A man asked his mom to start a Canadian craft beer company with him. His reasons made her cry
As featured in The Toronto Star
Jon Montgomery, Canadian Olympic skeleton champion and beer-chugging Games charmer, held hands with a mother and son he’d agreed to meet at a downtown Toronto restaurant. It was spring 2015.
Pat Macdonald and her elder son, Ian, had co-founded a new craft beer business called Old Tomorrow. A nod to the nickname of Canada’s first prime minister, Sir John A. Macdonald — no relation, but a soul who also enjoyed lifting a glass or two.
Pat had a test batch bottle of their new rye-infused, oak-aged beer in her purse. Montgomery drank the smuggled brew. The Macdonalds hoped their celebrity guest — whom they’d pitched via Twitter, fingers crossed that he’d respond — would endorse an ale they created for him. For the newbie brewers, Montgomery personified Canadian pride and spirit.
“It was a crazy idea,” said Ian, 32, of pursuing the Olympian who, after the 2010 Vancouver Winter Games, became host of The Amazing Race Canada.
“Obviously we’re proud to be Canadian. That’s why we started this company.”
The Macdonalds — Ontario’s only mother-and-son craft beer co-founders — left successful customer-centric careers to pursue an interest in beermaking. They entered the crowded craft landscape in 2014 when Pat, off work with a broken ankle, accepted Ian’s suggestion to build a family company from scratch. The original idea: it was something they could have fun with in their spare time. And oh, they’d need to put up $40,000 each as seed money.
Now, they were banking on Montgomery’s star power to distinguish their suds from everyone else’s.
Montgomery liked the product. He liked the Macdonalds.
“The beer was delicious and Ian and his mum were bright, eager, and checked all the boxes for the type of people you’d want to work with,” Montgomery said.
Hands were clasped, a gesture of faith, in lieu of a contract. Time was too short for a formal deal, not with a high-profile Toronto craft beer festival just weeks away. Ian got the last festival spot, at the last minute, and paid the $2,000 entry fee by credit card before telling his mum what he’d done. Pat gasped at the price — “We were making no money,” she said — but trusted her son’s instincts. Part of the event’s lure was the coveted winner’s prize in the celebrity collaboration category: LCBO shelf space.
Montgomery attended the beer festival with Pat and Ian, and brought his wife and parents, too. This time, however, there was no top-of-the-podium finish.
Still, “Monty’s Golden Ryed Ale” placed a close second as voted by festival goers. The Macdonalds, undaunted, recognized opportunity and aggressively marketed the aged beer across Ontario.
Five months later, Monty’s was being sold in LCBO stores. Four years, a bit more booze and a name tweak after that, “Monty’s Aged Ryed Ale” is now Old Tomorrow’s top-selling product.
Ian’s “crazy idea” became a stepping stone for Old Tomorrow’s path through the precarious craft industry. Pat’s long experience in consumer packaged goods, marketing, entertainment and government helped steer what was, at times, a seat-of-your pants business model.
The traditional power dynamic between a parent and a child was reshaped, too.
Ian learned to call his mother “Pat” in business meetings. Pat learned to accept her son’s higher tolerance for risk.
There were disagreements: how to deliver beer was one. Producing a low-alcohol shandy — beer mixed with ginger ale — was another. And consensus, including: they would not build their own bricks-and-mortar brew pub (yet) in order to invest their time and money into developing their Canadian-focused beer company.
Not only did the company grow, the Macdonalds have now acquired brands from other brewers and, by mining their marketing skills, also sell strategic services to help small craft operations drive sales.
But none of that would have materialized if Pat had not received troubling health news shortly after breaking her ankle. Back then, Ian — sensing his mother was out of sorts but unsure why — sent her an email with an offer. An unwitting “lifeline,” as Pat described it.
“I needed something to start thinking about other than ‘Am I going to die in the next year?’ ”
In early 2014, Pat Macdonald was on crutches, nursing a fractured right ankle. She and her husband, Ian Sr., were also starting to absorb the consequences of pulmonary hypertension — an unconfirmed diagnosis at that point — and how it might shorten her life. They kept that news from their adult sons, Ian and Blake, who nonetheless recognized their mother was struggling.
