BeerShop's Hangover Thoughts Series: Silicon Valley’s Unchecked Arrogance

In its mind, Silicon Valley creates the future, while the rest of the world will soon become the “idle class.” What if they instead helped people build wealth for themselves?

By Ross Baird and Lenny Mendonca

 

Last month, Y-Combinator, Silicon Valley’s blue-chip startup fund, announced a request for proposal to study a universal basic income. Sam Altman, the President of Y-Combinator, wrote in a separate essay that in the future, we will have a “smaller and smaller number of people creating more and more of the wealth. And we need a new solution for the people not creating most of the wealth — many of the minimum wage jobs are going to get innovated away anyway.”

The people without jobs will be an “idle class” — and the obvious conclusion, to Altman, “is that the government will just have to give these people money.” (Emphasis ours.)

And you wonder why political candidates on both sides are tapping into anti-elitist anger with great success.

Silicon Valley is, with good reason, the envy of the entrepreneurial world. Brilliant people have created transformative companies — and have earned a great living in the process. Facebook and Twitter have given people the ability to express themselves in authoritarian governments; the inventors of the mobile phones have brought information and services to billions; and Google makes the world’s information available to everyone.

But Silicon Valley’s view towards the rest of the world is often one of unchecked arrogance.

In the universal basic income proposal, the Y-Combinator team posits that Silicon Valley’s wonderful creations will create an incredible amount of wealth, but will put a lot of people out of work. Silicon Valley frequently worries, for example, that if self-driving cars are commercialized, truck and taxi drivers will be out of work. As such, a universal basic income will ensure that they’ll be happy and society will be successful. It’s a seductive idea, but they are asking the wrong questions.

The idea here is borne from an underlying assumption that capitalism has winners and losers, and the victors have a responsibility to take care of the rest. Instead, we’d posit that many of the “winners” in Silicon Valley are part of a faux meritocracy — being born into the right city or social network.

Silicon Valley seems to be worried that the rest of the world won’t find its way. A recent podcast from venture firm Andreessen Horowitz described how a few “Alpha Cities” are going to drive the future, while other metropolises will struggle to find their meaning. When India didn’t go for a Silicon Valley-led internet proposal, Marc Andreessen gained global denunciation (including from Silicon Valley CEOs such as Mark Zuckerberg) for a tweet that said, “Anti-colonialism has been economically catastrophic for the Indian people for decades. Why stop now?” And Y-Combinator themselves say that for startups to be successful, they have to move to Silicon Valley. “We would not be doing a startup a favor by not making them move,” their website reads.

So Silicon Valley, in its own mind, creates the future, while the rest of the world (by virtue of zip code or differing world view) should follow suit or risk being left behind.
One could take this to its logical (and cynical) conclusion and say that the rest of the world will eventually be out of work and become a burden on the enlightened few. They’ll storm the gates of Silicon Valley’s kingdom, and the resulting social unrest will be an unfortunate distraction to the wonders of artificial intelligence, research into extending life past the age of 120, and other great wonders of modern technology.
The universal basic income will keep “these people” at bay.

YCombinator and their Silicon Valley counterparts often talk about the value of geography. The best ideas, we are led to believe, come from a small stretch of earth close to San Francisco.

James Fallows in a recent Atlantic essay describes how most of America’s elite believe in “The Big Sort” — that to be successful, one must be sorted into a few metro areas: San Francisco, New York, Boston, perhaps Seattle or Washington D.C. When it comes to people investing in new ideas, this is absolutely true. 78% of investment in startups goes to three states (New York, Massachusetts, California). While in the past 20 years startup investing has increased 300% in those states, it has actually declined in the other 47 across the country.

Silicon Valley has become a “monocrop” culture where entrepreneurs are well-educated, have frictionless access to capital, and have their basic needs taken care of. The majority of resources today are going to entrepreneurs whose lived experience is in well-off, well-connected cities.

Successful startups are born at places like Y-Combinator and go through the venture capital gauntlet frictionlessly — the same way big factory farms across America churn out cheap corn and beef.

Yet there is a problem with monocrop culture: ultimately, you deplete the soil. In a recent podcast with Kleiner Perkins partner Randy Komisar and legendary Silicon Valley “coach” Bill Campbell — mentor to Steve Jobs and Larry Page — Randy asked whether, over time, entrepreneurs were solving increasingly frivolous problems. Campbell responded, tellingly, that entrepreneurs solve problems that they can understand.

“While you and I might think Snapchat is frivolous,” Campbell said, “my grandchildren find it a great solution for how better to communicate with their friends.”

Snapchat may be solving an important problem for well-connected young people in America who don’t have to worry about basic needs. But whether it’s unemployed young people in St. Louis looking for their next paycheck or a family in Flint, Michigan worried about clean water, many Americans have more immediate problems.

