E-Malt.com News article: USA, CO: Crazy Mountain beer to expand into other states

In an era when most local businesses are happy to be holding steady, an Edwards, CO company is growing the way luxury condos once did. Crazy Mountain Brewing in Edwards hasn't yet celebrated its second birthday, but the company has grown far beyond its founders' expectations, Vail Daily reported on November, 6.

“In 2010, we were already in year three of our business plan,” co-founder Marisa Selvey said. “We've had such intense local support.”

Now, thanks to a distribution deal and a cash infusion of $4 mln, the company is expanding again. The company is adding brewing and canning equipment that, when installed, will allow the brewery to add another zero to its annual production figures.

The original brewery was set up to produce about 1,200 barrels of beer per year and landed Crazy Mountain's beers in virtually every liquor store in the valley, as well as many restaurants and bars. The new equipment will boost production up to about 12,000 barrels per year, which will be distributed to several other states, starting with Southern California.

Under Kevin and Marisa Selvey's first business plan, out-of-state distribution should have taken between seven and 10 years. But in the Vail Valley, you never know who's going to see, hear or taste what you're doing.

At some point, someone from the Reyes Group — a beer-distribution conglomerate that covers 26 states and most of the country's geographic area — got a Crazy Mountain beer.

“They called a few months ago and said they'd had their eyes on us,” Kevin Selvey said. “We sent some samples, and they asked us how soon we could increase our production.”

The easy part of the answer was “as soon as we can find financing to do it.” But it's harder to find money to expand a still-new business than it once was, so the Selveys had to get creative.

Instead of going through banks, the Selveys found about half the money needed from investors buying stock. The other half came from “angel” investors.

“Getting the money was easy, but getting the contracts done was hard,” Kevin Selvey said, with Marisa quickly adding that some of the contracts seemed to be roughly the size of phone books.

The contracts haven't been the only piece of the expansion that turned out to be more complicated than expected.

Deals with can suppliers can be incredibly detailed — if the design on a batch of 100,000 cans isn't just right, somebody's going to lose money. Still more complicated has been getting the packaging design blessed by government officials. Sending beer across state lines gets the feds involved.

The feds' attention to detail extends even to the type style and size used on the packages. And the cans can't say the beer is brewed in the “Vail Valley,” since the law demands that products come from specific towns. That means the cans will say the beer is brewed in “Edwards, Colorado, in the heart of the Vail Valley.”

And that's where Crazy Mountain's going to stay, Kevin Selvey said.

“We have no intention of ever moving,” he said. “We knew it would cost us dramatically more to be here than on the Front Range, but this is where we wanted to be.”

In fact, tasting-room manager Holli Velvis started out as a regular customer before landing a job with the company. It's possible that a few other regulars might find jobs with the company, since a bigger brewery will need more people to run it.

That's something the Selveys are looking forward to.

“It may be easier to maintain our quality with more specialists,” Kevin Selvey said. “We'd all been wearing a lot of different hats. It'll be nice to have more help.”


10 November, 2011