Kickstarter Shouldn't Be Your Brewery's Contingency Plan

I know I'll probably get some shit for this post. Unfortunately, it's a message that I think needs to be said.

It seems like every new brewery is taking to Kickstarter to help their future fans launch their brewery. I get it. The sense of ownership, the feeling of helping a friend, the sense of community, and the cool rewards (stickers, beer, growlers, "brew with us" events). 

The problem is that breweries seem to be relying TOO MUCH on Kickstarter. Maybe they're rolling the possible money they can raise on Kickstarter into their opening costs. Maybe they're spending all of their initial cash (some of which might COME FROM Kickstarter) recklessly, and realizing that they can't open unless they get more. They already owe the bank too much, and have tapped their savings. TO KICKSTARTER!

To some potential customers, this can be off-putting. "I gave you money during your first Kickstarter. Where did all that money go? Why do you need more? Why didn't you plan/budget better?" I hear these questions from brewers as well as potential customers. I find myself asking the same questions.

Who plans to open a brewery but doesn't include the basic things in your budget, like a keg washer, or a bottling machine, or a grain mill, or the barrels you plan to age all of your beers in? Where DID all the money you raised, either from the bank or from a previous Kickstarter go? How do you not allocate a contingency fund in your initial budget, a "Just In Case" fund, for when something takes longer or costs more than you initially think?

Personally, I think that Kickstarter is a great medium, especially for breweries. Grow interest in your product, by having potential customers donate money to you. They tell their friends about the cool things they're going to get for helping your upstart brewery open, and they decide that they want to help to. 

There are built-in problems too. Maybe your Kickstarter is down to the last few hours, and you're a few hundred (or thousand) short. You know that unless you reach your full funding goal by the date and time set, you see none of it. What to do? Do you post something on your Facebook and Twitter pages? Do you scrape the last little amount from your own money, or that of family and friends? Do you do both?

The biggest problem with starting a new brewery these days seems to be that brewers/owners aren't thinking about the "Oh, shit!" moment when they're a few weeks (or months) from their planned opening date, and they hit an unexpected expense. Unfortunately, you took all of the money you had, and spent it (or budgeted it toward something else). Instead of saving some of that money as a "Just In Case" fund, you spent it all. With a lot of breweries raising part of their launch money on Kickstarter, they go back to it. Maybe it's $15k, or $30k, or $60k. Whatever amount you suddenly need for essential equipment, you should have budgeted for it. Or maybe you don't need the highest end keg washer or grain mill or fancy growlers or custom tap handles. 

Maybe you could save yourself $10k by making your keg washer yourself. Maybe you have a buddy make your tap handles for you. I get it. Projects run out of money or go over budget all the time. Unfortunately, it can leave a bad taste in peoples' mouths when, after already giving you money to launch your brewery, you're now asking them to spend more. A little more planning, or padding your budget, or adding in a contingency fund (that you don't touch unless an urgent problem comes up) can save that headache. You could leave your future customers excited to see the money going to something great, or leave them scratching their heads wondering where all their money went.

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Twins and Then... by Tom Williams is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.