But the entrepreneurs there — “those people” —often don’t have access to resources or opportunities to solve their problems. And Silicon Valley can’t foresee a future where St. Louis or Flint could create the jobs of the future.

Because most of today’s entrepreneurs have their basic needs taken care of, their problem-solving often seems frivolous to the rest of the country.

Take Uber, for example. Uber’s great at solving how people with smartphones and disposable income can get around major cities — a small fraction of the global population. Uber is less good at helping the drivers, whose income is much lower than the riders, benefit from this new paradigm. Uber has hailed their impact as letting people work flexibly and use assets more productively, but strategically is investing hugely in driverless cars.

And we don’t blame Travis Kalanick (actually we do, but that’s not the point of this story). Uber’s founders’ experiences are as riders, not drivers. But imagine an ownership structure in which, for example, drivers could earn fractional equity in the company for each ride they gave. What if a percentage of the $50B valuation were shared among the drivers, based on a merit-based system?

We’re not saying that Uber should do this (they can’t at this stage); we are saying that if Uber’s leadership had different lived experiences, the company might look different.

The universal basic income (UBI) is not a new idea. Richard Nixon originally proposed it in the early 1970s. Manitoba, Canada and Uganda have tried it, as have European countries like the Netherlands and Sweden, and political parties in India and Brazil. Andy Stern has a book coming out shortly about how to make it work in the United States. Done well, it could smooth volatility and provide some base stability for those who need it most, and even encourage risk-taking and help better deploy outdated, government-run welfare approaches.

And Y-Combinator’s thesis isn’t misguided. There is definitely a conversation worth having about what happens to society after software has eaten the world. But the conclusion — that the automation of these jobs will create a lot of wealth for a few people (of course the brilliant ones in Silicon Valley) but leave most out of work (the rest of us) — is reflective of Silicon Valley’s arrogance.

It seems like noblesse oblige for Silicon Valley to throw coins at the 90% of the population that will no longer have a job, thanks to their inventions. But the reality is most people don’t want just a universal basic income.

We need to figure out how to make the system work for everyone in the face of technological changes. We need policymakers to incentivize regional and industry diversity in our innovation, and entrepreneurs to focus on the larger, thornier questions related to building businesses that share the wealth better among those who create them — not design a system to spread the crumbs a little better.

How do we change ownership structures to prevent Snapchat, Instagram, and Whatsapp from distributing billion-dollar windfalls among only a couple dozen people? How can we enable great people, regardless of zip code, to solve messy societal problems? To us, these feel like much more constructive approaches than calculating the minimum income required to eliminate “the fear of not being able to eat.”

So there’s the problem. How do we change this? We have some ideas, but would love to hear from you as well. And you can contribute to the conversation on social media with #ReinventVC!

When a Craft Beer Is Released, Beer Geeks Go Crazy

FRENZY

02.15.16 7:01 PM ET

When a Craft Beer Is Released, Beer Geeks Go Crazy

If you thought the world of craft beer would be more civilized than the frenzied shoppers of Black Friday, think again. The furious mobs descend when a new beer comes out.

This most recent Black Friday saw the annual release of Goose Island’s Bourbon County Brand Stout, a highly touted offering that sends people scrambling to find bottles--and, in turn, acting just as childishly as what’s seen in those viral videos of Wal-Mart customers pursuing discounted televisions.

Unfortunately, the pushing, shoving, line-cutting, and fights are not surprising because, as of late, the rise of limited craft beers has led to a similar rise of beer geeks behaving badly.  

Firestone Walker Brewing did a special release on Black Friday for Parabajava, a highly anticipated coffee version of the California brewery’s acclaimed Parabola imperial stout.

It was sold at only three locations, at none of which one could purchase more than four bottles. But, as Jemma Wilson, Firestone Walker’s marketing specialist tells me, “Never underestimate a beer geek.”

At 10 p.m. that night, Wilson got a text from a fellow employee telling her someone was bragging online about having somehow scored 54 bottles of Parabajava.

Comments on Firestone Walker’s Facebook page derided the man, before turning on the brewery itself for allowing such a great tragedy like this to occur.

Relaxing at home, Wilson opened her computer to find an avalanche of nasty comments and hate emails.

Even worse, she soon learned the man was now trying to re-sell his 54 bottles—something technically illegal—for $80 each (they had retailed for around $20). 

Wilson issued an apology to Firestone Walker’s angry fans, but it was too late. Someone had figured out Mr. 54 Bottles’ home address and posted it online.

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Now still-seething beer geeks were making threats toward him and his wife. By the next morning the man had deleted his Facebook account and was threatening legal action against the brewery.

