Brewdog boss and co-founder James Watt has had a torrid year, but a renewed focus on building a different type of business that looks after the planet and its people has put him in a party mood ahead of its AGM in Aberdeen on Saturday.
The firm still retains a sense of brashness, dubbing its yearly update to shareholders as the “annual general mayhem” rather than annual general meeting – a name for affairs that are usually much more staid than what is promised for Hazlehead Park this weekend.
Everything you need to know about Brewdog’s 2022 AGM at Aberdeen’s Hazlehead Park
As part of the event, Watt and his business partner Martin Dickie will present an hour-long business update giving an overview of the “highs and lows” of the last year, such as what beers have launched, new bars opened as well as expansion plans over the next year – including the planting of trees on its Lost Forest estate near Aviemore.
Speaking to the Press and Journal ahead of the shindig, Watt also discussed lessons learned after several former employees launched an attack on bosses at the north-east beer giant accusing them of “lies, hypocrisy and deceit” and of fostering fear in their employees.
This sparked a significant series of changes the business has made, including Watt himself handing over a stake in the business worth £100 million to employees and the firm launching a generous profit share scheme for workers in its bars and restaurants.
Watt said the first instalment of profit share payment has just been calculated as being worth £300,000, and employees seem to be responding positively to changes.
“It has been a challenging year for us as a company after we received the open letter from team members just over a year ago,” he said.
“Since we received that our response has been very robust.”
Brewdog ‘could have done more’ for staff
He admitted that, in retrospect the firm, “could have done more” for its people but efforts are paying off in terms of recruitment and staff loyalty.
He said: “We’ve added 800 people to our team in a tough labour market.
“People want to work for us and loads of staff in the company are very happy to be working for us.
“We responded in a really good way and we’ve got really great things in place. For us now as a company it is about moving forward, opening new locations and continuing to build the business.”
Difficulties of being a leader
Watt, who first founded the company with his fellow Peterhead Academy friend Dickie in Fraserburgh, admitted: “Being a CEO can be lonely.”
He also confirmed he was recently diagnosed as having “high functioning” autism and attention deficit hyperactivity disorder (ADHD).
It comes after speaking to entrepreneur and Dragons’ Den member Steven Bartlett recently for his Diary Of A CEO podcast, where Watt opened up about feeling a “bit socially awkward” and said he was seeking help from a specialist.
He said: “I don’t think it came as a massive surprise to myself or people close to me.
“It is interesting to work with specialists and use tools and take advantage of their knowledge to make sure I am aware of it and I channel it in the best way possible.”
As he looks towards the future, he admits he’s nervous about the economy as spiralling inflation and energy prices causes a cost of living crisis affecting the business and its customers.
Cost of a beer set to rise
He said costs to make Brewdog beer have risen 30% since the war in Ukraine, a shock which has affected the price of raw materials and fuel across the world.
He admitted inflation will affect the price of Brewdog products soon.
“I don’t think we have woken up to how bad inflation is going to be,” he said.
“I am nervous about what it means for the economy, particularly the UK economy which is performing worse than any other economy.
“It is going to be a tough six to 12 months ahead for consumers and for businesses.
“There’s no way any business can take a 30% increase in costs and not move pricing.
“We will have to do it the best way we can.
“We will have to make sure we are laser-focused on providing best value to consumers at a time when we know consumers have less money to spend.”
Nevertheless, Brewdog still has plans to float on the stock exchange – when economic conditions allow. This will enable those employees to realise the value of the shares in the company he gave to them – a move he said will make the business worth even more in the long term.
“I believe the equity I have, which is less now, will be more valuable in the long term because I have done this,” he said.
“By doing all these things we want to build a new type of business, a business that will look after the planet and that looks after its people, and a business that makes something it absolutely loves which is fantastic beer.”
As the event in Aberdeen approached, Watt, who is the son of a Peterhead fisherman, affirmed that Brewdog has “always been an Aberdeenshire business and proud to be based in north-east Scotland”.
“It is our home and the business’ home,” he said.
“To be able to showcase Aberdeen and what we do here to 10,000 people from all over the planet at the AGM is really exciting.
“We want to continue putting Aberdeen on the map for some of the best beer in the planet.”
Conversation