“We became B-Corp certified in April and really view it as a starting place for everything else that we want to do as a company.”
In business you often find growth to be at odds with some of the values that you hold close. Upslope Brewing has found the recipe for staying true to your mission while also creating a scalable brewery and a beloved brand for craft beer lovers throughout the Rockies. In this inspiring interview, Matt Cutter, founder of Upslope, shares his craft beer story and tells us why Upslope’s focus on sustainability lead them to become a registered B-Corp in 2018. You’ll also find useful advice on the decision to use distributors and leverage your team to find sales channels that fit your values. Thank you to Matt, Upslope, and all the companies out there who are leading the charge in corporate sustainability.
Lilypad: I was hoping you could start by telling me a little bit about how Upslope got started in 2008, what you left behind, and how you found your team members.
Matt: Sure. So long story short, I moved to Boulder, Colorado, from Cleveland, Ohio, in 1991. I discovered craft beer here. I didn’t know beer could taste like that. I started homebrewing on my own; then I put a business plan together in 1996 for a microbrewery. I started looking at space with a couple of other folks out of a local brewery and decided that we all really didn’t have any money to be doing something like this. Haha. That was an important component. So we went our separate ways. One of the guys I was teaming up with stayed in the industry the entire time. The other one stayed in the industry, left the industry, and is now back in it.
I got into project management in high-tech and continued to brew throughout those years. Then I had kids and a family. Then summer of 2007, I had the possibility of starting a brewery still rattling around in the back of my head. So I took that business plan that I wrote in 1996 and re-wrote it for Upslope Brewing. It was more of an exercise at the time. What is the industry like today? What would my concept be today? What kind of people would I need to team up with? What would the financials look like? So I put that whole plan together over the fall of 2007.
Matt (left) and Dany (right) in 2011 taken by Mackinnon Photography
So, now it’s January 2008, and I’m like, “Okay, I’m a home brewer with a business plan. I need to find people that complement what I bring to the table.” So I reached out on ProBrewer and found Dany Pages. He started a brewery in Ushuaea, Argentina in 2000, then followed a girl out to Colorado. It was our meeting that was the catalyst. It was the go, no-go for Upslope Brewing Company. It was such a good fit that it was actually kind of frightening because if it was ever going to happen it was going to happen with this guy. We both recognized the possibilities and how we complement each other. So, we ended up looking at space. Dany’s tourist visa was running out and he had to go back to Argentina. He said, “if you find space, let me know.” So, April 1st I signed a one year lease for 2,700 square feet up in North Boulder and contacted Dany.
He bought his plane ticket and came out in a couple of weeks. I put a second mortgage on my house to start the brewery, God bless my wife. We were all in. We developed our recipes over that summer. I kept my day job at IBM Printing Systems in order to have some kind of income because I didn’t pay myself for three years. Henry Wood came on in the fall and it was three of us. Henry came on as Director of Sales and Marketing and it is still the three of us today. We will be celebrating our 10 year anniversary, November 3rd. Come on out and party with us if you’d like.
So, over the summer you developed your recipes. How long did it take for you to start selling beers?
So we developed two recipes during that summer, our Pale Ale and our India Pale Ale. I was doing a lot of branding work, financing, cash flow, licensing – all kinds of things. So we did seven pilot batches for the Pale Ale and three for the India Pale Ale. Our brew house came in October and we brewed our first batches of beer. Henry was figuring out the market, he had never sold beer before. It was the Monday before Thanksgiving that we first sold our beer into liquor stores. Henry completely sold us out of beer that first week. We had a little time until more beer came out and then it was really about Dany and I trying to figure out ways to ramp up production in order to catch up with Henry.
“It was the Monday before Thanksgiving that we first sold our beer into liquor stores. Henry completely sold us out of beer that first week.”
So you guys were distributing right off the bat then?
Yep, self-distributing primarily in cans. When we started out we were probably in the first dozen craft brewers in the US to be canning their beer. We had the second IPA in a can. I think we missed by a few months to Amendment 21. We couldn’t afford kegs at that time; we didn’t have the capital. We didn’t have a tap room until May. So yeah, it was self-distributing.
For that first 10,000 barrels, was it just you three or did you start to hire on salespeople when you were in that range?
Yeah, we did start to hire on salespeople. That first full year, 2009, we had a goal of 450 barrels and we increased it to 650 barrels. But that year we produced and sold 1100 barrels. That was primarily Henry, and we brought on a delivery driver during the second half of that year so that Henry could focus more of his time on selling rather than selling and delivering all of the beer. So, that was Jack Walsh. Jack is still here, he’s our Boulder county sales rep. Then in 2010, Jack became a salesperson and we hired another delivery driver. Luke Franklin came on midway through the year and he started opening up Denver for us – self-distributing one account at a time. So it was very organic like that. When we couldn’t afford to not have a salesperson in a geography, we would hire one.