“I think the entitlement that comes with beer geeks is that they’re able to hide behind their computers and spew hate comments as though there are no repercussions,” Wilson tells me. “But many forget we are real people who sit there being verbally abused by complete strangers all the time.”

It’s not just some once-a-year, Black Friday phenomenon. This crude behavior occurs with just about every beer release, something that happens most weekends in some city or another. It would be completely hilarious, if it weren’t so pathetic.

There’s a YouTube video that shows just what this looks like in the flesh. The brief clip open on what sounds like a mob scene.

The camera is pointed toward a nearly empty, somewhat ransacked warehouse where a man in a logo-ed work shirt holds his palms up, trying to calm the angry mob.

Tampa police officers step in to help, but that just stokes the flames. Eventually, the men have no choice but to pull down a steel garage door and block themselves, and the warehouse, from the throbbing masses.

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As the door lowers, men in beards start pounding on it and chanting: “Cigar City sucks! Cigar City sucks!”

A protest? A demonstration? 

Nope, just angry beer geeks.

This was the 2014 release of Cigar City Brewing’s Hunahpu’s, yet another acclaimed imperial stout. And these frothing hoards had simply not gotten to purchase some of it. 

To get into Hunahpu’s Day required a $50 ticket with attendance capped at 3,500. Attendees would be allowed to buy up to three bottles of Hunahpu’s. While sales were going on, ticket-goers could enjoy other beers on tap in the brewery parking lot.

The problem? Some beer geeks created counterfeit tickets.

With no way to know which tickets were real and which weren’t—and with the line to get inside stretching a half-mile long—Cigar City made the impromptu decision to leteveryone in the doors. With far more than 3,500 people inside, bottles sold out quickly and many legitimate customers were shut out before getting access to their three guaranteed bottles.

That’s when the YouTube video picks up.

“I am acknowledging defeat. That was the last Hunahpu’s Day,” Joey Redner, Cigar City founder—and that man in the YouTube video with his palms held up—said in a statement the next day. (It returned for a sixth year in 2015, nevertheless.)

Jester King in Texas is another brewery that has had to spend far too much time trying to figure out how to get their coveted beer to customers without the subsequent shenanigans. This acclaimed Hill Country farmhouse brewery has been beset with countless beer geeks behaving badly.

“Limited beer releases do inevitably bring about ugliness and silliness,” Jester King founder Jeffrey Stuffings tells me.

On the silliness level was 2014’s infamous Montmorency vs Balaton Blend 2 release.

So few bottles were produced they were restricted to one per customer. That didn’t stop industrious beer geeks from finding ways to subvert that.

“Our staff recounted stories of patrons going to their cars to change their clothes, as well as putting on hats and sunglasses to disguise themselves,” Stuffings tells. “One guy tried speaking in a fake Irish accent to try and fool us into thinking he was a new customer who had not yet purchased his allocation. When caught, he simply said, ‘A guy’s gotta try.’”

Stuffings also shared with me an amusing photo he snapped during a recent release of Atrial Rubicite, perhaps Jester King’s finest beer.

In the photo, a young man holds the hand of a feeble-looking elderly woman, one we can only assume is his grandma, perhaps even great-grandmother—and who we likewise can assume he’s only brought along in order to help him “mule” extra bottles of another one-per-person beer.

Similarly, a beer fan on Instragram caught another elderly woman hauling away limited cans from Tree House Brewing. He comically dubbed her the “Grandmule.”

On an uglier level, Stuffings tells of customers buying bottles and then immediately setting up black market booths out of their car trunks in his brewery’s parking lot.

He was also aghast to find a man who devised a scheme in which 40 out-of-towners would give him $20, after which he would raffle off his single bottle of Sherry Barrel Atrial Rubicite to one winner, thus netting himself $788 (the beer costs $12). 

“In other words, people apparently paid $20 for a 1-in-40 chance of winning the beer,” Stuffings laments. 

As beers’ perceived secondary market value only soars higher and higher, bad behavior just seems inevitable.

I’ve grown tired of the madness of beer releases. Still, when my local brewery Other Half announced they were releasing a special collaboration IPA they had made with Trillium—a well-regarded Boston brewery—I knew I had to attend.

Others clearly felt likewise.

“We don’t really spend time looking at social media so we were kinda caught off-guard with how crazy that release would be,” Matthew Monahan, a co-founder of Other Half, told me.

While waiting in that snaking line I was approached by a man who handed me a card that read Same Ole Line Dudes, “professional line sitting/management services.”

He was offering to sit in line for me for a small fee. Some people actually took him up on that offer. TaskRabbit also reportedly had several “employees” at the release, acting as line proxies for beer geeks with money but no desire to actually wait in line.

These professional line-sitters raised the queue’s ire once discovered, but as Monahan told me, what could he do? It’s perfectly legal and he was far too busy worrying about getting his beer sold and out the doors in an efficient manner.

