Brewdog, the Voldemort of the financial establishment, just sold out its equity punk army. Welcome to the real world boys.
Just to make a few points clear for readers - some of whom have tried to comment but have not been posted as we felt the comments were ill informed. This blog is about investing via an ECF platform. So most of the Brewdog investors are not relevant here. Brewdog has been a phenomenal success - to this point. Yes early stage investors (via BD's own campaigns) have seen great returns - although figures out there range from 2800% (Brewdog's own figure and 600% - a comment here). Our estimate is that CC investors could see a 170% return or 1.7X but this is limited in scope as you cant sell more than 15% of your holding. The point of this post is that BD have always been v proud of being outside the mainstream - but here they are helping themselves to it. Their US ECF campaign has been a flop, their exponential rise in profits has slowed and they were in trouble - half finished US brewery needs cash. So they went the orhtodox, establishment, PE route. Given what they said about Camden we thought this was worth writing about.
Brewdog have raised their own ECf and used Crowdcube to tune of many millions over the last 3 years. They harangued Camden Brewery for selling out to the massive ABV.
Now with the failure of their US ECf campaign, they have crashed into reality. The new build, half finished, brewery in Ohio needs funding and money really doesnt grow on trees; even in Ohio. Not even if you are punks.
So the Brewdog has lain down and rolled over; selling 22% of the company for £100m to US PE firm TSG. The founders, Watts and Dickie, have also sold 10% and 8% respectively of their own holding to TSG, along with a few selected investors, for another £113m. Everyday Crowdcube investors would not have been invited. You are the real punks now.
We have been banging on about their poor performance in the US - the ECf campaign there is woeful. Well here is the result. Dilution bonanza. Will their US plans work out - my guess is no.