Making a co-op work

There is a new cooperative brewing in Granite Falls. The Bluenose Gopher Brewery is forming a brewing community and brewpub on Prentice Street by selling memberships to build capital and give any beer lover a chance to have an ownership stake in a brewery.

“I’ve always thought that Granite Falls would be a perfect place for a brewery because of its history,” said Sarina Otaibi, who chairs the co-op’s board of directors. “We’re doing it because we wanted a brewery, and no one else was doing it.”

The history that Otaibi refers to focuses on the legacy of Granite Falls native U.S. Rep. Andrew Volstead, who served in the house from 1903-1923. Volstead is probably best known for his sponsorship of the National Prohibition Act of 1919, permitting the enforcement of the 18th Amendment that outlawed intoxicating beverages. The law is more commonly known as Prohibition, and the United States remained a dry country until the ratification of the 21st Amendment in 1933.

The co-op’s name is also a jest at the representative as the term bluenose refers to a person who advocates a rigorous moral code. Otaibi said that she had seen a blogger use the term bluenose gopher to describe Volstead and his home state, so she thought “it was a cool play on words, and the name just kind of stuck.”

The brewery takes another page from Volstead’s past by utilizing his lesser-known work with the Capper-Volstead Act that got the ball rolling to allow associations of producers to create cooperatives. This co-op, however, is probably not something Volstead ever imagined would happen, especially in his hometown.

“We like to use him as a marketing point based both on the history and off of his work,” said Otaibi.

Last spring, Otaibi mentioned the idea to friends, and one of them told her about a cooperative brewery in Washington State.

“Andrew, a co-chair, bought a membership to a brewery in Seattle because it sounded fun,” Otaibi said. “I had never thought about starting it under a co-op model, but if Andrew bought a membership to a place he’s never seen, I thought we could maybe do it with our community.”

After more discussions and brainstorming sessions with friends and community members, the founding members had their first meeting in August 2013 and incorporated later in October. They’re not brewing beer yet – instead they are focusing on the business model by “setting it up, fundraising, accumulating members and organizing,” Otaibi said.

“I’ve never brewed beer, but I like beer,” Otaibi said. “But I’m really into community revitalization and seeing small towns succeed.”

The group plans to start on a small scale, brewing batches of beer for sale in the brewpub and as off-sale in growlers. They also want to offer food sourced from local farms and other craft beers to provide a variety of beverages.

The co-op model for their business has been working well so far; they’ve sold more than 50 memberships already. Otaibi said that they have a goal of signing up 300 members by the end of the year to gain enough capital to pursue other avenues of funding, such as loans or approaching banks that work with co-ops.

“We didn’t have the funds and couldn’t take the risk,” Otaibi said, “but if the community could support it we would have a better chance of success. I’d like to thank our current members, because without them, this co-op wouldn’t exist.”

Membership is more than just being able to say you own a brewery. The first 150 members will get a personal mug that will be kept and used at the brewery. Members will also have voting power, a choice in who is running the co-op, as well as be given discounts and invites to special events. The hope is that profits could be distributed among members, but Otaibi said that “it’s not guaranteed, and it might take a little while.”

“We hope to add more benefits in the future,” Otaibi said, “but basically, you’ll be awesome when you’re at the brewpub.”

The Bluenose Gopher Brewery hopes to be open by late 2015 or early 2016, but Otaibi says that they still have work to do. The co-op has secured a building in downtown Granite Falls next to the river, and after reviewing the building’s deed, they knew it would be a perfect fit.

“We found out the building used to be a bar, and it was owned by Schmidt Brewing, so it has a great history with beer,” she said.