Still, those people who paid for line-waiters were onto something. A much-larger crowd than expected showed up and many people, myself included, found themselves waiting upwards of five hours for a mere eight cans of Street Green.

Soon, a devil-may-care attitude overtook the bored crowd, and people starting cracking beers and lighting up joints within the brewery’s residential neighborhood. Eventually the police arrived.

“We now have to notify the local precinct when we do these releases,” Monahan tells me. “They are certainly aware of what goes on.” 

Other Half releases are some of the best-behaved in the business from what I’ve seen. At least I didn’t witness any fights, something that can’t be said for a release that same month courtesy of Hill Farmstead.

Perhaps the best brewery in the world, and set on a bucolic family farm in Greensboro Bend, Vermont, Hill Farmstead is not exactly the easiest brewery in the country to access.

If any brewery could remain somewhat removed and immune from beer geeks behaving badly, it would surely be this one. But at the release of a farmhouse ale called--I swear--Civil Disobedience, a fight almost erupted when one man was kicked out for trying to mule more bottles than allowed.

Reportedly the man even tried to fight brewery owner Shaun Hill before, yes, the cops had to be called.

Even so, the beer geeks behaving badly coup de grace surely occurred at Iowa’s Toppling Goliath late in 2014.

In this case, one local resident was caught snapping up bottles of the brewery’s sought-after stout Assassin, drinking the limited beer himself, and then refilling empty bottles with something else.

He’d then add his own shoddy wax-dipping job and trade these counterfeits for other highly-coveted offerings.

Not surprisingly, Toppling Goliath founder Clark Lewey doesn’t have much interest in revisiting such a sordid incident, telling me, “Long story short, the beer community, not us, outed the guy and hopefully put an end to his foolishness. Of course, there is nothing we can do as a brewery. Just like any product, once it is sold it is out of our hands and control.”

The fact is, nowadays if you produce great beer in limited quantities, it seems to assure the ugly side of human nature will eventually rear its head. Everyone feels entitled to these beers, it’s the “everyman’s drink,” right?

Jester King has had to resort to marking forearms with invisible ink to prevent people from re-entering the line (fake Irish accents be damned!) and are considering swiping driver’s licenses in the future.

Other places, like Other Half and Hill Farmstead, wait until almost the last minute to publicly announce releases, hoping to limit crowds.

Cory King of Side Project Brewing has a strategy that also seems to work. He under-promises the amount of bottles that will be available, then over-delivers on release days, something that made for a much more positive YouTube video of beer geek behavior.

Unfortunately, releases free of bad behavior are more the exception than the rule. With craft beer only getting hotter and more and more geeks joining the hobby every day, the whole scene is surely only going to get worse.

“I just want to scream ‘IT’S JUST BEER!!!’” Wilson tells me, “but they act like it’s the cure to cancer.”

A Craft Beer view from across the pond..

As ‘Big Beer’ turns to microbreweries, Roger Protz worries for the future of craft ales.

Have we taken our eyes off the ball? Beer lovers spent most of 2015 rejoicing at the surge in sales of quality beer and the unstoppable rise of small independent breweries. And yet, quietly and stealthily, giant global brewers have been moving into the craft beer sector.

Within a few weeks, the merger of AB InBev and SABMiller will create a corporation of frightening size. It will account for 30% of all the beer brewed around the world.

But the new conglomerate will not rest on its oars. It is crucially aware that its big bucks brands are flat-lining. It has not only witnessed the rise of craft beer and brewing but is taking urgent steps to address the situation by muscling in on this vibrant sector of the beer market.

Writing in the American journal Money last month, business commentator Brad Tuttle said: “Big Beer’s strategy is to put the pesky craft category in its place — or even destroy it, if possible. Craft’s portion of overall sales has doubled over the past five years while ‘macro’ beers like Budweiser and Miller have gone flat or declined.”

The first warning shots were fired last year when SABMiller bought the Meantime Brewing Company in south-east London. That takeover has quickly turned sour. AB InBev says it will dispose of Meantime, which puts the Greenwich brewery “in play” as they say in City circles.

The sale doesn’t mean AB InBev has no interest in the British craft sector. On the contrary, just before Christmas it swooped and bought the Camden Town Brewery in north London for an estimated £85m. Unlike Meantime, which has grown so fast it scarcely qualifies as a “small craft brewer”, Camden is small and bullish about its craft credentials.

I was present at a meeting at the Beavertown Brewery in north London last summer when Jasper Cuppaidge of Camden and Logan Plant of Beavertown announced they were creating a craft brewers’ alliance along with BrewDog and other producers of modern keg beers. The plan was to cut a decisive new image in the industry, putting themselves outside the ranks of SIBA (the Society of Independent Brewers).

