And that was the exact point in time when Sierra Nevada Brewing Co. fired up its cobbled-together brewing system and produced its first batch of what would spearhead a quintessential American beer style.

“The industry was about at its lowest, with somewhere around 35 independent breweries left in America, down from 1,000 or more before Prohibition,” recalls Ken Grossman, founder and president of the Chico, Calif.-based craft brewery.

Three decades later there are more than 1,500 commercial breweries in the United States thanks to the craft movement Sierra Nevada helped pioneer and the evolving tastes of the American consumer (the two are inextricably linked).

It would have been an unlikely prediction in 1980 that such a startup operation would even live to see its 30th anniversary, let alone grow to the size it is today with a nationally—and internationally—distributed line of beers.

An avid home brewer, Grossman’s first commercial foray into brewing occurred in 1976 when he opened The Home Brew Shop, selling ingredients and equipment to Chico’s DIY beer-making community. This further fanned the flames of Grossman’s professional brewing aspirations and he and business partner Paul Camusi—who retired from the business 12 years ago and sold his share to Grossman—famously built a brewery from dairy tanks, a soft drink bottling machine and whatever equipment they could get their hands on from defunct breweries. It culminated in the fall of 1980 with the brewing of a first batch.

“It was tough times and we started on a very small, shoestring budget,” remembers Grossman.

That shoestring was a paltry-even-by-late ’70s-standards US$100,000. “And that covered everything from building the equipment, to buying labels and malt and hops and all that,” Grossman continues. “But US$100,000 was certainly a lot of money for a couple of twentysomethings to scrape together and get into an industry that had a pretty terrible recent track record of failures back when we started.”

Historian Maureen Ogle had gotten to know the brewery quite well during the course of her research for the popular 2006 tome Ambitious Brew: The Story of American Beer and notes that Sierra’s founders faced monumental risks. “They were young and putting everything on the line,” Ogle says. “They had no reason to think they would succeed because nobody was going to loan them money. They borrowed all of the money from friends and family… That was enough to get them to realize that they had to make this pay because A, they were going to be deeply in debt and B, they were going to be letting down a lot of people that they personally knew. So it was personally risky, and of course professionally, it was completely insane.”

The insanity has more than paid off. Last year, Sierra produced a little more than 720,000 barrels of its beers, about 30 percent of which is draught volume.

Pushing the Boundaries
The brew that started it all is Sierra Nevada Pale Ale, which would come to define the American pale ale style—one of the most produced styles among US craft brewers.

“When we first came out with that beer, our hope was to produce something that was worthy of the price we were charging—as a very small company we realized that we needed to command a fairly high price for our products,” Grossman remembers. “So we tried to come up with a beer style and flavor that was distinctive and unique—back then we didn’t have as many of the different hop varieties and malts available to us that we do today. We started working on a recipe for a fairly bold, American-style English ale.”

And, notes Grossman, the emphasis is on American.

“We featured American hops that we thought were appropriate for the style and a fairly strong malt character at the time,” he explains. “It was something we thought, one, would get people’s attention and two, be memorable and enjoyable.”

Beer drinkers seemed to remember and enjoy it quite a bit as it remains the company’s widely distributed flagship. It’s also among the brands that got consumers to explore what they considered to be new frontiers in beer and seek out new experiences that lie even further beyond the boundaries.

“Consumers today are more interested in finding products that push the boundaries, as far as flavor and style, so there’s a whole new world of beer styles that were not widely available when we started: sours, Belgian styles, very very hoppy double IPAs—a whole world of beers that maybe weren’t built off historic styles, but have been pushed to sort of extreme limits,” Grossman says. “There’s certainly a percentage of consumers out there who are looking for those kinds of bold flavors and high alcohol and other directions that the craft brewing industry has pushed the world of beer. Consumers are experimenting a lot more than they used to.”

Sierra Nevada’s other year-round offerings include Porter, Stout, Kellerweis—a traditional, Bavarian-style hefeweizen—and Torpedo Extra IPA. Its seasonals include Glissade Golden Bock, Summerfest pilsner-style lager, a hoppy Anniversary Ale released each fall and a holiday Celebration Ale. Other special brews include its Bigfoot barleywine-style ale and its fresh-hopped Harvest series.

The strength of the movement Grossman and Sierra Nevada helped cultivate and the ensuing affect it had on the evolving taste buds of America ultimately enhanced the perception of the segment within the distribution tier. That’s a phenomenon that’s accelerated only in the past five years or so among larger distributors.

“We are now viewed as profitable and growing and a more significant part of the US beer scene,” Grossman observes.

“When we started it was tough to get a distributor to pay attention to you and it certainly was very tough to get a good distributor to pay attention to you. There were thousands of distributors in the country and a number of them in each marketplace might have carried 100 or more lesser-known brands and not necessarily have a great sales force or the training and knowledge to take those beers to market.”

