EP-247 Phil Sexton of Giant Steps Winery and Matilda Bay Brewing

This is Luke Robertson and you're listening to the Good Beer Hunting Project. When it was announced in October. would be opening a Matilda Bay brew pub. Australian beer and If we were in a We would have discarded a hip flask from under our coats. To say it was a surprise is underselling it. Sexton co founded Matilda Bay in the early 80s. He left in the early nineties of From there he went to the States to become brewmaster at Bridgeport.

where he created Bridgeport IPA, one of the first ever West Coast IPAs. Then back in West Australia, he teamed up with the old Matilda Bay crew to open a new brewery. Yeah. Lagship pile out. Yeah. Like Matilda Batman. Public listed on the Australian stock. and eventually This time by Obsidiary Lion. From there he focused on his other passion, wine.

launched two brands in the Arab Valley just outside of Melbourne, and it looked like Sixton was In his absence, Matilda Bay has been increasingly driven by marketers. Yak Brewing, and old favourites from the Dog boat of dark life. and fewer and fewer Bay's only recent launch is a vehicle Frothy. The kosher influenced. Drink a little bit. It's a similar style and even though it's a very important thing While CUB say it was designed independently, the imitation is obvious and disappointing.

Matilda Bay fans. It was a death knell for an old Much has changed since Sixton left the business. Especially with his old brand. Only in the past year. is being sold by A Bienbev to Asahi. Little Creature's parent company, Little World Brew, Well Bridgeport was a casualty. of market. I wanted to find out from Phil why. Why would those always be like? And here is thoughts on the chaos. This is Phil Sexton. Giant Steps Winery and Matilda Bay Brewing.

Okay. Phil, how are you? I'm great, thanks. That's good to good to hear and good to join us on the Good Be Hunting podcast. It's a lovely day in Hillsville. Uh summertime is a couple of days away. We're out in a beer garden. Um you're at a we're at one of your pop ups. It's not sort of a home base for you. Can you tell us a bit a little bit about where we're sitting? Yeah, it's sort of a pop up and it's not a pop up. Um this uh I um my interest in brewing kind of extends into

winemaking as well and to me they they're very similar um pursuits. And of course for us and probably a lot of brewers that I know um great coffee is an important part of the process. Um and great bread is too and being a brewer it feels like full circle.

Great bread because that's where brewing started and um so we actually have a a a sourdough, uh just a natural sourdough bakery here on this site that we're sitting at. And uh we also roast coffee and we have a small, I hate to use the word cafe, but a small cafe that um serves coffee and and croissants and and bread that we produce. We're sitting out the back at the moment right next to a pizza oven we've put here, uh which again is using sourdough based pizza.

and um we're c kinda trying to work out what to do with this garden. At the moment it's just a lovely and beautiful space to sit in. We have, yes, so coming back to the pop up, um we we have s just started to arrange to put our wine tasting into the space alongside the courtyard we're sitting in.

uh as we transition the wine making and winerking gear out of our winery which is 150 metres up the road and turn it into a brewery and we're moving the wine making equipment eventually uh down to one of my vineyard sites so that it can continue. And uh we're a brewery. Um I was just at the brewery having a quick look around and

The openings I think the lady said December nine. Uh a lot of construction happening in there at the moment. How's it all going? There's a lot of construction happening and everyone that's been involved in putting a brewery together, whether it's a tiny one or a big one, knows that you run into all sorts of obstacles and And there's often an agenda running in the background that that's marketing people and PR people all wanting to sort of have organized messaging and and the rest of it. Whereas

I haven't changed very much. Um I I've always loved the process of just putting it together and uh and doing it properly and doing it well and Uh, you know, it'll be ready when it's ready. Uh it's not looking like it's gonna be ready before Christmas and um you know, that that news is being spread by me. Uh and You know, as we become ready it it will organically start to serve some beer and it will be other people's beer and

people's beer that we admire. Uh and as we have had some time with the equipment we're we're installing at the moment and and got to know the equipment and got to know the the materials we want to work with, then slowly some beer that we're producing as Matilda Bay will will become available and Um, you know, that could be too much time, it could be six. Um it is it is when we are happy and comfortable that what we're doing is right.

Um can you uh I guess we've started at the end. I want to go back to the start now. Um what is Matilda Bay? What is Matilda Bay? Um Matilda Bay is well, I I can tell you some simple things that you know already. Um Matilda Bay is is the first um craft brewery that was put together in in this part of the world. Uh back in originally I mean the work started on on what is Matilda Bay started about nineteen eighty two. Um and it's it's been a a a prominent

Part of the Australian craft beer movement in history from day one. And at the moment it's a kind of sad, lost um image of of what it once was. And uh but it also takes with it lots of memories for people and it was great chatting you with you before we started this.

Um and I I run into many people who, you know, their first experience of craft beer was from Matilda Bay and their first experience of a wheat beer or Hefe Weizen style was Matilda Bay. So there's a lot of memories um and probably a lot of uh authentic um experiences that people have had that make Matilda Bay a little bit more than just the word.

That's why I'm here again, because uh there was an opportunity to um engage with um the current owners of Matilda Bay and uh Talk to them constructively about what it means and and what it could be doing and what they would like to see it doing. and uh that's how I've ended up taking it on again, uh, with the objective of putting it back into a place where it it delivers for people what um their mindset um

thinks it could deliver or what it represented to them when they first saw it. Matura Bay is also a geographic location, just to to help help that question through. Uh it's a it's a bay on the Swan River in Perth and it's a very large and beautiful bay. It had a it has a a a big role in in West Australia's history because it was a Catalina flying base during World War Two.

where both US Catalinas and Australian Catalinas headed out from Perth to Colombo, um, m keeping connection with Europe during World War Two. So it it's got it's got a a prominence in West Australians' minds.

And it's also the where the University of Western Australia is based, right on the edge of Matilda Bay. And and that's where Matilda Bay first started coming together with some of my very close friends that I studied at with that university and we had a a a shared passion for wine and beer and uh we travelled in Europe um looking at beers there where and and looking at each other over these beers going, why can't we get this at home?