But that alliance is now stillborn, with BrewDog removing all Camden beers from its pubs while Cuppaidge says the takeover will enable Camden Town to build a bigger plant in Enfield where he will “continue to make great beer”.

Time will tell but the omens are not good. Global brewers not only think big and want to centralise production in large brewing plants but they also have a long track record of cutting costs by using cheaper ingredients.

In the 1990s, when I visited Chicago, I went to a brewpub called Goose Island, founded by father and son John and Greg Hall. The beers, Goose Island IPA in particular, were excellent and demand encouraged the Halls to build a bigger, stand-alone brewery at Wrigley Field in Chicago. In 2011, Anheuser-Busch, now the AB of AB InBev, bought Goose Island for $38m. Greg Hall left and John Hall has now retired.

What has happened to Goose Island gives a frighten-ing insight into the way in which global brewers think and operate.

The Chicago brewery still operates and produces small-run specialist beers. But the main brands — Goose Island IPA, Honkers Ale and 312 Urban Wheat Ale — are produced at a new brewery built by AB in Baldwinsville, New York State, and have been relabelled simply Goose. IPA is also brewed at a major AB brewery in Fort Collins, Colorado, and at two Labatt’s plants in Canada.

Goose IPA has been turned into a major brand, on sale in the UK as well as the US. A spokesman has admitted that the original yeast
culture used to make the beer has been dumped because it wasn’t suitable for big-batch brewing. The Chicago beer used a blend of American hops with varieties from Slovenia and the Czech Republic, but all the hops are now sourced from AB’s Elk Mountain Farms in Idaho.

You can buy Goose IPA in most British supermarkets for £1.65 a bottle. You will also find Lagunitas IPA on sale at the same price. Lagunitas was a highly regarded craft brewery in California but Heineken has taken a 50% stake in the company and is using its marketing clout to ramp up sales at home and abroad.

The profit on a beer sold for £1.65 is marginal but there’s money to be made if you sell a lot of it. The speed at which Lagunitas IPA is moving off the shelves in my local supermarket suggests Heineken will be well pleased with its investment. Genuine craft brewers can’t possibly sell beer for such low prices and will find themselves driven off the shelves.

AB InBev, SABMiller and Heineken have either taken over or bought stakes in an alarming number of American microbreweries. They
are now turning their attention to the UK.

If you think I’m crying wolf, remember: in the end the wolf got the sheep.

Lemmy, Motörhead frontman, dies at 70 from The Guardian Tuesday 29 December 2015 13.32 EST

Ian “Lemmy” Kilmister, founding member and singer in the British heavy metal band Motörhead, has died at the age of 70 shortly after learning he had been diagnosed with cancer.

The band announced on their Facebook page that Lemmy learned of the disease on 26 December, and was at home when he died.

Lemmy, born Ian Fraser Kilmister, formed Motörhead in 1975 and was its only constant member, as singer and bassist. The band released 23 studio albums and are best known for their 1980 single Ace of Spades.

The band requested fans “play Lemmy’s music LOUD. Have a drink or few. Share stories. Celebrate the LIFE this lovely, wonderful man celebrated so vibrantly himself.

“There is no easy way to say this … our mighty, noble friend Lemmy passed away today after a short battle with an extremely aggressive cancer. He had learned of the disease on 26 December, and was at home, sitting in front of his favourite video game from The Rainbow which had recently made it’s way down the street, with his family.

“We cannot begin to express our shock and sadness; there aren’t words.

“We will say more in the coming days, but for now, please … play Motörhead loud, play Hawkwind loud, play Lemmy’s music LOUD. Have a drink or few.

“Share stories.

“Celebrate the LIFE this lovely, wonderful man celebrated so vibrantly himself.

“HE WOULD WANT EXACTLY THAT.”

The band signed off: “Ian ‘Lemmy’ Kilmister 

“1945 -2015

“Born to lose, lived to win.”

 

And if you want to see why Lemmy was pure Rock and Roll, check out him here...

https://www.youtube.com/watch?v=YqJWVJwgLJg

 

 

 

The Close Ties Between Exercise and Beer

 

By 

GRETCHEN REYNOLDS

 DECEMBER 2, 2015 5:45 AM December 2, 2015

For many people, working out and alcohol are closely linked. Sports teams and training partners celebrate victories, bemoan defeats or mark the end of training sessions with a beer or three. Beer, in fact, provides a substantial portion of some exercisers’ fluid intake after workouts. 

But whether exercise encourages people to drink and, likewise, whether drinking encourages people to exercise has been in dispute.

Now two new studies suggest that exercise may well influence when and how much people drink. Drinking may even affect whether people exercise, and, the findings suggest, the interplay between exercise and alcohol could be a good thing. 

