A 6-pack of Straight Drank, one of Two Roads Brewing Company's new seasonal non-alcoholic beers.
In 2018, the beer industry was rocked by a startling announcement: Constellation Brands, owners of Corona, Modelo, Ballast Point, and Funky Buddha Brewing was making an investment in cannabis.
It was a strangely lateral move for a company and industry that has spent several years playing within its own borders. In 2011, Anheuser-Busch InBev began the trend of purchasing craft breweries by picking up Chicago’s Goose Island. In 2014, Mahou San Miguel purchased a stake in Founders Brewing Company and another in Colorado’s Avery Brewing Company. In 2015, Duvel Moortgat — already the owners of Duvel, Liefmans, La Chouffe, Brewery Ommegang, and Boulevard Brewing — announced the purchase of Firestone Walker Brewing Company.
While Constellation’s investment in Canopy Growth Corp. was surprising, they weren’t the only beer company eyeing cannabis. Also in 2018, Molson Coors took a controlling stake in a partnership with Canada’s HEXO, while AB InBev invested in $50 million in the Canadian-based Tilray. Lagunitas Brewing Company — which is owned by Heineken — teamed up with CannaCraft to create the first-ever THC-infused, IPA-inspired Sparkling Water. Their Hi-Fi Hops is available in two versions: one with 5 milligrams of THC and 5 milligrams of CBD, and another with 10 milligrams of THC.
And yet, while Big Beer was eyeing cannabis, cannabis was looking back at beer: in 2017, Two Roots Brewing Company acquired Helm’s Brewing in San Diego. What seemed like another larger-brewery-acquires-smaller-brewery story was actually something much more interesting: Two Roots is the creation of a cannabis brand management company called Cannabiniers.
“We aimed to bring craft beer to cannabis,” said Michael Hayford, CEO of Lighthouse Strategies, the parent company to Two Roots Brewing and Cannabiniers. “To make this a reality we needed to start with a high-quality craft beer that could be converted into an outstanding non-alcoholic beer, laying the foundation for cannabis.”
Over the past two years, Cannabiniers has acquired Dad & Dudes Breweria in Colorado, and earlier this year announced that it had “letters of intent” to acquire four craft breweries, including a “top 20 privately held brewery in California.” The ultimate goal, as outlined in past interviews by Cannabiniers’ Vice President of Market Activations Kevin Love and reinforced by Hayford, is 500,000 barrels of production capacity.
As expected for a brand acquiring breweries, the Two Roots brand offers alcoholic products. And as expected for a cannabis brand acquiring breweries, they also offer psychoactive products. On August 27th, 2019, they’ll have one brand in three channels — alcohol, cannabis, and non-alcohol. The non-alcoholic Two Roots product will debut at BevMo! stores across California and will come in several styles, including core brands — lager, IPA, and wheat — as well as seasonal styles that include Mango IPA, Grapefruit Radler, and Straight Drank IPA (a collaboration with Jetty Extracts).
“The demand for high-quality, healthier, low-calorie products continues to grow, and we’re excited to kick off our mainstream entry with BevMo! in California, and continue to work with retail partners nationwide,” said Hayford.
It’s a smart move for a company already making cannabis-infused products, which require a non-alcoholic or de-alcoholized base. By marketing the base as a separate product, Cannabiniers diversifies their portfolio while also capturing one of the beverage industry’s fastest growing trends, which has increased at approximately an 8 percent CAGR over the past few years.
