When BrewDog launched Equity for Punks, it felt like a revolution.

A couple of normal lads from Scotland.

A DIY beer brand.

And a chance for everyday fans to own a slice of the anti-corporation dream.

Over six funding rounds, more than 120,000 people bought in - raising £73M and turning BrewDog into one of the UK’s most recognisable brands.

Years later, the founders walked away with £110M. And the “punks”? Heavily diluted, locked into illiquid shares and rewarded with… discount codes.

This is a cautionary tale for any businesses thinking about crowdfunding, and any investor getting swept up in the hype.

Let’s take a sobering look at:

In 2009, BrewDog raised its first £2M through Equity for Punks, a crowdfunding campaign that invited craft beer fans to become shareholders. Over the next decade, they ran six rounds and pulled in £73M from more than 120,000 people.

The pitch was galvanising: Stick it to Big Beer, join the movement and own a slice of the rebellion.

It landed, because the timing was bang on. Post-financial crash, trust in institutions was in the bin, social media was booming and grassroots brands were gaining ground fast.

Fine print however…

These weren’t ordinary shares. They were B-shares in a private company - voting rights on paper, limited sway in practice. No guaranteed dividends and almost no route to sell. BrewDog wasn’t listed, and with no organised secondary market, getting out was nearly impossible.

Still, the early rounds offered real value. Low entry prices, solid brand momentum and yes, some investors did very well.

So while the setup was unconventional, the returns (for some) were legit.

Which is why the model worked: it wasn’t just a case of believing in the mission, it was about getting in early enough to make it pay.

Imagine if Apple, at the height of its cult following, had said:

"Buy in, get voting rights with little sway, no liquidity, no guaranteed dividends - BUT we’ll throw in a T-shirt and 10% off your next charger.”

Plenty would’ve gone for it. When you’re that bought in, identity beats logic.

In 2017, BrewDog landed a £100M investment from US private equity firm TSG Consumer Partners. That deal gave the business a £1B valuation and the founders a personal exit worth £110M.

As for the retail investors, the crowdfunding worked… on the way in. BrewDog got scale, loyalty and capital. By the time of the 2020 share offering, however, only 2% managed to sell.

The rest were left with diluted, illiquid shares and no clear route out. Between the early rounds of 2020, the number of shares in circulation had ballooned, from around 100,000 to millions. For most, “ownership” was more symbolic than financial.

The upside? Gone.

The perks? A lanyard, a discount card and a warm welcome at the bar.

Now, that doesn’t make it a scam. That’s just equity.

Risk is part of the deal - you don’t get to cheer for 100x and cry foul at 0x. But it does highlight something easy to forget: once the money lands, founders owe nothing to individual shareholders. Not legally, anyway (ex-lawyer speaking).

Technicalities aside: our legal obligations might end when the deal closes, but your reputation doesn’t. If you win on paper but lose trust, it’ll cost you in the long run.

I’ve got a weird relationship with this one.

On the one hand, I admire what BrewDog pulled off. You don’t raise £73M from the public without serious conviction and a story people want to buy into. It was ballsy. It was different. And it worked - at least for the business.

The way it played out, though? It leaves a bitter aftertaste.

I don’t drink anymore, so I’m immune to the hangovers. I have, on the other hand, seen far too many financial ones since launching FundOnion. 

One client - £20M turnover, solid business - nearly got wiped out by short-term invoice financing they didn’t fully understand. We renegotiated it, took it back to market and they came out better.

However, it drove home the point: these relationships are transactional. Your investors aren’t there to hold your hand. They’re there to get their return.

And that’s fair. Equity comes with risk. When I posted about this a few weeks ago, one founder summed it up like this: “Equity crowdfunding leverages emotion to raise capital from people who don’t fully understand what they’re signing up for.”

But not everyone sees it that way. Another commenter said they’d invested £37, got it back many times over in free pints, discounts and the novelty of being a ‘BrewDog shareholder’ - and never expected a big return in the first place. For them, it was worth it for the perks and the story alone.

Both views are valid, but if you’re the founder, you’ve got to plan for both. I’m all for fan-led capital, as long as the story you’re selling matches the reality they’re buying.

I finally got around to reading The Shining.

Unnerving, immersive and way more psychological than I expected.

Highly recommend it.

Aside from the entertainment factor, it reflects how easy it is to lose sight of what you originally set out to do.

(SPOILER INCOMING)

Jack signs up as a caretaker for the hotel. He means well, but over time, the pressure takes over and he ends up doing damage.

Obviously, BrewDog’s story isn’t axe-through-the-door horror… but when founders lose sight of who they’re building for, the effects can linger. 

It started as a mission to reward the fans. Somewhere along the way, it became more about extracting value than sharing it.

Releasing the grip on your founding chapter is hard, but necessary for unlocking the next phase of growth.

At FundOnion, we’re in the thick of that process ourselves - which is partly why BrewDog’s rebrand caught my attention:

Back in the day, they hit headlines with beers served in roadkill and slogans orchestrated to offend. It did the trick. They built a brand people felt part of, even when the marketing crossed the line from bold to bizarre.

Eventually, they pivoted. 

Staff development replaced shock value. Public stunts gave way to inconspicuous structural changes. They didn’t announce a rebrand. Just outgrew the performance.

And despite the controversy, dilution and shareholder backlash, they’re still standing. The bars are full. The supermarket shelves are stocked. Whatever you think of the funding story, the business itself has weathered it.

That’s the power of brand equity, and a reminder that evolution doesn’t always need a press release.

Crowdfunding isn’t evil. Discount codes aren’t a crime. And turning fans into shareholders doesn’t make you the villain.

But if you’re going to push the promise, be clear on who carries the risk when it doesn’t pan out.

Also worth remembering: crowdfunding rarely covers the whole raise. It’s traction capital. The rest usually comes from angels or VCs - and they’re not buying T-shirts.

Planning a raise and want a second set of eyes - on the terms, the story or the strategy? I can help → [email protected]

Till next time,

James