Lagunitas Brewing Co. has been on a wild ride over the last few years. Founded in 1993, the Petaluma, California–based brewer has become a national craft player, and its flagship Lagunitas IPA has more than tripled to nearly 6 million cases since 2012, according to Impact Databank. Heineken International took a 50-percent stake in Lagunitas last September for a rumored $500 million, with an eye toward domestic and international expansion. The deal gave Heineken a strong foothold in craft beer and will provide Lagunitas with the resources to continue to expand aggressively.
The flagship Lagunitas IPA, first introduced in 1995, is made with 43 types of hops and 65 malts. Since 2012, the label has advanced by more than 4 million (2.25-gallon) cases, according to Impact Databank, driven by expansion to the East Coast. In 2015, Lagunitas IPA grew 31.8 percent to reach 6.2 million cases, building on growth that exceeded 50 percent in both 2014 and 2013. Impact Databank projects the label will reach 7.5 million cases this year. And the 6.2-percent abv IPA is hardly the company’s only success story. The 7.5-percent abv Little Sumpin’ Sumpin’ pale ale joined its portfoliomate on Impact’s “Hot Brands” list for the first time this year after a 34.9-percent gain to 1.4 million cases in 2015.
Beyond its flagships, Lagunitas has always had a diverse product range. Its year-round lineup features over a dozen brews, from traditional offerings like Pils lager to such eclectic labels as Aunt Sally dry-hopped sweet tart sour mash ale and Lagunitas Sucks Brown Shugga’ Substitute ale. In addition, the company offers seasonals like Wilco Tango Foxtrot imperial brown ale. The One Hitter Series features such limited-edition brews as High West-ified Imperial Coffee stout—finished in High West rye whiskey barrels. The company released its first canned beer, 12th of Never, in July 2016.
Lagunitas has breweries in Petaluma and Chicago, and combined capacity totals around 1.2 million barrels. The company is building a third brewery in Azusa, California, which is expected to open in 2017 and add at least 400,000 barrels of capacity. Lagunitas founder Tony Magee told Shanken News Daily last year that the decision to build another California brewery was strategic. “In California and in the Pacific Northwest, we’re still seeing many more beer lovers coming over and liking what they find,” he said. “That’s why we need more brewing capacity here on the left coast.”
The outspoken Magee is the public face of the brewery, which has cultivated an edgy yet laid-back reputation that appeals to millennials and Gen-Xers. The culture made the brewery into a national player in craft beer—before the Heineken deal, Lagunitas was the country’s sixth-largest craft brewery, according to the Brewers Association—and those values will propel the company forward. Under the agreement, Lagunitas will continue to operate with complete independence. Magee continues in his role as executive chairman, and senior management, brewers and staff remain in place.
Heineken struck the deal with Lagunitas partly to make the brand a key player in the nascent market for U.S. craft beer sold abroad. Lagunitas IPA’s domestic growth is likely to continue at double-digit rates as well, but the brewery still hews to Magee’s original vision. “We’re doing the same sorts of things that we did over 20 years ago, only on a larger stage,” Magee said in 2015. “It’s very gratifying to find that those things are still attractive to beer lovers.”