Rich Marcello, 44, is Strand Brewing Co.’s vice president. A former… (Luis Sinco, Los Angeles…)
Two surfing buddies who created one of Southern California's fastest-growing microbreweries have advice for anyone eager to follow in their steps. Don't do it. Seriously, dude. Don't.
Joel Elliott and Rich Marcello built Strand Brewing Co. in a tiny space at a Torrance industrial park by working 100-hour weeks for three years, without vacation or pay or employees.
They borrowed money from relatives and friends. Then they hit them up again, and again, and again. They tapped out their own credit cards.
Money was so tight in 2010 that when Marcello loaded kegs into his nicked-up '98 Chrysler van to make deliveries, Elliott would think: "Just don't crash." A wreck might finish them.
Marcello never crashed — and Strand's by-tap-only beers are now served in more than 200 bars, restaurants and hotels across Southern California, including places as diverse as Wolfgang Puck Bar & Grill at L.A. Live, the Ritz-Carlton in Marina del Rey, and craft beer meccasFather's Officeand Beachwood BBQ & Brewing.
Sales nearly tripled the second year to $309,000 and are on pace to hit $750,000 in 2012. The partners hired their first employee in April, an assistant brewer, and have signed with a distributor, Wine Warehouse — freeing Marcello from making every sale and delivering every keg from his van.
It's all quite nice. But getting there? In Elliott's word, insane, especially for two guys whose knowledge of beer had been: "We drank a lot of it." Even the idea of opening a brewery was something of an accident.
As Elliott recalled, the idea for Strand came via a misunderstanding. He and Marcello had a third friend, an avid home brewer who dreamed of starting a microbrewery — someday.
The home brewer's wife talked to Elliott's wife one day late in 2008 and afterward, Elliott's wife told him his friend wanted to open a brewery — now.
Elliott jumped at the idea, discovering only later that something had been lost in translation. The home brewer had no immediate plans.
But Elliott pushed on, persuading Marcello to join him.
Neither had a business background. They had no business plan, no budget. "Nope, we just knew we had to get some money," Elliott said.
Friends and relatives put up about $85,000, in return for promises to repay at 7% interest. The partners leased a unit in Telo Industrial Center in April 2009 and began converting it into Strand, taken from the name locals give to the pathway lining the beaches of the South Bay.
Kevin Day, beer manager for Wine Warehouse, said the partners had two things going for them at the start: smarts and luck. Both were evident as Strand caught the craft beer wave, he said.
The industry, born in Northern California in the 1970s, took flight in Los Angeles only in the last four or five years. The market here is young and growing fast, said Paul Gatza, director of the Brewers Assn., a craft beer industry group headquartered in Colorado.
The rising demand means opportunities for Strand and the roughly 20 other microbreweries operating in Los Angeles, Orange, Riverside and San Bernardino counties. Those are all craft beer breweries, which means they meet certain industry standards, chiefly that they are independently owned and small.
That certainly describes Strand three years ago, when it was all of 1,000 square feet.
Elliott and Marcello started by dividing responsibilities to match their wildly different personalities. It turned into a sound business decision. "If you have two Riches or two Joels, this doesn't work," Day said.
Elliott, 36, is solitary, lean of speech and likes to make things with his bare hands. The son of a handyman, he built much of the brewery — carpentry, plumbing, wiring and so on.
He is president — and brewer, government liaison, and the maintenance and art departments.
Marcello, 44, is Strand's irrepressible front man, with an ease among strangers, a salesman's savvy and knowledge drawn from decades as a bar and restaurant manager.
He is vice president — and sales, distribution, promotion, and accounts payable and receivable.
After five months squaring away the brewery, the pair were ready for their first brew in September 2009. The partners used the only fermenters they could afford — small ones, each capable of producing seven 31-gallon barrels.
They chose a pale ale home recipe and multiplied for the larger volume. It was an unfortunate choice, or so it seemed initially. "It turns out, you can't just scale up a home recipe," Elliott said with a wry smile.
Accidentally, they had cooked up an IPA, the popular shorthand for India pale ale, an intense brew with more alcohol and hops than a pale ale. Instead of classifying it, they slapped on the name Genesis and prepared for a coming-out party.
Marcello targeted the popular Naja's Place on the Redondo Beach Pier. Assistant General Manager Martin Svab said he took an instant liking to Marcello and, because the bar believes in supporting local brewers, agreed to buy one 15.5-gallon keg for $135.