I’m truly sorry it’s been so long since my last official update on the Ugly Beer, Beautiful World project.

I’ll give my best two excuses for that delay, and then continue on to the meat of the update.

1. Since late last year, I had been attempting to sell, and now have officially sold, my prior companyStackSource. I had worked on that company (along with a stalwart Co-founder) for 8 years. It was simultaneously being recognized as one of the fastest growing private companies in the country 🚀, and doomed to failure 😱 as the real estate capital markets crashed and burned nationally over the last ~two years. The company finally officially sold to a capital markets firm who coveted our tech platform in April, and I’m still in a consulting role with the new owner for a few more months.

2. We’ve kept Ugly Beer rolling forward slowly as a side hustle. We still love the vision of the project, but we’ve hit some walls that I’ll unpack below.

Boards and walls

A few months ago we gathered an advisory board of a few friends with varied yet impressive backgrounds that we hoped could help Ugly Beer in one way or another. They include a longtime beverage industry operator, a small business owner with a historic restoration business, a longtime employee in the city of Orlando’s waste management division, and a local politician who is well connected in Volusia County.

We laid out our mission and what we had accomplished so far, and jammed on ideas, problems, and potential next steps for the business. The four types of challenges of scaling this project map out to these:

1. Collect em - increasing our rate of bottle collection in our region where glass recycling is unavailable.

2. Clean em - increasing our capacity to scale this safely.

3. Fill em - our first and only product at the time was the Root Beer.

4. Sell em - the first channel was Farmers Markets, which was an excellent test ground, but not a scaleable sales channel.

My amazing wife Emily and I have been struggling most with segment 2, “Clean em”. Our current solution is setting up a tent in our driveway to wash bottles by hand for hours on end, then soak the cleansed bottles in PBW (a common brewing industry disinfectant), and finally to finish by running them through a commercial dishwasher at the commissary kitchen before bottling. “Clean em” also includes de-labeling bottles, which is easy for paper labels that are lifted off nicely in the PBW bath, but requires more personal effort for the many bottles that have plastic labels.

One of the key takeaways from this first advisory board meeting was from the beverage industry operator, and it was a bit discouraging: we should expect “Clean em” to get harder at scale, rather than easier. While the human effort per bottle will fall with the right equipment, the bacteria in the bottles will likely become resistant to our methods and harder to kill, requiring a more scientific approach to ensure bottles are safe for repeat use. This doesn’t seem to be a show-stopper, but rather a reality to accept and budget for as we project what this project can be.

Our metrics

If we’re only including sold bottles, we’re getting close to 1000 bottles “saved”!

You’ll note in the sales chart above that we recently tried introducing a new product, our “Ugly Brew” coffee. We will potentially adjust the full brand to Ugly Brew in the longer term, as it can capture coffee in addition to soda (or real beer). Our thinking was that our root beer has sugar but no caffeine, so adding a coffee product as an alternative was just the opposite (caffeine but no sugar).

New product aside, after the initial novelty/local press bump launching our brand locally, sales weren’t being sustained at Norwood’s Farmer’s Market. We held out for a bit before pivoting to try larger farmers markets nearby. Port Orange and Deland have more promise, but as a friend of mine quipped, “Ooh, if you did this all 52 weeks of the year, you could make over $8,000!”

Jokes aside, this sales channel really served the purpose of initial product validation, and the good news is there is demand for this type of product! Here are our current unit economics, inclusive of everything except labor per bottle washed since that is the wildcard:

Gross margins may end up being a bit lower for the Cold Brew Coffee, despite the fact that trials showed successful sales at a higher price point per bottle of $5. That is because we’re not coffee people, and getting the equivalent of good local coffee shop beans to cold brew is expensive.

Pipes and stuff

Here’s where I am struggling today. I can’t ask Emily to go out in the 100 degree heat with me and wash bottles, and we’ve learned most of what we can from the Farmers Market scene. This business needs to take a step forward, or a step back.

I have a pretty clear picture of what the operation may look like if we raise a couple million dollars for this as a venture, because that would allow us to get some fancy, automated bottle cleaning and filling equipment, and attack this as a two-sided market (Collections on one side, Sales on the other). But it’s not clear what the perfect next steps would be for a much smaller fundraise, and it can’t become profitable enough to sustain itself with our current setup.

It may be that I’m in need of a true Co-founder for this company. My top priorities for co-founding relationships are matching values, followed by complementary skills and backgrounds (I have no consumer product experience prior to this project, let alone beverage or waste management!), and of course, culture fit.

While we think through the potential for a Co-founder search or other options, we are going to pause production and sales of Ugly Beer for the next couple of months while we work through the proper next steps for this project. I’m going to continue picking up bottles from a couple of local establishments so we don’t completely fall off the map with those partners, but I’m simply washing them and putting them in a local storage unit for now.

We’re 100% open to feedback about some of the roadblocks we’re facing and our thought process about how to take next steps. I’d also be extremely excited if anyone is able to introduce me to potential partners that might be Co-founder material!

With love for you and our awesome planet,

Tim