Reason for Modern Times’ Contraction? – It Wasn’t a Lack of Meat
Since Modern Times Beer’s inception, they have been nothing short of ambitious. Stepping onto the scene, they broke the mold of a startup brewery with a vibe that set them apart from the rest. While many breweries shuffle around their brewhouse to accommodate a bar and tables for tasting room hours, Modern Times created a comfy, artsy place for millennial hipsters to not only enjoy craft beer but feel like they were part of something special. Mosaic artwork, furniture made from VHS cassette cases and a bar made out of old books was exactly the perfect formula for having customers not only patronize but to take a picture and tell a friend. Modern Times was on to something and went full throttle with their Bill and Ted’s/Teenage Mutant Ninja Turtle branding and swung for the fences.
Craft breweries that are between small and medium have mixed results when participating in the good old three-tier system of wholesale to retail, so when it’s possible, if you can sell directly to your fanbase you should. Modern Times had a reasonable goal of creating more points of sale to sell their beer directly to customers and cutting out the iffy proposition of competing for shelf space in an overcrowded market dominated by other craft breweries and now, hard seltzers.
What did seem unreasonable and viewed as a wild gamble was Modern Times lighting up six new locations, all with the artful architecture and cozy retro themes that make a middle-class hipster want to stop in for a cup of pastry stout and to take a selfie next to an elephant made out of LEGO. You don’t need to be a financial expert or a construction expert to know that it would A – cost a lot of money to make this vision a reality and B – you will have to sell many cups of pastry stout to pay back the financing on this wild gamble. Shortly after Modern Times began making these big moves, they announced a public offering of sorts to help inject some funds into the company. In doing so, Modern Times was required to share their books with the public, and that showed it wasn’t a matter of if, but when, the wheels were going to fall off. In simple terms, the question everyone asked who was interested in this important era of craft beer, how can Modern Times pull this off?
When the C19 pandemic hit shortly before Modern Times opened a few of their new spots, those following along let out a collective groan. How could Modern Times weather the storm, as the first leg of the pandemic was met with government-mandated quarantines and temporary closures of on-premise dining. While Modern Times and many other hospitality-based breweries received some relief funding, many expected the worst for this overleveraged business plan.
On February 14th, 2022, Modern Times posted a memo on their website and social media announcing the closure of all destination locations above Anaheim’s Leisure Town.
As new leadership has stepped up and taken the helm over the last few weeks, it became clear that the financial state of the company that we are now tasked with directing is not just unsustainable, but in immediate and unavoidable peril. As a result of this, we are forced to make some incredibly hard choices, which—while necessary for the health and continued success of our company—will result in many of our talented, hardworking staff losing their jobs.
As of the end of this week, we will be closing our Portland, Oakland, Santa Barbara, and Los Angeles locations. It is a surreal and painful turn of events for us, and we realize that the suddenness of it puts many people we care about in very difficult positions.
Modern Times has run a successful club membership for their most loyal fans, and in addition to it being a nice stream of revenue, it was a great way to expand their reach and have these members pay a visit to their local Modern Times location. With these locations going away, they have had to reach out to their members and make new plans for delivery logistics.
After the news broke, there was an abundance of commentary on social media with takes hotter than even I could spit. There were long-time haters who claimed the beer was never good or has gone downhill. There were plenty of “financial analysts” who “ran the numbers” and knew this was going to fail. I read conspiracy theories surrounding the workplace fallout involving CEO Jacob McKean leading to investor pullout. One of the best takes I read across any platform was that Modern Times business was on a downward spiral because they offered a plant-based food menu.
Not being a construction expert, or a business expert , I can tell you without a doubt: Modern Times Beer was forced to contract efforts because their business model cost more money to operate than the amount of money it was bringing in, it was not beacuse they don’t serve meat. If Modern Times DTLA or Portland were open and selling beers 24/7, it still would not have been enough money for the model to make sense.
For those playing deadpool with other breweries that seem to be expanding quickly, Modern Times was a special circumstance of timing and effort. They picked a bad time to expand, which they couldn’t have known, and the cost of execution was much higher than just slapping a Modern Times sign on a new building, they were creating a craft beer wonderland for well to do beer geeks.