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Invitation to Expert Brewers to Co-Found and Operate
VolcanoBrew Company, Microbrewery, Costa Rica
Hello, my name is Jean Paul Cazedessus, and I am looking for a business partner to co-found and operate VolcanoBrew Company as a Costa Rica resident brewer and operating partner. VolcanoBrew Company is a start-up microbrewery located at Lake Arenal, and will be the second microbrewery in operation in Costa Rica. I look forward to providing interested expert brewers who fit the profile outlined herein with a detailed business plan and financial analysis. It is important that interested expert brewers feel they fit the profile of who we are looking for at VolcanoBrew Company before contacting me.
VolcanoBrew is looking for someone who is:
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an EXPERT BREWER (please provide resume/references),
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capable of running a small business,
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interested and capable of living outside of the US for most of the year,
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able to invest approximately $92K in the first year to get started in Costa Rica, ($57K for brew business start up costs, $25K for your own 4X4 [there is a 50% car tax in CR], $10K spending money for the first year)
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mature (preferably over 40 years old; single or married),
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educated (knowledge of the Spanish language is preferable, but not mandatory),
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a fan of nature and sports,
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interested in breathing clean air, drinking clean water, and eating organic food.
General VolcanoBrew Information: Micro-brewery to operate in an existing destination resort producing and selling ales kegged in 20 liter Cornelius kegs to the existing on-site restaurant, and three off-site bar/restaurants in the towns of Jaco, Tamarindo, and LaFortuna.
VolcanoBrew Location: Hotel Tilawa, Lake Arenal, Tilaran Guanacaste.
Existing VolcanoBrew Equipment:
- A microbrewery with 25KL max annual production capacity (ale)
- 3.5HL steam powered brewhouse (installed and functional)
- 2x double batch 7HL fermenters (installed and functional)
- 2x double batch 7HL serving tanks (installed and functional)
- 35kw steam boiler (diesel fired) (installed and functional)
- 50 five-gallon stainless steel Cornelius kegs
- 1 new malt mill.
- A large after market ceramic aeration stone.
Living Situation of Brewer Partner:
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First Year: Room 104 in Hotel Tilawa which includes a bedroom, bathroom, small kitchen, and a living area with a lake view patio. Meals available at the on-site restaurant at cost.
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Second Year and Beyond: Make your own arrangements (if you like). Home rentals start at $300/mo., residential construction costs start at $40/sq.ft., land purchases start at $1/sq.ft.
Biography of Jean Paul Cazedessus:
I am the founder, designer, builder, and owner/operator of Hotel Tilawa and Water Sports Center. I have 17 years of experience in Costa Rica. I am currently developing a 20-dwelling sustainable community. Prior to Costa Rica I was in the construction industry and ski school business in Taos, New Mexico. I am a happy father of four of my own children and four adopted children. I am deeply in love with my wife, Helga. She is a practicing Architect with her degree from UC Berkeley. We split out time between Encinitas, California and Costa Rica.
VolcanoBrew Company is interested in an expert brewer who can imagine the following scenario for themselves:
Bob (or Bobbie) Brewer, is looking to make a big change in his (or her) life, with focus on his love of brewing great beer. When he sees an ad in BYO of “Going Pro in Costa Rica” he is interested because he has always dreamed of having his own brewery and he knows several people who have been to Costa Rica and he has heard it is a very nice place. Bob takes a quick look at the info posted on the web and shares a few e-mails with the guy, JP, who listed the ad in BYO. Bob likes what he reads and has enjoys his discussions with JP and therefore decides to book a flight to Costa Rica to check it out.
The rental car is waiting at the Liberia airport for Bob. No matter what happens with the visit to Hotel Tilawa to see the brew equipment and talk with JP, Bob is going to enjoy his time in Costa Rica and make this a nice vacation. Arriving at the Hotel after a 1.5 hour drive from the airport, Bob meets JP. Touring the Hotel and its grounds, and talking with JP, Bob is impressed with the Hotel installations and the brew equipment (but not the Costa Rican Pilsen or Imperial beer which are better than Budweiser but still not impressive). Bob spends the next few days around the Hotel talking with JP and a few other North American “locals” and begins to feels like this is an environment he could live in. Bob starts to seriously consider Costa Rica as the place for him, but first a whole lot of investigation must be done. JP’s brewery equipment is inventoried and a list of what is needed is put together. The equipment is tested by running water in the kettle, confirming the ability to manage temperatures needed for his favorite recipes. While Bob would like to ratchet down JP’s asking price of $57K for a 49% stake in VolcanoBrew Company, JP is clear that the equipment, location, and his support, along with the business plan’s viability easily add up to an $80K value. Investigating the business’ viability further Bob heads off to La Fortuna (Volcano Arenal) and the beaches of Jaco and Tamarindo to gauge the market for quality microbrewed beers. Bob is confident that the market will support the business plan goals and decides to head home to the US to make preparations for his departure.
