The Brown & White

An entrepreneur showed that small businesses can succeed by telling the stories of their companies in industries dominated by large companies during a speech Thursday in Rauch Business Center.

Sam Calagione, president and founder of Dogfish Head Craft Brewed Ales, opened the smallest commercial brewery in the U.S., and is now purposely slowing down the growth of his company.

"We are trying to bring our story back inside the bottle," Calagione said.

"A business plan is like a work of fiction," Calagione said. "It makes people want to come on this journey with us."

Dogfish Head Craft Brewed Ales creates interesting ales with ingredients such as raisins, roasted chicory, brown sugar and vanilla. Each beer is nine percent alcohol and made with six ingredients.

"We make off-centered ales for off-centered people," he said.

"Knowing I wanted to open a small brewery, I thought it was necessary to differentiate ourselves from the big brewers," Calagione said.

He explained that craft breweries are the only ones growing, showing that they can compete with the two major big brewery competitors.

The company started in a restaurant in Rehoboth, Del. with a 10-gallon brewing system.

"Initially there was not a big following," Calagione said. "[Other companies] thought we were not following traditional brewing methods."

"I had to brew two to three times a day," he said. "I could take tremendous risks in ingredients without financial risk."

Calagione said feedback came from regulars paying for the beer.

"Business is not just about taking money from people," he said. "If you can give them something of value, you are adding to people's lives."

The company expanded with the purchase of three steel tanks, which could produce 10 kegs of beer at a time, Calagione said. He drove hours to give out samples of beer at festivals and dinners, slept in his car many nights and sent samples of beer to chefs recognized in magazines.

"Even though we weren't popular yet, I could see the light at the end of the tunnel," he said.

Today the brewery produces 7,000 - 8,000 cases a day, Calagione said.

"We are trying to slow down our growth to sell the breadth of our portfolio," he said. Calagione hopes this will enhance and expand the story of the company.

"The risk of losing our identity is greater than losing our distributors," he said.

Although the company is strategically limiting its growth, it still has expansion plans for this year. Dogfish Head Brewery is making a beer for a Sony Records celebration and collaborating with renowned chef Mario Batali to open a restaurant in New York City.

"We spend a lot of our energy thinking of other things we can bring to the market," Calagione said.

Dogfish Head Brewery Craft Ales has a distillery, makes dog treats and designs and sells its own clothing merchandise.

"We have a really robust bonus program," Calagione said. "It makes everyone in our company think entrepreneurially."

The company is also extremely involved in the online world of Twitter and Facebook.

"Social media has leveled the playing field," Calagione said. "We can have intimate conversations with customers. It is different than the traditional monologue from the big companies."

Even though Dogfish Head Brewery Craft Ales only advertises inside the craft beer industry, it still has a big following.

"I have always been a big Dogfish Head fan. I think it's great for the Lehigh community to be introduced to craft beer," Joseph Sala, '10, said.

"I have always admired [Calagione's] entrepreneurial expertise," he added. "He gave us the whole picture of what he does and how he got there."

Sala hopes to start his own business potentially involving a collaboration of music and a brewery.

"You have companies that start out, but you don't understand it until you hear about it," he said.

Sala coordinated the event "Small Fish in a Big Pond: How Entrepreneurial Companies Can Differentiate Themselves in a Marketplace Filled with Large Competitors" talk. The event was sponsored by Phi Gamma Delta fraternity and the Marketing Club.

"Dogfish Head Brewery is very well known for having unique marketing," Emily Mazzaferro, '10, president of the Marketing Club, said. "[Calagione] was really focused on unique marketing. The Marketing Club tries to find events that spread out people's interest."

"Calagione knew what he wanted his company to be, and he built his company from nothing," she said. "It is important to know who you are as an individual and as a company."

"Dogfish Head Brewery does not try to be a big competitor. With marketing, it is important to have that total concept that doesn't change," Mazzaferro said.

Sala plans to invite Calagione back to Lehigh in the future.