Thursday, September 25, 2014

Brew It and They Will Come – The Karl Strauss Story

Karl Strauss Brewery Tasting Room
The Karl Strauss brewery tasting room.
Sometimes it’s easy to take things for granted.  For instance, I have lived in San Diego my entire life, so I sometimes forget how lucky I am to live in America’s Finest City.  While San Diegan beer lovers can’t be accused of taking the San Diego craft beer scene for granted, I don’t know if we always remember to be grateful for San Diego’s craft beer roots.  After all, if it weren’t for Karl Strauss, there might not even be a San Diego craft beer scene.  Chris Cramer and Matt Rattner, founders of San Diego's Karl Strauss brewery, truly are the pioneers of the San Diego craft beer industry.

Chris Cramer, CEO and Co-Founder of Karl Strauss Brewing Company
Chris Cramer telling the Karl Strauss brewery story.
I recently attended the Beer Bloggers Conference in San Diego, and one of the evening events was hosted by the Karl Strauss Brewing Company.  Chris Cramer, CEO and Co-Founder of Karl Strauss brewery, spoke at the event and shared with us the story behind Karl Strauss.

Stanford Beginnings

Chris Cramer’s journey in the craft beer industry started when he was a freshman at Stanford University in 1980.  He saw an ad in the Stanford Daily for a bartending class.  He thought bartending would be a great job because he could work at night, make some money, learn some skills, and it wouldn’t hurt with the women either.  Learning about what made alcoholic beverages taste really good started a spark for Cramer.

During his next year at Stanford Cramer studied in England for a quarter, at the same time the campaign for real ale was taking off.  He found real ale was very different from the beers he knew as a kid growing up in San Diego, mostly Bud Light, Coors Light, and Miller Light.  Cramer also spent time that semester traveling around Europe by train, which gave him the opportunity to visit Munich and drink really good German beer.  During this time a light bulb when off in his head and he thought, “Damn, there is a lot better stuff out there than what most kids and undergraduates at Stanford are drinking.” 

Karl Strauss Brewery Tasting Room Beers
Karl Strauss brews better beers than had ever been tasted in San Diego previously.
When Cramer returned from Europe he saw another ad in the Stanford Daily for bartenders, which turned out to be a job for a small bartending business that provided bartending for the conference office and alumni association of Stanford.  Cramer ended up buying the business.  Soon thereafter Cramer met Matt Rattner, who is now the President and Co-Founder of Karl Strauss Brewing Company.  Rattner joined the bartending class and then worked with Cramer to organize the little bartending business into one that ended up providing all alcoholic beverage catering in Stanford.  Along with bartending Stanford events came the responsibility to cater to the tastes of the international clientele coming to Stanford.  Cramer and Rattner had to start learning about better beers, better wines, and better spirits.  Tough job, right?  They were learning about better beers like Anchor Steam and Palo Alto Brewing Company’s real ale.

An Epiphany in Fremantle Australia

Cramer and Rattner decided they wanted to start some kind of business somewhere, but they didn’t know what or where.  After graduating with his MBA, and while Rattner was still in business school, Cramer took some time to put a backpack on his back and go traveling the world.  Cramer went to Fremantle, Australia for the America’s Cup.  Cramer was always on the lookout for areas where they were making better beers, wines, and spirits when traveling.  In Fremantle he plopped down at the bar of an establishment called the Sail and Anchor and ordered a pint of bitters.  The bartender brought him a glass of beer that changed his life.  He took one sip and was so surprised because it was so different from any of the other beers he had ever had.  He called the bartender over and asked what kind of beer it was.  He learned it was made right on the premises and the bartender took him around the side of the building to show him the little microbrewery.  This was the first time Cramer had ever seen a microbrewery.  He had always thought of microbreweries as large, unattainable productions like Anchor Brewing Company.  But here was something small enough that he thought this was something he could do.  In Cramer’s words, “I thought to myself, okay, here is the place in the entire world more like San Diego than any other place that I’ve ever been.  Here’s beer that’s differentiated from and better than any beer that I’ve ever had.”  This is when the idea of the Karl Strauss brewery was born.

Uncle Karl

Cramer had an ace up his sleeve.  He was related to Karl Strauss, a world famous brewer.  Karl Strauss was born in Minden, Germany in 1912.  Karl Strauss grew up inside his father’s brewery and had the opportunity to get involved in all the brewery operations.  The only thing he ever wanted to do was become a brewer.  Karl Strauss attended university in Munich and graduated in 1933 with a degree in the science and practice of malting and brewing.  He left Germany in March of 1939 and came to the United States.  On his way to California he stopped in Milwaukee to visit some friends from his hometown.  His friends took him to a local beer festival where he saw lots of Germans drinking good lager beer and decided he didn’t need to go to California, as there was good beer in Milwaukee.  His friends told him there was an opening at Pabst Brewing, so Karl Strauss went the next day and applied for a position in the bottling plant.  After one look at his resume they hired him on the spot.  Here was a real brewer from Germany at a time after the repeal of prohibition when they couldn’t get German brewers into the United States.  Karl Strauss quickly moved out of bottling and up through the ranks of brewers until he ultimately became vice president of productions and master brewer for all of Pabst Brewing operations.  Karl Strauss worked at Pabst Brewing for a total of 44 years, the last 25 of which he ran five major breweries across the United States.  Karl Strauss was considered one of the three most famous brewers in the world, was the past president of the Master Brewers Association of The Americas, and was the only person ever to have won the association’s three highest honors.  Karl Strauss was also co-author of The Practical Brewer and an active member of the American Society of Brewing Chemists up until the day he died at the age of 94 in December of 2006. 

