COOP Ale Works in Oklahoma City has a well-established identity among craft beer aficionados in its home state and beyond.
That’s largely due to the success of F5 — its flagship West Coast IPA — which Head Brewer Blake Jarolim gives credit for growing the brand into what CEO and co-founder Daniel Mercer refers to as the 800-pound gorilla in the Sooner state’s craft brewing industry.
While COOP hasn’t shied away from growth, having expanded into six states over the past 15 years, it’s had success thanks to a tried-but-true formula: finding its niche, avoiding rapid growth, entrenching itself in its home state and ramping up just before major legislative shifts would whet the craft-beer appetite of a state that was dry for more than a half century.
Prohibition was repealed in the United States in 1933, but it took Oklahoma another 26 years to get the memo. The state was dry from Day 1 when it was formed in 1907 and remained that way until well into President Eisenhower’s second term.
The aftershock of prohibition was still felt in 2009, when COOP started as a tiny production brewery in Oklahoma City.
Riding a changing cultural tide
When COOP began commercially in a 5,000 square-foot metal shed, breweries could only sell beer in Oklahoma that was 3.2% alcohol by weight — or about 4% by volume — in a taproom. Strong craft beer couldn’t be legally sold in grocery stores or convenience stores, with liquor stores and properly licensed restaurants a craft brewer’s only existing platforms to influence buyers.
In 2016, the passage of legislation that lifted those restrictions, creating a favorable environment for F5 (7.1% ABV, 100 IBU) to build on the momentum that had begun years ago with the help of an evolving restaurant scene in Oklahoma.
COOP’s first widely popular beers — the Horny Toad Cerveza and Native Amber — didn’t have the benefit of a taproom to entice customers. Mercer and co-founder Mark Seibel had to find creative ways to get the word out prior to the brewery’s opening.
“It was kind of like the Wild West — we just held fun events,” Mercer said. “We held what we called social raves on the second or third floor of downtown buildings and told the public through limited social media and press. We wouldn’t reveal the location until hours before the party started and we’d still have 200 people show up.
Jarolim was one of those early attendees. Mercer said there’s video of him approaching a beer stand, months before he joined the COOP staff.
“The market was so thirsty for a local craft beer,” he acknowledged.
The opening of the brewery dovetailed with a burgeoning arts and restaurant scene, which Mercer said was beginning to explode at the same time.
Opportunistic bars, restaurants and chefs helped propel COOP to early notoriety.
“There was a formal training program at Coach House, a high-end restaurant, that trained many people who’ve opened restaurants all over the city,” Mercer said. “Those guys were our biggest champions.”
“There were people out there eating nice meals who wanted to drink nice beer,” Jarolim added.
F5 takes over
COOP’s two biggest sellers for years were relatively basic beers: the Native Amber and the Horny Toad Cerveza. F5’s evolution from seasonal concept to year-round offering wasn’t one Jarolim — an erstwhile math teacher who homebrewed in his spare time — nor Mercer saw happening.
COOP’s first brewer was Chase Healey, who later founded Prairie Artisan Ales, and he created Horny Toad, which was among COOP’s first major sellers. F5 happened on the watch of Jarolim, who didn’t start out liking IPAs but was beginning to come around.
“I couldn’t stand IPAs,” Jarolim recalled. “The guy I started homebrewing with would bring them back from Dallas every week. “It wasn’t until I had Dogfish Head 90-minute IPA that I realized what hops could taste like and then I went off on the pursuit of taste.
“Once you get the hop bug, you can handle all sorts of [strong flavors]. It was Green Flash’s West Coast IPA that I really dug in on and wanted to create something in its likeness.”
This was something Jarolim and Mercer, who by now was the sole remaining founder, saw as experimental, figuring their easier drinking beers would continue to carry the mail.
They hit on the formula for F5 relatively quickly and chose to leave it alone once they were satisfied.
“We thought that this beer was not going to be one that people would want to drink all the time,” Jarolim said. “I was still a schoolteacher when I brewed the first batch. When it came out, we weren’t happy with it. We looked at the scale-up and looked for things we thought we might have missed, filled them back in, and with the exception of a hop change, we have almost the exact same recipe that we did on that second batch.”
That didn’t happen as planned.
The beer was first released at an Oktoberfest event in nearby Choctaw, Oklahoma. It got rave reviews almost instantly and demand for it surpassed that of Native Amber and Horny Toad within a year.
That happened despite the beer being only sold in kegs and it would be four years before it could legally be sold in a taproom.
“There was no packaged F5 — this was only draft,” Mercer said. “We had made the decision to package Horny Toad and Native Amber long before F5 was even a thing. The seasonal idea was way out the window.”
With trajectory having shifted, COOP made the decision to adapt, shifting their brewing schedule to accommodate their new best performer.
