Two weeks ago, a beer drinker in Fresno, Calif., called Hill Farmstead Brewery in Vermont to ask where he could buy its craft beers.
“You have to drive to the airport, get a ticket, fly to Burlington, rent a car and drive an hour and a half to the brewery,” the owner, Shaun Hill, replied with a laugh. But he wasn’t joking.
Hill Farmstead, in the hamlet of Greensboro, produces just 60,000 gallons of beer annually. The beer is available for purchase only at the brewery and in roughly 20 Vermont bars. In addition, Hill sends 12 kegs to distributors in New York City and Philadelphia a few times a year.
Next year, after several buildings are expanded and new equipment is installed, Hill plans to cap production at 150,000 gallons a year — forever. (For context, the Russian River Brewing Co., a craft brewery in California, made 437,100 gallons last year, and Dogfish Head Craft Brewery in Delaware produced 6.3 million gallons.)
Hill Farmstead is one of at least three Vermont craft breweries that are churning out small batches of highly sought-after beers and have owners with firm plans to keep the operations small. Hill’s story offers lessons in how limiting production can bring success.
Hill, 34, has been honing his brewing technique for nearly 20 years. He first learned to make beer for a high school science-fair project, then started a homebrew club in college and later worked as the head brewer at two other Vermont breweries, the Shed and the Trout River Brewing Co., as well as one in Copenhagen, Norrebro Bryghus.
Two beers created during Hill’s tenure at Norrebro Bryghus won gold medals in 2010 at the World Beer Cup, an international beer competition, and a third earned a silver medal.
Several months before these accolades, Hill returned to Vermont to begin construction on Hill Farmstead Brewery on a former dairy farm that he and his brother, Darren, a woodworker, inherited from their grandfather.
“I wanted to make beer, I wanted to live in this place, and I wanted to help my family and make sure I had the finances available to take care of this land in perpetuity,” Hill said.
This wasn’t his first attempt at starting a brewery, but it was the first time he was able to obtain financial backing.
“Ten years ago or even still five years ago,” he said, “it was very difficult to find private investment or to convince banks to loan money to a startup.”
In the past decade, craft-beer production has thrived, attracting investors with deep pockets. In 2012, national retail sales for craft beer were $11.9 billion, according to the most recent figures from the Brewers Association.
While Hill was in Denmark, where American craft beer was starting to become popular, he was able to borrow $80,000 from a small group of European and U.S. lenders who he felt respected his vision and abilities.
From the start, his philosophy has been to make the best beer possible without pursuing what he calls “infinite, boundless growth.” He operates under the belief that beer is a perishable item, “just like lettuce or broccoli,” he said, and should be consumed locally, not shipped long distances.
Hill has a staff of six, including two assistant brewers who harvest yeast and transfer beer into kegs, but he personally makes all of the brewery’s offerings — pale ales, stouts and porters — using modern stainless steel tanks and traditional wooden barrels, like those used in winemaking.
The beers are known for having “a sense of balance that isn’t common in a lot of new breweries,” said Jeff Baker, the bar manager of the Farmhouse Tap and Grill in Burlington, which serves the beers. “They’re hoppy, but they’re not superbitter and they don’t exhaust your palate.”
For entrepreneurs who measure success in more than just financial terms, it’s still crucial to have a viable business, says Bo Burlingham, author of “Small Giants: Companies That Choose to Be Great Instead of Big.”
“The challenge for a lot of small companies who have nonfinancial goals is that you can’t let that get in the way of having a very financially solid business,” Burlingham said. “You’d better have a sound business model, steady gross margins, a healthy balance sheet and margins you protect.”
For Hill, financial stability came quickly. He says the brewery began turning a profit after just one year.
Demand surged last February when users of the beer-review site Ratebeer.com deemed Hill Farmstead the best brewery in the world — after having anointed Hill as the best new brewer in 2010.
Now Hill says he fields questions like the one from the Fresno caller every day. He estimates that thousands of people have made long-distance beer runs to Hill Farmstead Brewery, some traveling from as far as New Zealand, Norway and Japan.
Customers wait in line for one to four hours to buy bottles and 2-liter growlers of the beers, many of which are named for Hill’s ancestors (Edward, Abner, Florence). The brewery once sold an entire batch of beer — 500 gallons — in one day.
As his beer’s popularity has risen, he has sometimes worked 18-hour days. Some small-business owners who have achieved financial stability choose to delegate a significant portion of their work to employees, but Hill says he won’t be doing that.
And the notion of moving production to an industrial park, where craft breweries are commonly found, holds no appeal for him. He has decided to invest in infrastructure and better equipment that will make his current operation more efficient.
“I didn’t start this brewery so I could keep growing and move it away from here; that wasn’t the point,” he said. “It wouldn’t be fun anymore. It wouldn’t have purpose or meaning.”