Ian had a Queen’s University honours commerce degree and was employed by Johnson & Johnson. Blake, also a Queen’s honours commerce grad, became a chartered accountant like his dad. Neither was living at home. Pat, then executive director of the Interprovincial Lottery Corp., was on medical leave.
“It was a pretty lonely recovery,” she recalled.
On one of those lonely days, her phoned pinged. Pat clicked the email from Ian.
He’d written a list of reasons why he and his mother should start Old Tomorrow. Among them:
- You’ve done big business, government, charities and companies in between. A small start up would be the last on the list!
- You’ll be able to make an impact on every decision. No politics. No red tape. Just go! Imagine what you could do if your talent was unleashed without restriction.
- It’s beer and it will be fun!
- Think about the impact as opposed to any other role. If people know what (Old Tomorrow) is in a few years from now, that would be a bigger leap forward than any other corporate program you could do.
- It would be really fun to work with my Mom!
“I started crying,” she recalled, getting emotional again sitting beside Ian at their Old Tomorrow offices in Don Mills.
“To feel valued. It was unexpected.”
For years around the dinner table, the Macdonalds had blue-skyed about a family brewery. (Ian Sr., a Canadian, was living in Bermuda, where he was a Bacardi International senior executive. He met Pat — an American working in New York as marketing director for Clairol products — when she took a vacation to Bermuda. They married in 1985, lived in Bermuda then moved to Toronto in 1986. Pat is a dual Canadian-American citizen.)
The family had home-brewing equipment and their son Ian, especially, enjoyed tinkering with beer recipes, experimenting with flavours and styles to share with friends.
Young Ian also had an entrepreneurial streak. He created money-making ventures with friends while at Queen’s, including a website where Kingston-area businesses bought ads in a “digital repository” to reach students.
After graduating, Ian spent nearly six years at Johnson & Johnson as a brand manager before he reached out to his mum — in part because she was frustrated at being sidelined with an injury. (This was her second broken ankle.)
“This was an idea I’d had since I was 12,” he said, “getting into the beer business and celebrating Canada through beer.”
He said he valued the potential of partnering with someone — who just happened to be his mother — with this pedigree: previous to Pat’s work at the Interprovincial Lottery Corp. (the national entity that oversees games of chance, occurring between provinces), she was CEO of YTV Canada and vice-president two top attractions, the CN Tower and Canada’s Wonderland. She had an earlier history with consumer packaged goods in the U.S. and Canada.
Pat’s response to Ian’s email: “Let’s do it.”
“I was like, holy crap, I couldn’t believe it,” Ian said of Pat’s same-day reply. “But I knew she was the first and only person I would ask to do this with me. I knew I needed someone I could really trust, depend on and someone who had another level of experience.”
Couple of ground rules: the company would be unconditionally Canadian from ingredients to philosophy to practice. It would be called Old Tomorrow, a name the Macdonalds had considered for years. A Canadian Pale Ale would be the first product.
Their initial business decision was critical: when to launch?
“I said we have to be in market by the end of the year,” said Ian of the late January 2014 discussion with Pat. “She said, ‘No, no, no, let’s give it a year or two years’ and I said, ‘Mom, no, it’s Sir John A.’s birthday next year, craft brewing is growing like crazy and we gotta go.’ ”
Pat agreed. They applied for a manufacturer’s licence, which took about six months. They met LCBO craft beer experts to introduce themselves and asked for feedback on their product plans and business concept.
Mother and son had experimented, taste-tested and developed their Canadian Pale Ale adorned with Sir John A.’s distinct likeness across the Old Tomorrow can. (The Macdonalds worked with two top brewmasters; first Jamie Mistry then Lon Ladell, a partner at Ottawa’s Big Rig Brewery, where much of their beer is made.) Their pale ale was available in select LCBO stores by November of 2014, with sales and distribution expanding over 2015.
By late 2015, and after months of medical testing, Pat learned that her illness had been misdiagnosed. She actually has heart failure, a serious but treatable condition, and was admitted to an intensive therapy and rehab program at Women’s College Hospital. Pat said by mid 2016, these treatments stabilized her condition, her energy returned and she “learned to cope” with her heart trouble.