And uh from so from all of that, um, the first craft brewery in Australia, one of the first in the in the modern world, or the new world I should say, uh, evolved um and has got us to this point right now.

So that brand um was sold, uh, I guess, to C U B over a over a period? Is that accurate? Yeah, the uh The people say it was sold. Uh it Matilda Bay uh was actually a publicly listed company and for Americans that that would mean it was listed on either the Nasdaq or the Wall Street. And it got to that stage because by the mid eighties we were trying to expand brewing capacity fast enough

to keep up with the demand as it was developing around the country. And we were well represented in every every state and city of Australia at that stage. And we had pubs that we operated and we were trying to supply them initially out of our our brewery in Perth and then we built small breweries in each of the major cities. and were trying to supply as well and realised that we were it was becoming more and more difficult to control.

More and more difficult to keep consistency between these small breweries that we were building, and we decided we needed to build a very large facility on the west coast and supply Australia from there. And to fund that, we listed on the Australian Stock Exchange. Exchange or the equivalent of the Nasdaq or Wall Street. And we did that um on the eve of the b Wall Street crash in nineteen eighty seven. It was actually

due to list the morning after the announcement his announcements hit Australia that Wall Street had crashed. And the underwriters we had at the time withdrew and the brokers that we engaged to help us float went You've Got No Hope. Uh but, you know, we weren't businessmen, we were we were brewers and um hate the word entrepreneurs too, but we I guess we were we fitted that description. Uh so we were well and truly committed to build this brewery.

and um we needed the funding to do it. So we continued with listing and it was it was very tough, um, but we we managed to do it and we managed to raise some money to what was it, 300,000 hectolitre, I'm trying to convert that to barrels for you, but that's probably about two hundred thousand barrels.

uh brewing facility that had a can line um to can craft beer by the way in nineteen eighty seven. Yeah. Um it had a bottling line and more importantly it had some very specialised equipment that we'd purchased out of breweries in Europe for doing shallow, open fermentations of ale style beers.

um to really push the envelope on um w what is today craft brewing production, but back then was considered crazy in Australia. Um So we funded that and we were listed on the Australian Stock Exchange and from then on on it was Uh and again, you know, this is a familiar story in the US and I have many friends in the US industry who have experienced this. It became a roller coaster ride between

Being a craft producer and uh working with our consumers, with our pubs, we we always faced the the market directly, across our bars. We we liked to be there when our beer was consumed.

uh versus um the daily um tumultuous life that you have when you're a publicly listed company, having to appease the stock market, having to appease your investors, having to raise more money, and uh That process went from 1987 through to 1990 where and and there were very good reasons for this, that we we became closely involved with uh what was then Carlton and United Breweries.

uh uh initially because we were selling their beer on our bars. And uh then um we got together to share distribution around Australia because at that stage we were brewing and importing stellar Artoir into Australia and that was simply because of the relationship I had with Artoire as a as a pupil brewer working in Europe years before

Um we were importing other beers as well as distributing our own of course. So we merged and we shared distribution and that was terrific for us. It helped us grow. We had a very good relationship with CUB and kept growing. We we offered um they wanted um a shareholding in the company. It was a minor shareholding and and we felt that that helped consolidate us and and it did.

Uh it helped us work together better. It it it sort of answered the questions that are usually asked and that is what are we doing for each other? Um but when we got to nineteen ninety C U B um was expanding its production or its sales across Australian markets.

prior to that, virtually all of CUB production only got sold in Victoria. And, you know, I think Matilda Bay was credited with uh opening up the I guess the the barriers to distribution and sale of beer around Australia, it was all very parochial up until the late nineteen eighties. And so as C U B was expanding into South Australia and then was expanding into Western Australia, they needed more production. Or more production capacity.

And also they saw lots of opportunity of course. And that that was the time when we started well they initiated discussions about utilising our facilities on the west coast. to get some production of CUB beers in the western s western coast markets rather than trucking it from either Victoria or they had some arrangements in South Australia to produce it.

and so that was a shorter run to truck it, but then they ran into some corporate difficulties with their partners there and the so the initial approach was getting production capacity for C U B beers in our quite large facility on the west coast. And that didn't go very far. uh because we we were trying to retain that capacity for ourselves.

um, although we weren't util we did have capacity, but we didn't want to tie it up with someone else's production. And it ultimately um ended up with us being approached um that they would like to buy the company. Um And that it then ended up in in an on market takeover. Uh and as I you know, I said earlier on, um, w we weren't great businessmen. Um we were brewers and and and entrepreneurs. and uh we hadn't positioned our ve cells very well to to defend uh a takeover and um

But uh eventually the price offered. Uh caused our other major shareholders to accept the price and uh and we were confronted with uh well that that's life guys and um you know, we'd like you to stay involved but now this company's gonna be owned by C U B. So it wasn't exactly we sold it to them. Um but, you know, through that whole whole process, um

we we always had a good relationship. We didn't like some things that happened but we managed to keep a good relationship going and I you know, ever since nineteen ninety, right through until today. Um I've I've have had good good relationships with the various um regimes that have gone through C S C U B. and uh we've had productive conversations about um the future of Matilda Bay all through and and you know I've advised all along um that is

if you want it to be successful, you have to cut it free. Um you can still own it, but uh you do have to cut it free. It has to be it's like a child I guess. Um What do you mean by cutting it free?

Cutting it free means you you you actually have to let it make its decisions. You have to let it do what it determines it needs to do to be a successful competitive um

um brewery or player i in in what is a unique market and that's craft beer. And um you know, I um I was speaking to a a guy I've known for a long time who I did a lot of work with in in the Little Creatures days and um and has done work with Matilda Bay earlier than that and is now doing some work with us as as we're starting to um reconfigure Matilda Bay for the future.

we got into, you know, brand management speak and marketing speak, uh all of which I you know I'm very familiar with but I I I I don't feel have a particular place in craft. Um it makes me very uneasy. Um But, you know, he encapsulated it and that is, you know, what you need to do, Phil, is be doing what the big brewers don't do.

