The Beverage Lawyer Who Won't Sugarcoat It | Shauna Barnes of Barnes Beverage Group

Shauna Barnes is the founding partner of Barnes Beverage Group, a full-service national law firm built exclusively for the beverage industry. She started in craft beer, built the legal department at Dogfish Head during its fastest growth years, and now runs a 15-person firm alongside her husband Brandon helping brands navigate formation, distribution agreements, labeling, trademarks, and the current hemp regulatory storm.

In this episode, Shauna and Nate get into what it actually costs to go national,  regional or statewide (more than you think), why landing a distributor is the beginning not the end, what brands need to do right now to survive the federal hemp ban, and the lessons Dogfish Head taught them both about building something with soul.

They also talk about the craft beer shakeout happening in across the country, the vultures in the beverage space, why beverage ain't it if you want a cushy paycheck, and what it means to be a lawyer who tells you the truth even when it costs her the billable hour.

Shauna's firm: DrinksLaw.com 

Find her on LinkedIn: Shauna Barnes

Follow Ready To Drink Podcast: Spotify | Apple Podcasts | YouTube | ReadyToDrinkPodcast.com

Ready To Drink Podcast is hosted by Nate Fochtman, founder of The FreeMind Group, a strategic advisory firm serving beverage brands since 2008.

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Transcript

SPEAKER_04 0:00

Shauna Barnes, founding partner here at Barnes Beverage Group.

SPEAKER_00 0:03

Perfect. All right. Give me a cloud level overview about what Barnes Beverage Group is.

SPEAKER_04 0:08

Yeah. So we're a full service law firm that services the beverage industry. So when we say beverage industry, it's all the intoxicating beverages. My uh background started uh actually in craft beer as well, and then um similarly kind of expanded out into hemp and intoxicating THC beverages, um, and then sparkling energy functional, you name it, which kind of followed our clients where they wanted to go.

SPEAKER_01 0:31

And are you geographically restricted at all or anything like that?

SPEAKER_04 0:34

No, so we're a fully national firm. Um, my husband and I run the firm together. We're based here in Annapolis, Maryland, with five student-to-be seven uh to eight other folks. Um, but then we have the rest of our team. Um, we've got 15 now spread out geographically all over the country, up and down the East Coast, some in Middle America, and then also we have a few in Portland, Oregon as well.

SPEAKER_01 0:56

Very cool. If uh if there's a startup uh founder listening that doesn't hasn't retained a lawyer other than starting their LLC or anything like that, what do you kind of what are some of the top common things that you deal with? And then we don't have to name brands, obviously, but like what are some of the top issues or topics you guys deal with?

SPEAKER_04 1:11

So for our smaller brands um or our startups, uh it's a lot of formation and entity planning, right? So making sure that if you've got a partnership agreement with somebody or you got a money guy that we're planning for a potential problem. Um, hopefully there's no problem. I love it when they get shoved in a filing cabinet and never come back out, but just in case. But then we also do a lot of that labeling formulation, um, you know, kind of review and support to help make sure that what you want to put on your label um matches how it's formulated. And like so you're put so you're not disappointed, right? You don't think you're gonna run with a product that you can't actually you can't call it what you want to call it, or you can't market it how you want to market it. Um, a lot of distribution agreements, trademark uh, and those sorts of things. Hopefully nobody of that size is in a lawsuit, but sometimes that's all the small brands come in, they're pissed at their co-packers. Excuse me, like they're mad at their co-packers.

SPEAKER_00 2:03

Oh, we curse all the time.

SPEAKER_04 2:08

Yeah, I use all the words. Um, but no, so like they're mad at their co-packer or they're you know pissed at a distributor and want to break up. So um sometimes they come in that way, but I don't like litigation. I think it's a waste of everyone's time and money. So uh usually it's more of those kind of formation type things to help folks get their product on the shelf.

SPEAKER_01 2:24

I see the uh Penn State shirt. I'm a Penn State guy. Is that where you did you go to Penn State?

SPEAKER_04 2:28

Oh my gosh, yes. My whole family went to Penn State. I have an enormous yeah.

SPEAKER_01 2:35

No one ever wants to be the black sheep that doesn't go in the whole family.

SPEAKER_04 2:38

Well, there was a moment in time where to piss off my parents, I told them I was gonna go to pit. Um, and my mom was like, that's fine, we're not paying for it. And I was like, oh, okay.

SPEAKER_00 2:50

The only next one it could have been is like I'm going to be able to do that.

SPEAKER_04 2:53

Right, 100%. Well, and I mean this was some years ago, but um, I knew I wanted to go to law school, so I was like, we'll take whatever financial support you will give me, parents, wherever, wherever I go. That's it, it's fine. But um it was the best, the best place. So it was the right move.

SPEAKER_01 3:10

That's awesome. Well, I'll give the I'll give the audience some context. I got to meet your husband while we were lobbying together in uh in DC and stuff like that. And uh kind of let's let's not necessarily all focus a hundred percent on him, but I do while you're on this call, would like to spend a few minutes talking about where we are and kind of as much as you want to share about. I mean, I can kind of fill in as well from different levels as far as state goes and stuff like that. But um I guess I'll just say like where where are your personal, where's your perspective on it as a business and kind of what advice let me let me leave it this way. I don't want to leave it as like just feelings, I want to leave it as uh as like action items that like like where you see it and then where what opportunities where people can step up, step in, and help kind of keep this thing moving forward for the next couple months.