Around that same time, the Macdonalds said it was becoming apparent the part-time family business was growing faster than they’d anticipated.
Their workload increased with each incremental success — and it pushed mother and son into a critical decision about their beer delivery system.
Old Tomorrow’s beer orders from pubs, restaurants and LCBO stores were on the rise. Pat spent long evenings calculating cross-province routes for drivers. But when their small core of drivers were swamped with shipment orders, Pat and Ian had to use their vehicles to drop off beer, too. The routine — “Every day was Groundhog Day,” said Ian — consumed working hours and threatened company growth.
“I remember after eight or nine months, I said, ‘Mom, this is crazy.”
It would take Pat one miserable beer run to understand her son had a better solution.
On one LCBO delivery day in 2016, it was cold, windy, with lashing rain. Pat Macdonald lifted beer from her vehicle and onto a dolly. She wheeled it to the door but struggled to open it. A driver from a delivery company hustled over and opened the door. Pat, grateful, asked the man for his business card.
Pat told Ian: “All right, you win.” They hired the transport company with the courteous driver.
This was also a moment when Pat recognized that her son identified a company problem long before she had.
“Ian developed a saying: ‘We have to stop working in the business and work on the business,’ ” she said of her son’s delivery frustration.
“That’s a good example where I realized he was wiser than me,” Pat continued. “I could have all this life experience and all this business experience but (it took) a young person to actually see that we were treading water, that we were too immersed inside the business.”
Other elements made their “lean” operation more efficient. For one, they regularly purchased LCBO craft brewing data — information only available through the province. Pat said the data informs their “fact-based decision making” to stay connected with customers.
Technology — Ian’s area of expertise — has been another key. He and a Queen’s friend modified ordering software that Ian estimates frees up about 40 hours a week. (It automatically aligns with accounting, inventory and invoice systems.)
“I think what the big guys are counting on is for the little guys to run out of energy,” he said, noting the province has 276 craft beer companies, up from about 65 in 2014.
Technology can be an equalizer. But the Macdonalds haven’t forsaken that old-fashioned touch, either.
When meeting prospective customers for a taste-testing session, the Macdonalds complement the discussions with homemade food made with their beer — like cake, baked by Ian’s mother-in-law, or Pat’s cheesy dips. It was during these meet-and-greet sales pitches when mother and son became more comfortable working a room as business partners.
“It was a source of pride to actually see my son in action and to think he might have listened to a few things along the way,” she said, noting it was “awkward for him” at first to call her by name.
“Eventually people . . . started getting comfortable with us in meetings. I think the most important dynamic is they know when they speak to one of us, the other is going to back the other one up,” she continued.
A new opportunity surfaced last year: the chance to acquire Double Trouble brands, a craft beer company that also had a cider licence. Funds, however, were scarce.
Besides the $80,000 in seed money from Pat and Ian, Old Tomorrow had taken on initial investors recruited from their pool of friends and family. Ian Sr., who owns Tricapital Solutions (specializing in financial restructuring and debt financing for small to medium-sized companies), helped drum up that early support.
“We’d been able to operate Old Tomorrow without any debt (and) we’ve really rubbed two nickels together,” said Pat, who does not take a salary, while Ian does.
Ian Sr. was able to raise additional funds to execute the deal. The Double Trouble line expanded the inventory. (Son Blake, who was also at 2015 meeting with Jon Montgomery, named the cider Eden Grove.)
The Macdonalds said as part of providing more choice to beer drinkers by developing and acquiring distinctive craft brands, they also offer strategic services under a company that evolved from Old Tomorrow, now called United Craft. Pat said “we help grow craft brands by combining our data analytics of the market, software, sales force and tasting team to better connect craft brewers with customers.”
Along the Macdonalds’ journey, Old Tomorrow has won awards at beer festivals across the province. This spring, the beermakers collected another tribute for what Pat calls “my special baby.” MPP’s voted for their favourite Ontario craft beers from several categories to be served in the legislative dining room at Queen’s Park for a year.
Pat’s creation, Old Tomorrow’s Honey Ginger Shandy, was voted best specialty beer.
“That shandy? I did not think that was going to be as successful as it was,” conceded Ian.
“It’s fun to see how excited she gets about all her ideas coming to life.”