And, you know, if there was one piece of advice for someone sitting out in craft I'd give them that advice. It's not mine, it's it's it's Jeff Schempteloops from Brain Cells in Perth.

Um so you you kinda talked about and you alluded to um Matilda Bay losing its way over the years and I've I've seen you mention in interviews. Um, you know, there's I I guess my own perception of the brand is from those days of Redback and Dog Bolter, um, now it's spun off into and I guess for American listeners that might not know this spun off to I guess a sub brand called Yak O.

Um and then they've Matilda Bay right now in the marketplace is mostly frothy, which is kind of a uh entry level ale, I guess for lack of a better word. Light summer ale. Um Is that what when when you say, you know, it's lost its way, is that the kind of thing you're referring to? Yeah, it is partly. Uh those are marketing solutions and um I I I don't think craft's about marketing solutions. But then when those decisions were taken, I would assume

Um they weren't taken with craft in mind. Um they were but they were taken with um um selling beer. Uh they were taken with leveraging or extending uh a reputation or or um the concept of craft into a a place where I I I'm not sure it works that well. Uh but you know that's not I'm not an expert on that and Um I I don't really want to speak about them because I haven't been involved in it and I'm not going to be involved in it going forward. But I'm quite happy to work alongside it.

Uh to me I mean to c to me craft and um and big scale commercial commercial brewing are actually two different industries, two different pastimes, um to me they're as different as wine is from um beer or wine is from commercial beer and Uh yeah, they can work alongside each other very well, but I think the moment you try to merge them, uh y the overlaps and the the boundaries become very blurred.

and, you know, we risk tripping ourselves up in every way, whether as commercial brewers or and, you know, I've been a commercial brewer and uh We we so we were stripping ourselves up as a commercial brewer or as a craft brewer because uh we're trying to merge something that doesn't merge.

So the uh brew pub that you're you're now sort of relaunching in collaboration with them, uh is that's gonna kind of exist separately to those brands? Yes it is. Um I I'm I'm working with Matilda Bay, the craft brewer that was the craft brewer I guess I let go of.

um always from me, uh back in nineteen ninety. And th those are the things that I want to address and and also I want to address uh Matilda Bay's position in in craft. because, you know, it does have a position because it was there and it started it.

and we didn't have a blueprint. Um, back then. We we had no idea what we were doing apart from trying to brew and introduced to the Australian market some beers that uh had been here if you go back to the eighteen hundreds, but hadn't been here certainly for eighty eighty years or so and were completely lost to Australian consciousness. Uh so I'm that's the unfinished business that I I I want to get back involved in. And and

also, you know, people have said, Why do you want to do this, Phil, at this stage in your life? Because y you know, I keep thinking I want to go sailing, but I know in the moment I went sailing I'd probably start looking at craft beer again. So uh what I would like to do is Also use the the megaphone that I'm getting here Because you're just giving me one today. But I'm I I've also got one in what is going to be a great pub in Hillsville. And I I love pubs.

uh, use that megaphone to go, you know, craft is about craft beer and for me craft beer isn't uh and I've used the word and it's not a nice word, but idiot beer. Uh Beers can be made into just alcoholic beverages and therefore they get marketed alongside all the other different sorts of alcoholic beverages that um are out there on the shelves and are on the bars. or beer is about the craft of beer. And the craft of beer is is absolutely well defined by the Germans. It has been for a long time.

and last time I looked and I'm I'm not entirely up with what's happening in Germany at the moment but certainly last time I looked, if you're gonna brew beer for the s for sale within Germany, it still must conform to the Reinheitskabot. And That wasn't protectionism. I th I to me the Reinheitsko Bo was put in place uh to to preserve and protect the craft. And and that's a craft that I've loved reading about.

Um going back two thousand years and it's why I like to make bread. Because beer came from making bread and you know, these are the crafts and you know, when we make bread here in this place that we're sitting in the courtyard, we use flour and water. W we don't add stuff. We don't even culture yeast. Um we don't add yeast, we just recycle it as a sourdough and we let it do what it wants to do and we we shepherd it and we we watch and we marvel and

Um we you know, whether it's wine or or craft beer, it's we let it do what it what it is going to do. And our job is to shepherd it. keep it safe, uh, respect it and take it to people as consistently as we possibly can. So the moment we start then, you know, bringing in a whole lot of fruit

um and other flavours and other concepts. It it to me it starts to drift and and I can hear people listening to this go, Yeah, but what about the you know, the the Lambic beers of Belgium and and so on. Well sure. Um, but that that's steeped in craft as well. Um So Craft is is what I what I would like to talk to the the the the craft world about and to talk to people I keep running into, young brewers I keep running into, who have been taught everything they know in the modern craft world.

but haven't had the access to the craft of brewing that I was very fortunate to have. Uh going back into the seventies and spending quite a lot of time in Europe and studying classical traditional brewing in one of the great schools. uh and then being bringing it to Australia and and and making all the mistakes you could possibly make, including having to make our own equipment because back then in nineteen eighty three

the established brewing industry, Australia, made sure that we weren't going to be able to start up. And the only way we did start up was we had to design and build our own equipment ourselves. and we had to then go and find the raw materials because that wasn't available to us either through the established channels at the time.

Um, we so we had to reestablish relationships I had with craft people that in in England, for example, and Europe that I'd established years before, to get access to anything that was ever going to let us start. To me that's the craft.

After Matilda Bay, um, you went over to the US? Is that st was that right away? Yeah, I did actually. I um after Matilda Bay I was I guess I was in a bit of a funk. Um I was I was definitely exhausted and and very disappointed. Uh uh I uh And I've always been in the wine industry as well and, you know, for me i it's a very fluid um crossover between the two and I so I you know, I had a wine business and it was s it was small but it was beautiful.