One of Jack Walsh’s displays in Boulder County taken from the Lilypad Social Wall.
When did you stop self-distributing?
We self-distributed for two and a half years. Colorado started to get to be a pretty big state at that point. We were self-distributing to 250 accounts and distributing it as far as Summit County where Breckenridge, Keystone, Frisco, and Copper are. Then, we went as far away as Roaring Fork Valley where Aspen Snowmass, Basalt, and Carbondale are. We even went up into the northwest corner of the state to Steamboat Springs. There were some stores that we told, “Okay, we’ll drive up there. You’ve got to buy 100 cases, but we’ll drive it up there.” So we’d load up a van and make that trek.
So after two and a half years, we went to a local distributor out of Denver that was only craft beer and only in Colorado called C.R. Goodman. We knew these guys, ironically, because their general manager was one of the guys that I had worked on the first concept with back in 1996. He was still in the industry working for this distributor and so I’m like, “Okay, Dave, the state is getting pretty big for us. We would like for C.R. Goodman to take the mountains and we’ll keep everything else.” The response was, “You know, we don’t make a lot of money in the mountains because everything’s so spread out – it’s a lot of travel time and a lot of coverage for not as much sales as the Front Range of Colorado. We’ll let you keep Boulder County, but we want the rest of the state.”
“It was good move because they got us into a lot more accounts that we didn’t have the bandwidth to do. Truly a partnership.”
We said okay and that’s the way we operated until 2012. In 2012, they had a large supplier leave them, and they said, “Hey, we need another brewer that’s strong in Boulder County.” At the time we were self-distributing as much beer in Boulder County as they were selling the rest of the state. So I said, “We kinda got this figured out, the whole self-distribution game.” They said, “No conversation?” And I said, “Let’s have a conversation.” So we worked something out and they took on Boulder county for us and it was good move because they got us into a lot more accounts that we didn’t have the bandwidth to do. Truly a partnership. It was in 2013 that we grew 109%. The timing was good also because we had just opened the location I’m at right now, our Flatiron Park location, which is 27,000 square feet compared to the 4,500 square feet of our original location. We kept Lee Hill on as a specialty brewery doing barrel aging and sours and new recipes. Flatiron Park became our main production facility. We brewed our first batch of beer here, February 9th, 2013 just when C.R. Goodman had taken on all of our distribution. We hired on more sales reps and we went from 5,600 barrels to 11,800 in 2013. So, you couldn’t have planned all that. A lot of it was very serendipitous and much of it was recognizing opportunities. There was a lot of reasons to not allow them to take on our Boulder county distribution business, but it really helped us grow.
I know there are a lot of breweries out there that are probably having conversations about when is the right time to bring on a distributor. Do you have any general advice to other breweries about finding a distributor that you can partner with and how to treat that relationship?
Timing is important. If I were to give advice to a brewer, I would say, self-distribute as long as you can, as long as it makes sense, whatever the definition of “makes sense” is to that brewer. The reason is that you can organically grow your brand to a point where it is actually worth something to a distributor. If you’re a little new brewer and nobody’s ever heard of you and you step into a large distributor, it’s going to be difficult. It worked out well for us in that we had a well-established brand by the time we started to bring on a distributor. There are all kinds of different flavors of distributors in the three-tier system. There are smaller, newer startup distributors, there are large Anheuser-Busch houses, there are large MillerCoors houses, there are large independent houses that only sell craft beer. There are flavors of all those that sell and distribute craft beer, wine, and spirits. There are pros and cons to all of those situations. So, finding a distributor that matches you or your goals and your brand is I think the best way to go about it.
“If I were to give advice to a brewer, I would say, self-distribute as long as you can… you can organically grow your brand to a point where it is actually worth something to a distributor.”
How many states are you currently distributing in and have you experienced any challenges growing the sales team and keeping everyone on track even though they’re spread out?
So we’re only in seven states and most of them are very underpopulated states like Utah, Wyoming, and Montana. But we like for our brands to be centered around the Rocky Mountains. We just opened up in Nebraska two months ago. We have seven reps here in Colorado. We have a rep in Missoula, Montana. We used to have one in Jackson, but we’ve since relocated that rep to Missoula. We have a rep in Albuquerque and a rep in Phoenix. In Colorado, those seven reps are all over the state. So 10 sales reps, in time. The challenge with some of the outlying reps, especially the out of state markets, is making sure that they’re included in, not just the planning and the execution, but the culture of the brewery.
