published on October 5, 2017 - 11:23 AM
Written by Edward Smith
Alongside revivals of Fresno’s downtown and Chinatown comes another investment opportunity from its oldest brewery—Full Circle Brewing Co.
CEO Arthur Moye and his team opened up ownership shares in the business by way of equity crowdfunding this month for the pub’s brewing and entertainment ventures.
“Sixteen months ago, what we’re doing would have been totally illegal,” Moye said.
But following the 2008 housing crisis, Title III of the Jumpstart our Business Startup Act opened the door to crowdfunding and startups, which came into full effect last year.
The goal was to give people other than the super-rich the chance to invest in startups, with some limitations, according to Steve Miller, president and CEO of Fresno First Bank.
“These are the most significant changes made to the [Securities and Exchange Commission] in 80 years,” Miller said. “It allows the average investor to put some of their money into something very local. That was typically only reserved for the very wealthy. It’s a very big change.”
Last year, Breakaway Funding, an equity crowdfunding portal, came to Fresno First Bank with a proposal to work hand-in-hand with businesses looking for alternative sources of startup capital, according to Miller.
The idea was that Breakaway would bring customers to the banks with stronger balance sheets due to the equity raises, decreasing the risk that banks would take on, making access to traditional financing easier for startups.
For Moye, that kind of support was exactly what he needed and lead to the first experiment in equity crowdfunding in the Valley.
The deal
They knew they could get a bank loan, but after becoming debt-free in June, Moye wanted to go another way. That’s when he decided to give crowdfunding a go.
The biggest problem facing the brewery is it has no beer. They’ve had to dedicate most of their production to meet in-house demands.
They even had to reduce their menu from a dozen to about a half-dozen brews just so they could keep up with customers.
The team hopes that with the investment, they could upgrade to a 30-barrel system, which would allow them to produce enough to satisfy guests and get their product onto shelves around the valley.
“Right now, it’s two guys standing around our seven-barrel for a 7- or 8-hour brew day,” Moye said. “When we get the bigger system, it’ll be those same two guys standing around a 30-barrel system.”
According to Moye, their seven-barrel system equals out to not much more than 14 party kegs every brew, but the 30-barrel increases efficiency without much more labor. For Moye, that means bigger margins.
A lot of the current demand for their product comes from the unique events they host, carried over from the previous owners.
The brewhouse hosts events from comedy nights, punk and hip-hop shows to burlesque and roller derbies. The events, according to Moye, draw in the crowds.
“It’s not that we ever want to dial that back, but if we’re going to get beyond these walls while continuing to increase our demand in-house, we’re going to need bigger systems.” Moye said.
Getting beyond the walls is Full Circle’s next step.
To do that, the brewery has already invested in a canning machine they call the “paperweight,” because at the moment, it’s waiting for the company to have some beer left over for use.
The time for the bigger roll out all depends on the new capital campaign, but Moye hopes they could upgrade by next spring, which would land him right in the middle of beer season.
The past
When it first opened in 2000, Full Circle Brewing catered to a more insular crowd of regulars under the command of Bill McCrory and Kenny Young. They hosted events like the Rogue Festival and roller derby, much like the new Full Circle.
But in 2016, when the bar was nearing closure, Moye and his partner, Cassidy Jakovickas, who bought the building, knew they would have to balance bringing change to turn a profit and keeping an image to maintain brand recognition.
“At first we thought, this is what Full Circle is or this is what we’re going to change, but it was something that was already alive,” Moye said. “So we decided to amplify everything that was already Full Circle and put a cool brand to it.”
With nine investors and a background in accounting, Moye set about realizing the vision.
Out of the startup money he got from selling his accounting firm and the money pooled from the original investors, they purchased forklifts, brewers, their canning machine and a new team.
He pulled in brewers from other brewhouses like Riley’s Brew Pub and Kern River Brewing Co. to put out their product.
“We were worried at first because they had some inconsistencies in their beer,” Moye said. “We cleaned that up by buying new equipment really fast.”
The team decided to keep the flagship beer, Cluster Fuggle, but to brew it with fresher ingredients and in new equipment.
In terms of approach, Full Circle began to listen for demands.
“Everybody’s worried about trending. I think that’s something we bring the previous owners didn’t do. There were more like ‘this is what we brew and this is the way we do it.’ We have an ear to the market,” Moye said.
For instance, when they heard that people wanted Northeast style IPAs, he made them. It’s now their second biggest offering in the Juicy NE IPA.
The market
There is a lot of speculation about the future of the craft beer industry, and there are numbers to back up investor reticence.
In July, California’s Sierra Nevada Brewing Co., the second-ranked craft beer company by volume, reported a fall in sales by 7.5 percent, according to
“It’s more competitive than it’s ever been,” Ken Grossman, founder and chief executive of Sierra Nevada, said in an August article of MarketWatch.
When consumers scan the aisles of liquor stores, many feel overwhelmed by the number of choices.
This doesn’t scare Moye, though.
“Saturation is something on a macro-economic level,” he said. “On a micro-level, Fresno is not saturated.”
He compares the market in Fresno to that of Sacramento, where he says they have more than 55 breweries and still want more, whereas the California Craft Brewers Association reports six in Fresno and a handful more across the Valley.
“The trends of growth are still positive,” Moye says. “The slowing numbers are coming from the big guys that aren’t necessarily always considered craft, but their numbers are still positive… How are they getting those numbers? By eating the little guys and that becomes their growth. That means that the little guys are growing at a stronger rate because they’re swallowing them up to offset their losses in market share. I think on a micro-level, there’s a lot of room to grow and be local.”
Moye’s background in accounting brings an understanding and a strategy to their financing not often seen by other breweries.
The company is not just relying on beer sales to get them through, but also their property investment and location.
When Full Circle was closing last year, Moye and his investors took the plunge and bought the building outright.
“It inoculates us from rising rent,” he said.
Rising rent may be a real fear for companies in Chinatown, as cap-and-trade funding is available for major green development projects in the district. And a high-speed rail station is also planned there.
Moye feels the renovations would be a rising tide for property owners like him and his investors.

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