And so I threw myself into that for a few years um and again um focusing on some hospitality businesses over on the west coast that I I'd established. And I've always enjoyed h enjoyed hospitality, not because I like waiting tables, but because it's a beautiful place to to meet people face to face and talk about what you make.

I and I wouldn't be in hospitality if I wasn't uh working with things I make. Uh and th that was the reason or that is the reason why the hospitality business is there for me. But uh I was in the I think it was about nineteen ninety four. a a very good friend of mine uh was very intrigued with craft in the y US market and uh he started talking to me about uh you know would you might you be interested in coming over and working with us to get involved

i in in in what is still the very early s early stages of craft in the US. And uh Cut a long story short, that that involves what was originally the Columbia River Brewing Company uh in in Oregon and the U.S. I knew that business because and I'm trying to recall which year it was, but I I imagine it was probably about nineteen eighty five.

I was actually in Portland having a look at the early Starbucks businesses that were being set up uh in the Pacific North West because, you know, I have this love of coffee and going back again to the craft and origins of how you go about coffee rather than just making cappuccinos.

and, you know, I'd I'd I'd been reading and I'd heard from friends about the early Starbucks businesses and I I was over there and one night I was wandering around in what is the Pearl district and those days it was a great place to get yourself mugged. and I s w walked into this dimly lit, very cool looking bar, you know, warehouse.

that turned out to be a a craft brewery called Columbia River Brewing Company. And I got to know the people there and And So it was really quite fortuitous that when I was asked to have a look at getting involved in helping with some cr a craft business in the US

that it was actually to assist in the acquisition of the Columbia Brewing Company. Um between when I first met it and when in nineteen ninety four. But to get involved with the acquisition of it and um to then be able to redevelop it, reconfigure it, reformat the way the beers were were being done and the beers were lovely but they were very focused on traditional English ales, which I love.

And they they well, i in the Portland singing they just they weren't quite resonating and I know why, because well It was pretty well the first thing I said to the staff when I got involved and they said, I can't believe that I'm sitting here drinking traditional English ales made from Fuggles, East Kent, Goldings. uh s winter variety barleys that have been malted and brought over to Portland when I'm actually in the centre of the most exciting hop fields on the planet.

and also accessed some of the best looking barleys I've ever seen, American barleys. Why aren't we doing this? I guess it was like a winemaker turning up in Burgundy and going, why are you growing Cabernet Sauvignon? Couldn't we try Pinanoir? And We therefore I you know, I in my fairly usual quite aggressive way, bulldozed a a transition in what in Brock Bridgeport was doing from traditional English Ales to Pacific Northwest style ale and then going, Well

There's there's a fabulous uh pale ale in this market. I admire it enormously. Every time I come to the US the first thing I do is make to a bar that's got it on tap and and that is Sierra Nevada. My first exposure to Sierra Nevada was back in I think it was about eighty three as well. So why don't wanna do that, but why don't we just maybe amp it up? amping it up to me was to follow the the story of how pale ales out of England developed into India pales.

And why don't we do that here? So out of that whole process Bridgeport uh launched, I think after I'd been there for about two years, uh an India Pale ale. It was pretty unique at the time in that it was it was fully bottle fermented. And it was also unique because As a winemaker I was imposing some disciplines on craft brewers that I was working with in Oregon who didn't didn't really want to talk about this. But uh as a winemaker we always talk about balance.

and, you know, if you're gonna have very high sort of hop or bitterness characters then you've also gotta talk about sugar balance. And we worked a lot on that. But, you know, I was very, very proud of the beer as we finally got it out because for me as a winemaker, making a beer it was a it was a very nicely balanced beer that was running fifty IB.

But it also had very high non-fermentable sugar levels, which we achieved naturally using brewing techniques and and good source or selections of barley to get there. So it it it went really well that that business and there was a lot of IPAs followed. But um yeah, I so I spent three pretty well three years being full time involved in this and then

Uh and and I don't know how long you've got because there's a Starbucks story in this too, which um maybe is for another time. Well the Starbucks story is that uh i initially my colleagues who I started Little Creatures with in in about nineteen ninety seven uh had been with me in Matilda Bay and um we'd be we'd remained very close friends.

And you know, that shared my disappointments um about what happened with Matilda Bay. But And I'm gonna I we don't have s long enough to go through this and probably I'll end up getting sued, but uh w to cut a long story short, we got together and uh we negotiated that uh we were going to take Starbucks together into Australia. And

We we took it a long way and the uh the business plan and the models were being put together. But really at the last minute, one of one of the friends involved in this and his name's pretty well known, Nick Tromboli, he won't mind me telling you about it. But Nick said, I don't want to do it. It's doesn't feel right. Uh You know, my first conversations with you, Phil, when you were coming back from the US were actually just to do a pub brewery in Fremantle again.

have some really good fun with just making one really lovely beer and serving it over our bar and not putting bottling lines in and not getting involved with distributors and resellers but to just make a great beer and serve it over a bar, which really appealed to me.

and you've morphed this into us becoming Starbucks, Australia, New Zealand, Singapore s and half the world. I don't want to do it. So We all the there were f well there were four of us involved, not three, but we sat with and I remember it so well, it was in a bar in Seattle at two AM in the morning, virtually of the day we were due to sign. and we looked at each other and we said, Well, you know, if you're out, we're all out. Um we'll stay together on this So uh Starbucks morphed into

Uh little creatures. And and the condition that I d uh I was going to go forward and this was me coming back to Australia from the work I was doing in the US, the condition going forward is we're not doing bottling. We're not doing uh distribution, we're not having meetings with distributors. I'm not getting on planes flying around the country doing this, that and the other. We're not having marketing people. We're not having accountants. Uh We're just gonna have a great bar.

and we're just gonna put the beer straight on the bar from the brewery. and if you wanna drink it you're gonna have to come and see us and you know what's what's left in the till at the end of every week's gonna pay the bills, uh it's gonna pay the wages hopefully and uh if we're really lucky there might be some profit left for us.

