Last December, when news broke that multi-national corporation Constellation Brands was selling Ballast Point Brewing to Highwood, Illinois’ tiny, two-year-old Kings and Convicts Brewing, it raised eyebrows and numerous questions, the most prominent of which was: Who the heck is Kings and Convicts?
Though somewhat vague, the Kings and Convicts press release announcing the impending sale identified the company’s founders as COO Chris Bradley and CEO Brendan Watters. While little-known by brewing industry personnel or beer consumers, reputations earned through their international business ventures gave them enough clout that, when the duo inquired about acquiring Ballast Point, the brass at Constellation Brands were all ears.
Now that ownership has officially been transferred to the proverbial “king” and “convict” (titular references to Bradley’s English heritage and Watters’ Australian lineage), it’s time to get to know the heads of one of San Diego’s oldest and most influential brewing interests.
Fast Friends…and Even Faster Partners
Though both Chicagoland residents were aware of each other through business channels, Bradley and Watters might never have met if not for two important factors—beer and spouses. Knowing of their shared affections for ales and lagers, Watters’ wife suggested he reach out to Bradley to grab a pint. He did—albeit with some skepticism—and they met up at Lake Bluff Brewing where they instantly became friends. Soon, they were frequenting local craft bar The Art of Beer to shoot the breeze. With Bradley having recently made a lucrative exit from an executive position in the tech sector and Watters having just sold his hotel company, their discussions centered around recreational pursuits, most notably homebrewing.
Watters had a background in amateur fermentation and wanted to purchase a one-barrel system, but his wife made it clear she was not on board with the mess and odor that pursuit would bring into their household. Drawn in by Watters’ rosy tales of the joy of brewing, Bradley got the itch to take up the hobby, but his wife shut him down as well. That left the newly minted mates searching for offsite space. They figured 2,000 square feet would give them enough room to install a brewing setup plus TVs, couches and other creature comforts for their buddies. Then a Highwood alderman tipped them off to a 5,000-square-foot space that, being more than double the size they’d discussed, inspired them to think bigger.
“Chris needed a change from a high-impact business job and brewing seemed to fit the bill,” says Watters. “As we talked about it, we basically said, ‘if we’re going to do it, why don’t we do it right?’”
The pair started travelling to breweries all over the country for research. That touring included San Diego, where they visited Stone Brewing, AleSmith Brewing and Ballast Point. As is common in the craft brewing industry, they were welcomed in with open arms. Bradley spent three full days behind the curtain at Ballast Point’s Miramar headquarters asking questions of the brewing, operational and quality-control staff, taking copious notes so he and Watters could benefit from more than two decades of lessons learned.
Kings and Convicts opened to the public in 2017 behind a line of largely hoppy beers mirroring consumer demand. By 2019, the company had grown to include nine employees and, though its annual barrelage was just 660, demand necessitated an increase in production capabilities. To that end, Bradley and Watters acquired land in the Wisconsin village of Pleasant Prairie on which to construct a 48,000-square-foot restaurant- and taproom-equipped brewing facility.
Not Taking on Too Much
Straying as far as they had from their original plan of building a grandiose man cave, it’s surprising both Bradley and Watters believe in the importance of keeping things manageable. But much as their love for beer led them to go into brewing it on a professional level, their affection for a particular brand of beer inspired them to plunge even deeper down the rabbit hole.
When short-listing breweries to visit for research, Bradley added Ballast Point based on memories of business trips to San Diego when colleagues from Qualcomm took him to the brewing company’s Scripps Ranch tasting room for after-hours drinks.
“From then on, it was one of those places I made time to go out and get to every time I was in town,” says Bradley. “It was such a different concept from anything I was used to in Chicago. Every time I went back, the menu had changed and there were new beers to try.”
Watters still remembers the very first time he had a Sculpin IPA at The Venetian in Las Vegas and exclaiming “now that’s a bloody beer” following his first sip. It’s a story he shared with Constellation Brands executives over a round of golf and several rounds of beers on July 17, 2019. Emboldened by their liquid lunch, Watters sarcastically asked, “What are you guys doing over at Ballast Point?”
Facing declining sales resulting in production falling to around 200,000 barrels in 2019 from an all-time high of 403,000 barrels in 2016, and having shuttered Ballast Point’s Temecula brewpub and 80,000-square-foot multi-use facility on Trade Street in Miramar three months prior, one of the Constellation Brands higher-ups replied, “Why, you wanna buy it?” Watters responded in the affirmative, making it clear he was serious. A non-disclosure was signed and in no time the two sides were negotiating while Bradley and Watters rallied a small group of trusted investors and conducted their due diligence.
In recalling telling Bradley they were going to buy Ballast Point, Watters remembers his partner’s understandably shocked expression. He also recalls how quickly he went from surprised to contemplative to accepting and excited. While laymen saw declines, closures and layoffs, these businessmen saw opportunity, having diagnosed why purchasing the company hadn’t worked for Constellation Brands and why they believed it would work for them.
“Think about what Constellation Brands’ expectations were and why they acquired them versus what our expectations were and why we acquired them,” ‘says Watters. “They are a public company and their metrics on what they believe is success are very different. For them, if a brand doesn’t take off and go crazy, it’s a failure. Meanwhile, we see there is a brand in this country doing 200,000 barrels a year and say, ‘you think that’s under-performing?’ We believe profitability is success. It’s got to be about a profitable business and to do that we need to have a strong foundation here in San Diego. We need to own home.”