Side projects can sometimes evolve into successful businesses. For example, a Google engineer tinkered with an e-mail offering and, in one day, Gmail was born. But while Google and local outfits like Detroit Venture Partners encourage their workers to spend 20 percent of their time on side projects, there are more misses than hits.
Still, a side venture like Twitter or Foursquare far outweighs the time spent on duds. So what happens when a brewpub and restaurant get sidetracked? In this case, the German-style beer produced at Atwater Brewery in Detroit’s Rivertown district had shelf life, but the restaurant, with its hops-inspired menu and cavernous space, couldn’t hold its own.
“The restaurant worked at the onset (in 1997), but people lost interest in it,” says Mark Rieth, who purchased Atwater Brewery in 2005. “Where I saw potential was staying true to Detroit’s heritage of making German-style beer. There’s a reason Detroit had more beer production houses in the 1800s than any other state.”
While Prohibition dried up a large share of brewers (Michigan outlawed alcohol in 1916, and the nation followed in 1920), the law’s repeal in 1933 generated huge demand for spirits. Since then, beer sales have ebbed and flowed based on consumer demand. “Now people are into hand-crafted beer, and we’ve been riding that wave,” Rieth says. “But you don’t close a restaurant, focus on the brewery, and call it a day.”
To be sure, the former sales and marketing executive at Toyota has had his share of challenges. He excelled at generating demand, but with just four beer tanks, he had to pull out of five states when production couldn’t meet that demand. To reverse the tide, he quadrupled his brewing capacity late last year. Now Rieth, a Grosse Pointe native, has plans to sell his dozen-plus brands in 15 states by 2015 (up from eight states today).
“I got started making beers when I was working in Boston, just home-brewing in the late ’80s,” he says. “When I came back to Detroit in 1997, I visited Atwater and thought it would be cool to own the place. Little did I know that it would all come true.
After taking over, Rieth traveled to Germany to study beer-making. “I try to keep things simple and use four ingredients — hops, yeast, malt, and water,” he says. “To make it all work you have to have great water, and Detroit has plenty of that.”
With his added capacity, Rieth isn’t standing still. This year, he’s on pace to sell 15,000 barrels, up from 7,500 barrels last year. In 2013, he projects selling 30,000 barrels, and 150,000 barrels by 2015. Apart from traditional retail outlets, the beer is available at Comerica Park, Ford Field, and other venues.
“We’re looking at adding bottling and canning lines, and we’ll need 150,000 square feet (of space) to do it,” he says. “I know 11,000 square feet sounds like a lot, but we’re busting at the seams.” db