A and people that have been involved with beer a long time might recognise that story. It's actually the the the story that McSawley's Real Alehouse um in Lower Manhattan used to always say and that is uh we're very simple, we just have Draft beer on the bar. We you know, we don't run accountants, we don't run marketing people. Uh it's just if there's some money left in the tin at the end of the week, that's our profit.

Well, unfortunately, the little creatures sort of r ran away with that a little bit and it got it got quite large, but that's where it started. You're really bad at being bad at business. You know, I in some ways, um, telling me I'm a businessman or I'm a good businessman kind of offends me. I Uh uh I I I'm a brewer and a winemaker. H always was, always will be. Uh that's how I s I see what I do. Um it's how I see the world.

And but I have learned that uh y you do have to be in business to do it. Um and as as I've got older, you know, I've I've of often ended up speaking to people in in these sort of industries, going, you know, whatever you're doing, whether you're making bread or you're roasting coffee or you're making beer or you're growing wine grapes, if you aren't financially sustainable, um

And and uh well I use this term and so I'm gonna use it with you. You know, you're nothing but a rich if if you're not, you're nothing but a rich man's bit. And I don't know if you can publish that buttons.

You you can you can pour lots of money at at these things that we do with our hands and our souls, uh, and be successful in a in a external way. But if it's just consuming money like you're the you know, you've got a patron, uh, you know, what really is this? Whereas if you can do it and you can be paid for doing it.

and you can keep on doing it because you're being paid for doing it and you can e you can grow it because you're making money by doing it. To me that's what is is financial s sustainability and to me that's what makes it pure. So you do have to have some business skills to do that and you know, I've I've learned the hard way and you know, all these chats that I have with people are never around the absolute screw ups that I've made and they're they're massive.

uh because th the nice stories tend to gloss over it and probably when I'm asked I'd prefer not to talk about it. Yeah, my next question is be can you tell me about one? Yeah. If you'd rather not. But Uh so yeah, businessman becomes part of the process. and, you know, maybe the next question you're gonna ask me is selling it, um, or having it bought off you and and where does that fit in it? Well, you know, that's a really painful process.

and, you know, I it all these sales that I a allegedly have made that have been so successful haven't been as successful as you'd really like to believe because you know, when there's a sale there's also the um eradication of massive amounts of of absolute crushing debt. And in in many cases, you know, to to meet the obligations of the debts we create as we do things we end up

being put into position where before someone else makes us do it we we make the decision to to to do the right thing. But I I keep on being challenged by being sustainable. And, you know, I do have a sustainable wine business and it's taken me forty years to get to that stage and Uh I love the feeling of that and you know, as as we embark on this this new journey with Matilda Bay, one of the things that's going to be crucial f for me to demonstrate to myself first.

uh but then to the other people involved is this is going to be financially sustainable. Um even though it's got a very big big brother sitting alongside it, uh it it it needs to be financially sustainable and I know that big brother wants to see that happen. No one likes to keep having to put money at things or pour money at things to make them successful. They'd rather they were successful organically. Um, how long were you with little creatures?

I was with Little Creatures from start to finish. I uh you know, from the the moment it started as a discussion around Starbucks. to uh um addressing the um the the decision by by lion that they wanted to make a an offer to acquire the company for what was uh you know a very very high price. Uh we understood why. Um Little Creatures was in a fantastic position.

And but we also understood and you know, again and I'm not saying this to defend myself, I don't feel I do need to defend myself, but some people ask me to defend myself. uh, you know, when when these businesses that we have built become successful and get bigger, they also become beasts. Uh and uh they're a beast in consuming your your energy, your time. um, your compassion, um money

Uh and at some point you do start asking yourself what am I doing here? Am I transitioning from being a um a craft brewer, a producer, a creator, uh to being just a manager? And No, I'm not a manager. So, you know, when when that eventually happened, I know Nick and Howard and and our other partners and myself, we you know, we went, This is time and You know, do we want to do it again? Mm mm no.

But here I am doing it again. Uh but uh do we ru no not at the time. It was like, you know, it's time and and maybe this child that we've produced actually k is has got a head of steam for itself now and um

I know you did raise um, you know, what Little Little World Beverages is doing now and, you know, that was the business we founded. Uh well hopefully, you know, some of the things that we we we put into that is helping it go further, but certainly, you know, the ability and and um the management skills that the Lion Group have are taking at a place we were never going to be able to take it.

Um, it's interesting when you talk about having a place that just serves a beer in Fremantle and I think that's what Lion is doing with little creatures, taking that kind of model around the world, um, with brew pubs and you know th that that bear and fremantle was still talked about as one of the you know, the pilgrimages. So in that way it succeeded pretty well.

Yes, it has. Um and and that's great. And you know, the lion um and You know, I I d I I I hope we're not gonna end up in a a discussion looking at different large um corporates because uh you know, I think they they are both amazing organisations.

But I think Lion had the opportunity to work with us for quite a long time, uh, in in Little Creatures and we you know we worked very well together. Um we had some some m massive missteps which again are for another time but uh uh but there's some lovely stories that came out of it. But

in the end, you know, I think Lion understood what we were doing very, very well. And you know, from what I can see they're doing and and you know, I don't have the same association with Lion post that takeover that I've had with C U B. Uh and I I'm not sure why actually. I probably because Lion felt they knew what they were doing and knew what they wanted to do. Um but they've followed that model really well. And

You know, the beers when I y when I buy'em and I often do, you know, the beers are great. Um, you know, they've they've certainly carried that on and taken it further and and farther than than we were were ever going to do it. And so I'm looking forward to seeing just how that model works. Uh but certainly take the beer to where people drink it I think's crucial. And secondly, you know, I'm all about consistency, you know, if you're going to if you're gonna be a beer in the marketplace

You've you must be consistent. People have got to trust you, have faith in you. So taking it as a consistent product to the market where it's being produced is um a pretty good model and I look forward to seeing it grow.

