It was early December 2019, and Mitch Cobb was in Santa Monica, California, attending BevNET, “the leading business conference for the beverage industry.” 

Cobb is the co-founder and CEO of Upstreet, a Prince Edward Island-based craft brewery that had grown from “a few buds sitting around slugging back homebrew and talking big game of dropping it all to open a brewery of our own,” to a small startup with eight employees and one location in 2015, then 50 employees and three taprooms, including one in Dartmouth, Nova Scotia, just four years later. 

By 2017, Upstreet had also obtained coveted B Corp certification, an internationally recognized designation that a business is “meeting high standards of verified performance, accountability and transparency on factors from employee benefits and charitable giving to supply chain practices and input materials.” That had helped fulfil, and validate, Cobb’s own longstanding personal business ambition: to create a successful company that combined profit with purpose.

And yet, sitting in his Santa Monica Beach Hotel room that day on the edge of winter in 2019, Mitch Cobb couldn’t help but feel he was at a crossroads, one that was both professional and personal.

Upstreet itself appeared to be doing very well. Early on, the company had discovered profit margins were better when it sold its beer directly to customers instead of through retailers, so Upstreet had opened its own taprooms. The Craft Beer Corner in downtown Charlottetown begat Barbecue BrewHouse with Chef Bill Pratt in Dartmouth, which begat what seemed like an obvious model for continued business expansion and growth. 

And yet, when Cobb and his co-founder, Mike Hogan, sat down earlier in 2019 to discuss expansion options, “we took a look at what our core competencies were and recognized that they weren’t in restaurant management or hospitality. We were doing it, but it wasn’t where our skill sets were.” 

Cobb describes that as “a rookie mistake a lot of businesses make, chasing opportunities that come up, and running after everything.” 

But if Upstreet’s future was not in the restaurant management business, where should it be? 

Upstreet, of course, was also a craft brewery. It had become highly skilled at brewing the beers its customers prized. But “it was really starting to feel constrained in the craft beer space,” Cobb recalls, “because craft beer is such a hyper-local market. Everyone wants to support their local craft brewery.” 

When Upstreet opened in 2015, there were just three companies trying to occupy the beery space on P.E.I. By 2019, there were three times as many. In Atlantic Canada, the competition had become staggering. Upstreet was now pitting its products, beer keg to beer keg, with beers from close to 150 competing brewing and selling operations. That, of course, not only complicated getting its own products listed for sale in other provinces, but it also made it ever more difficult to generate sales traction in an already over-soused market.

But what if they were to take Upstreet’s expertise in craft beer and extrapolate…?

What was Upstreet, really? 

Upstreet really, he and Hogan decided, was a beverage production business. 

“Our real strengths,” Cobb says now, “were in innovation and developing new products.” So, that’s what they decided to do. They had already begun tentatively researching other possible beverage products and opportunities.

In fact, that was one of the reasons Cobb had journeyed across the continent to California for this conference. 

But he was also struggling with his own existential crisis. “I’d hit a bit of a wall,” he allows. “After five years of being in the brewing business, I had gained a lot of weight. I was eating out a lot. We owned restaurants… Every meeting…” He pauses, continues. “There was always an opportunity to have a beer, and so I… I had developed a lot of bad habits and felt like I wasn’t operating at my full capacity.” 

To make that more obvious, his California hotel room was five minutes from the famed Santa Monica Pier and beach. “Being in California and seeing all these fit people around me,” he adds, “I was taking stock of things.” 

In five months, he was about to hit his own Big 4-0. 

That was when he set a goal for himself. He would lose 40 pounds by his 40th birthday. He laughs. “One of the first things I had to do was stop drinking craft beer.” 

Cobb soon discovered that was easier said than done. “I still wanted to go out and do things with my friends, but there was nothing. There were no options. You could have water, or you could have pop.” 

But he also realized he wasn’t the only one in his generation struggling with this lack of consumer choice. “It was also happening to our staff. We started the business when we were in our early to mid-30s. A lot of our staff were younger. Now, everyone was growing up, having kids, drinking less and wanting to be healthier.” 

