Keurig Dr Pepper Invests $50 Million in Nonalcoholic Beer

The beer-sans-alcohol segment in the U.S. grew almost 20% in retail dollars over the past year.

November 11, 2022

BURLINGTON, Mass. & FRISCO, Texas—Keurig Dr Pepper has taken a minority stake in nonalcoholic craft beer maker Athletic Brewing Company, investing $50 million. The deal is Keurig Dr Pepper’s second move into the nonalcoholic segment after acquiring Atypique, a nonalcoholic ready-to-drink cocktail brand.

"Athletic Brewing is a winning brand in a rapidly growing beverage segment. Our investment reflects our interest and ability to move into exciting white spaces, including in the blurring of the alcoholic and nonalcoholic categories," said Keurig Dr Pepper Executive Chairman Bob Gamgort. "We look forward to partnering with the Athletic Brewing team to help them scale the business."

Athletic Brewing was founded in 2017 by Bill Shufelt and John Walker and is a top-20 U.S. craft brewer, according to NielsenIQ data. In 2022, Athletic Brewing was ranked as the 26th fastest-growing private company in America by Inc. Magazine and was also named to Time Magazine's "100 Most Influential Companies" list. Athletic Brewing has a lineup of more than 40 brews.

Nonalcoholic beer in the U.S. grew almost 20% in retail dollars over the past year, according to NielsenIQ, with the craft segment far outpacing total category growth. Nonalcoholic beer accounts for over 85% of total sales in the nonalcoholic beer, wine and spirits category, as an increasing number of consumers moderate their alcohol consumption.

And beer companies are meeting this consumer demand, with major beer companies, such as Heineken, Budweiser and Sam Adams, releasing nonalcoholic alternatives in the past five years, reports the New York Times.

Shufelt, Athletic Brewing’s co-founder, was a consumer who had cut alcohol out of his lifestyle when he was training for an ultramarathon in 2013.

“I stopped drinking for a month and felt incredible,” Shufelt told the New York Times. “And it was kind of a no-brainer for me to not go back to drinking—but then I was at all those drinking occasions, and there was nothing on the menu for people who were not drinking.”

Because of this realization, Shufelt went on to co-found the brewing company and create beers that could be enjoyed as a beverage and not just a replacement for an alcoholic drink. He told the Times that 80% of the company’s customers drink alcohol, with three-fourths of them between the ages of 21 and 44, and half of his customers are women.