SPEAKER_04 4:00

Yeah, so as B, my my husband Brandon um probably told you we are personally consumers of these products, we love them. So we are pretty pissed off about the current state of uh the regulatory framework, but it is what it is. So I think federally what we're recommending and kind of the way that we see it is plan for the ban, plan for the ban to go fully into place. I think doing anything other than that and spending your energy doing much other than that right now would not be the best use of your time. I think similarly, continuing to lobby your um, you know, your uh Congress people. We're actually in Andy Harris's district. Um, he won't take our meetings unless we're calling on behalf of the Brewers Association. But um so trying, we send emails, we know they go into the void, but um Canada is what it is. Um, but but to the extent that we can our businesses here hang out with us, so we'll reach out to our our local reps um every couple all weeks just to say, hey, we're still here and we still care about this. So if there's an opportunity to support us, please do. Um, and then in terms of what we're telling our clients to do, to your point, of like where are the opportunities, where can you lean in? I think sell as much as you can this summer, right? Like sell as much as you can this summer, stockpile as much cash as you can to hopefully weather the storm. We do think it'll come back. Um, all the signs are indicating that once there's some leadership change um in in the House and the Senate, particularly the Senate, we think that there will be some really good forward progress and motion. But there's probably going to be a period of time where we're sort of treated like uh traditional, you know, recreational marijuana cannabis. So um, with to that extent, selling as much as you can through the summer, sort of planning to make sure that you don't end up with a bunch of excess inventory. That's what we've been telling our folks to do. And then pivot, what can you do to keep your brand alive? So is it a functional beverage? We have some clients looking at Canna and Kava. Um, you know, what can you do to just weather the storm while we wait for the next iteration of um kind of a hemp regulatory or cannabis beverage regulatory framework, depending on what comes down. Um that's also got some side benefit, right? If you pivot to a functional and you've never done a functional before, you get a trademark. It's just not like some benefit. Um I know some of my clients are like, that's cute, Shah. That's not like great. So you're like, yay, trademark, no business, trademark. Um, but yeah, so that's that's kind of what we've been doing. And to the extent that you're in distribution as well, what we've been telling folks is think about is that the right distribution partner for a functional beverage? Do they want your functional beverage? You know, how do you wind that down? Because I do think most science is important to point toward this going through some sort of a three-tier system in the future. So that's kind of your throw.

unknown 6:46

Yeah.

SPEAKER_04 6:47

What we've been counseling a lot of folks on, and Brandon's actually doing uh my husband, you know, I think I mentioned we we run this together. Um, he's doing a presentation at Beverage Expo in a couple of weeks on like Oh, nice.

SPEAKER_01 6:57

I'll see him in a few weeks. Yeah, I'll be down there on a panel with the Brewers Association in uh Boston Beer. It'll be Paul and Matt, uh the economist from the Brewers Association, and then Paul Weaver from Boston Beer. Right. And uh Matt from Stufflaw, yeah.

SPEAKER_04 7:10

Well, that's awesome.

SPEAKER_01 7:11

Oh, that's yeah, I'll be moderating that. It's it's all about what craft beer taught us, and then where we see this category going because of what craft beer taught us. Yeah.

SPEAKER_04 7:20

I tell you that. Um, but yeah, so he'll be doing a panel on disaster planning, and part of that is um last my train of thought. Disaster planning, part of that is oh, I was talking about maybe distributors.

SPEAKER_01 7:34

Yep, you're going down the distributor path of their recommendations.

SPEAKER_04 7:37

That's what I was gonna say is I think there's an opportunity if you're in a state that has a strong regulatory framework to do some intra-state sales, kind of akin to again what um recreational cannabis has done over the years, right? So if you're in like a Tennessee or um New York where there's a clear framework where you can sell a beverage, in a outside of a dispensary channel, like there is some opportunity there. And there are some states, you know, as you're saying, like what can we do that isn't just crying? Like there's some states where there's some real volume there.

SPEAKER_00 8:10

I'm not a good crier. You know what I mean? I gotta I'm gonna roll them up and and and hit me again for another one.

SPEAKER_04 8:17

I was gonna say it's that like for me at least, like the from Pittsburgh, like kind of Midwest, like you shut that shit down and you go.

SPEAKER_01 8:23

You just work. I was I was raised, I was raised blue collar and we take the hits. My family was at the steel mill with the protests many, many moons ago.

SPEAKER_04 8:32

Oh, I love that. Yeah, that's awesome. Yeah, but mom still works for one of the mills. So um that's yeah, but yeah, so moral of the story, what um what we've been saying is maybe look to see if there's something you could do if you're in a good state. And if you're not in a good state, see if there's a way that you could get in kind of low cost, um, because there's some opportunity there. But B um is gonna kind of go through, I think, the details of that. Um, I'm happy to go further too if you want to talk about it, but no, it's it's great.

SPEAKER_01 8:59

I want to also, I actually that's a great point. I want to lead a little bit more into the interesting thing because I think yeah, what what I I hear a lot from these interviews uh every week, I do about four to six a week, sometimes a little bit more. And it's they don't know what to do. And it's like, if the and so I give the same exact advice you gave. So I I I took it from the CBC and I I attended your your your your series there. And where I want to kind of also let people know is um like it with Tryon, for example, Melissa and I are doing, we're the we're I'm the our agency is the one that created that regulate don't ruin. So we did the website, we're doing the campaign across the state. Um that's we're the partnership that they mentioned in the last and beverage alliance meeting. They just said they're working with somebody, and I was on the call. So I want to somebody somebody, so we've got a world, uh regulated don't ruin is a partnership between us and millennial marketing and uh traffic distributing. And we're actually launching it on in uh hopefully here in Pennsylvania. And um, I will publicly say this that was the uncomfortable part is we had some distributors that were ready to fund this program. And then our friends at the National Beer Wholesalers Association called all the distributors and told them to not publicly support anything with them. So on Friday, my afternoon phone calls were rescinding pledges. Uh so we were about to launch this week uh Pennsylvania campaign for petitions. So now this week I'm pivoting uh after after we finish this call as well, uh, to figuring out the new angle in which to get the fundraising necessary to make the impact. Because I believe just as much as you do that, regardless of the federal, if we have solid, sound states' rights uh in place. One of the things in our bill, House Bill 2309 for Pennsylvania, the bottom of it is states' rights supersede federal law, as well as we we actually expanded it to be a very unique bill where uh we allow dispensaries to also per buy a permit. So dispensaries are allowed to buy a permit as well as coffee shops, as well as everything. So it's not exclusive to liquor liquor, but it is an all-open thing that everybody can participate if they want to, but you gotta buy a permit, you gotta be inspected, you got to be regulated. Um, so uh that took the the wind out of the sales of the opposition, which was going for dispensary only with the Senate bill 49.