Cobb could see that desire reflected in the numbers that crossed his desk too. “All of the studies we were reading around millennials and Gen Z wanting to consume less alcohol, wanting to live healthier lifestyles… all of the market trends pointed towards that.” 

So, Upstreet decided to ramp up its own planning, research and development to meet that market need. In three years, its goal would be to have 50 per cent of its products come from non-traditional craft beers. So, sodas, non-beer alcoholic beverages, low-cal beer, perhaps even a non-alcoholic beer in the mix… 

Decision made. Cobb laughs. “And then COVID hit.” 

 

 

We’ll come back to COVID and all the many and various business spin-o-ramas that spawned. But first, a little background on Mitch Cobb, Atlantic Business Magazine’s Stewart McKelvey Innovator of the Year for 2022—and, oh yes, Top 50 CEO Hall of Fame inductee. 

The son of the owner of a heavy equipment construction business, Mitch grew up in tiny Malpeque, P.E.I.—population about 1,000—with no intention of ever owning his own business but every “aspiration to move away to the big city and become successful there.” 

He enrolled at the University of New Brunswick with the vague notion that he would become a doctor, but “I started taking some courses and just fell in love with anthropology and learning about different cultures. Then I started tapping into international development and really developed a passion for social justice.” 

Recognizing he needed to have a clearer career focus to capture all those still unfocused passions, Cobb decided to travel to Australia where he earned his education degree at Murdoch University. 

Oh, yes, and then he came home. “Like a lot of people with ambitions,” he allows with a smile, “I went away for a bit and then found myself back home on P.E.I.” 

Back home, he met the woman who would become his wife and found a job teaching life and employment skills to young people who’d dropped out of high school. A few years later, he switched “into the immigration field,” where he developed education programs for recent immigrants to get them employment-ready, and programs for employers to teach them about hiring and integrating newcomers into their workplaces.

Cobb and his wife had a daughter and then another child who was stillborn. 

“That experience,” he says quietly today, “prompted us to look at where we were. We decided to sell all our stuff and take a year off, and we went backpacking, basically around the world, with our daughter.”

Europe, Asia, Southeast Asia… Perhaps surprisingly, it was during an extended stay in Bali, the Indonesian tourist mecca, that the entrepreneurship bug finally, belatedly, unexpectedly bit Cobb. 

“Everyone we met there, including expats, had their own businesses, everyone doing their own thing,” he remembers. “We’d get into the cabs and the first thing the driver would ask is, ‘Are you here for business, or are you here for pleasure?’ And, of course, we would say, ‘Pleasure.’ But then, eventually, I started saying, ‘Oh, I’m here for business.’ Just for fun.”

“Oh, are you importing and exporting?” the driver would ask.

“I just started talking to them about all the different things happening in Bali, and that really got the wheels turning for me. I’m like, ‘Oh, maybe I could do something for myself.’”By the time the family arrived in the Philippines, Cobb and his wife, an English teacher, had “started exploring what it would look like to open their own online English school.” The school scheme didn’t come to anything, but “it sparked a lot of creativity in me, in recognizing how much creativity there is in entrepreneurship.”

“Up until that point, community and business existed at opposite ends of the spectrum in my world. Business was the Boogeyman. So, this realization that these things could co-exist, and you could run profitable businesses that gave back to the community, that were stewards of the environment and that created engaging workplaces…”

—Mitch Cobb

Back home on Prince Edward Island, Cobb and a friend, Joey Seaman—who would later become one of the initial partners in Upstreet and who now runs another brewery in Toronto—launched a company called Canadian Access, an international student recruiting company. 

“That was a really interesting experience,” Cobb says with a rueful smile.

“I remember jumping into [business] and thinking, ‘Well, I’m a smart guy. There’s lots of people who own businesses. How hard could it be?”

Harder than he imagined. Two and a half years later—for all sorts of reasons ranging from the fact that “international students weren’t really as prominently on the radar of universities then” to the reality “it was a lot of work with no guarantee you were going to get paid in the end”—the business shuttered.