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This year and beer in particular has been fairly full on. Um only the last five, ten years have been full on and then this year it feels like things have ramped up. Um I guess Bridgeport um closing down is is one that impacted I guess something that you're involved in. Um I guess how does that feel seeing something you're involved in get to that point? That's sad and um you know I know everyone involved in that is is very sad about it.

uh I think, you know, what what is the solution as to these things? What what's the solution before it becomes inevitable? I don't have the answer. Really? W but so I'm going to go slightly obliquely here. I you know, I do think craft is is in a really interesting place now and Again, you know, I'm not a businessman, but, you know, market dynamics and and the way things work um always eventually overcome what you're doing if you're doing it in a particular way.

and, you know, just you know, how big a an inroad is Kraft going to make in into this big world of beer. uh before craft becomes the commercial product and the and the commercial product as we know it becomes the alternative product. Well You know, I Pareto analysis, eighty twenty, ninety ten, whatever you like to call it, um, was coined because it it was an observation that was made in Italy many, many

centuries ago. Uh and I'm not so sure that that's necessarily any different today. And so there's a point where Kraft was going to find it hard. For a million reasons. And You know, I I reckon, you know, as Matilda Bay, I think when we when we looked at craft in nineteen ninety as being two percent of the national market, um, we were finding it bloody hard. uh craft in Australia now pushing I think seven is probably what the consensus would be is really, really hard.

much harder than it was for us back then. And craft in the US, which I think is around ten percent, does that sound right? Yeah, I think so. Yeah. They're finding it really, really hard. For a million reasons. And what happens when you find it really, really hard? Change what you're doing or suffer the consequences. And you know, the consequences are amalgamation, consequences are um, you know, the weaker ones either close or get mopped up. And

you know, the the whole equilibrium shifts again and and things start to emer reemerge out of that. I think we're in that stage. I think Australia's Australia was in that stage in in the mid nineteen nineties when, you know, the first wave of of very entrepreneurial, clever, beautiful craft businesses either just folded up or were were acquired

either um almost compulsorily or in some cases, you know, people manage to control the outcomes of a of an acquisition. Uh And, you know, the US did the same thing and then we got into this kind of second wave which I to me is now um well and truly breaching and it's what we do next.

that's going to determine where craft's gonna go and that that's I guess that's one of the reasons why I'm really, really interested and you know, instead of going sailing I'm throwing myself back into into this particularly interesting set of circumstances. And You know, I think it's it is time that we remind ourselves what craft is and Um and w I've spoken at length about that in in this in this chat. But I think the other thing about what craft is is it's

It's not what you do every day. It's it's something that you you spare the time to experience, you spend the ti spare the time to think about it. to maybe spend more of your money than you'd normally spend um in something like the process of just having a beer. And you know, as as we get to five, seven, ten percent of the marketplace it it it starts to morph into something different.

So I think craft's gotta remind itself it's that it's special. Craft's gotta remind itself that it's different, that it it does require more time and more e emotional engagement. and that maybe, you know, that sort of ninety ten, eighty twenty situation is really what's um influencing things a lot here and therefore

Would I be starting up a craft business today to go out there into the marketplace? No, I'd be very careful. Um you know, I think even with the experience and the resources that I might be able to talk into joining to help me, I you know, I think it would be a really tough road.

Because why should we be different? Why should we do it better than a lot of very clever people, hard working out there, um, uh are not finding a way around. So, you know, my interest in Matilda Bay is not to um launch off into a new beer, I think it's to readdress uh something that Matilda Bay already owns and to readdress it and readdress it in a way that might be a little bit more applicable to the situation that we're we're heading into now.

Um, just before we wrap up, I I'm keen to hear about your winery, Giant Steps. Um Can you tell us a little bit about the the ethos and what what that is? Yeah, I'd love to. Um first the giant steps is um is not my word. Uh it's um it's the name of of certainly my favorite uh jazz album, uh and certainly my colleagues at at Giant Steps who are also very into music, uh it's it's a very favourite album for theirs. It's it's the Coltrain album.

uh giant steps which was cut not long written and cut not long after Coltrane separated from Miles Davis and I I I love the story. My jazz my dad was into hugely into jazz and so I you know, I learned I got my love of jazz from my dad. and I love the story of Coltrane going, I you know, I see things so differently. I I can't relate with Davis anymore.

and you know, I I see a future, I I need to separate and go my own way and and and that album was one of the things that evolved out of out out of that. And For me it was because I've I've owned a wine business before and it was a wine business that I loved and when I eventually sold it because I needed to spend more time with brewing, I it every night it kept me awake going, why did I do that? It was beautiful, I loved it. and uh it wasn't about the money, it was about trying to find the time.

So going back into wine was for me like a a giant steps moment f and hence the name. But the other thing about um the st starting the giant sp depth business it really let I commenced that as I came back to Australia so I was doing it in parallel with my friends with Little Creatures.

was to do it with the benefit of h hindsight and, you know, most of us in life don't get the opportunity to do things that often with the benefit of hindsight. Uh and, you know, my my journey into Little Creatures was th was with the benefit of hindsight from my Matilda Bay time and Matilda Bay was the with the benefit of hindsight with my time in big commercial breweries, both uh in Australia and Europe.

and giant steps was with the benefit of hindsight from um moving on from Devil's Lair, the the the Margaret River vineyard and producer that I I established. W and the benefit of hindsight w in terms of giant steps was you know, w wine in Australia at that time was quite marketing driven. Uh wine uh was growing very quickly. But to me it was losing track of of what the source of wine is and that is, you know, wine wine is a place

um, wines people. Wine's what's happened there, uh and therefore it's it's about what is grown, where it's grown, how it's grown. you know, what th th the whole culture of of bringing together agriculture, the people that do it, and taking it eventually to being an e encapsulation of that in a bottle and what's more a living encapsulation that you can then take

And I I I love this. You know, you can take that and you can take it to the coolest bar in Manhattan and pour it and talk to people about it and about the place it comes from. And You know, that that process almost overtakes just tasting it. It's it's like you can take this living product that's got so much history i in in our culture and and other p other cultures of the world and

uh there's so many wonderful stories and relationships that come out of it. So Giant Steps became a single vineyard producer of wine and you know, we produce wine from seven single vineyards and you know, each vineyard um we we manage um and direct it in in the way that we interpret it needs and it wants to to go. And we do the same thing with wine the mo winemaking. So, you know, we don't claim to be natural winemakers but You know, we fit we we check all the boxes for that.

um we we let the wine make itself and and then we put it into bottles and take it away. And you know, it's been really tough. Um we right through the the the certainly there was a massive wine glut in Australia in the in the 2000s and um it was really really tough just staying sustainable. In fact we weren't. I was subsidising it with every cent I could find.

