On a recent Sunday afternoon, San Diego beer brewers, workers and advocates crowded into the East Village’s Mission Brewery to talk about beer, buy-outs and what makes a craft beer, “craft.” This meeting was the brainchild of Monkey Paw brewer and beer-buyer, Cosimo Sorrentino.  He recently engaged in a long conversation with Greg Peters, a brewer/manager over at Saint Archer Brewery, about “selling out” and what it means to be “craft.” After their discussion, he decided to put together the very first San Diego Beer Forum to expand upon their conversation while including other members in the craft beer community. By giving industry insiders a chance to come together and talk about some of the issues they are facing, he hoped to create a dialog between breweries, distributors and the media. Well, his idea worked and although not as much ground was covered in this first meeting of the beer-minds, it was a great idea, and a well executed first move.

To prepare for the forum, Cosimo sent out a list of questions to breweries including these..

– What does the word “CRAFT” represent to you?

– What is “local”?

-What do you see as the biggest threat to the “soul of craft”?

Although his hope was to have the panel of seven discuss these and other very specific questions, most panelists took this time to talk about their own experience in the industry and touch on a few of the key questions that they felt were important to their business.

Sitting on the panel was Larry Monasakanian, a sales rep from Firestone Walker, Tom Kiely, head of distribution and sales here at Thorn Street Brewery, Alex Von Horne, owner/brewer from Intergalactic Brewing, Brian Beagle, a self-professed craft beer fanatic and host of SD Beer Talk Radio, Daniel Drennon from Beer Paper LA, Tom Keliinoi, brewer from Acoustic Ales and media rep for What’s on Draft? and Greg Peters, a brewer/manager at Saint Archer Brewery.

We could go through what everyone talked about in this post, as there were definitely some interesting comments and discussion, but if we want to get to the heart of the topic, we can look at what was discussed by Greg Peters from Saint Archer. It was really great of Peters to sit on the panel, knowing he was the sole representative of a craft brewery that “sold out” to Big Beer. In essence, that sale, along with Ballast Point’s billion dollar sale and the impending arrival of 10 Barrel Brewing, are what this whole talk became about, no matter what the original questions covered. How is craft beer defined when a craft brewery no longer fits the definition?

Craft beer has a definition which is laid out by the Brewer’s Association. Craft breweries must be small, independent and traditional. Small is never an issue since the brewery has to brew less than 6 million barrels a year and Sam Adams’ Boston Beer Company, one of the 10 biggest beer companies in the world, still is considered craft because they only brew 4.1 million barrels a year. Traditional is also not an issue as this pretty much only excludes hard ciders and the like. It all boils down to independence and that is where Saint Archer, Firestone Walker and Ballast Point fail. Since more than 25% of their breweries are now owned by an entity that is not itself a craft brewery, they don’t meet the guidelines. Some might say, who cares if they are craft or not?

What was apparent from this discussion was that the breweries that were bought out care. They care an immense amount. That designation of “craft” is not only important to their personal identities but it’s precisely why they were bought out by bigger corporations. Big Beer (AB InBev/MillerCoors/SABMiller) has been steadily losing marketshare to craft beer and they don’t like it at all. So they decided, a few years ago, to get in the craft beer game and started buying up craft breweries to the tune of millions of dollars. Craft brewers put their blood, sweat and tears into their beer and if someone comes along and offers them millions to continue what they love to do, one can hardly blame them for taking the life-changing payday. Here’s where things get dicy though. At Sunday’s forum, Peters mentioned that as a Saint Archer brewery, he didn’t get any payday from the buy-out, and someone else mentioned that Ballast Point’s brewers are all still working there happily even though they didn’t get anything from their billion dollar buy-out. They wanted to be patted on the back for not taking money and continuing to do what they do best.

Does anyone else think it’s pretty crazy that Ballast Point and Saint Archer didn’t share the wealth with the people who actually make the beer that sold for so much money? STAB reported that most investors in Saint Archer got around $700k from the buy-out and some as much as a few million. Although we don’t know how the Ballast Point billion trickled down, someone at the forum said that Ballast’s brewers didn’t get a dime. We hope this is not true. Although it was brought up at the forum to illustrate how that brewer didn’t “sell out,” it really just highlighted the discrepancy between the people who brew the beer and the people who own the brewery. Another topic for another day…

So let’s be clear, we are not saying that the hard working brewers from these companies are selling out (though maybe in the future brewers should negotiate bonuses in case buy-outs happen). The issue is with who the company sold to. During the forum, Greg Peters, and others who supported his position like Bobby Matthews from Alpine Beer Co, were taking things very personally when this has nothing to do with their own credibility. Peters listed and name-dropped tons of local, craft brewers to establish his street cred. At one point he looked out at the crowd and asked people to raise their hands if they have ever worked with him and many did. He also said that Saint Archer’s beer was “craft as fuck” and went into detail of how they hand-mash or hand-grind coriander.

But Peters’ credibility as a brewer was never in question. The brewers working at Ballast Point and Saint Archers are still really great brewers and still turning out the quality beers that got them bought out in the first place. Peters said “I can’t say I’m not a craft brewer,” as a means to saying that Saint Archer is still a craft brewery. But it’s not craft anymore, as defined by the Brewer’s Association, and that’s ok.

In a recent blog post, we discussed 10 Barrel Brewing coming to San Diego. Our point was, there is nothing wrong with 10 Barrel Brewing’s beer, or their people, but when they sold to AB InBev, they hopped into bed with a company that actively is trying to kill the very community that 10 Barrel is trying to claim they are still a part of. You can’t have your million dollar cake and eat it too. That’s what’s happening with Saint Archer. They don’t want to let go of the craft label because they feel that they are still making a craft product. Yet many beer bars including Monkey Paw no longer serves Saint Archer or Ballast Point because they no longer fit their definition of craft beer.

What’s the solution? We could change the definition again, as it was done in 2010 to make sure that Sam Adams could still be considered a craft brewery when they grew beyond the 2 million barrel limit. Although that may happen, it would further water-down what being craft means, making it even harder for consumers to know what they are drinking. What does this label even matter?

It matters because of the need for transparency. Most of the people who spoke at the forum on Sunday agreed that there needs to be an increase in transparency in the craft beer community. That if it’s easy for consumers to know who owns the breweries, they can choose to spend their beer-dollars where they see fit. This is a great point and one that definitely should be explored further. Hopefully, in future forums, a discussion on how to create this transparency will happen.

Stay tuned for Part 2 of this discussion, delving deeper into what transparency means within the beer community and what we think the real issue is with breweries “selling out.”

Interested in seeing the forum for yourself? Here you go…

San Diego Beer Forum – Episode 1 from WhatsOnDraft on Vimeo.