The most important non-alcoholic beer model within the U.S. simply received extra priceless thanks partially to Gen Z’s efforts to make sobriety cool.
Athletic Brewing, cofounded by hedge fund dealer turned chief government Invoice Shufelt in 2018, almost doubled its valuation to about $800 million in simply two years following a $50 million fairness financing spherical led by progress fairness agency Common Atlantic, the Wall Road Journal reported, citing individuals aware of the matter.
A spokesperson for Athletic mentioned the corporate couldn’t affirm or deny the brand new valuation.
The corporate will use the brand new financing to develop its crew and fund renovations at its third U.S. brewing facility situated within the San Diego space, Shufelt mentioned in an e-mail to Fortune. The brand new facility will permit the corporate to double its brewing capability within the U.S. Shufelt mentioned.
The upstart firm has punched above its weight, beating out established names like Heineken and Budweiser to say the title of the highest non-alcoholic beer model by gross sales in U.S. grocery shops, in response to a Journal evaluation of NielsenIQ information. With 258,000 barrels bought final 12 months, Athletic ranked within the high 20 breweries within the U.S. The corporate mentioned it topped $90 million in gross sales final 12 months.
Whereas the extra well-known beer manufacturers focus simply a part of their operations on non-alcoholic beer, Shufelt mentioned its single-minded concentrate on the class has allowed it to get a leg up on the competitors.
“Non-alcoholic beer was beforehand considered a really small market, however we see an infinite alternative so as to add each events and populations to the grownup beverage world by opening new days of the week for current customers and actively recruiting new customers to the class altogether,” Shufelt instructed Fortune in an e-mail.
Aside from Common Atlantic, Athletic’s different massive identify backers embody beverage firm Keurig Dr. Pepper, which invested greater than $50 million in 2022, in addition to celebrities corresponding to former NFL participant J.J. Watt, Momofuku founder David Chang, and bicycle owner Lance Armstrong.
Athletic’s gross sales success, and buyers’ confidence within the model, is thanks partially to Gen Z’s rising curiosity with a sober life-style and non-alcoholic drinks. On TikTok, #sober and #sobercurious have racked up tens of millions of posts with many influencers raving in regards to the well being advantages of their transition to sobriety. Greater than 60% of younger individuals born between 1997 and 2002, up from 40% final 12 months, mentioned they plan to in the reduction of on their alcohol consumption this 12 months, in response to a January survey by promoting firm NCSolutions. Athletic’s chief government, Shufelt, mentioned that 75% of the corporate’s clients are underneath 45 years outdated.
Whereas in years previous, the emphasis on sobriety might have peaked throughout “Dry January,” Shufelt mentioned summer time is definitely one of many firm’s busiest instances. The proliferation of non-alcoholic choices would have been unthinkable only a decade in the past, he instructed the Journal.
“Ten years in the past, there have been no choices,” Shufelt mentioned. “We needed to completely change the product and the advertising and marketing.”
The rising sobriety, or “conscious consumption,” development has turned non-alcoholic beer into the fastest-growing phase of the beer market, at the same time as general beer gross sales have fallen with altering preferences. As extra younger individuals in the reduction of on their ingesting, they’ve turned to alternate options, together with mocktails and non-alcoholic wine, but in addition non-alcoholic beer, a lot to the good thing about Athletic.
“We’ve made non-alcoholic beer a optimistic alternative and given customers a product they’re proud to carry of their palms,” Shufelt mentioned.
