One of the most highly visible craft beer bar chains in the Midwest has filed for bankruptcy, in an indication of just how much the COVID-19 shutdowns have impacted both the service industry and craft beer culture. Barfly Ventures, the parent company of the HopCat chain of beer bars, Stella’s Lounge and Grand Rapids Brewing Co., said it was filing for bankruptcy to restructure its debt because of the pandemic. Company founder Mark Sellers said the company’s debt was now in excess of $30 million.
“We were doing okay. We were paying our bills,” Sellers said. “And then COVID hit, and it just sent us over a cliff.”
This doesn’t mean customers shouldn’t expect to see HopCat locations reopen—if anything, they NEED to get open sooner rather than later to provide some operating income for the chain. The Michigan locations of HopCat are expected to reopen in some capacity on June 13, followed by openings in Indiana and Nebraska on June 22. Other locations in Kentucky, Wisconsin and Minnesota are still waiting for reopening dates. In total, there are 14 currently existing HopCat locations, down from the high of 17 that existed before several in Chicago and Port St. Lucie became unprofitable and closed.
“It’s been a rough few months, but we’re excited to welcome our team and local community members back into our restaurants,” Sellers said. “We’re following all CDC guidelines and taking extra precautions to ensure the health and safety of our staff and guests.”
Addressing the bankruptcy, Sellers said the following: “From a customer standpoint, it will be no different. From a company standpoint, we’ll have more flexibility to grow again in a smart way.”
HopCat was first founded as a Grand Rapids, MI beer bar in 2008, and quickly expanded to other locations, first in Michigan and then throughout the Midwest. The chain briefly attempted to offer takeout food services at the beginning of the coronavirus pandemic, but found the format financially untenable. And although Sellers insists in the statement that customers won’t see a difference in the chain’s service during bankruptcy proceedings, he goes on to paint a rather stark portrait of how it’s likely to affect him personally.
“My personal net worth is completely decimated by this,” he said. “My stock in BarFly is going to be worthless. This is personally just a very bad situation for me. I just want to see the company that I started survive. That’s really all I care about right now.”