know, all the practical jokes. Practical Jokes require people, right. So without all of those fun things happening, the joy was really kind of lost. And I thought, okay, well, well, it's, it's clearly time, I don't have joy in it, I can't lead it with joy. It's going to change the culture. For the, for the negative, I don't want to see that happen. It's the right time for everybody. But going through that, and revisiting what the sales could look like, and really bringing up with the investment broker that I was, the banker that I was dealing with, realized that, you know, his fixation was on on a strategic, because that's the biggest multiple. But it wasn't the only possibility. And as we started to really uncover what some of the other possibilities might be, we kind of came up with, with a scenario that I think, what will, time will tell, but I think is landing in a in a place that's really healthy for the brand and for staff.
Eric Morse
So, tell us a little more about that.
Matt Phillips
So, I guess that leads into the question. So you know, I've seen a lot of breweries, really culturally destroyed by financial motivations. Because, you know, I really think breweries are cultural artifacts, for them to resonate with consumers, they need to have their own soul, they need to stand for something. And it needs to be somewhat transparent, if it feels contrived, because consumers feel that, and if the primary motivation is money, there's not too many customers that identify with that. So it can't be the, it's got to make money to be clear. But as soon as, as soon as you start ringing money out of it, you're ringing other things out of it. And so I'd seen breweries be destroyed by by those kinds of practices. And likewise, you know, I've always had this aspiration to do an employee ownership piece, but I was always terrified by the baggage that comes with it. And I've seen a number of companies and some breweries in particular, that were were really hamstrung and eventually destroyed by that employee ownership. So the very people you're trying to help, are hurt by it in the end as well. So, I didn't want to do a pure version of either of those things. But I kind of liked the idea of a hybrid approach to it. So you know, we came across, we came up with a model, where we have employees, who are really advocating for you know, a fun working environment and a strong culture, and creativity, and all those things that really, I think drive our brand forward, but could also be driving it too far and, in a financially reckless manner, and so balancing that with a private equity group, that sees value in what we have culturally but also has, you know, a financial motive to kind of continue pushing a growth agenda and, you know, highly efficient manufacturing environment. And so we've tried to set up a dynamic balance where we're, hopefully nobody's happy, and in which case, I think everyone will win. And so far, that's going really well, you know, we're really happy with the private equity group that we've landed with, they're really supportive of the brewery, they're not trying to impose themselves on us and, and stuff, we're really happy to have a piece of it. So, so far, it's great, but I think the proof in the pudding is probably four or five years down the road. Yeah.
Eric Morse
Yeah, it is so important. I mean, I think one of the things that's really set you apart is good beer, good product, obviously. But I think you are true to the image, the brand that you've built around it, and in that expression, throughout the community, but you know, throughout your products, in who you are, is pretty amazing. And so hopefully that doesn't die with this, right? I think it's, it's such a part of the soul of the business, which is cool. One of the things, one of the ways we met, is I run a program called Quantum shift for high growth companies. And Matt was a part of that. But I always learn things from the entrepreneurs that come through. And I think I've told you this, I don't know if I have or not, one of the quotes that Matt had during that week that he was sharing with fellow entrepreneurs, is one that has stuck with me, and I and I continue to share it with with classes and otherwise. And let's see if you remember this one. So "Dysfunction," shoot, I'm gonna get it all wrong, you know, "Grows and boils in those parts of our business that we have the least amount of passion." And I think that's so true for so many entrepreneurs. And I love the way you said it better than that, but but the way that you brought it into the class and just reminding us that we have passions about parts of the business, and that's what gets us up in the morning. But if we're not paying attention to those other pieces, it can really pull us down and pull down the whole business. And so, either finding people that love that piece of the business to support you, or making sure that hey, every once in a while you're going to get that checklist, because I know I don't like this part of the business, I better check and make sure everything's going okay. It's something that's always stuck with me from you, so I appreciate that.
Matt Phillips
Glad to hear that.
Eric Morse
The Entrepreneur Podcast is sponsored by QuantumShift 2008 alum Connie Clerici and Closing The Gap Healthcare Group. To ensure you never miss an episode, subscribe to the show on your favorite podcast player or visit entrepreneurship.uwo.ca/podcast. Thank you so much for listening. Until next time.