SPEAKER_03 10:57

Oh done.

SPEAKER_01 10:58

Uh so that's uh we we very much were very strategic in that. And I'm sure give credit to uh to uh to to Jay over at uh Waynern Association. I'm sure you've known Jay for a long time and stuff like that. So he's very much uh in the corner of doing this and trying to get this thing moving. Um but we are definitely uh back to the ground zero as of Friday afternoon.

SPEAKER_04 11:16

I mean, what I always joke, like, welcome to help.

SPEAKER_01 11:19

Exactly. And that's the thing. Everybody's like, are you tired? Are you tired of this yet? I'm like, guys, I've been selling alcohol for 22 years. I represented 30 brands in the craft beer industry from the heyday of it. And it's like to meet the opposition, like at a beer, a beer level that I was, I would be in Miller Corps meeting supporting them and then be in another meeting where it was in opposition to that. And it's just the nature of competition, it's the nature of business that you're never gonna have smooth sailing. Somebody always wants to cut your knees out, somebody always wants you out of business. And the ones that I I gotta give tough love to brands that ask me, what do I do? It's like you fight, and you don't fight until you go bankrupt or anything like that, but you fight until you're in a sustainable way.

SPEAKER_04 11:59

Completely agree, completely agree.

SPEAKER_01 12:02

So talk to me a little bit about your story. I want to know your story because there's not a lot, people know that you know there's there's alcohol lawyers out there and things like that, and there's lawyers that can help you in all areas, but it is a niche thing, and then I don't mean niche as small, I mean niche as you are intentionally in that path. Yes. And and and so talk to me about your your life, and I mean literally your personal life leading up to this that uh that led you to law school and that led you to choose this path.

SPEAKER_04 12:28

Yeah, you got it. So I grew up in western Pennsylvania, uh, outside Pennsylvania.

SPEAKER_00 12:32

Where exactly?

SPEAKER_04 12:33

So I went um Washington Township, so I went to Kiske area, not Kiske Practice.

SPEAKER_03 12:39

Yes.

SPEAKER_00 12:40

Um family's from Bedford Summer Stand. We still have sleeping. So not yeah, that's not one of the connectors I met. Yeah.

SPEAKER_04 12:46

I love it. Um, so yeah, so I grew up there. Um my parents both worked for the mill. Um, so been through multiple strikes, whatever. So they always wanted me and kind of steered me toward going to law school. And there was some um, you know, youthful rebellion where I was like, no, I'm gonna I'm gonna be a journalist. No, I'm sorry, I wasn't.

SPEAKER_01 13:18

So you I'm just joking, you're fine. I can't I'm I'm playing more with it. Yeah.

SPEAKER_04 13:22

And it's funny because like I but it was it's it's a funny the real reason I didn't want to do it is I realized that if you were gonna be a journalist, you had to bother people with their most vulnerable. I'm like, that's just not who I am. Like, I want to help you, I don't want to bug you, right? So uh went to Penn State, loved it, um, took it full advantage of that four-year college experience. And then when I was applying to law schools, was like, you know what, I probably should slow my ass down a little bit. And so I went to Wake Forest uh in with Carolina and went to Salem, uh, which is where I met my husband, came out, had a shit ton of law debt. So I was like, I need to get the job that will pay me the most, which at the time uh was Dermot Will and Emery, but this was 2008, and um so I got an antitrust offer, and this is not an antitrust lawyer, but I was like staring down the debt. Brandon actually went there as well. He recruited me a little too well as running joke. We were friends at the time, and then we ended up getting got married. Um, but uh I realized pretty quickly like that wasn't it for me. Like I didn't want it, I didn't like it. Um stuck out as much money as possible and paid out as much of my debt as possible. And then had this kind of so McDermott had um at the time Mark Sereni, who's now with the Brewers Association, was heading up their food and beverage practice. And I was chatting with him at a happy hour and I was like, I just want contracts. Like, I don't want to be in hospital basements pulling documents, like this isn't me. Um, I would really like to do some contracts. And I had done some work for him as a summer. I was like, Do you have anything you could give me? And he's like, hell yeah, I do. So I went into my office the next day, slightly hung over. There was a stack of files and a note that was like, see me, like, I've got some work for you. Completely changed the trajectory of my career. So I did that for a little while, kind of straddling one foot in Antitrust, one foot in Algal. Um, and um ultimately got the opportunity to go to Dogfish and start their legal department, which yeah. And once I was in, I was never leaving, right?

SPEAKER_01 15:24

I fell in love with it. Maybe the second connection is I started this business in 2008. Uh so I've had this business as a solo printware for 18 years, and I started it after well, I was selling Dogfish head when I was out of regular.

SPEAKER_02 15:36

Oh, yeah.

SPEAKER_01 15:37

Fell in love with the brand, the culture, got to meet Sam at a very young age, and I was like, I fucking want to be whoever this guy is, and I want to walk in whatever footsteps and brewing up a business. And uh, and that was the book. And I read the book, I'm sure it's uh probably on your shelf. Yep, exactly. And that's when I started this business, was right after I finished reading the book. And that's a year and a half ago, I went up and uh Mitchell actually made a connection, uh reinforced everything to Sam, and actually got to go up and uh shop the hundredth episode of my podcast with Sam.

SPEAKER_03 16:07

Awesome.

SPEAKER_01 16:08

Crazy, I didn't realize that was your connection too, because Sam and I were just on yesterday about trying to do some stuff again. So it's uh as far as just podcast-related stuff. And uh so I there's uh just every once in a while when I do these interviews, I want people to know like when we are when we're kind of crossing paths and we're about the same age, so it's uh it's yeah.