Bob returns to Costa Rica for a second time to sign the deal with JP and make a US equipment order. Three weeks after returning from Costa Rica, all of the needed supplies and equipment are packed into a 20-foot container at the port of Miami and ready to ship to Costa Rica. Two weeks later Bob is back in Costa Rica with JP at the Port of Limon getting everything through customs and experiencing Costa Rican bureaucracy and JP’s ability to work with the locals and the system. Cool, it’s done. Bob is clear on the fact that he sure wouldn’t want to do that by himself and absolutely convinced that he needs to learn Spanish quickly!
One month after all of the equipment is unloaded at the Hotel, JP and Bob and the Hotel maintenance crew have finished enough ground work to start brewing! Days are flying by, Bob is learning more and more Spanish, and Bob is convinced that the locals are nice, the food is good, and that he is, in fact, waking up in paradise every day. JP and Bob agree that the first brew of Beach Pale Ale tastes great. Bob proceeds to make a second brew, amber ale, and it too tastes great. The beers are kegged. Bob loads up his truck and is off to make the installation of equipment in La Fortuna at a cool little bar. Volcano Brew Co. is officially up and running!
Three months into Bob’s endeavor, VolcanoBrew is producing at 80% capacity. Bob drives a nice car (even though he still can’t believe that he has $25K in a two-year old Toyota diesel 4X4), he eats well, and he is enjoying his new life in Costa Rica. His investment of $57K allows Bob to (legally) work in Costa Rica. He is the main man at VolcanoBrew Company, working with JP as a supporting partner. It’s a cool job, his friends at home are envious. He spends his time brewing great ales, pushing his helper to do all sorts of clean up, watching temperatures on the fermentation tanks, as well as many of the other necessary jobs of brewing beer, but the 19 year old is now showing promise of becoming a naturally talented brewer. Bob works hard on brewing 3-4 times a month. He is living well, learning lots of Spanish, and is a partner of Costa Rica’s second microbrewery.
Bob travels regularly to the beach and the volcano for equipment maintenance (we cannot trust the locals to clean the taps). He checks on tap cleanliness, amount of Co2 pressure, and makes keg deliveries every other week, resulting in Bob being out of the Hotel and at his favorite spots on the beach and at the volcano, frequently.
On the beach, Bob is received like a visiting rock star by loyal customers when he walks in with a keg of Beach Pale Ale in each hand. The bartenders like him a lot because he is friendly, provides beer variety to their bars, and occasionally gives them (and their girlfriend/wife) a free stay at Hotel Tilawa to see and understand the brewing process, and to have fun. The bar owners love that Bob pushes their staff to clean the taps every day and that Bob works with them on how to sell VolcanoBrew. After a quick check and cleaning, Bob pours himself a beer and walks around the bar to talk to the visiting tourists who feel they have “discovered" great beer and who want to meet this great brewer in Costa Rica. He encourages them to add a trip to the VolcanoBrew Company brewery at Lake Arenal to see where this great beer is made and also because they want to literally buy the shirt off of his back, and he will not sell it (rather he sells a visit to the brewery, where they can get a new VolcanoBrew Co. shirt for themselves). The sun is going to set soon so Bob says his farewells and is off to pick up a friend and go out for dinner and a few days of R&R south of Tamarindo.
How does this vision end?
Well Bob, his wife, and kids all agreed to picking up and moving to Costa Rica for one year, especially because it’s what Dad wanted to do! Everyone was in agreement that learning a new language and experiencing a new culture in a tropical land would not only be an adventure but indeed actually good for the whole family. It would forever give them all the ability to speak the same language as 20% of their fellow United States citizens, and speak it well; Costa Rica’s dialect of Spanish is recognized as one of the finest, most educated, and clearly spoken of all the dialects of the Americas. Costa Rica also held the allure of a tropical setting with monkeys, toucans, cloud forests, and Pacific and Atlantic beaches. Costa Rica is often likened to Hawaii by the Hawaiians living in Costa Rica. Also considered by the family was the lifestyle with a maid, gardener, great food, clean water, and excellent and inexpensive health care including dentistry, all available locally, When all the attributes were added up it just made sense to everyone to make a go-of-it for a one year trial.
