KDP Acquires Stake in Athletic Brewing


by Brian Trivitt, MBA

Times sure are quickly changing in the beer business. Back in the mid 2010s, when I was working for a small importer of Trappist Ales and leading sales for 15 states, the beer industry had already gotten drastically more competitive with many new breweries opening and consumers constantly demanding to try a new beer. Incidentally, my relatively short time working for this importer was right before the hazy, North East IPA and hard seltzers came onto the scene and, at least temporarily, changed the industry almost overnight. While hazy IPAs are still selling well, hard seltzers have slowed down considerably, and with so many suppliers trying to capitalize on the gold rush a few years back, I’m willing to bet some of the seltzer offerings will start disappearing off shelves soon.

Now, as we near the end of 2022, and just in time for the holidays, we will take a look at the latest trend with a new article on non-alcoholic beer! However, for this article, I’m going to focus on a recent, significant investment made by a large food and beverage company, Keurig Dr. Pepper. They announced in early November that they will be making a $50 million investment into Athletic Brewing Company, which specializes in non-alcoholic beer.

Before analyzing what this notably sized investment could mean and why KDP is bullish on Athletic Brewing,  let’s take a closer look at some details of Keurig Dr. Pepper and Athletic Brewing.

Keurig Dr. Pepper (KDP):

  • 8th largest food and beverage company in the U.S.
  • Founded in 2018 as a result of Keurig Green Mountain acquiring the Dr Pepper Snapple Groupin an $18.7-billion deal
  • Dual headquarters in Plano, TX and Burlington, MA
  • $12.7 billion in sales in 2021
  • >150 distribution and warehouse centers

So, at a first look at these numbers and transactions, KDP is a large food and beverage company that has some of the most recognized beverages on the planet under their umbrella, including well known sodas such as Dr. Pepper (of course), Green Mountain Coffee, and Yoohoo, just to name a few. Additionally, KDP, also has partnerships with other well known beverage giants such as Folgers Coffee and Evian Bottled Water.

As recently as June of this year, KDP acquired Atypique from Station Agro-Biotech, based out of Saint-Hyacinthe, Quebec. and specializes in nonalcoholic RTD cocktails such as margaritas, gin and tonic, and mojitos. In Canada, nonalcoholic cocktails grew more than 30% in retail dollar sales during the last year, and Atypique now has a 42% market share of that segment.

Athletic Brewing Company:

  • Founded in 2017 by Bill Shufelt and John Walker
  • Based out of Stratford, CT
  • Utilize a proprietary method to brew NA beer (recall from past article https://craftbeeraustin.com/the-wild-world-of-non-alcoholic-beer) that historically brewing NA beer is not easy and results in compromised flavor and aroma)
  • The only non-alcoholic brewery in the world that owns and operates its own fully-dedicated facilities
  • Operate the only non-alcoholic taproom in the US
  • As of 2021, 27th largest craft brewery in the U.S.
  • Ranked as the 26th fastest-growing private company in America by Inc. Magazine and was also named to Time Magazine’s “100 Most Influential Companies” list
  • Has won more than 40 awardsfrom 2018 to 2021, including honors from the Great American Beer Festival, the World Beer Awards, and the US Open Beer Championship in 2021.
  • Backed by well known investment firms including TRB Advisors and Alliance Consumer Growth, along with celebrity athlete investors including NFL stars J.J. Watt, Justin Tuck and cyclist Lance Armstrong
  • Secured $17.5 million from investors back in 2020 to increase production by retrofitting a second location in San Diego that was previously occupied by Ballast Point to help meet demand
  • The 5-year-old brewery owns 51% of the US non-alcoholic craft-beer market and surpassed 100,000 barrels of production in 2021. While Athletic declines to disclose its latest sales and revenue figures, it told Bloomberg that sales soared to about $15 million in 2020, up 500% from 2019.
Photo Credit to Athletic Brewing

Although the reasons NA beer will likely continue to grow are numerous and certainly warrant their own analysis, Athletic Brewing, for reasons mentioned above, appears to be prepared to fully capitalize on changing times.  In only five years, they have accomplished phenomenal sales and growth numbers, but arguably, even more important for the long term than their sales numbers is that they are the driving force in completely overhauling the negative stereotypes of drinking NA beer both in terms of the beer itself and the perceived circumstances why people are drinking NA beer.

