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Charlie Papazian is the grandfather and ring master of the craft beer industry. It’s under his direction, promotion, and experience craft beer has grown from 44 breweries in 1979 to over 3,400 today. His love for craft beer led to the founding of the American Home Brewers Association, The Brewers Association of America, Institute for Brewing StudiesBrewers Publications, the Great American Beer Festival, the World Beer Cup, and Zymurgy magazine. The movement he started has now reached what many believe to be a tipping point, or a point where it seems we have reached the end of our beginning.

A few basics ideas suggest we have reached such a point in time, the most imperative of which is the sheer size of the market. The market has reached an annual growth rate of 18% in 2014, which accounted for almost 1/5 of all beer sales by dollar amount. With a market this hot and rapidly expanding, we have to ask the question: “can the growth be sustained?” It seems the basic answer to this is yes. The market seems capable of sustaining many more years for growth due to the changed consumer demographics of our country. We’ve moved from a mass society to a craft society and not just with beer. In all things, look at the rise of Etsy, Pinterest, the DIY network, and urban farming. Many of these cultural factors, which align with craft consumption, spawned off of the environmental movement of the 1970’s and were revitalized with the “Global Warming” debate. With the momentum environmental support has, craft seems to be the new path forward and shows no signs of slowing down any time soon. This is a major difference from the days when craft brewers had to fight for a single tap, convince people to drink better beer, and do it all on their own dime. We look to be entering a new era of craft brewing.

The idea of fast growth makes craft brewing an attractive market place from an economical stand point. This means it is an attractive investment opportunity for many people. Many of those people may not be beer fans, lovers, or brewers, but financiers and private investors looking for a high growth low risk opportunity. The attractive marketplace is allowing small breweries to start up with millions of dollars in capital without ever having produced a single drop of beer. These large treasure chests are providing them the ability to rely heavily on marketing to promote their brand and product. This is a stark contrast to the early days of craft brewing when brewery founders (like Sam Calagione at Dogfish Head, for example) had to mortgage their own houses, max out credit cards, and take small loans from any available source to fund their operations. This influx of money has brought more competition into the market, which has caused ripples in our perfect pond and are a sign that change is coming.

The first ripple is internal. With 3,400 breweries we are beginning to see the floor get crowded. Take beer names for example. Alastar Bland, in his article for National Public Radio, found numerous examples of breweries litigating over beer names, font types, and tap handle styling. To some, these are just numbers, but to the crowded beer market these are brands which must be protected to help stave off new competition. Jason Notte, in his article for MarketWatch, suggests the brewers association needs to step up to help fix this issue by compiling a database of all copyrighted content. This ripple is troubling to our industry, because when there is public unrest between breweries we begin to lose the cohesive, familial environment which has fostered in current era of craft brewing. Craft beer was founded on the premise that better beer could and should be made available to the people of the world, and for many years craft brewing held an all for one mentality against the establishment. Now, some of the larger breweries are becoming the thing they fought for so long, and it is causing strife.

The second ripple comes from the coagulation of smaller parts into larger ones. As breweries began they were on their own, fighting the good fight. As time has progressed we have began to see Mega Craft houses open up shop. These are large, publicly traded craft consortiums such as the Craft Brewers Alliance, and private ones such as Take Tenth and Blake, which is the MillerCoors consortium of breweries. There, also, is a brand new one called “Enjoy Beer” which was founded by Harpoon and Abita. This will allow the south’s oldest brewery to gain national reach, and make a move to become a Macro Craft brand. This move to become “Macro Craft” is a new play for our market, and one which nobody really knows the end result. Enjoy Beer says they, potentially, will launch an IPO by 2020, and, realistically, a buyout of this size is easy for a player the size of AB/InBev or any of the other majors to take on without blinking. So, what happens to craft when craft is no longer owned by innovative craftsmen, and is, instead, replaced by a bottom line focused bureaucratic collective? This is something we haven’t had to see much of in the previous years, but it is something we will have to face head on in our new era.

The third ripple is that even the smallest breweries are now acting like the biggest because they can afford it. When we first began Eventide I reached out to Adam Avery, of Avery brewing, to get his thoughts on marketing. He said, “Never give anything away, it cheapens the market and your product”. We’ve tried to stick to this, but it is very hard when everyone around you is handing out swag left and right. It seems at every beer festival it’s easy to go home with a full ensemble of free gear from vendors. There is no way we can afford to do this, but now people look at us as if we are cheap because we don’t give stuff away. It’s another signal when small breweries begin to mimic the marketing practices of the very businesses ti which they are opposed.

This fast growth is great, but it doesn’t have a check to the balance. This is the scary part of our new era. “Over the last couple of years, the number of new brewery openings has been at near unprecedented levels,” said Bart Watson, Ph.D., staff economist at Brewers Association, a craft beer industry group. “We’re seeing breweries open at about a rate of 1.2 per day.” Do the business math on this, and you’ll see the normal failure rate according to Bloomberg is 80% in 18 months. This means that we should have seen 350 breweries close their doors in 2014, yet we only saw the closure of 46. That is not a normal closure rate, and in an industry with such high capital costs this is way outside of normal. It seems the fast growth of the industry is able to support businesses which should fail under normal conditions, and to continue growth new and existing breweries should be mindful of this moving forward.

It seems our era began in a time and place where unbounded creativity, good times, and optimism were the spark which gave rise to the notion of crafting, yet it was the market’s appetite for craft which sustained the passion. Now, with the market in its fastest growth period, it is opening up a new era of business for us. No longer are all breweries best friends, but, rather, business competitors. No longer are we starving artists, but highly leveraged investments. No longer is this a playground for free spirits and good intentions, but a growing field for MBA’s and investment opportunities. Starting a successful brewery is not easy, and while it can be fun it also takes a great deal of work and devotion. It is a true craft, and it should remain as such without the entanglements which have hindered other craft focused pursuits in the past. Time will tell.