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Equity Raise For Second Brewery in Different State
POSTED BY Sam Holloway ON Fri, 10/20/2017 - 07:01

Hello, CAS Community! One of our members has asked me to post a question related to growing a second brewery in a different state. Their current operation is very successful and has quickly filled up current capacity. The plan is to have the new brewery use the same brand and leadership team in the new state. The business model plan is for a separate LLC in that state, plus additional and separate LLCs to organize the various businesses and assets. The hard part is to decide how to organize these different entities and how to organize the equity fund raising among the entities. Should an umbrella LLC govern the whole thing? If so, which LLC do you sell equity shares in to make the most value for your investors and to limit your risk. I know several of our members have considered and even implemented some of these strategies and fund raising ideas. Please share your thoughts below, against the following parameters. Also, share different perspectives (Accounting, Legal, Management, Financial, etc.) From our Member:

Technically we would have 5 separate LLCs for the operation in a different state.

1.) Real Estate

2.) Production

3.) On-site tap room

4.) Tap room #1

5.) Tap room #2

We need to raise some money for all of them. 15% for 1 & 2, 100% for 3-5. I'm racking my brain on how to divvy up equity between them, as they are all tied together in their success and will be sharing resources essentially. The real estate has no profitability, just appreciation of the land and building, while the tap rooms have no collateral, but will be profitable.

Should a parent company be created, with investors getting a piece of that?