Thanks to their broad range of award winning offerings and attractive bright can packaging, they have managed to appeal to the people who regularly enjoy full strength craft offerings but wish to moderate their consumption. In other words, the craft beer drinker now doesn’t view switching up to a NA brew during a drinking session as “let’s just get this NA beverage over with so I can get back to drinking a “real” beer for my next round, but rather, Athletics’ beers are arguably the closest NA offerings to their full strength counterparts and therefore very enjoyable to sip on. In fact, Mr. Shufelt points out that a whopping 80% of those who buy his beers do drink alcohol at other times and he goes on to break down Athletic Brewing’s fan base into three segments:

  • Health-conscious, socially engaged people with active work and social lives (which Shufelt dubbed “weekend warriors”)
  • Young parents who want to consume beer without the effects of alcohol
  • Athletes

Tedd Kenny, Owner of Top Hops Beer Shop, a craft-beer bar and bottle shop on Manhattan’s Lower East Side, said Athletic Brewing has been a consistent and unexpected top seller at the popular spot (source: https://www.fastcompany.com/90404650/inside-the-nonalcoholic-brewery-making-the-years-most-exciting-beer). In fact, in early summer 2019 Athletic Brewing was the best-selling packaged beer in his store. Did you catch that? A non-alcoholic beer was literally the best selling packaged beer in a store that I offers a wide range of a wide range of craft beer offerings on tap and bottles to go. Mr. Kenny goes onto add that Athletic has “expanded the market [beyond] just former drinkers.” He sees customers at his bar switching between NA Athletic beers and alcoholic craft beer in a single evening. In other words, the drinker who wants to moderate while drinking will now order an NA beer. I realize I’m taking a quote and basically repeating what I said above, but I think it’s very important to understand how quickly the perception and overall attitude about drinking NA beer has changed, as these changes are going to be major catalysts in NA beer’s continued growth, which will warrant its own article (or, possibly a series of articles.)

Photo Credit to Athletic Brewing

When you consider that statistically craft beer drinkers earn higher incomes and are generally more educated, Athletic Brewing has, and continues to fill a underserved market of people who generally lead productive lives and recognize the need to regularly moderate alcohol consumption. As Athletic Brewing continues to rack up awards and brew great beer, I foresee a day where craft beer enthusiasts will have a regular rotation of a craft NA in their dedicated beer fridge alongside their 15% ABV holiday stout.

As I alluded to above, it’s likely that KDP sees Athletic Brewing as the catalyst for completely changing peoples’ minds and perceptions about why somebody is drinking a NA beer. While I have not had the pleasure of visiting their taproom, I envision overhearing a conversation between two random strangers on a Sunday afternoon about a wonderful full strength IPA they enjoyed at a brewery yesterday and how much they are enjoying Athletic’s NA IPA. Contrast this with the negative perception that NA beer pretty much exclusively held for decades, and you can clearly see that Athletic Brewing is truly carving out a niche.

In September 2021, Athletic opened a pop-up facility that they coined “the intersection of “beer and burpees,” and included five free fitness class per day in heart of Austin’s Warehouse District followed by an Athletic Brewing beer of choice (https://craftbeeraustin.com/athletic-brewing-co-hosts-first-pop-up-in-austin). Offering a NA beer after exercise is certainly a great way to get people to try it and obtain some feedback, but I am envisioning even multiple, somewhat out of the box settings where Athletic Brewing could offer their beer that would not be appropriate for alcoholic beverages.

Above all, KDP has the foresight that NA beer is really just getting started (NA beer holds less than 1% share of the U.S. beer market), and for the reasons mentioned above, Athletic Brewing Company, will be regarded as the innovator of NA craft beer, similar to what the U.S. experienced in the late 1970s/early 1980s with some of the craft beer pioneers that offered more flavorful options. Notice that I didn’t use the term “inventor,” as that would certainly not be the case; but rather, just like there were smart phones before Steve Jobs stood up on stage to introduce the iPhone back in 2007; Apple’s user experience and user interface innovations arguably set the standard for everyday smart phone use we have today.

I am looking forward to a follow up article in early 2023 to continue this analysis on Athletic; and even broader on non-alcoholics growth in the beer industry and speculation on its future. That said, you can probably tell from above that much like KDP, I’m optimistic, and besides being very happy with Athletic Brewing’s success thus far, anxious to see how NA beer will likely continue to change the overall beer industry.


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