Instead of giving up on entrepreneurship, however, Cobb decided in 2008 to go back to school, enrolling this time in the MBA program at Holland College. He didn’t graduate until 2012, largely because he got waylaid by an opportunity to go to China to teach in a partnership between Holland College and a university in China. 

“I guess this is sort of a theme in my life,” he jokes. “It’s just surrendering to the universe and accepting opportunities when they come up.”

 

 

Back in his own MBA program, Cobb experienced the lightbulb moment that would ultimately become the catalyst for Upstreet. He was studying social enterprise, social entrepreneurship and B Corp enterprises. “I was learning about these companies like Patagonia and Ben & Jerry’s that had a model of combining purpose and profit. They were really good stewards of the community and of the environment, but they were also running successful and profitable businesses. Up until that point, community and business existed at opposite ends of the spectrum in my world. Business was the Boogeyman. So, this realization that these things could co-exist, and you could run profitable businesses that gave back to the community, that were stewards of the environment and that created engaging workplaces…” 

He wanted to be part of something like that.

While he waited for the “right opportunity to come along,” Cobb completed his own MBA and began teaching in the MBA program at Holland College. “I loved it. I love teaching, and it’s something I plan to go back to. But I always felt it was too early for me.” 

Not that the idea of running a brewery, no matter how early or late in his career, was on his radar at the time. 

But Mitch Cobb was still friends with Joey Seaman, who was now working for a tech company in Charlottetown. One of his co-workers there was a software engineer named Mike Hogan, who happened to be a passionate home brewer. 

Cobb and Seaman used to visit Hogan to test-drink his latest batches and shoot the what-if breeze. “When we started talking about opening up a brewery, it really clicked for me that this could be the opportunity I was looking for, this business that was very much focused on giving back to the community, that checked all the pillars I was hoping it would.”

 

 

Initially, their dream was modest—“maybe we could do this on weekends”—but the more the trio explored the possibilities, the “idea got bigger and bigger,” and they began mentioning it to their friends. 

Their friends were not exactly blown away with enthusiasm. And why would they be? “We all had great jobs, great careers,” Cobb recalls.

You’re going to quit your jobs? their friends marvelled. That’s a crazy idea…. Besides, there’s already a brewery on P.E.I. Why would you start a second one?

Why indeed? In 2013, to understand just how crazy their idea might be, the three friends decided to undertake a research/pleasure adventure to Portland, Maine, another tourism-centric community with a population smaller than that of Prince Edward Island. They were surprised to discover Portland already had close to a dozen breweries. Perhaps their idea wasn’t so crazy after all. “That gave us a lot of motivation and excitement,” Cobb remembers. “We recognized the opportunity, and so the scale of the project grew from there.”

But… wait a minute. Rewind this reel. Remember all that talk of social enterprise, profit with purpose? How exactly could a brewery possibly be described as a social enterprise? 

Well, for starters, Upstreet’s founders decided that rather than doing conventional advertising and marketing, they would host community arts and culture events to engage people and “use that to create content for social media. It seems almost cliché at this point,” Cobb allows, “but at the time it wasn’t really what other people were doing.”

Upstreet’s taproom—initially an afterthought in the construction process, “a place for our friends to come and hang out”—quickly became the “epicentre of Upstreet.” When the company wasn’t hosting its own events, it made the space available to community groups to host their events and fundraisers. 

There were other indicators too that Upstreet saw itself as more than just another bottom-line business venture. Upstreet became the first business on P.E.I. and the first manufacturing company in Atlantic Canada to earn B Corp status, which means that it uses 100 per cent green energy, sources close to 50 per cent of its material locally and is committed to contributing financially to its community.

One of Upstreet’s first beers, Do Good-er IPA, does exactly that. Ten per cent of the proceeds from Do Good-er go into the company’s “Do Good” fund for local arts and culture initiatives.

