Just over a year after Periodic Brewing closed in Leadville and Northglenn, the brewery filed for Chapter 7 bankruptcy.
The company said in its November 23 bankruptcy filing that it owed just over 50 creditors $ 1.4 million and had assets worth $ 58,324.
The periodical opened in Leadville in 2015 and added a valve room and production facility in Northglenn in 2017. It closed them both in September 2020, breaking the news on social media but offering little to no money. information about the reason.
Chapter 7 bankruptcies are generally a liquidation process, in which a trustee is appointed to oversee a sale of the debtor’s assets. The bankruptcy filing says the brewery’s equipment has already been auctioned off by Lake and Adams counties, where Leadville and Northglenn are located.
“We owed a lot of money,” founder Chris Labbe told BusinessDen on Tuesday. “There’s really no way around it. There is only one path at this point to protect all owners and ensure that all auction results are properly distributed to these debtors.
In its five years in business, Periodic has served more than 300,000 pints of beer and produced more than 100,000 cans and bottles, according to Labbe. In its file, the brewery said it had revenues of $ 784,998 in 2019 and $ 364,213 in 2020 before it closed.
Before the pandemic, Labbe said 80% of Periodic’s revenue came from its taprooms and 20% from distribution.
“I pushed the company all the way into growing our distribution, and we were successful. But when the pandemic started, we weren’t in a strong financial position, ”Labbe said.
While distribution was a lifeline for some breweries when the pandemic hit and taprooms had to largely shut down, Labbe said Periodic stopped distribution during the pandemic in an effort to save money. silver.
“We had expanded to almost 100 distribution sites in the Denver area and were producing at record levels,” Labbe said. “All signs were pointing to continued success in the first part of 2020, but then the lights went out. We went out of our way as best we could to muster resources and materials to survive what was to come, but in early June and early July income in Leadville was close to zero during a time when we usually make a lot of money. .
“It cost a lot of money to prepare and stay on top of the cast,” he added. “And when the valve rooms were closed, we lost almost $ 350,000 in revenue that first summer. It was too much to try to recover and continue fighting as a family. “
In addition to the drop in income, Labbe said he was struggling to find and pay employees to staff the valve rooms. Although he had another full-time job in the oil and gas industry, he worked in the brewery eight to ten hours a day.
“We couldn’t take it physically anymore,” he said. “In July, we were at an all-time low, and that led to our decision to close in September. We knew we would be hard pressed to recover without a significant personal investment.
Creditors include Labbe himself, who owed $ 268,044 for loans to the business; GVC Capital, based in Greenwood Village, owed $ 609,000 to finance the expansion; and OnDeck Capital, a lending agency that filed a lawsuit against Periodic to collect the $ 31,622 owed to it.
“And it’s probably not the last,” Labbe said. “These things will come against me personally as well as against the company, and Chapter 7 is the only way for me to be protected and the company can distribute these assets.”
Although he is enjoying his free time now, Labbe said he misses “staying behind the bar and talking to people who have become my friends”. He said he would like to get back into the brewing industry somehow, but won’t reopen Periodic to avoid past debts.
“It was my passion and my dream, and we built a great product. So it’s not easy to walk away, ”he said.
The periodical closure has left Leadville with a brewery. Two Mile Brewing opened last year.