Past epidemiological studies have shown that people who exercise tend numerically also to be people who drink, and vice versa. In a typical study from 2001, for example, researchers found that men and women who qualified as moderate drinkers, meaning they downed about a drink a day, were twice as likely to exercise regularly as teetotalers. 

But most of these previous studies had limitations. They relied, for instance, on people’s ability to recall their exercise and drinking habits over the course of, say, the past year, which can be notoriously unreliable. They also rarely took into account participants’ ages and gender, which affect how much people exercise and drink. 

And perhaps most problematic, these past studies rarely determined whether people’s exercise and drinking tended to go hand in hand, suggesting a strong link. In other words, someone might work out on a Thursday and then imbibe on Friday evening with friends, providing no obvious connection between the activities. But in many earlier studies, he or she probably would have been categorized as an exerciser who drinks.

So to better untangle the relationship between drinking and sweating, researchers at Pennsylvania State University, in the most scientifically ambitious of the new studies, turned to a representative group of 150 adult men and women age 18 to 75 who already were enrolled in an ongoing, long-term health study at the university. 

They asked these volunteers to visit the lab and fill out extensive questionnaires about their lifestyles, and then provided each of them with a simple smartphone app that could be used to record a day’s drinking and exercise activities. The app would automatically send each day’s report to the scientists. 

The volunteers agreed to use the app for 21 consecutive days. Over the course of about a year, covering different seasons, each participant completed three of these 21-day reports.

When the researchers collated and compared the data from their volunteers, they found, for the first time, an unequivocal correlation between exercising on any given day and subsequently drinking, especially if someone exercised more than usual. As the scientists write in their study, which was published recently in Health Psychology, “people drank more than usual on the same days that they engaged in more physical activity than usual.” 

This relationship held true throughout all seasons of the year and whether someone was a man or a woman, a collegian or a retiree. Age and gender did not affect the results. 

Thankfully, the data did not show that exercise incited or exacerbated problem drinking. Only very rarely during the study did anyone report drinking heavily, which the researchers defined as downing more than four drinks in succession for a woman and five for a man. 

But of course this kind of epidemiological study cannot determine why working out and drinking should be associated at all, which makes the second study, a newly published review of past, related experiments, especially those involving animals, so compelling.

In the review, published in Frontiers in Psychiatry, the authors point out that in lab rodents, both exercise and alcohol have been shown to increase activity in parts of the brain related to reward processing. The animals seem, in animal fashion, to get a kick out of both exercise and drinking. 

But while the animals’ brains responded similarly to the two activities, they did not respond identically, the past studies show. There are aspects of reward processing related to exercise that differ from reward processing related to drinking, and those differences may help to explain why, if given the opportunity, animals will avidly engage in both running and ethanol sipping. The resulting neurological high appears to be generally more pervasive and lasting than with either activity alone. 

It’s possible, although not proved, that something similar happens in people who exercise and imbibe, said J. Leigh Leasure, an associate professor at the University of Houston, director of the school’s behavioral neuroscience lab and the lead author of the new review. 

Feeling a slight buzz after a workout, she said, we may, without overt volition, look to extend and intensify that feeling with a beer, a glass of wine or a cocktail. 

But we also are more complicated and opaque in our behavior than rodents and likely to conjoin workouts and alcohol for many additional and sometimes tangled reasons, Dr. Leasure said. Many people, for instance, exercise in large part to burn the calories associated with drinking, meaning that, for them, drinking drives exercise behavior. Social bonding also plays an outsize role in the two activities for many of us, Dr. Leasure said. The camaraderie created on the practice field or among workout partners can nudge exercisers to reconvene convivially at the local bar, and those gatherings may motivate reluctant exercisers to stick with their routines, because they feel rewarded afterward. 

But while the available evidence suggests that exercise may encourage people to drink, it does not indicate that this relationship is necessarily worrisome for the vast majority of us, Dr. Leasure said. Someone who drinks moderately is unlikely to become a problem drinker as a result of exercise. 

“But it’s good to be aware,” she said, that the two activities frequently intersect. “Many people may not have noticed” that they indulge in an extra beer or two on those days when they visit the running trail or the gym.

San Diego’s Ballast Point Brewing Company sold for $1 billion

By Jonathan Kauffman on November 16, 2015 at 11:24 AM

The 19-year-old brewery, founded by Jack White, Pete A’Hearn and Yuseff Cherney, has become renowned for big-hopped IPAs like Sculpin, as well as variants flavored with grapefruit or habanero. Ballast Point had filed for an initial public offering on October 19, so the news is not a complete shock to beer world observers.

