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Frothy brew: Inside San Diego’s craft beer industry

By Alex Roth



If you’d predicted a decade ago that San Diego County might soon have more than 100 craft breweries, someone would have accused you of drinking one too many grapefruit-and-citra IPAs.

In San Diego, like most everywhere else, making craft beer used to be mainly the hobby of people who kept small home-brew kits in their basements and enjoyed swapping recipes online.

Today, however, San Diego has become one of the world’s leading players in the multibillion-dollar craft beer industry. And Ed O’Sullivan is uniquely qualified to lecture about the challenges facing anyone looking to get into the business.

O’Sullivan is a guest speaker in UC San Diego Extension’s Professional Certificate in Brewing. He also is one of the founders and owners of O’Sullivan Bros. Brewing Co. in Scripps Ranch.

As it happens, he and his brothers built their brewery while he was a student in the exact same UC San Diego Extension program where he now lectures.

“When I went to class, I was pretty much sitting in the front row asking questions about what I was going to be working on in the brewery the next day,” he said. “I was probably a pest with questions, but I was highly motivated.”

The industry has only grown and the competition has increased in the one and a half years since the O’Sullivans first opened their tasting room and began the arduous task of getting the right people to notice their beers.
 

 

Theirs was the ninety-sixth craft brewery in the county. Now, there are more than 125, all of them churning out exotic brews with names such as Farmhouse Noir, Daniel Boone Imperial Oatmeal Stout, and Freudian Sip Strong Ale. If you want a beer flavored with cinnamon, or watermelon, or chipotle peppers, or chocolate, or even peanut butter, you can find it on tap somewhere in the San Diego region.

O’Sullivan can talk at length about all the things a brewer must do to succeed in this environment. He has opinions about what equipment to buy, how big to make your tasting room, and the critical importance of making sure the next batch of a particular type of beer tastes exactly the same as the previous batch.

Given the level of competition, it is sometimes the smallest detail that can determine whether a business thrives.

“There are so many choices for the consumer,” he said. “All they want to do is to go to a brand new brewery they’ve never been to before. And you can do that on 128 consecutive weekends now in San Diego. That’s a long time.”

O’Sullivan has lived in San Diego since 1975 and was a successful businessman long before he decided to get into the craft-brew game.

He graduated in 1980 from UC San Diego with a degree in molecular biology, worked for many years in the tech industry, and eventually became the owner of two businesses: CFO Connect and Business Books, both of which provide consulting services to small biotech companies. He still owns both.

A few years ago, he and four of his brothers decided to open a brewery. On the O’Sullivan Bros. Brewing Co. website, they explain their decision this way:

“What if we combined our Irish heritage and California creativity to create a really tasty brown porter, or a clever stout made with a wide variety of yeast strains, hop selection, and malted barleys now available? Sounds good! Let’s do it.”

And so O’Sullivan enrolled in Extension’s Professional Certificate in Brewing. His professional and financial successes gave him the flexibility to pursue the new venture without the need for instant profits. That was fortunate because the brewery still operates at roughly the break-even point, at least for now.

“It’s not making anybody rich,” he said of his own business.

The beer, however, has been a success. This year, the brothers’ Catholic Guilt smoked porter won a bronze medal at the San Diego International Beer Festival, the largest such festival on the West Coast. A year earlier, the brewery won two silver medals at the same festival.

Unlike many other craft breweries, O’Sullivan Bros. doesn’t use any fruits, vegetables, or spices for any of its brews. Instead it concentrates on the four fundamentals: malt, hops, yeast (it propagates its own, using five different strains), and water (it takes tap water and treats it to certain specifications using special equipment and recipes). The brewery specializes in dark beers as opposed to many other San Diego breweries that focus more on West Coast IPAs.

The high quality of the product has been an essential part of the business model.

“There are a lot of craft beer bars in San Diego that are screening you,” O’Sullivan said. “Our first year was just developing street cred. So we got on tap at Hamilton’s. We got on tap at Urge Gastropub. At Barrel Republic. At Regents Pizzeria. People that really pay attention to craft beer, that know craft beer. Those are the guys that give you street cred.”

These days, you can find their beers at roughly 80 bars and restaurants in San Diego County. The brewery sells the beer in kegs but is hard at work on the next phase of its business: selling it in bottles, too.

“Bottling is another level of complexity: permitting, power, equipment,” O’Sullivan said.

Like all the other local craft breweries, O’Sullivan Bros. also faces a new challenge: competition from the enormous “macrobrewers,” such as Anheuser-Busch InBev, which are making an aggressive move into the microbrew industry.

“They have unlimited funds to do what they want,” O’Sullivan said. “I only have x number of dollars. It gets a little more difficult for the small brewers every year to compete.”

He discusses the fundamentals of launching a craft beer business to around 30 students as guest lecturer in a class titled, appropriately, “The Brewery Start-Up.” Despite the challenges, many students seem undaunted.

“What’s nice is you’ve got a bunch of very interested people wanting to hear about your experience,” O’Sullivan said. “A lot of them have that little dream of building a brewery of their own.”

Learn more about UC San Diego's Brewing certificate program on our website or register for a free, quarterly information session.



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