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    • JoeCrystal
    • By JoeCrystal 22nd Jun 13, 10:25 AM
    • 1,941 Posts
    • 1,366 Thanks
    JoeCrystal
    • #2
    • 22nd Jun 13, 10:25 AM
    • #2
    • 22nd Jun 13, 10:25 AM
    Well, reads its Prospectus and come back. It does have lots of perks. A quick skim through suggested that if you want highest discount when buying their products, you need to buy 3 'B' shares or £285.

    But it is a wise investment? In my opinion, no but this is more for people who is willing to pay a massive premium to own part of their beer company. Of course, it is unlisted so selling shares would likely to be very difficult.

    EDIT: Although it seems that you could trade/sell shares through some website anyway.

    Anyway, read the Prospectus beforehand. I will say this, if only all companies are like that. *sighs*

    Cheers,
    Joe
    Last edited by JoeCrystal; 22-06-2013 at 10:42 AM.
  • bride2be2012
    • #3
    • 22nd Jun 13, 10:40 AM
    • #3
    • 22nd Jun 13, 10:40 AM
    My dad has shares in Brewdog. It's their agm this weekend, so him and mum are attending that, more for the open day/free beer/brewery tours etc, than the agm I'd imagine.

    As the previous poster says, prob more for those who want to own part of a beer company, than a wise/serious investment.
  • gkerr4
    • #4
    • 22nd Jun 13, 10:45 AM
    • #4
    • 22nd Jun 13, 10:45 AM
    they'd be an interesting proposition if they were listed shares - they have a growing cult following and unique boutique bars - and good beer too! - but i wouldn't buy this sort of "share".
    • bowlhead99
    • By bowlhead99 22nd Jun 13, 11:00 AM
    • 9,492 Posts
    • 17,277 Thanks
    bowlhead99
    • #5
    • 22nd Jun 13, 11:00 AM
    • #5
    • 22nd Jun 13, 11:00 AM
    Is it wise to invest in something following your heart rather than your head? Usually not.

    They are looking to raise £4m which would value the whole company at ~£112m, not counting employees'/directors' share options (which would only cost them 200k to exercise but instantly be 'worth' £1.5m at the new issue price of £95 per share).

    This £112m is eleven times as much as their entire revenue last year and therefore many many many times as much as their annual recurring profits. They made £437k last year, so it's 256x annual profits. But this is perhaps misleading as they are high growth (at least in terms of revenues which they say they'll double this year) and they say it is not unreasonable on the current run-rate of profits since the latest facilities came onstream, even going as far on their site to compare multiples with a 'grown up' drinks business like Diageo.

    Of course there is actually a public market in Diageo shares and this is a private unlisted company owned 85% by the directors and their mates who can do whatever they want with it. There is no oversight from activist institutional shareholders or whatever.

    They say the fundraising is for future expansion and not to pay back director loans taken out this year but in reality they can do whatever they want with it.

    As alluded to by other posters, you could always just buy the minimum number of shares needed to get the maximum discount card. Even if you get just one share you'll get an AGM invite and the same discount in their bars (just a lower website discount than if you bought more shares, and who is to say that in time, the particular tipple you like won't be available from a supermarket on offer below RRP anyway).

    I like Brewdog as I like craft beers and they have some good ones. I was in their Manchester bar the other weekend and it was pretty dead, but best not to judge the whole company on that as it was a sunday early evening and I'm sure it livens up on other days/times. But treat any investment in it as spending the £95 per share for perks and a bit of fun rather than investing the £95 for a return. I note the director sold out 55,000 of shares to his mates or VC firms last September to raise £780k, half of which he's loaned back into the company. The price of those sales was £14 a share rather than the £95 they're now seeking from beer fans.