Bob believed he could make great profit using his skills and all around ability to turnkey the brewery to profitability in a year. While it was true he hoped he and his family would stay in Costa Rica longer than a year because he knew that to make the brewery produce double the volume and line up the bars to sell his beer, and build a home for his family, he would need more time. However, he readily agreed that he held his own doubts about leaving the USA for good. He was sure after his inspection tour that he trusted his instincts; he felt good about his new partner, Jean Paul, the equipment, and the sales potential in Costa Rica. He believed without a shadow of doubt that the math was correct, he could invest $57K to own 49% of the brewery, turnkey it and operate it for a year and generate $50k or more net company profit in the first year of operation.
One year and two months later, the brewery has been open and selling beer for almost twelve months and once this month’s receipts are paid, a bit over $50K will have been made. Bob and his family are also approaching a one-year anniversary of being in the country. It’s been wonderful yet some family members are reminding him “it’s time to go home”. Bob has seen the writing on the wall from the beginning, just a bit too rural and foreign, when compared with the states, for a few members of the family. Bob is content with netting a 2nd language for the entire family, and a wonderful exotic year, and great money for the effort; it was worth it. Too bad everyone didn’t want to stay, Bob sure would have liked to, but hey, they followed Bob and he is willing to follow his family home, even though everyone feels at home in Costa Rica now.
About a month ago Bob started to tally the numbers and figure out how he will fare on the economic side this year. But first he pulls the trigger on selling his share of the brewery and tells JP of his intent to sell. JP doesn’t want to buy Bob out, seems he doesn’t want Bob to leave, but if he is leaving JP wants to try to help Bob sell it to a brewer who is interested in expanding. JP hopes they can find someone like Bob. JP has no interest in buying the shares back and hiring a brewer, even if he can get a good one from the USA for $25K a year in CR, JP wants a partner.
Bob’s Expenses for One Year
$-57,500 Paid for 49% ownership (40k actually went into equipment, & the remainder to JP)
$ -6,000 Paid for shipping a container of household stuff and importing into CR, including taxes
$-23,000 Paid for Toyota HiLux 4 door 4X4, 2002 model year
$ -2,000 Paid for more house stuff
$-12,000 Paid in house rental
$-15,000 Paid in; food, gas, electricity, maid, direct-TV, etc. (living like kings)
$ -7,000 Paid for home-school with an American tutor + public school (free)
$ -4,000 Paid vacation for everybody back to the States, July 4th week (or whenever)
$-126,500 Total Paid out for 12 months
Bob’s Income for One Year
$+25,000 Bob’s half of the net profit (paid to Bob throughout the year)
$+22,000 Paid to Bob by a happy buyer for the used Toyota
$ +2,000 Bob sells most of his stuff; TV, washer/dryer, etc., if he sells it cheap
$+135,000 Minimum Bob will sell his 49% of the brewery for
$ 57,500 Net profit for the Year,
Considering the economics, Bob posts the sale of his 49% of VolcanoBrew Co. on probrewer.com as an investment opportunity, with an asking price of $148K for his 49% of the company.
He bases the probrewer.com posting price considering two things: First, a value of $300K for equipment value, the cheap location rental contract, and most importantly the fact that it has clients and is a profitable company. Secondly and parallel to this assets valuation of the sale price, Bob calculates his company’s value using the ROI formula (net profit is = 10% of his company’s total value) Therefore, $50K net profit makes for a $500K company value. However, Bob will not use this value for posting his percentage (asking price) because the equipment replacement value is only $300K, which is what the competition would have to spend to buy their own equipment and start their own brewery. Therefore, Bob uses the $300K value of the company for listing his 49% of the company for sale for $147K.
Obviously some prospective buyers would disagree with the $50K net profit sighting that Bob actually worked as a brewer and should receive $25K in salary, resulting in a net profit of only $25K and a ROI value of only $250K, hence Bob’s 49% of the company is worth $122,500. Bob would point out that his sale price is $147,000 a difference of $24,500 or roughly 20%, and in the interest of making the deal will agree to split the difference and reduce the sale price to $135,000. — Do we have a deal?
So… if you have the faith in your beer brewing ability and a relatively small amount of capital to invest in yourself and become a partner in Costa Rica’s second brewery (not to mention a fun lifestyle in Costa Rica), please contact me at jp@tilawa.com and I will send you a spreadsheet of the numbers and the business plan for VolcanoBrew Company, Costa Rica. I look forward to hearing from you.
Sincerely,
Jean Paul Cazedessus
Owner, Hotel Tilawa
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