SPEAKER_04 16:26

Dude, that's fucking awesome. No, we are the same age, by the way, because you said your age, but I'm not saying mine again. Um, but no, I think um, so I went there, right? And if you imagine this is 2012, so um heyday of craft beer, right? And they had this giant expansion. When I got there, I think we're in like I want to say it was 16 states. I might be underselling it, it might be like in the 20-ish range, but it certainly wasn't fully national. And so I had the incredible experience of being able to do all of the legal work for this brewery. And my goal, there were some things I couldn't do, right? Like I am personally, we have trademark attorneys here who are phenomenal. But like, I'm not filing trademark applications. So by very nature, like I had to send some out. But my goal was to do as much as I could myself to just just to help. Like, and I wanted to learn, and and then you know, Sam would come up with some crazy ass idea, like, let's put a record in a box of 750 bombers, and we'd have to go down and like fucking put the thing in and like repay it.

SPEAKER_01 17:28

And then I would load you on a truck and break it.

SPEAKER_04 17:30

And then you would load on a truck and sell it, right? But like I put my SELTOS and my PPE on, and I go down and like like I remember sitting down with the engineers negotiating the contracts for their expansion and being like, tell me all the ways that this could go to shit, right? Like, and I'm gonna draft you a contract that plans my best for this to go to shit. Of course, some things did, you know. And um, but I really learned the business, and it was such an incredible opportunity. And there was never a moment of like, get out of here, lawyer. Like, nobody wants you in here. It was just of course, like, yes, of course she wants to learn. Like it'll make her a better lawyer. And it really did, right? So I learned beverage and we grew so frigging fast. So, like the first four years were just trial by fire, um, constant, so much. And then we had about 2016, craft started to slow down. Um, and so I also kind of got to see like what doesn't more mature, because at that point we were in 40 states. When I left, we were 40, 48. Um, we were in like 40 states. We were looking at export, we were in Canada and some other, we built the distillery, but it was like a more mature business. And like, what do you do when you have performing distributors and you need to rehab your network? And so, like, I helped us flip the network from some of our first craft distributors to the miller, we traditionally went to the miller course house, although sometimes we would take the A B house, but like flipped all these networks, renegotiated agreements, like just got this incredible experience at such a young age. And then when I was looking to leave, not because I didn't love dogfish, but because at this point I'd had kids and dogfish just is pre-COVID, so it's super buttons-y. Um, and I was commuting. So Brandon was still commuting an hour and a half into DC where he was working. And I was commuting to Milton, Delaware from the eastern shore. And it just got to be too much. Like if you have kids, anybody has kids, like it's there's sniffles and there's things. And Brandon took public transportation and had to wait on a bus, whereas I could just get in my car and work, you know, take calls and do whatever. I mean, I negotiated contracts for my car, driving to pick my kid up. There was this section on 16 where the friggin' um cell would drop, and I'd be like, hold on, I'm in the corn. Then I'd like get out of the corner. I'm like, okay, let's go again. Like, here we go. Um, like it just got to be too much. So um ended up going out and starting um a food and beverage practice at a small law firm where a friend of mine was a partner. And um, there was never like I remember looking around and seeing like, could I find another in-house job, in beverage, in beer? There was never a doubt in my mind that I was gonna stay in this industry because it was just, it was my people, you know. Like I just, these are my people, the beverage people are unique and different. And as selling a beverage is so unique and different to selling really almost anything else. And I didn't like I didn't want to lose that expertise that I had. I also didn't want to go work with different people.

SPEAKER_01 20:22

Do you want to like why we always make a joke? We always make a joke, and actually a couple of times I made it at um at Sam Adams or not Sam Adams at Dogfish Head uh with uh when we would do those summits. So I remember the last one I was at was when they did the uh the truth serum, and they had the 120 that was unlabeled and they were handing it out to everybody and they're a lawyer, so I'm not gonna I'm not gonna get in trouble, but like tell us the ABB. Oh, oh no, yeah, Harry Schumacher was uh was speaking and all kinds of and they had the it was out in the patio or in the front lawn. And um, that was one of the funniest ones because like I at that time hadn't realized three and a half years sober now, uh, but I didn't know that I didn't know what I was dealing with at the time because the industry, and we I don't want to get it too deep into it, but obviously the industry it was it was a different time, but also I don't want to I don't want to use that as an underserving. We we very much we drank all day long, and there wasn't a lot of time to like really realize if you had a problem or not until like a little bit later, and that was for me, and I own that. Um but I was crushing those things like over that, and then all of a sudden I'm like, holy shit, I'm really drunk, and like it was yeah, it was funny.

SPEAKER_04 21:29

We called it going to the dark side, so like that's what that's exactly it.

SPEAKER_00 21:32

Yeah, yeah. I remember going over to Sam and like I wasn't I was like, I was like, dude, I was like, we gotta put labels on these moving forward. He's like, isn't that good? I'm like, yeah, it's true, Sarah.

SPEAKER_04 21:41

You gotta funny you say that because we did actually start putting label. So if you I'm just looking to see if I had one, we put a cap, we they're not having been we in a while, but it's like this color. Yeah, we put a danger cap on it. Um right with the exclamation to let you know, like, hey, these ones are above, I think it's for. anything above 10% or 12% or something like that. It's sort of signal, maybe drink this one a little slower and only have one.

unknown 22:07

Yeah.

SPEAKER_01 22:08

It's uh it it's one of those things that I think what you said about the record player is while it was a logistical nightmare from your end, while it was a logistical nightmare from the distributor end, while you know we had to, you know, we had to figure out what was broken, what wasn't, because they did absolutely and and and it was the thing that I want to always credit is we're we we we need to take risks. We need to do unique things. We need to be okay that the record's going to break metaphorically. And and that's the thing that I think we're losing and I really fear that. I fear that we're losing the risk and the grit in a in a survival mode sometimes, you know?