But, you know, now, you know, that that story, um and I'm not for a second claiming it's our story, but it's a story that other producers, you know, have have been doing alongside us. That story is becoming a very powerful story about wine, um and the future of wine, certainly in in our cultures. and being part of that's been terrific and uh and I wanna keep doing that and I'm trying to sort of engage my son in that process p which he loves.

But you know, you you you never get to travel business class growing um growing wine grapes and and making that sort of wine. Um you never will because, you know, they're just massively capital intensive. uh o awfully high cost if if you continue to do it the way you say you do it, which is properly.

And but, you know, there's so much um so much pleasure that comes from it and so, you know, I love it. And y you know, it I'm I'm hoping that it it it keeps going uh out of its own energy for a long time.

Does that sort of answer it? And and you know what you know, as I'm saying it and and I'm thinking how am I gonna put this into words? I'm going, you know, it sounds like brewing. Well it is. It's the same thing. One of the questions I had was taking their wine to the bar in Manhattan. Can you do that with with beer, do you think?

It's it's it's harder with beer. Um, you know, beer is a um Wine is a and and it's because of its inherently its chemistry or its biochemistry. You know, wine is a long evolving, long living um beverage. beer's not. Uh and, you know, that's driven by again by the chemistry of beer. And um be a therefore and and tr in history it has always worked this way. It works at its best in its own little space, in its own little marketplace with its own group of customers.

And when breweries do that, they they usually do quite well. And you know, the German brewers understand this better than anyone. So yeah, putting beer in a bottle and taking it to Manhattan from the Yarrow Valley to me is a n is almost an oxymoron. Um it's not you know yes, to take it over there and show people out of interest. That's what we do.

But really to think that we could establish a marketplace for ourselves in Manhattan, no, it's not gonna happen. And uh, you know, whilst I've got any say, it's not gonna happen anyway. uh it's best to you know, it's best to work in your local space. And you know, w if you ask me what w what's my first goal for Matura de Bay is to is to actually establish a heartland for it in in one of the most beautiful places of Australia.

which happens to have the the the great fortune to being on the doorstep of four and a half million um people who who love um beer, wine, food. It's a great place to be. It's kinda like gene b just outside San Francisco. Uh to but to establish a heartland for Matilda Bay in this space is is my first objective and you know, we're not going to be aggressive players, we we're going to be um cooperative.

consultative happy players. Uh but to you know, to be in bars and to work with bars um in in in our heartland is is our goal. Um, so you're transferring then the the wine tasting room into a beer tasting room. Um

Why? I guess it's m I probably asked that at the start, but I I'm gonna ask it again after we've talked about it all. Why from wine to bear in the same space? Well, I think you're asking me why are we putting a brewery and a and a pub in into a building that I built as a as a winery? Yeah. Yeah. Well Th my wine business um has outgrown being in the hospitality industry. We we had a very big restaurant um attached to our winemaking facilities right in the middle of the town of Hillsville.

And, you know, for the last two or three years we we've been that's me and my my my team, partners looking at each other, going, Why are we doing this? You know, we're we're waiting tables with pizza, we're fending off blogs over how how we you know, we didn't put the knife and the fork in the right arrangement on the table. and we're going, shit. We're we're just trying to show you wine and and and give you a great experience around wine and the conversations become about pizza and hospitality.

and as we became sort of more successful it became less successful for what we wanted to do and also I I suspect less suc successful successful for the people who came there because they got a they got a crappy experience. poorly served pizza instead of a great wine experience. It it just overcame us. So we went we we've got to stop and and and we've got to actually go back to our roots as wine producers. We should taste our wine in our vineyards.

Um, we should taste our wine without food. We should taste our wine with a a long conversation with our stopwatch on it, with with people that are interested. So we went we're gonna take our whole wine experience back to one of our vineyards and therefore we want to close this hospitality business.

And then we went, Well, we've got this wine processing facility alongside and it doesn't kinda make sense to have it sitting in the middle of town and to have the wine experiences going on on the vineyard fifteen minutes away. So Can we get our heads around moving the wine processing to the vineyard as well? And we well of course we can. So then we're left with this huge building stuck in the middle of Hillsville, which is a very purpose-built building. And we it's either going to

We'll sell it to someone that's going to set up s sort of a home hardware type business there. It would be great home hardware, by the way. Uh or Damn it. Uh it'd be a hell of a good brewery. And and that hospitality business there would be a hell of a good pub. So th you know, that's how this whole process into Matilda Bay started. And if if the if I hadn't started grappling with the problem what to do with this building

I don't think the conversation around what to do with Matilda Bay, which I've been having with C of B for a long time, would have actually crystallised into uh what is now a a real project. So And the second thing and and again I'm gonna use a term that I'm no, I'm sure I'm allowed to use this term, but th the second thing is that, you know, When you go to a a um a beer place and and y you go to have some fun, you go to drink some beer, uh you go to maybe have something to eat with it, but

I always like to toin the front to coin the term what you really want to do is th the best invitation you could ever get would be to go to a piss up in a brewery. And so that's you know, that's what we're trying to we're trying to do uh putting it nicely, uh uh i is to make it a pub. So it's it's not a it's not a pub brewery. It's not a um brew pub. It's actually a brewery with a pub in the middle of it.

