In this episode of The Funding Files, co-host Anna Guenther chats with Matt Stevens, co-host and co-founder of Parrotdog, about his funding journey raising capital to launch and grow a craft brewery in Wellington, way back when the beer industry was just taking off.

Summary

Parrotdog started in 2011 when three friends named Matt decided to start a craft brewery. Matt Stevens, initially brought in to help with incorporation, eventually became a co-founder.

The company began with contract brewing, funded by $7,000 initial capital that was mainly put on credit cards. They progressed through various funding stages, including family loans, asset financing, and bank debt, before successfully completing a $2 million equity crowdfunding campaign in 2016. The crowdfunding campaign, which reached its minimum target of $1.2 million within 24 hours and full subscription of $2 million within 2 days, enabled them to move from their original 300-square-meter location in Vivian Street to a larger facility in Lyall Bay.

Through their crowdfunding capital raises, they grew from producing 350,000 litres to becoming a business with 70 staff producing nearly 3 million litres of beer annually.

🌟 Key Highlights

Origins of Parrot Dog Brewery 02:16

Matt Stevens describes Parrot Dog’s current state as a business with 70 staff producing nearly 3 million litres of beer from their Lyall Bay headquarters. He focuses on the funding journey from the brand’s creation to their successful $2 million equity crowdfunding raise in 2016. Stevens explains his background in accounting and how he joined two other Matts to start the brewery, initially contributing $5,000 of the $7,000 initial capital.

Early Funding and Growth 05:57

The company started with bootstrapping and contract brewing, with Stevens investing additional personal funds through credit cards. Their first beer, ‘Bitterbitch,’ won the Beervana People’s Choice Award. They recycled batch money for growth but needed additional funding, leading to some more personal loans to the company.

Family Funding and Bank Relationships 12:19

After being rejected by major banks, they secured loans from their families, treating it professionally with formal loan agreements and regular interest payments. They later established a relationship with Kiwibank and Kiwi Asset Finance, eventually consolidating their debt through ANZ Bank, which allowed them to repay family loans after about two years.

Transition to Equity Crowdfunding 25:48

The decision to pursue equity crowdfunding came when they needed to expand beyond their 300-square-meter Vivian Street location. They sought between $1.2-2 million, focusing on clear messaging and community engagement. Their campaign included creative marketing through video content and leveraged the Beervana Festival timing. The campaign reached its minimum target of $1.2 million within 24 hours and full subscription of $2 million within 48 hours.

Final Reflections and Advice 34:54

Matt Stevens emphasizes the importance of having business partners who are also friends, noting how his co-founders were the groomsmen at his wedding 13 years later. He stresses the value of having others to share problems with and make plans together, especially during challenging times in business operations.