SPEAKER_04 22:42

On the beer side? 100%.

SPEAKER_01 22:44

On a couple of sides. I really think so on a couple sides. I think even on the hemp side now we're also going down this path where it's it's doing and I and I I really but on the beer side I we can talk about that because that's a whole that's a way I want to talk about too actually that's a great point is on the beer side of things how do you see like where things are now because one of the things that we talked about in getting ready for this panel is we find in Pennsylvania alone, I think in the last 12 months 64 breweries closed. Yeah. And 64 breweries didn't close because they had bad liquid 64 breweries closed because they didn't understand how to run their business because there was not a wave of of organic and and demand that was existing there. And I think that's something that if my and I I hope I I see you yeah you're agreeing with me is like if anybody does anything right now it's to go learn how to run a business to save your business.

SPEAKER_04 23:32

100% learn how to run a business to save your business and be really effing careful about two things who you let into your business, who's your investors, who's on your board, who's giving you advice because they're I call them vultures there are some vultures out there who will just take advantage of you and maybe not give you advice that is best for you. But then also how much debt you take out because ultimately like when you look at I don't want to name any names because some of them were our clients but some of those Pennsylvania breweries that went under it was because of either who they let in private equity or you know an investor that just didn't want to put any more capital in or they had way too much debt and the debt service as soon as things went down became too much to handle. And I think there was a lot of misspending of COVID funds and um some other things as well. So I think like if you're to your point, you have to adapt um I think you have to adapt but also it's and and I say this is so much easier said than done, but you have to adapt without losing your soul. So I feel like some of our clients pivoted because like well everybody has a heart seltzer and so they put in um they put in equipment and things to be able to can a heart seltzer flash in the pan of a of a moment. There are heart seltzers, right? Like some people still drink them. I don't love them, but it's okay. Some people do um and really at least three or four. There's only really three or four and there's like we have some clients that are up on calming and taking way more share on that than they should but it's because they have a good story right they have phenomenal liquid and a really good story. There's a and the brand ethos is there and everything is consistent. And that was I mean to me that was the secret sauce of dogfish. And it drove me fucking crazy like as the lawyer and God loves Sam if he listens to this I love you you told me you as his lawyers but like you know and and I appreciate it so much. He was doing these things because he he was like you know we're not gonna make any money but it's a good story. Everybody spit everybody spit in this beer we're gonna make a chicha it's a good story. We're gonna go down to the pub and we're gonna build chop we're gonna brew chalk lobster and I'm gonna need 20 of you to volunteer to crack the fucking lobsters into the like all of it right and it was you know and and at some point we started to do the math and we were like okay maybe not everything can be a good story like there is a ROI. But like it it was everything went through the filter of it originally it was like Sam's gut, right? Like does this feel like dogfish? And then at a certain point we put like a shout out to Bailey and Cindy and and Sam and some of the others like from those dogfish here like we put it all through a prism of like is this dogfish and we we put filters and we there was a process and and sometimes it was and sometimes it wasn't and then Sam always was allowed to call an audible because it was fucking business. Right. So like you do you did but like we we never lost the soul like we never lost the soul we never lost the story and don't get me wrong we made some beers that were not great um or at least I did not think they were great or they didn't sell in the way that we thought they would but even like I remember when we were doing Slightly Mighty it was one of the last beers I worked on while I was there and I didn't get it. Sam was just so focused on can you put monk fruit in a beer and I was so focused on like how do we get this through TTP and then what's the label going to say and it clicked at one point he was like well Shauna this is for all those people who are closet Michelob Ultra drinkers. And I was like I'm a closet Micheloba Ultra drinker because I'm getting older and um that shit sticks to me and it used to be wait a minute this is a full flavor 95 calorie beer with no sugar and you know like it's never like yeah and I was like oh fuck like I'm in and it was there right because it was like it served to me and there was a purpose and the story was there and the can was beautiful and like and that I think is the peat like there are so many people that come into beverage looking to just flip a business. They're like I see a white space I want to flip a business like you need to get into beverage because you're in love with your beverage.

SPEAKER_01 27:33

Yes. I I what you just said there is exactly it and I I need to reiterate when I say I'm three and a half years sober, I took a year away from the industry to get myself sober and get a footing and immediately went right back. And everybody's like why and that's exactly what you just said it's not because of the product it's because of the stories and the people yeah and I drive all day long I do three to five thousand miles a month in my car around driving around and I have RTD vodka I have alcohol in my vehicle as I'm dropping samples and people and I'm like yeah at any point I could be driving reach back and grab one for the past three and a half years and I don't but I keep driving and I keep driving and I keep driving because it's I'm telling stories. I'm not a salesman I go and tell a story I leave a product if they enjoy the liquid and they want to carry it great if not I move on to the next storytelling opportunity. The days of being a salesman pushing things into and jamming spews into a shelf is over. And and I want to also connect with you and I'm gonna be curious if uh if you were a part of this uh the Adam Lambert I'm gonna make fun of him and he's gonna laugh if he does listen to this at all Adam Lambert's Adam's uh profit margin and uh his excel file that I had a full head of hair when I first was introduced to dogfish I believe it was the excel file where it was like okay so you want one of these so then that's gonna change this over on on cell five and then you're only gonna get this of this and I was just like this is too much math for beers it's funny I mean we had to do it that way no I know and that's what I'm trying to say it was do this but it was amazing. I I was so my point is to the compliment that someone was able to formulaically take the organized organize the chaos of the creativity that was existing in the chaos I mean in the most beautiful way possible it was amazing because that is that chaos while it was trial and error gave acceptance and gave built a pathway for people to experiment it broke the norm of like here's this here's this here's this we have IPAs children's loggers and stouts well that's what it was forever until a fucking champion came out and said fuck all that I'm spitting in my beer I'm chopping up lobsters I'm I'm doing whatever and all of a sudden the world's like okay how do we put this in the metrics because also you can't produce 5000 cases of lobster stout like well and and that is it's so funny like I look back at it now because I'm at almost 16 years in beverage which breaks my brain a little bit a little over um but I look at it and I'm like I didn't appreciate like how beautiful it was in the moment because I was just pulling my hair out trying to make it happen.