As the company has grown, so has the scope of its cultural ambitions. It recently partnered with five-time Juno award winner Serena Ryder, for example, to promote non-alcoholic drink options at music festivals, concerts and venues across the country. And Upstreet donates one per cent of the profits of Libra, its own non-alcoholic beer, to ArtHaus, Ryder’s music incubator, “which supports the health and wellness of emerging artists from across Canada.” Not only that, but Upstreet will become the first non-alcoholic beer sponsor at the upcoming Ottawa Jazz and Blues Festival, one of the biggest music festivals in Canada.

Wait a minute… Non-alcoholic drink options? Non-alcoholic beers? Weren’t we talking about a craft brewery? Where did that come from?

We’re getting ahead of ourselves.

Back to COVID.

 

 

Once COVID was declared a global pandemic in March 2020, almost everything everywhere shut down, including the restaurants and bars that were Upstreet’s major customers, as well as its own revenue-generating restaurant and taprooms. By the end of the year, the company would report a precipitous 60 per cent collapse in its keg sales to restaurants and a similar 60 per cent downward spiral in sales at its BBQ brewhouse.

Enter… hand sanitizer. 

Rather than laying off all its staff, the company quickly pivoted to using its manufacturing savvy to bottle hand sanitizer, a prized commodity in a world that suddenly seemed unable to get enough of it. Although it was intended as a profit/purpose good deed in bad times, it became more than that. 

“It was a fantastic team-building experience,” Cobb says today. “We were able to bring back all our serving staff and all our employees to bottle hand sanitizer. It gave everyone a purpose in a really trying time where there were a lot of unknowns.”

Although that pivot didn’t turn out exactly as planned (in July, Upstreet was forced to recall 20,000 bottles of its hand sanitizer after Health Canada determined the denatured alcohol containing ethyl acetate used in it “may pose a risk to health” by causing skin irritations), the company’s experience with making hand sanitizer “demonstrated to us that we could act quickly, we could pivot quickly, and that gave us the motivation to launch the next line of products.” 

If not for COVID, he adds, “I think it would have taken us a lot longer to make the pivot.”

During the summer of 2020—just four months after the beginning of the pandemic—Upstreet introduced its new line of Rewind vodka seltzers. “We recognized the seltzer category was growing, and we knew it would be successful on P.E.I.” Plucking that “low-hanging fruit,” he says, “built confidence that we could expand outside of beer.” 

Or at least conventional alcohol craft beer of the sort they’d been brewing. 

Upstreet dipped its toe in these new waters, first with some low-calorie beers and then, three months later, launched Libra, a fully non-alcoholic craft beer that had been more than two years in the researching and developing. 

The launch represented what Cobb describes as an evolution of the company’s commitment to corporate social responsibility, which now includes “a recognition that alcohol is fundamentally harmful, particularly when used in excess… Our goal with this new direction is to destigmatize choosing not to consume alcohol and provide options for consumers in restaurants and retailers across the country.”

And, in the process, they came up with a beverage Cobb himself wanted to drink.

Libra’s launch also coincided neatly with Cobb’s own personal re-launch. “I had transformed my entire life, lost 90 lbs, stopped drinking and developed a rigorous health and wellness lifestyle.” Those changes, he says now, had a “profound effect on my mental clarity” and on his ability to function as a business leader. 

Libra became a game changer in all sorts of ways: Upstreet is no longer just another craft brewery.

On the one hand, launching Libra allowed the company to navigate outside the narrow corridors of beer’s usual liquor store sales channels and make its way onto grocery and convenience store shelves, as well as generating online sales through its own store and, more recently, Amazon.ca. In just one year, Libra “has become our highest-selling product.” Within two years, Cobb expects Libra alone will lap the rest of Upstreet’s product line in total sales.

In the process, the company has transformed itself from an Atlantic Canadian craft brewery with distribution in four provinces to a national beverage company with distribution in 10 provinces. Libra, Cobb says proudly, is now sold in over 700 stores across Canada, and online sales have seen an 870 per cent growth year over year. The company is already planning its expansion into the U.S. market. “We just started to put together a go-to-market strategy and figure out where our best bet is to launch.”

