Green Flash Foreclosed | The Drinking Class
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Green Flash Foreclosed

The loans Green Flash took out to power their growth surge into the East Coast have been foreclosed and its assets sold to a risk management company.

This is unfortunate.

I have absolutely no insider knowledge of what happened and what decisions were made or for which supposedly rational reasons. My gaze always gravitates toward the macro-level where forces outside those we are entirely conscious of determine our moods and bias our assessment of risk. So the “analysis” that follows is more an example of me trying to read the tea leaves of the larger system—rather than trying to tell Green Flash’s story for them.

From what I know of the timing and magnitude of Green Flash’s debt-financed growth, it feels to me that what was happening was Green Flash wanted to be either (1) to big to buy out or (2) so big—it would get a large buy-out option—something akin to Ballast Point’s $1 billion purchase.

In other words, it reminds me of the bust that followed the boom of the 1992-1993 boom in brewpubs. At the time breweries, brewpubs in particular, were exploding. So growth seemed desirable for internal reasons. On the other side of that was the threat of being shut down by the macros. So growth also seemed desirable for external reasons. Several brewpubs ventured into commercial brewing in the hopes of gaining a regional footing they could leverage into national one.

But the shift from craft to commercial is what caught the macros’ eye. That and an inability to leverage local identity into a regional one, led to several bankrupt brewpubs.

I mourn for the loss of Green Flash. Among my favorite beers and their brewery among my favorites when I visited San Diego a few years back. A genuine loss. And one that seems to reflect the period of maturation we’re undergoing.

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Posted in The Drinking Class.