Wicked Weed Funkatorium Invitational 2017

Just have to agree to disagree like you said. When you tell someone or a business they can "fuck right the fuck off" instead of simply saying "I won't support them anymore" it's clear you're taking it personally.

I won't be buying much if any WW anymore. I work in the industry and understand the issues greater than most. I have a couple of cases that I'll drink and enjoy though.

 

We've yet to see what the beer is going to be like. Only time will tell.

 

Fair enough. I guess the lines for what is personal and what is not can be blurry, even in one's own mind. I drop f bombs freely so I didn't see that as a big deal.

I will gladly make my opinion known on the matter when it comes up, and will not be purchasing anymore WW, but I don't plan to start a rally or start printing anti-WW shirts or anything.

 

Fair enough.

I hate it and get people being mad but think the hates gone a touch too far.


I really hope it comes out this was all pushed on them from the majority owners and Walt/Luke are just playing nice and towing the company line. Hope they go out on their own again after the their contract term.

 

It was admirable to think so highly of themselves still to believe they'd have enough breweries to make it a festival. Even more audacity to think they'd sell enough tickets to make it worthwhile.

 

I don't know, this years batch of Cerise Morte may be the best Sour beer they've ever produced. (not a collab as Red Atrial I heard was pretty amazing).

 

As do most people! The value isn't there because they are no longer an underdog in the name of craft beer.

I don't value them as highly as I used too, even before the sell out. I will be open minded and still drink the beers that sound good until the value I find is diminished. I don't need to get the warm and fuzzies that I'm supporting craft only. If more breweries were transparent about their vested partnerships and PE involvements and contracts I think we'd all have to sit down and re draw the lines! I'd rather not- and just a beer for what it is.

 

I won't purchase anything from them in the future.

Cheers!

 

Seems a little high to me. BP is the price leader in craft and sold at $1bn when it was making ~300,000 barrels - so it was valued at ~$3,300/bbl and ~27x EBITDA (per Nicole Fry of First Bev, the investment bank of the craft beer world, on a podcast).

Wicked Weed is significantly smaller at ~40,000 barrels. Using the price per barrel multiple of BP (which seems aggressive) would put it at a value of $130 million ($3,300 per barrel @ 40,000 barrels). On the other hand, if we assume they're selling at an average price of $400 per barrel (BP was selling at $355/barrel), and clearing 32% of sales in EBITDA (about where BP was), the value is $138 million (32% of $400 per barrel @ 40,000 barrels, times 27).

TL;DR, If Wicked Weed sold for $550 million, it means ABI values it at 4x what Constellation valued Ballast Point. Possible? Yes. Likely? No.

 

Wow, 27x EBITDA....

 

Ballast Point filed an S-1 just before the sale so these numbers are available. Just letting you know there is some support to her numbers.

 

Lower end of 6 figures is the newest rumor floating around....

 

BP had done 120k barrels the full year before the sale (or so I read). But I guess could have been on pace to hit that 300k on the year of the sale.

How much value does having the ability to brew more hold vs actually brewing more I wonder. Because with new sour and addition under way at the clean brew house they will be capable of brewing much more than 40k barrels. Also just got their can line going late in 2016.

Then you also have more valuable beer (sour, barrel aged stuff) than anything BP makes. Also two thriving locations with profitable restaurants etc.

A lot of different factors.

Im thinking 300-400 million but I could be way off. I am (well was) close to the brand probably overvalue it.

 

Yeah, hard to say with so many factors going into this. The podcast I referenced has some insights if anyone wants to get deeper into valuation stuff (https://soundcloud.com/beervana-1/pod-31-beeronomics-2) - listen from minute 25 to 48 or so. I'm a former banker so the numbers are fascinating for me.

 

Cool. I'll def check that out. Interests me too.

 

@PaleCale - the amount I heard, from a should-know guy, was "low 9 figures." That fits in with what you're suggesting. Makes sense - thanks for the breakdown.

 

Sorry I deal with numbers all day and we usually speak in thousands - meant lower end of 9 figures

 

I'm sure this isn't news to everyone, but this convo has strayed from what the issue of the acquisition really means. For those who are still planning to indulge in WW offerings and essentially put money into ABI's pockets, just understand the kinds of practices this supports: http://www.foodandwine.com/news/ab-inbev-cuts-south-african-hops-craft-brewers

WW makes some great sours, but there are plenty of comparable options available by truly craft brewers. Continuing to buy WW beers encourages ABI to expand its predatory practices and minimize competition.

 

So, as I sit hear drinking last year's Red Angel, knowing that next year's Red Angel was set in barrels prior to the buy out, will it still be considered craft brewed next year or not? Confused...

 

It is. And the value should be higher since it's pre ab. Wasn't made with tainted hands and minds.... and wallets.