Funds were needed for plant capacity expansions and marketing. Latecomers with large marketing and financial resources were introducing microbrewed beers aimed toward the mass market. With deeper pockets and greater economies of scale, these large competitors could be expected to lower prices to capture greater market shares and thus squeeze out the pioneers. Anheuser-Busch, Coors and Miller s are trying to market beer into this craft beer market. Craft beer buyers are loyal to their brands.
People move into the craft brewing market and stay there.
That s the big question. At a time when a beer s popularity could be measured in weeks, persuading a customer to invest in a brewery was seen by many entrepreneurs as a means for raising funds as well as a way to help ensure customer loyalty. The companies are selling the shares directly, without benefit of an underwriter, and no brokers handle later trading. By the end of 1995, the IPOs of several large microbreweries had nevertheless gained national attention and their stocks were actively being traded on public exchanges. Notable examples included the Boston Beer Company in Massachusetts, Redhook Ale Brewery and Hart Brewing, both of the state of Washington, and Pete s Brewing Co. in Palo Alto, California.