    So as a financial investment, I'd say there are plenty of high growth opportunities with lower risk or a better price. If want a shareholder's card to show your mates, don't let that stop you.
    Last edited by bowlhead99; 26-06-2013 at 10:04 PM. Reason: Picked up the wrong figure as pointed out by grey gym sock - points still stand!
    • grey gym sock
    • By grey gym sock 22nd Jun 13, 5:09 PM
    • 4,444 Posts
    • 4,000 Thanks
    grey gym sock
    • #6
    • 22nd Jun 13, 5:09 PM
    • #6
    • 22nd Jun 13, 5:09 PM
    They made £50k last year, so it's 2200x annual profits.
    Originally posted by bowlhead99
    i am looking at the right figure? looks like £437k profit last year, so "only" 250x annual profits.

    i strongly agree with your analysis in general.
    • Ifts
    • By Ifts 26th Jun 13, 8:47 PM
    • 1,827 Posts
    • 1,151 Thanks
    Ifts
    • #7
    • 26th Jun 13, 8:47 PM
    • #7
    • 26th Jun 13, 8:47 PM
    ^ More like a spam breakout from phoneygroup! ^

    Fellow posters please just press the button on these types of posts, if enough people hit the spam button it gets removed
    Never let the perfume of the premium overpower the odour of the risk
    • cos
    • By cos 27th Jun 13, 8:19 PM
    • 614 Posts
    • 308 Thanks
    cos
    • #8
    • 27th Jun 13, 8:19 PM
    • #8
    • 27th Jun 13, 8:19 PM
    I was at the AGM in Aberdeen as a guest. It really was a blast with lots of silliness amongst the facts and figures of the presentations. And a swathe of live bands to follow. I tried a good 8 or 10 different beers and was very impressed with their products. I was tempted to buy shares on the day but decided to wait until the alcohol left my system!

    In the cool light of sobriety I reflected on my normal share selection strategy, which includes reasonably strong and rising dividends and some expectation of share price growth.

    I looked at the q and a from the 2012 AGM and saw that one of the founders had stated that the company expected to start paying a dividend on 2013. There was no dividend announcement this year.

    Also, I was a little concerned that they were over stretching themselves, in my view, by expanding the brewery, opening up more UK bars, opening a shop in London, creating a swathe of partnerships globally and opening their first bar in Japan. They're also filming a TV series in the US! And they admitted that their online store has been 'pants' and they often run out of stock.

    My car also needs new wheel bearings, so the head has ruled the heart. However, I will definitely buy their beer!
    • Yorkie1
    • By Yorkie1 27th Jun 13, 9:00 PM
    • 11,055 Posts
    • 20,844 Thanks
    Yorkie1
    • #9
    • 27th Jun 13, 9:00 PM
    • #9
    • 27th Jun 13, 9:00 PM
    jamestrader is the umpteenth version of a spammer promoting this article. Please click spam (two separate posts).
    Last edited by Yorkie1; 27-06-2013 at 9:02 PM.
  • innovate
    Somebody suggested it's a bot. I fear they are right but have reported it to the Forum Team who will no doubt have means to stop the idiot.

    Spambomb him in the meantime
    • pd53
    • By pd53 3rd Jul 13, 8:11 PM
    • 31 Posts
    • 8 Thanks
    pd53
    First things first - I have bought a share.

    As was stated by bowlhead it appears in the accounts that the directors were selling shares at £14, rather than the £95 this share sale is at.

    I looked at it as paying an up front £95 to get £10 of 'beer tokens' for their bars, as well as 10% lifetime discount off the online store (admittedly P&P is not cheap, but still works out cheaper per bottle than in off licence) and 5% lifetime discount in their bars. This is great if you live in a town or city they have a bar!
    There is the potential of the company continuing to do incredibly well and the website does state they are hoping to create a way to trade these shares in the future (though the demand for this is not likely to be too high).

    If thousands of people have bought a share they will continue to make brewdog their beer of choice, as the more beer that is sold then the better is for their share! The prospectus does say demand is currently outstripping supply, hence the need for the expansion.