SPEAKER_04 30:14

Do you know what I mean?

SPEAKER_01 30:15

Like um like the brand manager for dogfishing I got death threats whenever they didn't get 120 if they didn't get what I used to have a wall uh Wendy Dumerat can tell you that I would print out I would print out the emails where people wouldn't get 120 or whatever they wanted and they would be like I'm pulling I had people like pulling all their products out of my portfolio and like leaving it outside and I would tape them all to the wall and she'd like come in to have our like business plan on one day and she's like where's the wall threats I'm like here you go and it's like me F you blah blah blah like I'm never carrying anything you sell again I'm like see that one case that I didn't give them just lost and yeah it's funny like check out in my car.

SPEAKER_04 30:51

Yeah I'm getting my my tires slashed I'm not watching yet yeah but no I think to your point I think the the combination of like really great liquid has to taste good because it tastes like shit like it ain't happened. Yeah exactly this is where I'm like table stakes is that it has to taste good right and then you need to have a story and and and not a made up bullshit story that you threw through grok right like a real story. Why did you make this what purpose are you serving? And that's what I always tell them like you got to have a good good marketing but it's not just the marketing like you have to believe it and feel it and and like live the soul of your brand and then the last piece is then you got to make the math math because at the end of the day you're not I don't give a fuck sorry you're good. No I don't give a fuck I don't give a fuck how good the liquid is and how great the story is if you're not fucking profitable nobody's going nobody's gonna invest in you nobody's going to buy you and at a certain point the money runs out and the bank has your house.

SPEAKER_01 31:54

So like I'm on this show talking about I was homeless at a point during the past 18 years of building this business I lived in motels and I moved around wherever I was working whatever market I was working in that's where the hotel I booked and every day I would find the cheapest motel and that's where I would sleep that night or I slept in my car. It's a story I tell on here often and it's not of a place of pity or victimhood. It's that people if you want to be in this business you've got to be ready to do whatever it takes to be in this business. And it's not all green pastures and it's not all bank loans that are going to carry you through and it's not all big rich investors. It's grit and it's creativity and it's resilience.

SPEAKER_04 32:32

Yep completely agree completely agree it's it's it's hard I do feel sometimes like part of my job is to be the killer of dreams but um but you have to I mean especially when folks are like and I'm cashing out my 401k to start this beverage business and I'm like oh my god yeah I get it I get it I get it however maybe then you don't start with a 50 state lunch maybe you start with one market and you're selling it and you're sampling it and it's all you right um so and I do think that that's part of what people appreciate like I I'm not I don't know for better or worse I am who I am like I'm gonna tell you whether or not I think what you're doing is good.

SPEAKER_01 33:14

I'm gonna be kind that's I'm considered a very polarizing person because I'm I'm just enough of the Haspergers and just enough ADHD where like I tell you what how it is I love it.

SPEAKER_04 33:26

Like I'm just tell you shit and I don't want to be again as I talk about like the vultures that are out there. I'm sure you feel the same way like I don't want to be the one of the reasons why they didn't tell you something because I didn't want to have the hard conversation or I charged you for something that you didn't need. Like that's just not this industry is based so much on collaboration and kindness and and like people have been so wonderful to me and it that I just anyway that's my soapbox I get thinking of a couple of scenarios right now where yeah.

SPEAKER_01 33:56

Yeah it's it's one of those things where it's it's important whether you're a lawyer whether you're a consultant whether whatever it's important to guide your clients the right way even and and the and even if it means the detriment of your relationship. Like I tell a story of a couple months ago where I was like uh doing coaching for executive coaching for a a different industry and I was on the fifth session of this executive coaching and because I go deep in this executive coaching like it's not I don't have a work I do it like this where it's all motion and I try to find their passion and remind them of their passion of it. And at the end of the fifth session he realized he was he was just there for a paycheck. And at that point I messaged the owners who were my direct clients and I said I'm gonna fire myself right now because there's nothing I can do for my principles I can't manufacture desire and drive out of this person and that's what you want from from this person. I unfortunately this is out of my hands now. And that's something that is a hard thing that we have to realize sometimes that not everything's good for you. And exactly like you just said just because you want to create a beverage brand does not mean you have to be in 48 states. Like the amount of brands that I talk to and I'm gonna leave this on so everybody knows the amount of brands on this as well as anywhere else that within the first six to 12 months and they're in one state and they have 15 accounts and they're like oh we're going national we're gonna sign with Kay we're in conversation with Kahi. Great. Oh no you're in conversations like I conversations are free. And but even then when you get to that point where are you going to find the $100,000 for the sales rep to be in that mark because that's the other thing. People don't realize they're like oh well I got marketing dollars. No you need a hundred grand to put somebody on the ground well okay I got a hundred grand okay well where's the other hundred grand to then market the product in parallel to the person on the ground to then get people to know these even on the shelf because putting on the shelf is one thing but then you're in a billboard of a million other things. Somebody else got to drive and that's when the sweat begins not on me on them. I agree 100% and I think it's a a and I know you come from the distributor tier like the idea that the distributor is going to be primarily like I I feel like so many folks are like I have a distributor I'm done now I made it 90% began like okay you you you were you had a baby business now you have a real one saddle up kids like it's time to go and like band brand building and distributorships ended 10 years ago I'm sorry it waked everybody up and realize that in 2016 to 2017 it died and it didn't it is not coming because here's what's happened since then is they've been onslaught by all these new categories and all these new inefficiencies and all this they don't realize everybody I I ask a lot of people this this is my one test. Did you meet with the distributor? Did you meet with them? Yeah did you meet in person? Yeah where did you go when you were at the distributor? Well we went to the boardroom and then we went to the car you didn't walk the warehouse no why didn't you walk the warehouse? Well it's just a warehouse that's where you see who your competition is as well as who your share of mind is I was impressed that's how you understand what is going on in your brand manager like when I was in the distributor space like I had 37 craft breweries in my portfolio personally that meant every day 37 people depended on me to do a good job. That is a lot and also let's we're the same age uh we're talking 2010 to 2017. I'm 20 some years old at this point and I got 37 people in their home market that are depending on me to to lead a team to then build their brand for them. And yeah I did it for a lot all of them but those days aren't there anymore because the same guy that's sitting in my seat or girl I think it's a girl now but the same person sitting in that chair does not have the same opportunities to build brands that I did 10 years ago.