Since 2013, Constellation Brands has distributed major Mexican beer brands including Corona, Modelo and Pacifico. Best known for its wine brands, the Constellation portfolio includes Robert Mondavi, New Zealand’s Kim Crawford and, as of this summer, the Pinot Noir label Meiomi. This purchase will be the company’s first incursion into the world of craft beer. Constellation CEO Rob Sands told Reuters that it would consider Ballast Point a standalone business — which may be somewhat reassuring to the brewery’s 400 employees.

This is the second big San Diego brewery to go big this year; Saint Archer sold to MillerCoors in September. The Ballast Point news comes just a few months after the sale or partial sale of the Petaluma’s Lagunitas Brewing Company, Firestone Walker in Paso Robles and Golden Road Brewing in Los Angeles. It’s hard not to see Constellation’s move through the lens of the proposed merger between the world’s two biggest beer companies, AB InBev and SABMiller.

The sale price is occasioning the most exclamation marks on Twitter. A few commenters had slightly more nuanced 140-character observations:

 

Washington Post: How pot and hippie beer explain the future of the American economy

Oregon's breweries and dispensaries offer lessons for how policymakers might nurture a small-business comeback.

By Jim Tankersley November 7  


Stickmen Brewing Company in Lake Oswego, Ore., has thrived in an industry dominated by big players. (Photo by Niki Walker/For The Washington Post)

LAKE OSWEGO, Ore. — At first, Jon Turner was just a software guy who really liked to brew beer. He cooked up two batches a week in his kitchen and kept his hard-drinking friends well supplied. He once brewed one pale ale over and over for a year to get it just right. In 2011, at a national conference of home brewers, he fell under the spell of a panel called “Going Pro.”

This is how Turner came to cash out a large chunk of his retirement savings and launch a 16-tap brew pub on the shores of a private lake in a swanky suburb south of Portland. He and his co-owner, Tim Schoenheit, have kept their tech jobs and worked nights, weekends and assorted off hours to bring their 80-employee operation, Stickmen Brewing, to the brink of profitability.

Drive around the Portland area today and you’ll see dozens of stories just like Stickmen’s — small pubs and breweries that have sprung to life in the past half-decade and endured, in spite of fierce competition from rivals large and small.

In the past month, Portland has seen a similar proliferation of start-ups in the cannabis industry, ignited by a new state law that allows legal marijuana sales to the general public.

Microbreweries and pot dispensaries aren’t the major drivers of Portland’s economy, but they loom much larger here than in most U.S. cities. In both those industries, small start-ups are thriving.

That’s a sharp contrast to the American economy at large. Don’t let Silicon Valley fool you: The nation has long had a start-up problem. The rate at which new businesses are formed has fallen steadily since 1984, a trend that accelerated during and after the Great Recession, according to research by University of Maryland economist John Haltiwanger and several co-authors. Since the recession ended, more businesses have failed every year than have sprung to life.

Breweries and dispensaries offer lessons for how policymakers might nurture a small-business comeback in the United States. But they offer very different lessons, one focused on government intervention, the other on reducing hurdles for entrepreneurs to enter a market — and their ultimate lesson could prove to be, the big guys tend to win in the end.

In Oregon’s sin industries, “We’ve had a renaissance of start-ups, which is almost the exact opposite of what we’ve seen almost everywhere else in the economy,” said Joshua Lehner, a state economist in Oregon. “It’s going to be challenging to maintain this.”

America’s start-up slowdown began in the 1980s and ’90s, when much of the drop-off was concentrated in the retail trade and service sectors. A lot of new mom-and-pop groceries and bookstores were pushed out of business or were kept from starting up in the first place by the emergence of Wal-Mart, Barnes & Noble and other large chain retailers. In the 2000s, the trend spread to other industries, most notably high tech, which has seen its start-up rate decline over the past 15 years.

Economists can’t say for sure what’s driving that trend, but one theory has to do with market power. As big companies get bigger — in retail or tech or anything else — they find ways to shield themselves from competition, often by lobbying the government.

Here’s an Oregon example: Google and Facebook have each received tens of millions of dollars in property tax reductions from cities on the state’s rural eastern side, where those companies have built huge warehouses filled with servers to store user data. It’s unlikely that a small-time social-media rival could win the same deal, which means that small company would face higher costs than Facebook does to store its data — a powerful advantage for the large incumbent.

The beer industry is more dominated by big players than almost any other in the United States. Its four largest companies account for nearly 90 percent of all sales. That’s a function of a wave of brewery consolidation in recent years, culminating in an announcement last month that the world’s two largest beer companies, SAB Miller and Anheuser-Busch InBev, plan to merge.

And yet, for all that market power, the beer giants are acting scared of their smallest competitors — perhaps because there are more of them every day, especially in Oregon.