    In summary, in my opinion this is a share to buy for the lifetime discounts and up front £10 beer token, not necessarily to get rich quick or make a huge return on!
    • N1AK
    • By N1AK 4th Jul 13, 10:25 AM
    • 2,852 Posts
    • 3,798 Thanks
    N1AK
    Has anyone invested in Brewdog the Scottish Craft Beer Company?
    Is the a wise investment?
    Originally posted by Paddypaws
    I gave it some serious thought. The truth is that unless you drink in their pubs or buy a lot from their website then it it probably wouldn't count as a good 'investment'.

    That doesn't mean it isn't worth buying some. I decided against it because the postage for web sales means there's no point in buying even with the discount for being a shareholder; additionally the shares value the company extremely highly. The value isn't unreasonable because they are expanding very rapidly in sales, bars, shops but as a company based on an 'outsiders', 'little guys' and 'non-corporate' image I wonder how big they can get before the customers who are drawn to that image stop seeing them that way.
    Having a signature removed for mentioning the removal of a previous signature. Blackwhite bellyfeel double plus good...
    • pat_cashmoney
    • By pat_cashmoney 4th Jul 13, 2:56 PM
    • 40 Posts
    • 35 Thanks
    pat_cashmoney
    Their success is entirely due to hipster popularity. Once all the "cool dudes" stop being interested in beer, Brewdog will slip back into obscurity.
    • pd53
    • By pd53 4th Jul 13, 6:49 PM
    • 31 Posts
    • 8 Thanks
    pd53
    Assuming these 'cool dudes' are men, when do men stop being interested in beer. Surely as men get older they'd prefer a craft / IPA rather than the bland lagers brewdog rally against.
    Though I'm aware this may start taking this thread off topic - sorry!
    • cos
    • By cos 5th Jul 13, 12:20 AM
    • 614 Posts
    • 308 Thanks
    cos
    My car also needs new wheel bearings, so the head has ruled the heart. However, I will definitely buy their beer!
    Originally posted by cos
    Car repaired today - cost £336. I'd thought about buying four BrewDog shares, which would have cost £380, so I think I was right in getting the car fixed.

    I like the company, but don't feel 'driven' to invest at the moment.
    • bowlhead99
    • By bowlhead99 5th Jul 13, 6:43 AM
    • 9,492 Posts
    • 17,277 Thanks
    bowlhead99
    Assuming these 'cool dudes' are men, when do men stop being interested in beer. Surely as men get older they'd prefer a craft / IPA rather than the bland lagers brewdog rally against.
    Though I'm aware this may start taking this thread off topic - sorry!
    Originally posted by pd53
    Investing in a fashion brand is always tricky. As random examples from the world of clothing, within the last 3 years Supergroup (makers of Super Dry) might have been bought for 760p, later 1860p, later 270p and now 790p. Muberry: 270p, later 2500p and now 900p.

    It doesn't mean that people have started or stopped being interested in clothes generally: ASOS who sell everybody else's clothes through the internet have happilly gone from <1000p to >4000p in the same time (I'm still regretting not buying about 5 years ago as I remember thinking the rise from 120p to 320p was a little too rapid...).

    Essentially you are right, beer has been popular for hundreds of years. But microbreweries and 'craft' beers have gone in and out of fashion, so while the idea of selling real beer rather than the mass-produced lagers has always been popular with a certain set (certainly in an "old man pub" rather than a trendy wine bar), the buyers in the "old man pub" are not typically going to be buying branded niche drinks like Punk IPA, Mashtag or Electric India (nice though they are) over their entire lifetime.

    Someone in their twenties or thirties might currently love the vibe of punky grungy craft beer at an "iPhone" price point. But ten years ago people suddenly rediscovered the idea of drinking cider with ice in. In the 90s it was alcopops, from studenty ones like Two Dogs and Hooper's Hooch to the 'sophistication' of Smirnoff Ice. In the 80s you had your Babycham and your Cinzano Bianco. All marketed aspirationally, some sticking around longer than others.