Karl Strauss Brewery and Tasting Room
Karl Strauss appears on the brewery wall and every bottle of the original Karl Strauss Amber.
Cramer’s trip to Fremantle started him thinking, “Gosh, if it worked down in Freemantle, which is so like San Diego, why can’t we have good beer here in San Diego too?  Why do we have to drink all of this nondescript beer rather than these really interesting beers that I would pay a lot more money for?”  So when Cramer returned from Australia, he cornered Uncle Karl at a family party and started asking him about the microbrewing concept he had seen in Fremantle and asked him if he would be interested in doing a project with him.  Karl Strauss stopped, thought for a second, and responded, “You know Chris, I think this could be the wave of the future!”  Cramer was the first person in the family who had ever expressed an interest in Karl Strauss’s craft, and Strauss was delighted.  With Karl Strauss’s brewing expertise and Cramer’s and Rattner’s business training, they set out on an odyssey together to start the first new brewery in the city of San Diego in more than 50 years. 

Creating the First Karl Strauss Brewery

Cramer and Rattner discussed how they could succeed, as nobody in San Diego had ever had a craft beer or anything remotely like craft beer.  They wondered how they could get San Diegans to be interested in such a thing, how they could create bridges from what people knew and were happy with to things that were unknown to them and get them to take a chance.  They thought about examples that had already happened, how Californians had gone down a path towards better wine, better coffee, better cheeses, and better food.  They decided they needed to create an environment where they could get people to come in and try these styles of beers in a comfortable setting, explain what made Karl Strauss’s beers so exceptional and different, and then hopefully convert them and create raving fans for these new styles of beers. 

Karl Strauss Brewery Lineup of Beers
From a dream to a laundry list of craft beers.
Cramer and Rattner wrote a business plan for what they called the Neighborhood Brewing Company.  They sent out an executive summary to family and friends who were interested in investing.  Once they had backers they needed to build both a biological manufacturing process, a brewery, and conjoin it with a successful restaurant operation.  They knew it would have to be in a place that would give them access to the influence leaders in the community.  They chose a location in downtown San Diego, on the corner of Columbia and B Street, in an old mechanics bay that had been converted into an architect’s office.  Disaster almost hit when it was time to obtain an ABC license.  California at the time was not able to allow people to get an ABC license until the brewery was installed and operational.  One morning Cramer got a telephone call stating that because of a loophole in the law, the license would not be issued.  Cramer could see his dream turning into bankruptcy.  He spent the next month in hell, running around the state of California all the way up to the director of the entire ABC and convincing him they had relied upon the representations of the ABC to make the investment.  The director ended up freezing every other license in process in the state until the legislature changed the law and closed the loophole.

Karl Strauss Brewery Restaurant Downtown San Diego
The original Karl Strauss brewery restaurant.
The last preopening party occurred on February 1, 1989.  It was the night before they were going to open up to the public and all the media and VIPs in San Diego were there.  After the party, Cramer and Rattner looked at each other as they walked out the door, turning off the lights, turning on the alarm system, knowing that the next day if people did not come immediately, if they didn’t spend money, they were going to go bankrupt and lose everything.  They stopped at the front door and said to each other, “Will people come?”  Fortunately the next day came and people were lined up around the block.  The restaurant started off doing 100% more sales volume than the kitchen was ever designed to do at the Karl Strauss downtown location, which was a problem.  But fortunately, from day one the beer was right.  Karl Strauss’s beers were phenomenal.  People would come in, taste the beers, and almost universally say the same thing, that it was the best beer they’d ever tasted. 

Karl Strauss Today

Karl Strauss Brewery Awards
Some of the many awards won by Karl Strauss beer.
The rest is history.  Karl Strauss brewery is now the 41st largest craft brewer in the entire United States.  In addition to the distributing brewery operations they have eight Karl Strauss brewery restaurants in Southern California.  Karl Strauss is the featured beer of the Disney Resort in Anaheim and one of the most award winning brewing companies in the world in the last five years.  In the last four years alone they have won 64 major medals in competitions and Karl Strauss Red Trolley Ale is arguably one of the most, if not the most, awarded beer in the world, having won the gold medal at the World Beer Cup two out of the last three World Beer Cups and two out of the last four GABFs as the best Irish Red in the world. 

Peter Rowe, a writer for the San Diego Union-Tribune, recently said that Karl Strauss not only launched the craft beer industry in San Diego, but also taught consumers that beer can be consistently good when crafted locally.  Above and beyond that, he said Karl Strauss inspired the revolution.  The DNA of Karl Strauss brewery runs throughout the San Diego brewing industry.  When Karl Strauss opened on February 2, 1989, Gina Marsaglia was a cocktail waitress.  She since started Port Brewing Company/The Lost Abbey.  On the other side of the bar was bartender Scott Stamp.  Scott Stamp later started San Diego Brewing Company.  The tour guide on opening day was Jack White who later went on to start Ballast Point Brewing Company. 

So now as I sit here writing this, drinking a Karl Strauss Amber, San Diego’s original session beer, I am grateful for what Karl Strauss did for the San Diego craft beer industry.  And while we will continue to be excited for every new craft brewery that pops up in the city, we should always remember that without Karl Strauss, San Diego’s craft brewing industry may have never existed.

Thank you to the Beer Bloggers Conference and Karl Strauss Brewing Company for making this post possible.  Disclosure: I received a discounted rate to attend the Beer Bloggers Conference in exchange for writing two posts inspired in some way by the conference.

Katherine Belarmino has been traveling for over ten years on a quest to see as much of the world as possible, experience new cultures, and sample other cuisines and libations. She also writes the travel blog Travel the World, which journals her world travels with her husband Romeo and seeks to encourage others to take the time to travel.