49th State Brewery Has Found Success In Alaska By Embracing Challenges

One of the first things you will notice when approaching 49^th State Brewery is the throngs of people milling about in the large fenced-in dirt courtyard around multiple fire pits and picnic tables. Worn Carhartt pants and faded flannel shirts seem to be the clothing of choice, and there are numerous dogs of all shapes and sizes milling about. The parking area is filled with battered trucks, SUVs, and other utilitarian vehicles, most bearing scars from the hard lives vehicles endure this far north. Inevitably visitors notice the rusted old bus with faded green paint sitting off to one side. It’s a popular place for selfies and appears in many people’s social media feeds. That’s because its bus featured so prominently in the book and movie “Into the Wild” by Jon Krakauer.

When you ask David McCarthy, the co-founder of 49th State, about the bus, he enthusiastically explains why he felt it had to be a part of his facility. “It’s not the real one but the replica used in the movie. We felt that we should have it here; we kind of relate to his story,” he said. “He fully dedicated his life to something and gave it his all. That’s very uniquely Alaskan. So many people come to live here and do that every day. Life can be hard up here. Unfortunately, he (Chris McCandless) paid the ultimate price for his adventure, but he went for it. That’s how we feel about 49th State, we are going to lean into challenges, and hopefully, that allows us to succeed. If not, then at least we tried.”

That mentality has propelled 49^th State Brewery through expansive growth and has positioned them for success looking forward as tourism slowly returns to Alaska.

When McCarthy and his partner Jason Motyka first decided to open their brewery in 2010 in the tiny town of Healey, Alaska, most people did not predict big things for them. The town of 1,100 located just outside Denali National Park and Preserve was pretty much in the middle of nowhere. Fairbanks is 130 miles north, and Anchorage is 248 miles south, plus the park’s busy tourist season only lasts for the short Alaskan summer from May to September. The rest of the time, the area was quiet.  

Their decision to open in Healey was based upon their knowledge of the town, where they both lived. The two men owned the popular Salmon Bake and Prospector Pizzeria and Ale House in nearby Denali Village, where they saw that customers were asking for craft beer. Something that was still in its infancy in Alaska in the early 2000s when the few breweries there were in the state were located near the coast.

“That was our proof of concept; people were buying all of the beers we were bringing in,” says McCarthy. “We knew that if we created something uniquely Alaskan, then the community would embrace it. So, we cobbled together enough funds and opened with a tiny half-barrel system in a converted bus depot building. From the moment we started pouring beer, we couldn’t keep up with demand.”

Brewing a wide array of beers designed to appeal to every drinker, word of their business rapidly grew, helped by drafts poured at their other two businesses. Their business grew, and they opened a second location in Anchorage in 2016, followed by a production brewery there. Part of the decision to expand was driven by the unique nature of manufacturing in Alaska, where most goods come from outside the state resulting in expensive shipping costs that impact the bottom line.

“The cost of products is huge here. Nothing is cheap, especially as remotely located as we were,” says McCarthy. “We had to focus on the economy of scale where necessary because the cost of manufacturing in such a remote area is even more challenging than even in Fairbanks or Anchorage. The reason why is because most of the products we buy literally drive right past us. They have to cross-dock in Fairbanks and come down. Even UPS and FedEx didn’t deliver directly to us. If we could cut down on those costs by brewing in Anchorage, then we knew we should.”

The other reason is that their brewery closed in the winter to save costs. It was a seasonal business. Opening another location was in their plan from day one. It just took them six years to find the right place and not over-extend themselves in opening it. 

When the pandemic hit, it could have spelled disaster for 49^th State. They were in the middle of an extensive remodel and expansion of their original location, dramatically expanding their dining room, bar, and outdoor area. Plus, they were upgrading parts of their brewing facility to add in barrel aging capabilities and the capability to stay open brewing year-round. That was on top of their other businesses shuttering and all forms of tourism abruptly ending. But true to form, they decided to lean in with an eye towards the future. 

“We had decided to expand this because Healey is the home base, the center of our brand. So, the decision to expand wasn’t based on the population here; it was based on the overall community support for 49^th State that we have received from day one,” says McCarthy. We felt that if we built something iconic, we could create the demand based on filling a bigger restaurant and pub. We were not going to backtrack on that commitment.”  

 They quickly pivoted to packaging their beers for sale to meet demand during the shutdowns, something they rarely did beforehand. A full canning line was added into their production facility, and package beer was sold out the door at their two brewpubs. That has led to them deciding to work with a distributor to make their beers available across Alaska, and they are in talks with a major chain to start shipping beer outside the state.

If the enthusiastic crowds filling 49^th State are any indication of what the future holds, things look good. By embracing a lean-forward attitude backed by a supportive community, they have ridden out one of the most challenging years in the history of craft beer. Their decision to open in the middle of the wilderness and brew beer has paid off and made them one of the more popular beer brands in the frozen north.