    If you're a Diageo, you can keep adding the high fashion stuff to your portfolio and sell millions of drinks year in year out. If you're an 'alternative' non-mass-market brewer and all you do is craft beer and have some urban bars, you might get a cult following but will that cult go 'mainstream' enough for proper market penetration while keeping its USP of being a cool alternative to the mass market stuff?

    I'm sure when Apple brought out the iPod there would have been some people saying "this will be mainstream popular, people have always liked music" and others saying "why is it twice the price of an equivalent just because it looks pretty when it doesn't do a better job, this is simply going to be a fashion fad". They ended up with the best of both worlds, selling a pretty product at a premium price point AND going mainstream - the share price liked that very much indeed. Now after taking over the world, Apple's users are still viewed snarkily as hipsters by those outside the cult while the products are worshipped by those within it.

    Of course Brewdog could be the 'next big thing' while maintaining cult status and making millions, so today's price might be a bargain. But ultimately, this fundraising is for fans - as mentioned, the serious VC investors bought in at a sixth of the price in the last year or two. You might want to buy the shares in the same way fans want to buy shares in Arsenal, Spurs or Man U. Mostly with their hearts rather than their heads. Sometimes it works out financially and sometimes it doesn't.
    • pat_cashmoney
    • By pat_cashmoney 5th Jul 13, 10:24 AM
    • 40 Posts
    • 35 Thanks
    pat_cashmoney
    Assuming these 'cool dudes' are men, when do men stop being interested in beer. Surely as men get older they'd prefer a craft / IPA rather than the bland lagers brewdog rally against.
    Though I'm aware this may start taking this thread off topic - sorry!
    Originally posted by pd53
    haha! By which time they will be old dudes rather than cool dudes, and Brewdog loses it's cred with the yoof and thus the decline kicks in
  • astraiton
    Ive just returned from living in New York for 2.5 years and i can tell you that craft beer is not going to go away anytime soon. The craft beer 'revolution' started in the 90's in the USA and there are now about 2500 craft beer breweries, and another 1500 are in the works. Some restaurants in NYC have beer sommeliers (called a cicerone) to help you match your beer to your different courses. craft beer accounts for 6% of beer sales in the USA, however, if you go to any bar in any major cities you'll probably find at least 5 craft beers on tap for every bud or miller...i hope brewdog paves the way for craft beer here in the UK as ive been back for a week and find the beers scene in London very boring unless you make an effort to goto a select number of bars.
    • sabretoothtigger
    • By sabretoothtigger 18th Aug 13, 2:39 PM
    • 10,026 Posts
    • 6,604 Thanks
    sabretoothtigger
    USA does have some awful beers though so salvation was overdue for them

    However, I will definitely buy their beer!
    That could be the best indicator. I dont see that as ruling with your heart, believing in a product does count for something.
    Quite a few stateside backed Apple on that basis and they were right

    I was looking at CREE who make LED and they are amazing advancers in that sector and well justified however they are 100x PE so is the growth that likely right now. I think no is too possible, I have held them before though and maintain an interest so maybe people should wait even if they dont commit now.
    Tokyo residential prices have gone from 4x London in 1990 to ľ London in 2014
    Maybe this is one of those cases where you canít go home again,
    by Ben S. Bernanke, former Fed chairman
    • Biggles
    • By Biggles 18th Aug 13, 3:47 PM
    • 7,611 Posts
    • 5,016 Thanks
    Biggles
    The craft beer 'revolution' started in the 90's in the USA
    Originally posted by astraiton
    No, only the name 'craft beer' started in the US. Micro-breweries and brewpubs had already been big business here for maybe 20 or more years but it's good that the US is finally making some decent stuff.

    But it's not just bars in major cities, we were over there nearly ten years ago and I don't think we ever encountered a bar in even a small town that didn't have a few micro-brewery taps as well as the 'usual suspects'.

    Obviously, it isn't real beer, as we think of it in this country, but as long as you don't mind the gas, some of it can be quite passable.
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