Rocky Mountain Kolsch from Upslope’s Instagram
There are text streams that the sales guys have. We use tools like Slack and Lilypad that help to tie in those out-of-state sales reps into the day-to-day. Slack is a good tool because it encompasses everybody in the company and everybody here seems to like to use that tool. So you can get on a channel that includes production folks, your tap from folks, or other people in the brewery, and you can stay apprised of everything that’s going on.
We also have a monthly meeting that I hold, we call it the First Friday Meeting, and it’s an all-employee meeting. We have those reps dial in and I’m pretty transparent on what I tell our employees about what’s going on in the company. It’s really an opportunity to share information. “How are we doing, what kind of events do we have coming up, what are our challenges, what victories did we have last month, how are we doing year to date, do we have some new equipment coming into production, what’s that all about?” You know, it’s another great opportunity to tie them into the game plan that’s happening with the company.
Do you have any strategies that you’ve found to be effective tackling these states that you described as spread out? Are there any kinds of accounts or chains that you’re tackling to make those reps be successful where they are?
Yeah, we are in chains in the out-of-state markets. That’s primarily getting to know the chain buyers, which our reps have done a good job with. There’s, of course, a lot of love for “local” in out-of-state markets. So, how do you penetrate that? Our reps are primarily born and bred in those markets. We had some misfires with reps that we’ve taken from Colorado and put in an out-of-state market. But also, I’m thinking of one or two examples in which that has been successful. So it’s a lot of the same blocking and tackling that we do here in Colorado. But very often, you know, those out-of-state reps come with their own relationships. Maybe those relationships are a tavern or restaurant or liquor store, but maybe they’re something else. Maybe they’re a fly fishing shop, maybe they’re a bike shop, or maybe they’re a climbing gym that is in line with our values, our goals, and the demographic that we’re targeting.
“Those out of state reps come with their own relationships. Maybe those relationships are a tavern or restaurant or liquor store, but maybe they’re something else. Maybe they’re a fly fishing shop, maybe they’re a bike shop, maybe they’re a climbing gym that is in line with our values, our goals, and our demographic.”
You’ve talked a lot about values on this call, and when we met in person you talked about wanting to give back, which is why you’re part of the Colorado Brewers Guild. Upslope is actually a registered B-Corporation, so I’m wondering how those values have played into your growth. When did you decide you were going to go above and beyond to limit your waste, give 1% back, and really focus on your sustainability efforts? Would you encourage other breweries to do the same and is there a right time for them to do so?
Ah, a big question and a good one. So, we’ve always wanted to create a company that we were proud of. With that comes a lot of the values that B-Corps hold high. Yeah, we have a 1% For Rivers campaign where 1% of the sales, not the profits, the sales of our craft lager cans go to local Trout Unlimited chapters to protect coldwater fisheries and watersheds. That seemed like a good idea to us because it was aligned with this awesome resource that we have from Colorado – water. Great, great water. We’ve always tried to design our process and the brewery to save water, save power, and divert our waste to just be a good steward of the planet and of the community. Yeah, of course, we give back to the community. Last year we donated to over 170 non-profits. Part of that is just because that’s what you do if you’re a good company and if you’re a steward of the community. Some of it, especially early on, is an opportunity for people to sample your beer.
“Part of that is just because that’s what you do if you’re a good company and if you’re a steward of the community. Some of it, especially early on, is an opportunity for people to sample your beer.”
We would always lead with an in-kind donation as opposed to cash because we never had cash. But we did have beer. There are also supporting our employees as best as we could all along with great benefits, and, of course, we had 401k and healthcare before it was mandated. Of course, our employees have free pints in our tap rooms. Of course, we have these programs with partners that give them great discounts and on and on. So with all that, I started to get an idea of what B-Corp was all about and how in line it was with everything I just talked about. So, after going through a pretty rigorous certification process, I think it took about nine months, we became B-Corp certified in April and really view it as a starting place for everything else that we want to do as a company.
There’s a lot more to work on even though we are certified. We’ve split up those objectives into various committees and we’re working on our recertification already. That’s about two and a half years out. So, I would say, if you’re a new brewery and that is important to you then go for it. If you’re doing it purely for marketing reasons, maybe you should do something else instead. I would say it should be true to yourself, true to your brand, and true to your goals.
“If you’re doing it purely for marketing reasons, maybe you should do something else instead.”
That makes sense. I personally think that’s really admirable. So just to end things, I was wondering if you had anything that you wanted to share with readers about what Upslope has planned for 2019?
Well, we have our 10 year anniversary coming up November 3rd which we’re pretty proud of. Having been through those first three years, I never assumed there would be a 10th-Anniversary celebration. It was hard fought. We look forward to next year, we have some new releases coming out. Just a lot more of the same I guess, keep doing what we’re doing and trying to improve upon the foundation that we’ve established.
Awesome. We really appreciate your time, Matt. Thanks so much.
This article is part of the Lilypad Sales Leaders Interview Series.