01 Jun 2012
IPA Meets IPOTopics:
Lots of business executives tout the importance of focusing on the customer. But craft brewmeister Jim Koch (MBA 1974), founder and chairman of the Boston Beer Company and its Samuel Adams product line, took that concept to another level. When his company went public in 1995, Koch made sure that his loyal quaffers (at $15 a share), not Wall Street insiders (at $20), got the best stock price. He attached fliers to his six-packs that alerted customers to the chance to purchase stock in the company. As required, Koch told the SEC how many buyers he expected: 30,000. So when 100,000 people mailed in checks, Koch had to select 30,000 folks by lottery and return the others’ money.
It was more than the financial equivalent of offering a round on the house—it was a studied business move, and one that other intensely customer-oriented companies are eyeing. “It’s good for a company if its shares are in the hands of the people who really believe in it—and for us that means the people who really love Sam Adams beer,” Koch explained to the New York Times (February 19, 2012). One of those original $15 shares of stock in the Boston Beer Company is now worth about $100.
Class of MBA 1978, Section J