Statistics show that 50% of small businesses fail within five years. In October, we looked at general numbers for the kombucha industry. This is the story behind one person’s decision to move on.

Moss Beach Kombucha was profiled on Booch News in May 2019 when I visited founder Douglas Nelson at his brewery south of San Francisco. He told me how, in January 2017, he decided to start his commercial kombucha company as “the next project after culinary school.” Seven years later, he has closed his doors and moved on.

Douglas decided to close after Safeway and Whole Foods reduced the amount of kombucha they sold and — together with several smaller brands — removed him from their chillers in the Spring of 2023. He attributes this to other functional beverages entering the market and a slowdown in the growth rate of kombucha.

His experience is supported by data from SPINS, which reported declines various grocery channels.

Douglas acknowledges that his brewery was located in a high-rent area, and the fixed costs of the lease, plus wages for his two employees, were high. As a mid-sized company, he did not see benefits in downsizing since “it takes about as much work to produce 100 gallons as 1,000 gallons.” Fermentation requires a licensed commercial kitchen and moving to a smaller facility did not make sense. He was able to auction off his equipment and is now clearing debts.

Douglas admits he is essentially “an artist who pretended to be a businessman” and, while he firmly believes he made great kombucha, acknowledges that he did not have the necessary business skills in financing and marketing to succeed.

He’s moved on to become a life coach who loves helping people.

He advises other entrepreneurs: “Take an honest look at yourself, decide what you lack, and find a partner to mitigate those weaknesses.” He confesses he never found a counterpart with these skills to team up with. It’s not sufficient to “just do your own thing.”

Listen to the podcast interview to hear Douglas tell his story.

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