The number of breweries and brew pubs in Oregon has roughly quadrupled since 2001, to more than 200 today. Since the end of the recession, the state’s total beer production for consumption by Oregonians has grown from about 30,000 barrels a year to nearly 50,000. All but a few drops of that increase has come from start-up brewers, according to state statistics.

There are simple reasons why brewing is so friendly to start-ups, all of them on display at the


Jon Turner, 46, cashed in retirement plans to co-found Stickmen Brewing three years ago. (Photo by Niki Walker/For The Washington Post)

Stickmen facility in Lake Oswego. It doesn’t cost much to learn to brew — just $100 or so for a starter kit and a handbook, more for hops and grains when you begin to experiment, as Turner did when he returned to his native Oregon in the late 1990s after a stint in the Navy. It also doesn’t cost much to start a brewery, relatively speaking.

Turner practiced his art on the side from his software job until he was hosting annual beer bashes with 30 varieties on tap. When he decided to go pro, he tried to get a government small-business loan. When it fell through, he and Schoenheit borrowed close to $200,000 from a company called Brewery Finance, which paid for steel tanks and other brewing supplies they needed.

The other reason it’s easier to start a brewery in Oregon is that Oregonians really love beer, and they’re willing to pay a premium for new and interesting varieties or for better beer closer to home. Stickmen chose Lake Oswego because there weren’t many brew pubs in town. He also had a stock answer for the people who asked whether he was worried the area was being saturated by beer start-ups.

“Does anybody ever ask,” Turner said, “if there’s too many muffler shops in Portland?”

Stickmen struggled through its first winter, when foot traffic slowed and the restaurant, which did up to $15,000 a day in business during the summer, was lucky to bring in $600 some days. Some weeks Turner had to ask employees to wait to cash their paychecks.

But the beer was good enough to get noticed around town, and it eventually won its way into some of the city’s hottest spots for beer nerds. Stickmen hired a distributor and a full-time brewer. Next year, it’s on track to produce 1,000 barrels of beer, largely IPA; this year should be the first it clears a profit.

Turner says government regulations of his brewery are minimal and that other small producers help one another out — all advantages in a start-up culture. “It’s not like we’re competing with each other,” he said, “as much as we’re competing with the big guys.”

Some beer bloggers, though, have begun to worry that lax government oversight could endanger start-up brewers, whom the large players are targeting on multiple fronts. AB InBev has bought a string of craft brewers across the country, including one called 10 Barrel in Oregon.

It’s also buying beer distributors, a move that could eventually choke off smaller brewers’ ability to grow by shipping to cities just beginning to warm to microbrews. So far, according to published reports, only California officials are investigating potential anti-competitive implications of those purchases.


Shane McKee, 46, co-founder and owner of Shango Premium Cannabis, in Portland. (Photo by Niki Walker/For The Washington Post)

In the early days of Oregon’s legal marijuana industry, state officials are already taking steps to keep any big guys out of the game. They have proposed limits on the size of growing operations, along with mandating that they be majority-owned by Oregon residents — a move widely expected to limit outside investment in the industry. They’ve also approved annual licensing fees, from $4,000 to $6,000, for growers and retail vendors.

Many of the rules won’t be final until next year, but the uncertainty hasn’t stopped hundreds of cannabis entrepreneurs from setting up storefronts around the state. Portland-area billboards are plastered with ads for dispensaries whose names run heavily toward puns. (A few of the pun-ier ones in the area: La Cannaisseur, Yer Best Bud and The New Amsterdam.)

Some of the industry’s more established players — veterans of the state’s smaller medical-marijuana trade, which has been legal for nearly two decades — warn that the mom-and-pop newcomers will struggle to survive once the market matures, and they say state regulators will inevitably loosen size and ownership restrictions.

“You’re going to see some consolidation, and you’re going to see the small players either get out of the market or learn to operate at a higher level,” said Shane McKee, the co-founder of Shango, which runs four commercial growing operations and three dispensaries in the state.

Shango employs 47 people in Oregon, McKee said. Seven of them work on licensing and compliance: “The barriers are pretty high to do it right. You start looking at regulations, you look at legal fees, you look at licensing — they’re pretty intense.”

In that way, the pot industry’s approach to start-up cultivation is the opposite of the beer industry — higher barriers to entry, coupled with strict regulations. And yet, some cannabis entrepreneurs think they can copy a (quintessentially Portland) secret of microbrewers’ success: artisanal differentiation.

In Oregon, said William Simpson, the president and founder of Chalice Farms, which operates four dispensaries that are decked out like Pinot Noir tasting rooms, “People didn’t understand there could be so many varieties of beer, cannabis or wine.”

“There is a market for your large corporate product as well,” he said, “but I don’t think it’s going to be that big in the Northwest.”

In other words, consumers don’t want a Miller High Life of marijuana. They want the equivalent of a fresh-hop IPA.