Owner of Narragansett Beer speaks to students

By: Chloe Thompson

Posted: 3/7/08

03/07/08 - Many college students don't like sitting through lectures, but when it comes to beer, they're bound to perk up a little.

That's what happened when Founder and Chief Executive Officer of Narragansett Beer, Mark Hellendrung, came to speak to the University of Rhode Island's Entrepreneurship Club Wednesday.

Hellendrung, casually sporting a vest bearing his company's name, didn't hand out free samples of his product, but he did give students some valuable business advice in Ballentine Hall.

He looked back on his years as former president of Nantucket Nectars, a famous juice company, and recalled his friend coming up with the pitch. "Somebody once said there aren't any new ideas, just borrowed ideas," Hellendrung said.

He then asked two volunteers from the audience to create the ideal paper airplane.

Onlookers, a bit confused, watched as he tossed his crumpled paper ball "airplane" with more accuracy than the other airplanes into a nearby target. He explained that, like with the airplanes, business is all about innovation.

"Who's to tell me that's not an airplane?" he said, gesturing to his paper ball. "That's innovation. And part of the key to this industry is accuracy."

Hellendrung told the students that small ideas can turn into large corporations overnight, and students should always strive to be creative. He used his friend at Nantucket Nectars as an example.

"He saw all these exotic fruits in Spain, and at the time there was not a whole lot out there for the juice industry," Hellendrung said. "He basically said, 'Why don't we have these in the U.S.?' and next thing you know we've got an $80 million company."

The same type of overnight success happened to Hellendrung, who bought his beer company from the Falstaff Brewery Corporation in 2005 and transformed it into the company it is today.

Narragansett Beer comprises about 2 percent of the beer market in Rhode Island, which might not seem like a big number to many, but Hellendrung said a lot of this market comes from the relationships he's developed among the community. He said he prefers to be small because it allows him to do "quick things" in terms of marketing, like putting more of his product in a store without having to go through mounds of paperwork.

He acknowledged a difficult task in business, fundraising, and called it "an incredibly long process."

"Banks don't want to lend you money," he said. "They'll give you money when you don't need it."

Hellendrung said that although entrepreneurs might be tempted to go to their friends and family for loans, he'd stay away from it.

"Entrepreneurial adventures are as likely to fail as they are to succeed," he said.

Instead, Hellendrung said he goes to local groups to advocate on his behalf, noting that he raised $350,000 through the Cherrystone Angel Group, which offers early stage investment funds to businesses in Rhode Island, Connecticut and Massachusetts.

Hellendrung attributes his passion for his beer to its location, and said he is hoping to make it the "New England beer of choice."

"All these parts of the country have this blue collar, hometown beer, and New England didn't really have that," he said. "Your brand is your life blood, and you have to protect it at all costs."

Hellendrung linked a particular problem in his company to other types of business. He discussed his competition with Budweiser as a challenge, but said eventually his beer had to find its own niche instead of overpowering Budweiser.

"For us what we've learned is ... we've become the premium beer, the affordable beer, the drinkable beer, for that scenario," he said. "We're a craft beer."

Though competition is fierce, Hellendrung said marketing always helps out businesses. He said Narragansett Beer spends about $200,000 per year on marketing, whether that's through hats, T-shirts or billboards.

"We value [the] merit [of the market idea] and ask ourselves, will this lead to another market?" he said, adding that competition is always brutal.

Hellendrung also shared another lesson he learned in his business days about judging good publicity versus bad publicity. He told his audience about a time when an unsuccessful convenience store propositioned him to sell his beer on their floor.

"Someone said to me, your first impression [of Narragansett Beer] can't be in a place like that," he said. "My point is, somebody's always trying to sell you something, but you need the discipline to say no."

Hellendrung shared a quote that held particular meaning in his life to the young entrepreneurs about his purchase of the brewery.

"You know, Woody Allen once said, '90 percent of life is just showing up,'" he said. "Well, I showed up that morning ... and after 18 months of negotiation with investors, I purchased Narragansett Beer."

The Entrepreneurship Club, which began this semester, creates networking opportunities and real-life experience through lectures from large business owners.