Tony Magee founded Lagunitas Brewing in California in 1993 and has built it into one of the largest craft breweries in the U.S., opening a 300,000-square-foot brewery and taproom in Chicago in 2013. (Lagunitas is also in the process of building a brewery in Azusa, California.) Magee has been in the news quite a bit this year, first for filing suit against Sierra Nevada for trademark infringement over an IPA label—which he immediately dropped in the wake of customer backlash—and then in September for selling a 50 percent stake in Lagunitas to Heineken in order to export his beer internationally. On November 3, the 55-year-old Arlington Heights native will be discussing the politics and business of craft beer with Mark Bazer, host of The Interview Show and WTTW’s My Chicago. Magee spoke over the phone recently about recent events in the beer world, what defines a craft brewery (and whether it should be defined), and what’s next for craft beer.
Julia Thiel: It seems the biggest news in the beer world these days is the acquisition of SABMiller by AB InBev. What, if anything, does this mean for craft beer?
Tony Magee: What no one is talking about is that in the U.S., there’s no way the Department of Justice is going to allow Anheuser-Busch to own Miller and Coors. It’s not going to be AB owning the three biggest U.S. beer brands. Not even close.
What it means for craft is that it’s going to be a bumpy road to the top. In my mind, this is a weather event, not a climate event. You can get kicked around a little bit by the weather, but ultimately the climate is what you need to think about, what you need to live in alignment with.
Every time Anheuser-Busch or Miller-Coors loses a share point, it goes either to craft or to the Modelo brands. The whole of beer in the United States is getting smaller, year by year. People aren’t drinking more beer per capita, they’re drinking a little bit less. That’s been going on for 20 years.
So they’re drinking less, but they’re drinking better beer overall?
That’s what I think, yeah. I think the world is turning towards better beer, and that craft beer is in its ascendancy. The state of craft beer has nothing to do with what happens with Anheuser-Busch. They’re two different worlds.
But increasingly, it’s not always two different worlds, with the bigger companies acquiring craft breweries. And especially with Lagunitas’s merger with Heineken.
No, not especially. My business with Heineken is about growth across the oceans from the United States. Our business in the United States is as it was. I run the company, my people do their jobs, Heineken stays away from us. That has absolutely nothing in common with Anheuser-Busch buying craft breweries 100 percent, taking them over, brewing 312 at a Budweiser brewery. That’s a completely different thing from what we did.
Would Lagunitas still be considered a craft brewery?
By who? By the Brewers Association? I don’t know. [Note: Under the BA definition, less than 25 percent of a craft brewery can be owned or controlled by “an alcoholic beverage industry member that is not itself a craft brewer,” which excludes Lagunitas.] They got their own ax to grind, their own reasons. I don’t pay much attention to that. The labels about who’s cool and who’s not cool have a frat party aroma. If we don’t measure up to the Brewers Association’s definition of physical beauty, I’ll just say, there’s more of us ugly motherfuckers than you anyway.
But you would say that Lagunitas is still a craft brewery?
Yeah. Craft is what craft does. Who your friends are has less to do with anything than what it is you do. There are a lot of people who feel very strongly that Anheuser-Busch has made Goose Island into a better company. More power to ’em. If you like what you’re tasting, rock on.
I think the word “craft” has outlived its usefulness. In legend, one of the ways you can get control over a spirit is by learning its name. In other words, when you name something, you gain power over it, and it becomes weaker. If someone has to define craft, the first moment that sentiment exists, craft becomes a weaker idea.
So the Brewers Association’s definition of craft beer doesn’t encompass all of craft beer.
What’s a definition? It’s something you can believe in, right? The word “shit” used to mean that little pile of brown stuff the dog leaves behind. Now if someone says, “That’s the shit,” it’s the best thing that ever was. The definition that the BA uses for craft—every few years over the last ten, they’ve changed it to accommodate one member or another. I don’t think their definition means very much anymore.
Even the word “craft,” it’s funny. My brother-in-law, Ray Daniels, gave the Brewers Association that word. He runs the Cicerone [beer sommelier certification] program here in the city, was on the Brewers Association staff for a long time. Back in the 90s—that’s when we were starting up—everyone called them microbreweries. After a while, some of them became kind of big, and the BA was like, Huh, we’d better change the word “microbreweries,” it doesn’t make any sense anymore. And Ray says, “Why don’t we just call them craft breweries?” Even the word “craft” was born yesterday, but everyone thinks it’s a permanent demarcation.
What’s next for craft brewing?
It’s just going to keep exploding. That’s what’s next. The breweries engaging with other breweries, whether it’s small breweries buying another small brewery, or someone like us making a partnership with Heineken, these are moments of maturing and taking opportunities. Which is, in my mind, still different than selling your business to another brewer that’ll run it for you.
If there’s a headline to the state of craft beer, it’s that it could hardly be better. And this is the first time this has happened since the 1870s. There was once a guy named Adolphus Busch who made a beer that later became Budweiser. There was once a guy named Friedrich Miller. There was a guy whose last name was Pabst. And people in the towns where these breweries were could go and meet ’em. Those people are long gone.
This is the first time in 150 years that you can come and shake the hand of the person that makes the beer, talk to them about what they’re thinking. The craft brands of today will grow up and become the global brands of tomorrow. It’s a big deal. v
Politics and the Business of Craft Beer With Tony Magee (introduced by the Reader‘s Julia Thiel), Tue 11/3, 6-7 PM, Francis W. Parker School, 2233 N. Clark, 312-494-9509, chicagohumanities.org, $12, $9 CHF members, $5 students and teachers.