SPEAKER_04 37:31

The economics have shifted like it's just it's different right it it just it's just different and you know and I've I've mellowed with age I was very like these distributors like I get it like they're running their own like own business own inputs own issues own you know um masters right like all of it yeah so you know going getting their attention and getting in and getting what you can get right and then after that like the idea that they're gonna build it for you it's not happening to your point it's all got to be supported and then I worry you know on the alcohol side you've got franchise you've got three tier you've got some other components but if you're talking about a functional energy drink the other issue is you mentioned Kahi like you got to plan for those to go to shit because the terms in those contracts are nuts.

SPEAKER_01 38:22

And most people aren't even looking at billbacks price promotions all this other stuff.

SPEAKER_04 38:26

If the inventory on the beer side worst case or the you know the alcohol side worst case scenario your product goes out of code and maybe you're you know you're buying your inventory back at the invoice price or your um it's just out there out of code right depending on the state law for for a K hey for some of the like you're buying it back at their profit price. Like you're basically guaranteeing their profit. And if it does not sell where the f is that money coming from so a lot of times what I'll do is I'll cancel clients like take don't do shit with those sales until you have enough saved up in cash in case it goes poorly. And then after that take what's left and reinvest it into the market so that you can continue to grow.

SPEAKER_01 39:07

So back to your original point you need you know a couple hundred thousand bucks I mean for if you're gonna go and I I hate this this let's just say per state by the way I hate to tell people it's like you do a fully national like you've got chain mandates you're you know there's something you need probably two to three million bucks table stakes table stakes and that's you're not hiring those those um folks directly you're probably um using one of the like fractional sales services to support you right which is pros cons like we love them especially for a cash flow standpoint that's it it's it's more of a short term hard part for them from a cash flow to hire those outside people because they can't make the commitment for the long term and employees so it's just you know kind of backing it out to the original point like slowing down growing smartly and not outpacing your cash flow is how you how you make it and rather than not like grinding it out. I mean we had somebody that was like I just to your point like I just want to make a a cushy paycheck I was like beverchain it then beverchain it's it's I have a at one o'clock today I have a meeting with a client of mine and I'll I'm not gonna name them but it's it's a similar thing it's in and it's one of those things where our conversation isn't how I get more money. Our conversation is going to be how do we how do we decrease the budget while also giving some sort of an output to keep momentum moving forward. And I don't say that in a negative way I'm open to those conversations with people because I appreciate the transparency when somebody calls me and say I don't think I can make the next two retainer payments tell me that now and we will figure it out and get to there where I've I've faltered as well with people whether it's the conversation or in the past or whatever or people's own ego not wanting to admit that they don't have the money which sometimes is is a marked majority of it.

SPEAKER_04 40:57

It's I'm always like don't tell me when the invoice is due tell me when the problems start I love that one of my favorite clients was these four guys in a dorm room they called me three times um before they finally kind of like got like I'm pretty sure they were hungover the first time they called me from whatever rager was happening the night before they didn't end up making it right for a lot of reasons they didn't end up making it but they would call me and be super upfront and I'd be like then don't do this. Like don't pay us to do this you can do this. Like call me I'm not gonna bill you like hold your hands with the licensing like you licensing is not rocket surgery. Like you can get your own license as long as your shit's straightforward. It's just time consuming and then you got to maintain it and that's where people usually fall down. So but like getting ahead of it owning it and having those difficult conversations because and then I think that's also very character revealing as well if a partner isn't willing to work with you when you've been upfront about where you're at they're probably not the right long term partner and I've seen enough of those because you can imagine nobody I I get a lot of the fun things. Yay we landed a distributor hooray for us right we got this great deal this great partnership this influencer I also get a lot of the like for me um and how people behave in those moments kind of tells you I think a lot about there it is it is and that's that's the other piece is when I try to explain to them about the invoice piece it's like if you tell me ahead of time when the problem exists then it's our problem to fix.

SPEAKER_01 42:28

Our problem. Yep if you tell me when the invoice is due and you're gonna tell me you're not gonna pay it's my problem now and now what you just did was you're weak and you're not you're cowardice because you and I mean that and I tell that to them and this will stay in the episode because that's what you you just put your responsibilities and your negligence of your running your business onto me. And now however much money that invoice might have been I'm a solopreneur. I don't I'm not sitting I'm also that's the other thing that people need to realize I'm not sitting with a bank account.

SPEAKER_04 43:01

I work with startups right yeah yeah well I got 15 people's payroll to meet right like I you know and I think um I I love that because I think that there's so much to that that like yeah that's why I'm excited about this meeting this afternoon.

SPEAKER_01 43:18

Most people would be like I'm so uncomfortable blah blah blah I'm like no I'd rather you tell me two months in advance or a month in advance.

SPEAKER_04 43:24

100% because there's something that can be done about it then.

SPEAKER_01 43:26

Yes. Yeah it's the ignoring the utility bill until it turns into a remote until it turns the lights out.

