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Profiles

Almanac Beer Company

By Eric Peterson | Aug 13, 2020

Brewing & Distilling California

Company Details

Location

Alameda, California

Founded

2010

Ownership Type

Private

Employees

41

Products

Beer

Co-founder and CEO Damian Fagan is riding a hazy wave of growth as the company innovates with brewing styles and business models.

Photos courtesy Almanac Beer Company

The underlying idea behind Almanac was simple: leverage year-round access to California's leading agriculture industry and build a catalog of Belgian-inspired beers around local produce.

"The birth of the farm-to-table ethos in Berkeley, that permeated everything in the culinary environment here in the Bay Area," says Fagan, who met since-departed co-founder Jesse Friedman in 2009 through a homebrewing club. "You go into a restaurant and know exactly where the tomatoes were grown, you know exactly where the beef was raised. One of the things that dawned on us as craft enthusiasts was: How come nobody else is paying the same kind of attention to sourcing ingredients with beer? We thought there was an opportunity."

Named for the farmers' trusted book, Almanac sought world-class California-grown fruit for its initial beers, largely barrel-aged sours. The first one spent a full year in the barrel before its June 2011 release.

"That core concept permeates everything that we've done in the last 10 years," says Fagan. "To this very day, we still pay very close attention to where our ingredients come from. As we've grown, we've continued to expand on that ethos. We think that's one of the key differentiators for our brand."

For its first six years, Almanac worked with Hermitage Brewing Company in San Jose on a contract basis for its base beers. "A lot of our barrel aging is sour beer, and most of that sour beer -- 90 percent or more of it -- is actually aged on whole fruit," explains Fagan.

In 2015, Ron Silberstein of ThirstyBear Organic Brewery in San Francisco approached Almanac with an intriguing offer to lease about half of a 50,000-square-foot facility he was building in Alameda for Admiral Maltings, the first new maltster in California in a century.

Fagan jumped at the opportunity and turned the lights on at its own brewhouse in 2018. Almanac is a tenant as well as a customer: The brewery sources about 30 percent of its grain from Admiral.

Before the move, the plan was to continue to brew an all-sour selection in Alameda, but a lot changed in three years. "The landscape became very crowded," says Fagan. "All of a sudden, lots of breweries were making sour beer. We realized once we opened the doors that that was not going to be a sustainable model for us."

Because of this, the brewery expanded into a "core line" of IPAs and other fresh styles to supplement its sour foundation. The new beers -- especially LOVE Hazy IPA -- have catalyzed sales.

"It's the best decision I think we've actually ever made as a business," says Fagan. LOVE "has sort of taken over the universe. . . . We've really nailed a beer that's highly drinkable -- it's only 6 percent alcohol -- but it's not a stunt beer. It's not hazy for the sake of being hazy."

The core line of fresh beers now represents about 70 percent of production. LOVE now represents a whopping 45 percent of the brewery's total output. "That beer didn't exist for us two years ago," says Fagan.

But Almanac stays true to its roots with "a pretty wide swath of experimental beers and beers that are one-offs or perennial releases." The new-for-2020 Gemini Mind Trick is a sour IPA that takes "several-month-old, barrel-aged, mixed-culture sour beer aged on all kinds of different fruits . . . and trying to integrate a hop character with it," he says. "Marrying these two styles together has had unexpectedly positive results. We intend to do a lot more along those lines."

After production of 2,700 barrels in 2017, Almanac's output increased to 7,000 barrels in 2018 and 14,500 in 2019. For 2020, Fagan projects a 20 percent uptick to about 17,000 barrels.

Almanac raised $2 million for an expansion in early 2019, lifting the maximum annual capacity to about 14,000 barrels. Subsequent "piecemeal" upgrades have increased that number to about 20,000 with the crew going "full-tilt boogie," says Fagan.

The brewery has weathered the COVD-19 storm surprisingly well. While draft sales dropped to next to nil in March, packaged volume is up 40 percent with the help of a direct-to-consumer online store, leading to a net gain. "We're actually up about 10 percent on a revenue basis year-over-year," he says.

After using mobile canners, Almanac installed a Wild Goose canning line at the new facility. Fagan says perfecting the barrel-aged sour in a 16-ounce can required about 18 months of research.

"That format historically always came in bottles, largely because the beers unfiltered and you're still going to have live culture in the bottles," says Fagan. "You're going to have secondary fermentation happening slowly. Bottles tended to be the more natural fit, because they're more resistant to pressure. But of course, the downside of bottles is they're harder to take places."

The R&D led to a better way to put a barrel-aged sour in cans, he says. "We like to think that we're one of the first breweries in the entire country to actually safely put that style of beer in a can so that it doesn't explode later on."

Fagan says Almanac will brew about 40 different beers in 2020, ranging from 10 barrels of Dead Souls Russian Imperial Stout to 7,000 barrels of LOVE.

"If nothing else, we like to be creative," he explains. "The last thing we want to do is hang our hat on the handful of core beers we release. It keeps things fun and exciting and leads to new ideas and future core releases."

Favorite beers: "Internally, I drink more LOVE Hazy IPA than anything else, no question about it," says Fagan. Another go-to at Almanac: "Our Sournova series, which is our primary canned, mixed-culture, fruited beer. We've now released eight different versions of that; they're always different fruits: strawberry, we're doing a plum version, a tropical one is dropping in a couple weeks. I love that whole line of beers. I think we've really mastered producing a tart beer that isn't bracing or shocking. We find people that say they don't like beer, when they drink the Sournova, they actually can't believe it's beer."

Beyond his own taproom, he's partial to classic lambic varieties, noting, "Belgian beer is what got me into homebrewing."

Challenges: "There's a fair bit of uncertainty as it relates to COVID and the broader environment," says Fagan. "Where is all this headed? We are all watching the same news and seeing the numbers go all over the place and a very mixed response on a local, state, and federal level."

He adds, "We're feeling optimistic. Assuming the wheels don't come off again and there's another shelter-in-place order mandated or the election has some sort of dramatic impact on everything that's going on, we're optimistic."

Opportunities: While Almanac distributes to about 20 states, California accounts for about 80 percent of sales and Fagan says he expects it to remain the brewery's primary market. "That's increasingly literally month-over-month."

"Wholesale right now is our biggest opportunity," he says. "We work exclusively with a single distributor in California, Wine Warehouse. . . . That has been one of the best business decisions we've made as a company. . . . They invested heavily in the brand, they're motivated, and they are just kicking ass." Big grocery chains like Safeway and Raley's have been upping their orders on a regular basis.

He also highlights the direct-to-consumer model that's emerged during the pandemic. "The margins are two to three times as high as they are at wholesale," says Fagan. "Every case of beer I sell at the taproom or online is two to three cases of beer at wholesale."

Needs: "We need a crystal ball," jokes Fagan. "One could argue, given the trends we're seeing, we could with the straight face make the argument that a substantial capital injection would make sense."

Beyond an orb of prognostication, he teases the possibility of a larger production facility in a less expensive area like California's Central Valley, where the square-foot prices are about a third of that in the Bay Area. "At some point in the not-too-distant future, we will get to the point, sort of a crossroads, where we can't expand this particular facility a ton more," says Fagan. "We're having active internal discussions now about what's next."

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