Q&A: Canarchy’s Tim Matthews

The VP of global brewing for Canarchy (the parent company of Oskar Blues, Cigar City, and others) shares his thoughts on developing a thoughtful and open approach to the ingredient supply chain.

Jamie Bogner May 28, 2020 - 17 min read

Q&A: Canarchy’s Tim Matthews Primary Image

Photo: Jamie Bogner

CBB // It’s been a long one—you’ve been here 11 years; you’ve seen it through a lot of phases. You’ve certainly watched craft beer as a whole explode. And you’ve ridden it all along, but you’ve also kept some core principles along the way.

TM // Yeah, I have come to a realization that after the year has passed, it is the last year I’ll ever experience that brewery, and [I] get ready for a new challenge and a new future every single year along the way. It’s changed every single year since I got here in 2008, right when this Longmont facility opened up. And you can say that the blood pressure has had its ups and downs, but at the end of the year, we are definitely very happy with what we’ve accomplished. Nonetheless, [we’re] continuing to evolve and challenge ourselves and how we make beer and why we make beer.

CBB // Every year you look at the next year as a different experience for the brewery as a whole; you put [last year’s] brewery to bed. What have been some of those major turning points for you?

TM // Culture shifts, volume shifts, the new challenges in what beers we’re going to make, expansions, new breweries, consolidations, the creation of the Canarchy Craft Brewery Collective. But I love where it’s come to be, and we’re challenging ourselves to create something that nobody else has ever had before—to set a precedent and then evolve that precedent every year. In the brewing sector, I’m trying to at least facilitate the needs of all the brewers to maintain individual identity, but also create a collaborative atmosphere where we are sharing ideas and sharing creativity and bouncing things off each other—like a microcosm of craft beer but focused and directed with shared resources.

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CBB // In any kind of business—especially when it’s been in business for over a decade—employees have certain expectations for how things are going to be. There can be a delta between what those expectations are and where the business goes. And if you have that kind of long standing, “Well, this wasn’t the way it was last year,” then that can be a kind of mental block toward looking for what the business needs at any given point. But craft beer, if you look at even the past five or six years, has been changing so dramatically and so quickly—business models changing, the packaged-beer market changing, the wholesale- and retail-beer markets changing. It is impossible to have a business strategy that works now that worked three years ago and then also worked six or seven years ago. Certainly not one that worked 11 years ago. The business, as a whole, is requiring constant pivots on the part of businesses operating in this sector.

TM // Yep. We are definitely in a time where we must be dynamic. You mentioned the word pivot—you must be very agile in today’s world. You cannot just pick one way to do things and then stick to your guns and go that way. Adhering to tradition is one of the things you must do [while] challenging yourself and challenging tradition. So multifaceted approaches that are expanding your abilities and such are going to be the way that a brewer can maintain competitiveness moving forward. But it is competitive. It is much more competitive than ever before, when brewers were able to almost float in some ways.

But there are also different categories of brewers based on size. And everybody who has reached a certain size has to decide if they’re going to maintain that size or lose that size. Jobs will go, and presence will go, and the entire growth plan will go with it. But as a brewer trying to create beers and brands in today’s world— finding where the pulse is—it’s a moving target. So that’s why we need to do it all. You need to operate as a big brewery but also as a small brewery—maintain that connection to what got you here as a craft brewery and will always be the foundation for what supports craft brewing (and differentiates it from industrialization). Collaborations and interactions with the outside world, traveling outside of your little boundaries, but also looking at what you do in house and challenging what processes you have. Having groups of people in the brewery that are looking at this one thing and then saying, “Are there ways to do this better or even differently? What would happen if we treated this yeast in a different way? What would happen if we used this malt with a different protein structure as a base malt compared to this that was more modified? What would happen if we used this hop (that’s not typically looked at as an aroma hop) as an aroma hop, or this hop that we never thought of as a potent New World hop, but we pepper some in? And what would happen if we looked at the full spectrum of flavor rather than just individual markers?” So many different things, but the external and the internal approaches to expanding your knowledge must be engaged.

CBB // At the same time that you’re trying to improve [your beer], you’re also trying to make sure that it’s consistently the beer that consumers want it to be. You can’t change it wholesale and have it become a totally different thing. Adjusting or changing [a classic craft beer such as Mama’s Little Yella Pils] has to be a touchy subject around here.

TM // First you have to ask yourself, why are you changing it? And the number one reason we changed it was because the brewers wanted to modify it to adhere to what we always called it—we always called it a Bohemian-style pilsner. In 2014, I started digging extensively into the quality of our European hops. Between 2011 and 2013, we saw intense variability—especially in the Saaz variety, at that time only sourced in the Czech Republic. I dug in and I found the Aramis hop out of the Alsace in France, and we incorporated that in 2014—we just blended it in. Prior to that we used the U.S.-grown Saaz, Sterling, but only in the early kettle additions to drive IBUs up and such.

