Just 16 months since launching its award winning non-alcoholic beer 'Quiet XPA', Canberra-based Heaps Normal has raised an intoxicating sum as it plans to build a dedicated production facility and capitalise on growing demand.
The $8.5 million Series A round was led by Heaps Normal chief executive Andy Miller, and was open and closed within a week with backing from the likes of Who Gives A Crap founder Simon Griffiths, Athletic VC managing partner Matt de Boer and Tripple executive director Bec Milgrom.
Heaps Normal, an almnus of the Startmate accelerator program, now has its non-alcoholic beer stocked in 2,000 venues and retailers around the country, with Andy Miller predicting a new facility will allow the brewer to chase 20 per cent of Australia's non-alcoholic beer market in 2025.
"When we launched, we thought there were probably a few people like us who wanted to cut back on the booze, but didn't necessarily identify as sober," Miller says.
"It turns out there's a lot more people in that camp than we first thought. We’ve spent the last six months selling beer faster than we can make it.
He says Australia is only now catching up to the rest of the world when it comes to great tasting 'non-alc' beer, but "we're catching up pretty bloody quickly".
"Of course we’ve worked really hard to develop a great tasting beer that can stand up to a full-strength flavour, but we also feel super fortunate to have tapped into a culture shift away from the stigma traditionally associated with cutting back on the booze," he explains.
Simon Griffiths from Who Gives A Crap says Heaps Normal has created a wholly unique position in the market that reflects the current social and cultural climate.
"This is a product and a brand that all beer drinkers can get behind, not just those who are abstaining," says Griffiths.
"I can’t think of an example before now of a non-alc brand that has been cooler than an alcoholic brand."
Matt de Boer, who is also a professional AFL football player with the GWS Giants, says Heaps Normal resonated with him on a number of levels.
"As an athlete, you’re always seeking out that added advantage by sharpening your performance. I think we’re all becoming more conscious of how we can optimise our own conditions, and the no- and low-alc movement really taps into that," he says.
"As an investor, Heaps Normal embodies the kind of positive disruption and high-growth opportunity that we are looking to back. The non-alc space has gathered a lot of steam recently, but these guys are leading the conversation."
Bec Milgrom, an impact-focused investor with extensive experience in the craft beer industry across the USA and Australia, including Little Creatures Brewing, believes Heaps Normal has the potential to positively impact Australia’s drinking culture on a large scale.
"When it comes to changing behaviours and mindsets, you have to do two things: create a viable alternative, and know your customer," Milgrom says.
"What Andy and the team have done is build a brand around those two core principles to give beer drinkers a choice that doesn’t feel like a compromise but goes a long way in shifting social norms and expectations."
A report released by IWSR earlier this year forecast that the no- and low-alcohol volume in Australia will grow by 16 per cent 2020 to 2024 - a trend largely driven by younger generations. The number of people in their 20s abstaining from alcohol increased from 8.9 per cent in 2001 to 22 per cent in 2019. A recent study by DrinkWise found that Australians aged 18-44 are twice as likely to consume zero and low-strength alcohol consumption compared with those aged over 45.
Miller says the biggest indicator of a behavioural shift is the uptake of Heaps Normal over other alcoholic beer options.
"Retailers with hundreds of beers in their range, like Beer Cartel, Kaddy and Blackhearts & Sparrows are selling more Heaps Normal than any other beer," says Miller.
"We get stories that involve someone being able to order a Heaps Normal by name at a venue, and not even have to ask about non-alcoholic options."
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