Our story so far: Local craft brewery opens and is successful for several years. Needing capital for growth, local brewery sells itself to larger corporation with eyes toward expansion. Large corporation finds local brewery insufficient as an investment, and so liquidates local brewery.
You may think this little parable refers to the recent closure of Dallas’ own Deep Ellum Brewing. Of course it does, but the story is not unique and applies to several of our favorite Texas breweries, past and present:
- Celis Brewing was acquired by MillerCoors in 1995, who closed the massively popular Austin craft brewery at the first sign of recession in 2000 and sold off the brand.
- Four Corners Brewing was acquired by Constellation Brands in 2018, who started shedding craft beer and wine acquisitions with the economic downturn in 2023. Fortunately, the former owners of Four Corners were able to buy the brewery back from Constellation, and it survives as an independent Dallas brewery once again.
- Revolver Brewing of Granbury sold to Tenth & Blake (a division of MillerCoors) in 2016, and it remains operational and thriving (for now) after opening a second remote taproom in Arlington.
- Karbach Brewing was acquired by Anheuser-Busch (AB Inbev) in 2016 and their new and expanded brewery in Houston looks real nice, but fans have done nothing but complain about their dip in quality ever since.
Opening in 2011, our own Deep Ellum Brewing was sold to a craft brewery holding company called CANarchy in 2018. CANarchy and the portfolio of breweries it owned were subsequently acquired by the larger Monster Beverage (yes, that one) in 2022, who announced the closure of the Dallas brewery and taproom just last month. To be precise, only the local brewery and taproom are closing; the Deep Ellum Brewing brand will continue to be brewed at an as-yet-unnamed consolidated location, likely outside of Texas.
For craft breweries, at least, corporate ownership/partnership is a cautionary tale. Once such an agreement is entered, the brewery and brewer are no longer in control of their own future. Another master must be served, often one not connected with the locale or state, or even the same industry, and very often one not committed to the craft beer cause. Decisions from individuals and board rooms far removed may determine one’s fate year to year.
The rub here is not that these craft breweries are ultimately not profitable, but that they are not profitable enough. As independents, craft brewing can be a successful business on its own, but the particular nature of the industry means a brewery has many dependencies on supporting industries. From ingredients to utilities to distribution and retail—even extending to state regulation and politics—the brewing industry has its own unique economy, and investors seeing popular trends and seeking only financial gain may find even successful breweries a disappointing return on their capital.
The rub here is not that these craft breweries are ultimately not profitable, but that they are not profitable enough.
As one of the first-movers in this most recent generation of North Texas breweries, Deep Ellum Brewing was both successful and not without its own controversy and drama. It truly helped build the current commercial market, including participating in the state lawsuit with Grapevine Craft Brewery against the Texas Alcoholic Beverage Commission (TABC) in 2021 to allow direct sales from brewery taprooms, a long legal holdover from Prohibition. The brewery had its own local scandals, such as a lawsuit brought by founder John Reardon against owner CANarchy in 2020 over missed payouts. And who can forget the state-wide flap regarding their sexist and lightly offensive marketing campaign for their Dallas Blonde ale?
Like the City of Dallas itself, Deep Ellum Brewing had its fair share of strong personalities, and more than once ran off some of its best and most promising employees. The details need not be repeated here but some of the personal accounts from those working for and at the craft brewery are somewhat unfortunate from a human resources standpoint, particularly for a local business striving to succeed. Fortunately, many of these talented brewery personnel remain among the DFW craft beer industry in various roles, including a few opening (or about to open) their own breweries.
In many ways, the loss of Dallas’ oldest brewery may signal the loss of Deep Ellum itself. The area has changed significantly over the past decade, moving past gentrification into full-scale redevelopment and now with more high-rise apartment buildings than independent breweries. This drive for financial gain erodes the character of the neighborhood with such cash-grab ideas like a surfing-themed bar and wave pool—a ridiculous and tone-deaf concept for the former indie arts and music district.
Ultimately, the land that Deep Ellum Brewing sat on was worth more than the craft beer that it produced. And it doesn’t get any more Dallas than that. PH
