After an open-ocean race sailing from Key West to Cuba a few years back, all that Scott Hansen wanted was a good beer. “There were only two beers available, and both were not good,” said Hansen, a Sullivan’s Island resident who is CEO of Island Brands.
At the time, Cuba was newly open to U.S. citizens after decades of sanctions. Sitting in Cuba drinking bad beer, Hansen decided that when he got home to Charleston, he’d start a company that could make a beer good enough for the island that captivated him.
“I’ve done these races before and it’s a time of reflection, to really understand kind of what you are made of when you are sailing in the middle of the night,” Hansen said. “When I got to Cuba, I just fell in love with the people, and the idea that these people were so incredibly resourceful with all they’ve created. I felt charged to really do something and it moved me.”
Hansen had no history in the beer industry, except for liking the beverage, but he had a lot of experience with startups in technology, health care and finance.
With encouragement from family friend and mentor John Paul DeJoria, who founded Paul Mitchell hair products, Hansen said he launched a couple of technology firms, worked in securities for Merrill Lynch and founded a talent firm that supported technology being developed by the Pentagon.
How hard could it be to start a beer export company? he wondered.
“Unfortunately, the White House had opened things up, but the State Department hadn’t quite caught up,” Hansen said in a recent interview. “After I incorporated and started the process of being able to ship into Cuba, the State Department froze my bank accounts and sent me some ‘cease and desist’ letters.
“But I am just somebody who likes a challenge, so I forged ahead with a plan to curate better-quality beers. Along the way, I learned a lot about beer, talked to brewers, and, in my mind’s eye, I started to think about a product that, if the Cuban folks were able to make their own product, they would make. It was going to be really clean and an all-quality premium product.”
By “clean,” Hansen means a product that subscribes to the German Reinheitsgebot law, the oldest food and drink regulation in the world. That law decrees that beer is to have only water, barley, malt and hops. Hansen’s result: Island Coastal Lager.
Cans before beer?
The beer’s can, designed by friend and Island Brands’ chief marketing officer Chris Edington, is an homage to the white beaches of Cuba with the variety of blues that Hansen saw in the Cuban waters. Hansen said that in his mind, he was still going to leap the obstacles the State Department had placed, and he printed 300,000 cans in anticipation of exporting them.
But by this time, in 2017, the U.S. open-door policy to Cuba slammed shut.
“Unfortunately, the State Department and the U.S. government would not allow me to proceed with the project and I had to find a home for all these cans,” Hansen said. “I simply pivoted and called some major retailers in the Southeast and told them the story.
“Publix was willing to take the product into 12 stores in South Carolina. I’d never sold beer before. I fumbled through it and, about six months later, I got a call from Publix saying they’d never seen a product sell so quickly and [asked if] I have the capacity to put it in all 1,200 stores. Of course I said ‘yes’, and then I hung up the phone and had to figure out how to do it. I got the beer into seven states in the Southeast and in every Publix store.”
He said he and cofounder Brandon Perry of Sullivan’s Island obtained investors through a crowdfunding source. Investors understood what he was trying to do: create a market that wasn’t “bespoke or artisanal but not macro either. Somewhere in the middle.”
He raised more than $1 million in 30 days. Now, he has crossed $5 million, he said.
The company this year was named one of Inc. 5000’s fastest-growing private companies in the U.S. and has obtained a fleetwide contract with Carnival Cruise Lines. In addition to the original Island Coastal Lager, Island Brands also makes a lighter beer and three fruited beers, a flavored malt beverage, ready-to-drink cocktails and, in January, will be launching Island Coastal Rum and Island Tequila.
Hansen also partners with 1% For the Planet to give 1% of his revenue to causes supporting the global environment.
Hansen admits he is not a brewer, but he does taste every new beverage.
“I am the No. 1 crash test dummy,” he said. “My palate dictates what I think most people would like. We do have a multiplicity of different test labs we utilize. It starts with a visual that we provide to the lab and internally, [Edington] and I will develop something, bouncing it back and forth until it looks like what we’re talking about. Then it’s back and forth between our lab, and then we scale production.”
When he’s not working on beer, Hansen said he surfs and will continue competing in open ocean regattas. But, unless he happens to take a Carnival cruise that goes into Cuban waters, he still won’t be able to enjoy the beer he created for Cuba in the country that inspired it.