So the we you know, we can't actually s set people under the tanks, but it's pretty close to it. And if you know, someone's gotta get o out of the way of a forklift then it's they're gonna have to. And if we manage to spray we certainly won't spray cleaning clean cleaning chemicals around the place, but someone gets sprayed with beer or something it's kinda be wool.

You know, th it's what happens when you come here. So you know let's enjoy it. Things can be a little bit looser in a in a brewery. Yeah, yeah. And of course there's all the work safety issues and and and we take them deadly seriously. But, you know, it's supposed to be fun, it's supposed to be real, it's supposed to be authentic. It is a brewery. We're making beer. You know, we're not doing brain surgery here.

and uh let's make it fun and let's not do table service and worry about which way the knives and forks are arranged. And please if you're gonna blog us, blog us about our beer. Don't bogg us because the pizza was too salty or you know, whatever we managed to get wrong there because yeah, we're happy to do food, but um, you know, it's about beer.

I've blogged about Matilda Bay uh a little bit over the years. Um so I'm really excited to see how it evolves and and the next chapter in in this story'cause um it's fascinating and it's exciting. Are you excited? Yeah, look I am. Uh I'm excited as a uh 65 year old can be, having done this so many times that I've lost count. Uh And of course it's exciting, but what's most exciting for me is beer. w love it. I love the history of it. Uh I love to drink it.

I've learned not to drink so much nowadays. And to you know, to be able to be involved in in this again with uh you know, new markets, new people, people whose dads grew up on Redback.

Uh uh I think is is really exciting. Yeah, I am I'm excited. Um it was my mum who first told me about Redback when uh I'm from New Zealand originally and she went to Perth for a holiday and she's not a big beer drinker at all when she came back and said Oh they've got this bear over there on a Perth sunny day sitting in a bear garden, this wheat bear called red bear.

Um and I I was certainly not old enough to drink at the time. And but she was so excited about it she had to tell someone and and I was the person that she was excited to enthuse it about. Um You know, I I love hearing that. Uh because if you go back to nineteen eighty three and and you go to pubs and and and breweries in Australia, there was there was one piece of the market missing, it was fifty percent of it. And and that is women. It women

uh, were so disenfranchised by the culture of beer and the culture of pubs in Australia at that time that, you know, the big brewers couldn't see it. They couldn't see that they were really only selling beer to fifty percent of the marketplace. So, you know, from the very first day that we opened a bar, um, which was the bar we called the San Anchor where we actually put the craft brewery that we built ourselves, we put it in there.

from the f very first day we went, how do we get women to come and drink our beer? We knew they'd like it. That that wasn't the hard part. It was how do you break this culture? So how do we get women to come and drink our beer? How do you get them to feel comfortable in these places? How do you get them to feel comfortable with these conversations?

And uh you know, I think if we looked at the demographic today Um, in some of the def demographics I get the uh get the privilege to see sort of tell me that often the d beer decisions, the beer d purchasing decisions nowadays are almost more controlled by women than by men.

So that's great to have been part of that and and I love hearing that story about your mum. How how did you do that? What was your approach then then? It was really easy. Uh firstly Back then the way you got a bar to be successful is you had women um in the bars with no tops on. Secondly, you segregated the bars so that you'd have a tiny little shitty to be honest bar in the corner which said ladies lounge.

And then you had the big bar uh where all the the men drank and you know, if a woman walked in there, everyone stopped drinking and stare at her. So it was really easy, you just didn't do that. Um and the and the other one that was really, really easy is that you actually went to the bathrooms or in Australia we say the toilets um and you made the women's bathrooms

as pleasant places to go into as you possibly could and put attention into keeping clean. And, you know, i it was that damn simple to just do those very basic, simple things around respect. um and being inviting and it it just happened. And of course.

uh, you know, the notion that the the you know, I mean it's another funny story but, you know, people I think hopefully will find this amusing as well as devastating and and and that is, you know, I recall vividly in Western Australia Uh maybe a year before I actually left the large brewer I was working with and um to start uh Matilda Bay.

was that, you know, this thing around having partially clad women in bars um serving beer to men and they you know, bars competed with each other over how partially clad they were and you know, what they looked like and so on. Um, which, you know, m me and my friends uh out of university had always been friends, we were just shocked by. We never went to bars ourselves.

But, you know, when then at one stage the health department, Western Australia, um, I guess in in a governmental attempt to try and rein this s this behaviour in went uh or impose some legislation that was in place over you must wear protective clothing when you're serving food or beverage. And therefore um you know, partially clad people serving beer must be put in protective clothing.

Well what some of the more enterprising bars did, and I you know, I think this is just so poetic, uh, was they put'em in see-through disposable garbage bags. And You know, that's how that's that's how things get. And, you know, in many ways that appalling state, um, in in some ways sowed the seeds. For the start of a craft brewery business in in Australia. So maybe it wasn't just that we we made different beers, it was that we we

were part of a what is was a massive cultural change in this in this country. Uh are you gonna be brewing? Yes I am. Um I anyone that's ever worked with me talks about me as a micromanager but also, you know, in interfering and I you know, I like to translate transl translate that back in in my head to I'm extremely hands on and You know, someone else can can worry about all the business issues

I I'll try to have a say. Well I I know I will have a say. But you know, this is all about the beer and it's all about what we do brew by brew and it's the way that we develop a culture around brewing really well and precisely and you know I'm that's my job to work with uh you know the the the people that are gonna be doing that with me.

And also, you know, the first thing I do is I go and have a look what's going on in the brewhouse every morning. And, you know, never forget that smell and when I'm not near it I always miss it. Oh, it's been a a pleasure to talk to you. Um I could sit here in this lovely garden all day chatting, but you're a busy man. Uh I appreciate you taking the time and good luck with the new venture. Thanks.

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