“We brewed all the Amber, the Horny Toad and the Porter in a week, and then spent the next three weeks making the F5 that was needed to satiate the market. We were barely keeping up with the market — we didn’t can it until 2014 because we knew we were going to piss off the market if we couldn’t keep up with the draft demand.”
F5’s popularity outkicked COOP’s coverage regarding what the relatively new craft brewery knew about canning and packaging, too.
“We didn’t know a lot about packaging stability back then,” Jarolim said. “So it’s honestly a good thing we weren’t canning it.”
Learning about packaging
It’s not a stretch to say that the boom of F5 put COOP on an accelerated course of study on packaging and production.
The founders spent a lot of time in their early days talking to established production breweries like Left Hand and New Belgium about improving things on the brewhouse side, but paid less attention to what Jarolim said was the “less sexy” side of the business.
“The industry back then was more than willing to tell you what they knew, but we weren’t hanging out with the packaging teams at those breweries,” Jarolim said. “We wanted to see the brewhouse side and talk about improving that side. We had no idea how much of a can of worms we were opening there. It’s a turning point in a brewery’s evolution when you go into packaging.”
F5 and the need to put it into cans were those catalysts.
“Microbiological stability and dissolved oxygen were not things we understood,” Jarolim said. “It was getting purged, so it should be fine? We weren’t paying attention to what the purging was actually doing, or how fast the lid had gone on. Or undergassing. Or foam fobbing. There were so many things we didn’t know at the time.”
The young brewery developed its QAQC. It stretched the budget to acquire a dissolved oxygen meter and, when the time was right, replaced its 35-per-minute can line with a 200-can-per-minute canning line.
That and moving from the small shack to the large warehouse with taproom that it’s been in since 2014.
Canning was one of the bigger parts of the learning curve.
“Even doing bottles was a lot different than cans,” Jarolim said. “Wanded bottlers give you some grace that canning lines don’t. It caused a lot of sleepless nights.
“Hindsight is 20/20, but I think if we could have, we would have worked to understand this earlier.”
Finding the Sweet Spot
You don’t find success without a little bit of luck, and COOP had a couple of things going for it.
First, the lack of a speedy canning line and needing to take time to learn more about the canning process likely prevented them from falling prey to the fate that has recently befallen some breweries.
COOP is in just six states: Oklahoma, Texas, Arkansas, Kansas, Nebraska and Missouri. However, 99% of its consumers reside in its home state.
COOP eventually made it into the bustling North Texas market, which includes the Dallas Fort Worth Metroplex. However, it began to notice a shift.
At the time, out-of-state sales for COOP had grown to about 14% — a percentage that dwindled as the hyperlocal movement began to take hold and the craft beer industry saw numerous towns with one or more local breweries.
“When volumes are moving down and there are more local options and people make a conscious effort to go experience taprooms and products first hand, it’s not good for your capabilities as a brewer in your non-home markets,” Mercer said.
COOP was able to weather the blow because it hadn’t had the equipment to expand at the speed former brands like Green Flash did, he added.
“Luckily for us, we were behind the curve, because given the capital and capabilities, if we had had our current can line in 2014 and $1 million in cash flow, we would have tried to move into more than six states,” Mercer noted.
“We have always a year to two years to three years behind and it was really a blessing that we didn’t commit to raising more capital. The retraction of state markets really allows us to refocus here in Oklahoma.”
There’s still a lot of room to grow, he added. Rewriting the statutes has been impactful for both the brewery and the population from a cultural standpoint, allowing for more growth an inch wide and a mile deep.
“There are still people out there in Oklahoma who have never heard of COOP,” Mercer said. “Oklahoma is still a sub 3% craft beer market, where the national average is 14% and places like Bend, Oregon are 35%. If you can grow a 3% market to 4.5%, thats a 50% increase, and of all the breweries in Oklahoma, we already sell 50% of the beer that is sold here.
“We will just continue to push the bounds of saturation here, because people are always looking for evolution.”
To help that happen, the brewery has recently expanded its product line. It’s begun making and selling COOP 66, a lager meant to compete at a price point with Michelob Ultra and appeal to the type of consumer who might normally choose a Pabst Blue Ribbon or a Modelo.
“I think for us, the innovation is is evolving the marketing portfolio,” Mercer said. “You have to make considerations from a pricing perspective and predict what you think will happen with the economy.
“Is it the right idea to try for a double IPA? Maybe, but you have to run a business like it’s a business first and a brewery second. We can make pilot draft beers and throw them in our taproom and hope that one day we can increase the breadth of our brand, but I think it’s more about product portfolio, composition and continuing to entrench ourselves in Oklahoma.
Editor’s Note: Prior to the publishing of article, Daniel Mercer resigned his position at COOP Ale Works.
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