Would you invest $2.4 million in a brewpub? The hosts dissect a listing that raises eyebrows due to its questionable profitability and high asking price. They explore the intricacies of brewery licensing in New Mexico, discuss the current contraction in the brewpub industry, and question whether real estate is the real asset in play. With a deep dive into market rent assumptions and financial evaluations, the conversation highlights the challenges and opportunities within the business of brewing.
30:22
forum Ask episode
web_stories AI Snips
view_agenda Chapters
auto_awesome Transcript
info_circle Episode notes
insights INSIGHT
Brewery Profitability Often Overstated
Breweries often struggle with profitability despite strong branding or location.
Market rent assumptions not accounted for can hide true financial health of a brewery business.
insights INSIGHT
Brewpub Industry Contraction
The brewpub industry is currently contracting after a period of overexpansion.
Many brewpubs are struggling to maintain value or profitability in a saturated market.
question_answer ANECDOTE
Success From Buying Used Equipment
A couple built a beer garden by buying used equipment cheaply at auctions, enabling success with low capital.
Their approach contrasts greatly with expensive brewpub startup costs.
Get the Snipd Podcast app to discover more snips from this episode
📈 Check out Capital Pad, the platform for acquisition entrepreneurs and investors—standardized terms, simplified investing. Get started at https://capitalpad.com.
Thinking about owning a franchise? Connor Gross is your go-to expert—join his newsletter or attend a Gateway to Franchise Ownership workshop today. Learn more below!
In this episode, Heather, Bill, and Michael dissect the listing for a taproom in Albuquerque, New Mexico, that’s asking $2.4 million for a business generating $300K in cash flow. With the real estate not included, the team breaks down the economics of owning a brewery, dives into the intricacies of taproom licensing in New Mexico, and debates whether this is a hidden gem or a real estate play in disguise. Spoiler alert: the numbers don’t add up. From licensing laws to market rent assumptions, this episode is a deep dive into the realities behind the romanticism of owning a brewpub.
Key Highlights:
Asking 8x EBITDA for a taproom with questionable profitability
Real estate valued at $2M not included in asking price
Discussion on current contraction in the brewpub industry
Insight on liquor licensing workarounds in New Mexico
Breakdown of potential mispricing and market rent blind spots
Perspective on real estate being the actual asset over the business
The risks of unsophisticated sellers and brokers in these deals
Evaluation of business scalability and margins in taprooms
Acquisitions Anonymous - #1 for business buying, selling and operating