Nonetheless, we picked it after evaluating Select from the Spalt region, Tettnang (which is technically Tettnang Saaz), and also every single area they are growing Saaz. We picked Aramis, and that was 2014. But we didn’t make the beer an Aramis-focused beer. We drove it with Saaz. We then also started looking at making our Saaz pellets more consistent, so we started working with the Elbe-Saale region in eastern Germany and found that they were actually growing a Saaz hop that was very similar to what we wanted. Nonetheless, it’s taken years. We didn’t start taking hops out of the Elbe-Saale until 2016. And after establishing it in 2014, it took years to add commitments and then get the hops and get the quality where it needed to be. But it wasn’t until 2017 that we made the big modifications. We still have the same yeast—Augustiner—provided by the Brewing Science Institute. And we still use the same hops—Aramis and Saaz. But what kind of Saaz? Where’s it grown? Who’s growing it? What profile are we looking for? What specs are we looking for? We’ve even messed around with type 45 pelletization processing versus type 90. And we still very much use Aramis—I even go to the Alsace to select and dig in.

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But when it came down to making the big shift in Mama’s in 2017, it was about our objectives as brewers, and we wanted it to be more authentic. I spent about six years in a row in Germany drinking pilsners—let’s just say I had a shocking moment, especially when I was at Schönram with Eric Toft. He just kept feeding me pilsner and helles, and at the end of that I’m like, “Oh, man, I’m full of it. If I’m going to make a pilsner, I need to be attacking this the right way.”

I also learned a lot about the role of pilsner malt in beer and what you’re trying to get from pilsner malt. The protein structure of it is very different. And that’s not just how you malt it. Only certain varieties can actually be a perfect pilsner malt. But to be honest, don’t get romantically involved with the barley varieties. They’re not supposed to be around for so long, but you should know what it is and know its genetics because agronomics are a big, big thing.

CBB// Time is money, whether you’re talking about the agricultural business or the brewhouse. Every additional day or two or three that what you’re making is sitting in your production process—that’s a time that the same equipment is not producing something else. There’s an opportunity cost to that. How do you incentivize some of these producers who are thinking about their own process? They have to be able to charge more money for it in some way. But they’re constantly having to deal with clients—large breweries—that are looking for the most cost-effective solution. It can be hard to try to create a value proposition.

TM // Exactly. This is the long-term approach that all brewers must have. You should have constant communication with your suppliers and know where the barley is coming from, where the hops are coming from. And those interactions with growers are a huge focus for a lot of brewers, especially Canarchy. We spend a lot of man hours and airline miles and such getting all over the place and actually having face-to-face conversations. We’re actually understanding what we’re asking for, economically. That’s the most sustainable thing we can do, and—in terms of actually achieving a product that we want—that works for everybody. Will we pay a premium for certain requests? Definitely. But at the same time, it just goes to show that you need to make sure you’re using the barley varieties that are good for the grower and that can achieve the product downstream. That is why we spend a lot of time in barley development—with breeders, maltsters, growers, and such.

CBB // You’ve raised an interesting point that there is also an efficiency to be gained on the kind of materials development, validation, ingredient quality side of the equation, where you use that combined buying power and the combined budgets from those breweries for ingredients, and work more directly and intentionally with some of these producers. Putting those resources to work for the entire group as a whole has to add some sort of advantage to this.

TM // Shared resources in terms of buying power—I think that’s a little bit overstated. It is a thing, but it means we are able to take a different kind of risk, especially with contracting and outlooks and supply assurances. We don’t have to book all of our barley, we don’t have to book all of our hops because sharing collectively we have so much that it is a safety net. We have a major objective of using more varieties, not consolidating. We have 40 different actively contracted varieties in Canarchy right now. We all have the same account, but at the same time, it allows us the ability to be flexible and have options, and not get tied up in any one variety, [while still being] able to invest in any one variety to the fullest extent because we combine our usages.

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CBB // We are starting to see more and more two-way communication with growers, whether that’s malt or whether that’s hops, and especially on the hops side of the ingredient equation. Having the right hops and having access to some of these harder-to-get varieties is one thing, but also developing unique assets—partnering with growers to create things specifically for you—is another piece of this that you are engaging in.

TM // Definitely. We try to be very involved with breeding programs across the entire world. We are trying to be as integrated with those as possible but also be in touch with what the growers want. That full agronomic conversation needs to occur.

CBB // You’ve supported and encouraged and financially committed to having growers produce enough of these so that you could make a beer in order to get to the point—that’s a lot of risk on your part.

TM // You have to limit that. Don’t go out there and purchase 40 acres just like that. I’ve seen some breweries do it—fully sponsor hops, and then it goes under. And then I hear the brokers and the growers just bemoan it. They lose the enthusiasm that we need from them in order to push the boundaries of what flavor can be from hops. Ultimately, brewers should not look for their own special hop. Don’t do that. It’s too much pressure on yourself. You want a hop that works for everybody. And that means the growers, the brokers, and the brewers. And that’s plural brewers, not just you, not just Canarchy, but all of craft beer.

You want it to be proliferated across the entire industry so it’s sustainable. You want something stable that can deliver very real benefits to every single step and every single player along the way. Partner up. We’re very much part of the hop- quality group, and we share information on hops with our friends all the time—outside of Canarchy, inside of Canarchy. It’s good to be the first, somewhat, but it’s also good to share.

We established our Strata contracts years ago. And now we have all of this Strata, and people are just getting into Strata. Of course, I’ll share a box with you. Go play. Go tell the world. If we believe in a hop, we want the world to know and the world to invest because the brokers want more than one customer. But it does take a brewery to take a plunge. You just need to calculate your risk on that plunge and [know] exactly what your objectives are. If you’re going to take that plunge, go get some friends. And don’t do it alone.

This interview has been edited for length and clarity.

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