SPEAKER_04 43:32

Yeah well and what I was going to say is I think that you know for me I think all the time about you know we have I I love having our business it consumes my whole life my husband and I don't we're constantly talking about it. So um but I get all the upside and the joy and the the like oh I mean you know right like I built this you did this like this is incredible. We have you know we're 15 people and we're chambers ranked and we like all the things right On the flip side, I'm the one that has to take those fucking calls. I think that's what people forget. You don't get all the upside of like I built a business and a beverage, and look, there it is on the shelf and it's crushing it. Like you also have to take the calls from the pissed off distributors and the pissed off retailers and deal with the fact that the Copac line went down and your time is off. And you know, I'm yelling at you because you haven't paid me or whatever. Like you get both. So you get all the upside, you also get the downside. And that's I mean, that's like America, right?

SPEAKER_01 44:31

That's exactly it. That's exactly it. And my my business is called Free Mind for a Reason. You know, I mean it's like it's it's that it's it's you have it all, and it's all gonna be there, and it's a matter of embracing it and figuring out how to navigate it. So I uh I want to start, I'll start doing the kind of wind down here now and kind of any other anything you want to share or anything that you want people to know about about Barnes Beverage Group.

SPEAKER_04 44:54

No, man. I mean, I think um this was a fun, I really enjoyed that. So uh no, I mean we we're here to help. So if we can ever be helpful, reach out. Um and if you see me do um if I've got a beverage in my hand, that's a great time to poke me for some free advice because I'm always I'm always good for it, especially if I'm gonna be able to do it.

SPEAKER_01 45:12

What about the like at the end giving you like some topic that I'm working on? And yeah, I was like, let me look the last five minutes and get a uh you know, billable hour out of it.

SPEAKER_04 45:20

I love it. No, it's uh I'll use that later when I later you you call that favor in a later date.

SPEAKER_00 45:28

Yeah, I've been in this business long enough with all the all the guys that are managing this.

SPEAKER_01 45:32

I'm not a favorite guy. I'm gonna I'm gonna let's do it all together guys. I love it. Um, but I want to uh kind of give everybody kind of snapshots about uh online where to find you guys if uh if a brand's listening and they're like, I really I really give this personality and this seems like a real down-to-earth lawyer, which by the way, I'm gonna also before you say anything, I want everybody to know I've spent time with with Brandon uh in over a two-day period, not just at 15 minutes at a happy hour. And I can tell that if Brandon is representative of you, which it seems like it is, and you as the business, this is a stand-up guy and a stand-up business. And what you got, you also, I know you not directly, but I know you because of the people you've worked with. Um we've name-dropped a few people, not in a bragging way, but because we have common acquaintances and we have common friends. And that's what I want everybody to understand is that there's a this industry is smaller than you think. And uh I want I'm glad to be able to provide a platform for for people like yourself to be able to bring that forward and stuff like that. So yeah.

SPEAKER_04 46:23

I appreciate that so much. Yeah. So if you need us, if you want us, um, our website is drinkslaw within slaw.com. Um, you can find me on LinkedIn. Um, somebody from our teams at almost every um every major conference. So uh feel free to kick me an email. I'm slow on LinkedIn, but I do eventually get to it. Um, or my email is just sbarns at drinkslaw. So uh, but I really appreciate it. This has been so friggin' fun.

SPEAKER_01 46:48

So it it always it always is, and I like that. It's a good that's good feedback. And and uh I wanna kind of I'll close out with with this stuff here. I'm looking forward to handing out Brand again in a couple weeks. I'm only there for one day uh because we have our public testimony, uh public hearing for HB23V9 on the 17th. So I'm gonna we're gonna testify and then hop on the airplane and get down to Texas for that. Um but I'll I'll definitely text him and reach out when I get down there. But um what I want to also I want to thank you for coming on, and I I want to I do want to be serious about this, is that not a lot of people want to get off uh because they want questions. They want to they want to know prep. They want to run through what am I gonna ask. And it's a filtration process for me. Um, it's intentional. Um, it's because the authenticity comes out and the real story comes out. I'm not a clickbait person, but I want honesty. And people that don't want to come on because they want questions, to me, that's a flag that you want to prepare because you want to cover something up sometimes. And so I want to thank you for the courage of coming on. And I don't under, I don't want to undervalue that courage because this world is full of clickbait, it's full of gotcha moments, and the trust that you give me to have your story and to share your story, I I respect and and and value that. So thanks.

SPEAKER_04 47:54

Well, thank you. This has been really fun. I really appreciate you having me.

SPEAKER_01 47:58

Perfect. Well, I'll close out with my last little thing here is uh for everybody to understand it is 2026 is a beautifully destructive world. And as much as we did talk about drinks and all the fun stuff, I also want people to know that this is a completely authentic thing. We Shauna and I have never shared a coffee together or sat in a bar together, we've never met. Uh, the biggest thing on top of learning about drinks and learning how to start a business and how to navigate the adult beverage world is understanding how to connect with strangers and the undervalue that there is in connecting with strangers. And I want people to realize that while your life might be fulfilling and you're listening to this because you're preparing your next business, that doesn't mean the person on the street is dealing with the same thing. So I implore everybody and I challenge everybody five minutes a week to be kind to a stranger, no matter where you are. When you're walking down the street, put your phone in your pocket, look strangers in the eye, smile, wave, wallet up, whatever. When you're at the coffee shop or you're at the gas station, look to the person next to you filling up their coffee coffee, ask them how they're doing, and don't talk. Just listen to what they say and engage on their topic. We talk about ROI on the show all the time. Five minutes a week, 20 minutes a month being nice to a stranger, you're probably gonna change somebody's week, month, year. And God forbid, where we are in this world, if they weren't even planning on staying in this world, you might even change their life because a kindness can go a long way and a great ROI for 20 minutes a month. So, Shauna, thank you so much. I'm looking forward to many more conversations with you. I'm sure we're gonna cross paths in person soon enough. Yeah.

SPEAKER_04 49:19

Have a feeling. Thanks again.

SPEAKER_01 49:21

Take care. Have a great day. Bye.