Kmflett's Blog

The politics of shareholding & Brewdog’s Equity for Punks

Shareholding obviously has a long history connected to the rise and persistence of market capitalism. Historically the investor class were known as coupon clippers. They could make a decent return off share dividends.

Margaret Thatcher in an attempt to popularise capitalism promoted the sale of shares in public utilities that her Governments privatised, British Gas and BT for example.

It may surprise some to learn that I am a shareholder. I have never been in the business of buying shares. Rather my employer, one of the UK’s largest private businesses, for many years handed them out to employees. The idea was that being a shareholder gave people a tangible stake in the success (or otherwise) of the Company.

I don’t know how many shares I own my view along with many of my colleagues being that a decent wage is what is required. That said I can of course check the share price and were I so minded sell the shares at an appropriate moment. It’s all highly regulated.

Then we come to Brewdog’s Equity for Punks crowdfunding schemes. I do know some EFP holders and I think their investment was mainly aimed at getting reduced price Brewdog beer and perhaps attending the AGM. Given the discounts that can be found on Brewdog beers in 2026 I’m not sure the attraction is still there and I understand the AGM is not what it was.

Some people clearly invested more than just the nominal sums required for a discount. The FT ran articles back in the day pointing out that if people were actually interested in investing in shares then the regulated Stock Market via a financial advisor was the way to go. Perhaps not many EFP investors read the FT.

With Brewdog now sold for a cut price (FT 3rd March) £33m there is no equity of note to distribute not even to TSG who have first preference let alone EFP holders.

Media reports suggest that James Watt’s alternative bid came in just £3m under the successful one and proposed a holding company where EFP holders would have had a 19.5% stake. Hmmm. Not sure that would ultimately have provided any payouts either but it does suggest that EFP people do have questions to ask

As has been pointed out on social media however, Watt aside, the EFP schemes could have been structured to at least potentially avoid what has happened. However Brewdog being punks broke all the rules..

A reminder that while sometimes tedious and bureaucratic rules do exist for a reason…