Craft beer is dying, but this brewer is bucking the trend | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Craft beer is in decline. For the first time in nearly two decades in the U.S., more breweries closed in 2024 than opened, according to the Brewers Association.

But one brand, Dogfish Head Brewery, is celebrating its 30th anniversary and bucking the trend, expanding its business and staying relevant while others close their doors.

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Part of the decline is a hangover from the pandemic shutdowns, which hit restaurants and breweries hard.

Even as pandemic restrictions lifted, breweries found themselves in an altered landscape. Many didn’t survive.

The ones that did faced a new set of challenges. At the top of the list: rising rents and labor costs, supply chain disruptions, and inflation on ingredients and packaging.

Then came tariffs, affecting brewing equipment, steel kegs, and aluminum cans. These headwinds made the financial pressures facing many brewers impossible to overcome.

Dogfish Head Brewery is celebrating its 30th anniversary, even among a downturn in craft brewing.

Image Source&colon; Bloomberg/Getty Images

Why Americans are drinking less beer, and what it means for craft brewers

The entire alcoholic beverage industry has been facing an existential problem: changing consumer behavior.

Americans are drinking less beer, particularly younger consumers, who are opting instead for hard seltzers, canned cocktails, nonalcoholic drinks — or skipping alcohol altogether.

Recreational cannabis is now legal in 24 states, which is also taking a bite (sip?) out of the market.

Then there is the growing use of Wegovy, Zepbound, and Mounjaro, drugs that curb appetite and often reduce alcohol cravings.

Amid this perfect storm, Dogfish Head Brewery stands out as an exception — and a blueprint for resilience. The Delaware-based craft brewer is marking its 30th anniversary in 2025 with continued growth and a broader business model that’s helping it weather the industry downturn.

“Weed, wellness, and weight-loss drugs are all impacting the way people drink,” Dogfish Head Brewery founder Sam Calagione told TheStreet in an exclusive interview. “Instead of fighting that, we’ve expanded the portfolio to meet people where they are.”

Inside the Boston Beer deal

When Dogfish Head founders Mariah and Sam Calagione started making beer for their Delaware restaurant in 1995, they had no idea they were at the forefront of a new industry; twenty years in, Dogfish Head Brewery’s sales were reportedly between $110 and $120 million.

Then, in 2019, Dogfish Head announced it was merging with The Boston Beer Company, bringing the country’s second-largest craft brewer (Boston Beer, maker of Samuel Adams) together with the 13th largest, Dogfish Head.

The merger was massive, but it preserved the independent craft brewery status of both brands, as defined by the Brewers Association.

The Boston Brewing Company acquisition was worth around $300 million in cash and stock to the Calagiones. Following the merger, Calagione joined Boston Beer’s board of directors, and he and his wife Mariah are the company’s largest individual shareholders outside of Jim Koch, founder and chairman of The Boston Beer Company.

Today, Dogfish Head’s portion of the Boston Beer Company’s sales is around $275 million (out of a total $2.01 billion), according to RocketReach.

Dogfish Head Brewery’s secret: innovation and diversification

So what’s Dogfish Head’s secret? There’s more than one.

First, Dogfish Head has been making ready-to-drink canned beverages almost since day one. The company distills its own Dogfish Head spirits, including vodka (“Awe-Spray”), gin (“Compelling”), and rum (“Barrel Honey”) for use in its Vodka Lemonade, Vodka Mule, and Rum Mai Ta, among other drinks.

Dogfish Head’s business model, which Calagione calls “beyond beer,” isn’t limited to just beverages. The company operates a boutique hotel in Lewes, Delaware, as well as brewery and distillery tours that he says draw hundreds of thousands of visitors annually.

Retail closings:

This hospitality component adds a revenue stream independent of distribution or retail, and gives the brand a valuable experiential marketing engine. Visitors become loyal customers, and the tours reinforce Dogfish Head’s position as a craft pioneer.

That kind of vertical integration — product, experience, and lifestyle brand — is a key differentiator in an otherwise saturated industry.

What’s next for craft beer?

Dogfish Head has always been known for its off-centered ales, using unexpected ingredients – from black limes and saffron to Mace and even human saliva – to create bold flavors.

One of its earliest successes was Midas Touch, a beer brewed with honey, white Muscat grapes, and saffron, inspired by an ancient recipe found in a 2,700-year-old drinking vessel from King Midas’ tomb.

The company’s bestselling beer today is its 60 Minute IPA, which Calagione says gives him inspiration even as he rethinks his own drinking.

“I spend 60 minutes every day on a paddle board or my mountain bike out in the bounty of Mother Nature,” he says. “I do that to earn my beer calories for the evening.”

When Dogfish Head Brewery was founded, Calagione says there were 600 craft brewers in the U.S. Today, there are around 10,000, so there is a lot of competition to fend off, but Dogfish Head is a model showing how craft breweries can evolve into multi-channel businesses that go beyond beer.

“Short term we’re facing some challenging trends, but we need to remember beer’s been around and part of human community building for 10,000 years,” he said. “There are a lot of closings and bankruptcies and sad stories,” Calagione said. “So we’re really excited to tell the story of how we’re bucking those trends.”