Many Cambridge students share beers at a pub, but three Cambridge MBA students went on to start their own beer brands – beginning with Varsity Draft and Lagerithm.
After downing craft beers at The Mill pub overlooking the River Cam last year, three MBA students from nearby Cambridge Judge Business School switched to a standard lager – and lamented that there was nothing “in between”. So a new beer venture was launched then and there.
A year later, the venture has unveiled two new beer brands – Varsity Draft and Lagerithm – and will share the brews at a social event at the business school on 13 October. Those two beers, a golden ale and a lager, will be followed by a stout, and the company will then launch its “flagship” brand – a new British export beer.
“We think that there’s a gap in the global market for a British beer that’s premium but not a craft beer,” says Aditya Nigudkar, who co-founded the venture along with Ashwin Balivada and Akshit Gupta after the three natives of India met as members of the Cambridge MBA class of 2015 at Cambridge Judge. “We’re aiming for a young, fresh British product that appeals to a global audience.”
The company launched three other brands prior to their flagship brand in order to fine-tune the brew, packaging and brand identity before exporting the signature brand to global markets – beginning with India, North America and Africa. Beginning with the pub chat last summer, the trio devised plans for production, design and distribution, and then registered their Cambridge-based limited company, 3ABC.
The venture contracted with established British brewery Elgoods, located 40 miles from Cambridge in the town of Wisbech, to brew their product; had the beer labels designed by agency Cartils (which has also done design work for the likes of Grolsch beer and Wyborowa vodka); and put together a marketing and distribution plan with various agencies. The company’s beer labels feature designs based on iconic Cambridge images such as rowing oars and mathematical formulae created in the University.
Access to market is the largest obstacle for new bottled beers, says Alan Pateman, production director at Elgoods, so 3ABC has worked hard on this aspect. “The recipe choice and quality of beer has to be the best to enable a successful future,” says Pateman. “3ABC have put a tremendous amount of effort into the research of the market and are using several channels to access the market for the two products they have started with.”
“We wanted to get it going and feel that it will be easier to get investors interested after we have a product in hand,” says Ashwin, who has been grounded in the alcoholic beverage industry since his family began a whisky business in India in 2009. “With consumers trading up and drinking better, premium British beer has a tremendous future across global markets.”
Varsity Draft is a golden ale with a sweet malt base designed for easy drinking, and was deliberately designed not to be too dark in colour because this would limit appeal in warmer countries. Lagerithm is fermented from the top in a northern German beer style, with a light malt background balanced with fruity hops that match well with spicy foods.
“The top-fermentation helps the beer retain the taste of alcohol, like an ale, but it’s served cold and fizzy, so there’s a lot going on with it,” says Akshit, who is a biochemist.
The target markets for the brand are students and other young people who sometimes splurge for something more premium, as well as internationally minded professionals and British expatriates living abroad who long for real ale. The venture acknowledges that plenty of challenges lie ahead: the beer industry is mature and saturated, and distribution is a key issue to get right in a perishable product like beer – which, unlike whisky, tastes worse when it ages.
The trio says the venture was inspired in part by the entrepreneurial spirit of Cambridge Judge, and credit some of their professors for instilling a long-term view in negotiations and other critical aspects of venture creation. For example, 3ABC established a good relationship with Elgoods that led to the brewery agreeing to handle 3ABC’s relatively small first-batch run as the new beer venture finds its feet.
“Elgoods uses two contract bottlers we have worked with for many years, and this means we can offer small and large bottling runs for our customers,” says Alan Pateman. “Working with 3ABC we have been able to pass on our experience and understanding of the constraints and critical timings for the bottling of beers.”
This article is part of Venturing Forth, our series on the aspirations and challenges of ventures connected to students, alumni and others associated with Cambridge Judge Business School.