But the changing distribution landscape has been a bit of a mixed blessing for smaller brewers. With intensifying consolidation resulting in far fewer distributors than before, it’s harder for up-and-coming breweries to gain a presence in certain markets. And if they manage to get distribution, it’s difficult to get the focus they need to build the brands. “But on the other hand, there’s certainly a lot more excitement and interest around the craft world,” Grossman points out. “It’s sort of a double-edged sword.”

Another high-profile byproduct of the craft revolution has been the launch of craft-inspired products by the major, multibillion-dollar brewers. The efforts have met with a fair amount of hostility from the craft segment, but Grossman sees it as another two-sided coin. “Certainly the lines are being blurred with some of the big brewers’ ‘faux craft’ entries into the segment; it can add some challenges,” he says. “However it’s another of those double-edged swords because it does add some credibility to the segment. But in the end, we’re at times competing for handles and shelf space and if there are 10 brands out there in the same style and nine of them are from major breweries, it does make it tough to get placement sometimes.”

Part of what has made Sierra such a success story has been its ability to stay ahead of the curve in terms of the demands of the market and the technology and equipment needed to get the job done. The brewery has the capacity to brew about 1 million barrels, about 35 percent more than its current annual output.

About two and a half years ago, the brewery completed a major bottling expansion and it’s currently adding a small specialty line that enables it to fill a wider array of packages, including cork-finished bottles and other smaller-volume containers and labels. Later this year, the brewery is building a cold-storage warehouse.

As is the case with a large percentage of its craft brewing peers, Sierra Nevada has been at the forefront of green technologies in an ongoing effort to ultimately achieve 100 percent energy production. It moved a step closer to that goal in 2008 when the brewer completed construction on one of the largest private solar arrays in the US. The array, which covers most of the brewing facility’s roofs, incorporates more than 6,700 Mitsubishi 185-watt lead-free panels and produces more than 1.4 megawatts of AC power for the brewery. Surplus electrical energy it generates will be available to ease the load on the California power grid during peak usage periods.

Competitive, Yet Collaborative
To think, all of that grew out of what began as a mostly handmade facility held together only by dreams, ingenuity and a fair amount of improvisation.

“I suspected at the time that most people who heard about [the brewery] thought, ‘Oh, there’s a couple of hippies who are off doing yet another hippie thing,’” offers Ogle. “There were lots of people who had screwball ideas back then. But having said that, full credit has to go to Ken Grossman’s intelligence and talent, of which he has gobs. There’s nothing the guy can’t do as near as I can tell. He could probably build a rocket and send it to the moon and successfully build a space colony. He’s really smart and he knows how to solve problems.”

But Grossman is less interested in tooting his own horn for the 30-year milestone than he is shining the spotlight on some of the other noteworthy craft brewing pioneers. As part of its yearlong anniversary celebration, the brewery is teaming up with others who ignited the spark for what has become today’s craft segment, including Fritz Maytag of Anchor Brewing and Jack McAuliffe, founder of New Albion brewery. Maytag and McAuliffe are widely regarded as the godfathers of craft brewing, with Maytag’s purchase (and ultimate reinvention) of the Anchor Brewery in 1965 and McAuliffe’s founding of New Albion—considered the first microbrewery—in 1976. New Albion proved fairly short-lived, but it was the spark that was needed to ignite an entire movement.

“Jack was the first one to go from home brewing to commercial brewing and Fritz was really the first pioneer in showing that American beer can charge a premium price and compete with quality and image against any of the beers in the world,” Grossman notes.

Maytag and McAuliffe also had offered guidance during Sierra Nevada’s early years. “Ken knew that Fritz and Jack were there and were generous with their advice and help,” says Ogle. “They shared their hard-earned wisdom from doing what [Sierra Nevada] was trying to do and that certainly helped… Fritz offered to get malt and hops for them because they were having a hard time finding anyone who was willing to sell them such small batches.”

In addition to the 30th anniversary brewing team-ups with Maytag and McAuliffe, collaborations with Fred Eckhardt, beer author and homebrewer and Charlie Papazian, author, homebrewing advocate and, now, president of the Brewers Association, round out the series. This month the first of the four collaborative brews makes its way to the market and the others will follow throughout the year. It continues the spirit of cooperation that has always been in Sierra’s DNA.

Last fall the brewery joined forces with Milton, Del.-based Dogfish Head to produce Life & Limb and Limb & Life, a pair of collaborative brews that Sierra Nevada sold through its distribution network.

“[In this industry] you’ve got all these creative, artistic brewers,” Grossman explains. “A lot of them like each other, so we’ve gotten along. On one level we’re helpful to each other—certainly we’re competitors in the marketplace, among a number of the brands that are collaborating—but on the other hand, we’re a pretty small industry and we’re a small segment of a big industry and we need to help each other out where we can and support each other. Collabora­tion just shows how brewers can work together for the collective good of the consumer, as well as the craft beer industry in general.”

From Beverage World March 15, 2010