Although escaping the confines of alcohol sales channels was one of the initial business motivations for developing the non-alcoholic beers, Cobb notes that “ironically, we’re having a lot of success with Libra in the liquor store channels as well.” Libra, in fact, will be available for sale in Ontario LCBO retail outlets in May.

That, he suggests, is because—as in his own case—there’s been a shift in how younger people perceive non-alcoholic “adult” beverages. “There used to be a hard line in the sand where you either drank or you didn’t drink, and if you didn’t drink, it was because you had health issues or addiction issues, or… Now it’s much more about moderation, and younger people specifically are looking to moderate their alcohol intake.”

 

 

Many customers who buy directly from Upstreet, he says, will often buy a four pack of Libra and pick up another four pack of regular beer, mixing in non-alcoholic products over the course of a night’s outing to get a buzz but not end up too intoxicated to function. Cobb points to one recent study that showed close to three quarters of people who purchase non-alcoholic beer also purchased alcohol. Liquor retailers, he says, are beginning to take notice and are stocking both side by side on the shelf.

COVID was the father of other innovations too, all of which, cumulatively, have helped Cobb win his Innovator of the Year status.

“He is a visionary,” says Brent Scrimshaw, the former president and CEO of Atlantic Lottery Corporation (now retired) and one of the judges for the Innovator of the Year award. “He sees where the market is going and gets there before it does.”

Upstreet’s designation, suggests Dallas Mercer, the CEO of Dallas Mercer Consulting Inc. and another member of the judging panel, is an indication that “innovation doesn’t just mean a new ‘something’ from a software point of view.” She calls Cobb a “trailblazer who thinks outside the box. I can’t wait to see what he does next.”

What Cobb has done already is impressive enough. Given the emergence of supply chain issues and product shortages during COVID, for example, Upstreet’s response was to consider their suppliers “part of our team. We’ve treated this challenge as an opportunity to get more organized with our forecasting, increase communication with our suppliers, and work with them to find creative solutions to meet our needs.” They’ve also begun reviewing their own supply pipeline to see whether there might be local suppliers who can fulfill more of their needs.

For many companies, especially in the food and beverage sector, COVID also exacerbated job insecurity and unhappiness, leading to staff shortages. Upstreet already had what Cobb calls “a strong workplace culture and team that aligns to our values, is committed to the vision and trusts that we are all working in the same direction.” 

But, with COVID, “we have continued to lean into this idea, and have worked harder than ever to create a culture where people feel empowered, valued, and involved.” Staff complete annual employee engagement surveys, which are shared and discussed at employee town halls. Those take place monthly. Managers also meet one-to-one with employees every month just to “check in, identify any successes or struggles employees may be facing professionally or personally… We will continue to create a flexible work environment, where employees are trusted to make the best decisions for themselves, their families and their work roles.”

Upstreet also intends to “remain ahead of the curve of cultural shifts in our community and we’re continually searching for ways to support our team to learn—and sometimes unlearn—to be at our best as we support and refresh the community.” These days, 60 per cent of Upstreet’s senior management team are “women or people who identify as minority.”

And the company, says Cobb, is now also looking “beyond sustainability” and has begun to implement initiatives to get closer to full carbon neutrality.

All of that may help explain how Mitch Cobb came to be chosen as Atlantic Business Magazine’s Stewart McKelvey Innovator of the Year for 2022, but it doesn’t fully explain why he has been so successful. His own one-word answer? “Failure.” 

He ticks the checkboxes. “Had my first business not failed, Upstreet wouldn’t exist. Had our line of craft sodas not failed, we wouldn’t understand product market fit or brand positioning. Had our hand sanitizer not been recalled, we wouldn’t be as adamant about labelling requirements. Had our products not been delisted in other markets, we wouldn’t have been as focused on growing new products in different markets.”

He pauses, considers. “Clearly, all of these things could have been avoided with the right people or understanding. However, when we started Upstreet we really had very little knowledge about the business we were getting into, but we did have a passion to take risks and to learn and grow and that truly has been the underpinning of our success.”

And what a success it has been. And looks to become. Cheers to that.