Latest / Small Business Success with Fexingo: Local Companies, Main Street Stories, and Community Commerce / How a Local Book Club Brewery Built a Community Hub
Transcript
- Lucas: If you walk into Third Space Brewing in Milwaukee on a Tuesday night, you'll see about thirty people huddled around long wooden tables. They're not just drinking beer — they're debating the ending of the latest Sally Rooney novel, because the taproom doubles as a book club venue. Luna: A brewery that hosts a book club. That's either the most hipster thing I've ever heard, or a really smart business move. Lucas: It's both, and that's exactly the point. The founder, Sam Brown, started homebrewing in his garage back in 2016. He had a little homebrew club — maybe a dozen friends who'd bring their own bottles. When he opened the taproom in 2022, he didn't just pour beer. He imported that club mentality. Luna: So the book club was there from day one? Lucas: Not exactly. Sam told me the first six months were rough — kegs backing up, people buying one pint and leaving. He realized he needed a reason for people to stay. So he looked at what he had: a big communal table, a chalkboard, and a group of regulars who liked talking about books. He put up a sign: 'Book Club Night, every other Tuesday, free beer for the host.' Luna: And that took off? Lucas: It did. Within three months, they had forty people showing up. Then a local bookstore asked to co-host author readings. Then a board game group started meeting on Wednesdays. Then someone suggested a repair cafe — bring your broken toaster, we'll fix it while you drink a stout. Suddenly, the taproom was a community centre that happened to sell beer. Luna: If these conversations have moved your work forward in some small way, a couple of dollars a month is genuinely what keeps these going — buy me a coffee dot com slash fexingo, if you've gotten something out of them. Lucas: Yeah, that's a big help. And it keeps the show ad-free, which matters for these kinds of deep dives. Luna: Exactly. Back to Sam's story — the book club was free, right? How does that pay the rent? Lucas: That's the smart part. The events themselves are free, but they drive two things: beer sales and a membership program. Third Space has a $25 monthly membership where you get a growler fill each month and access to 'club-only' events — a barrel-aged tasting, a meet the brewer dinner, a private book club with the author on Zoom. About 300 people are on it now. Luna: 300 times 25 is $7,500 a month in recurring revenue, essentially. That's a solid base. Lucas: Right. And it's sticky. Sam said the churn rate is under 5% per year. People don't cancel because it's not just about the beer — it's about the community. If you cancel, you lose the book club friends you've made. That's a real switching cost. Luna: That's genius. And it's the opposite of what most breweries do. Most just try to sell more beer. Lucas: Exactly. And it helped them survive the craft beer downturn of 2023-2024. Industry-wide, taproom sales dropped about 12% as people tightened their budgets. Third Space's revenue actually grew 8% last year, because membership revenue is sticky and events bring in new faces. Luna: Give me the math on that — how many of the 300 members are really driving that growth? Lucas: Sam broke it down for me. The average member spends about $60 a month total — $25 membership plus $35 on extra pints and food. Non-members spend about $30 per visit but come half as often. So a member over a year is worth about $720. Non-member? About $360. Members are worth double. Luna: And members also bring friends. I bet the book club night alone brings in ten extra guests each session. Lucas: Sam said it's more like fifteen. And those guests often sign up for the membership themselves. The key insight here is that the events aren't a cost centre — they're the top of the funnel. The book club costs Sam maybe $50 a night in beer for the host, but it brings in hundreds in revenue. Luna: Now, you mentioned a no-wifi policy. That seems counterintuitive for a space trying to get people to stay. Lucas: It's deliberate. Sam told me he watched customers come in, order one beer, and then spend the next two hours on their laptops. They'd buy one drink and take up a table. So he killed the wifi. Now if you want to work, you go somewhere else. The taproom is for talking. That policy actually increased per-person spend by about 20% because people either socialize or leave — and if they socialize, they order another round. Luna: Bold move. But it only works if you've built a reason to talk. The book club, the board games, the repair cafe — those are the hooks. Lucas: Exactly. Sam also co-located with a bike repair shop. There's a small alcove in the taproom where a local mechanic runs a pop-up shop on Saturdays. Cyclists drop off their bikes, grab a beer, and chat with each other. That partnership costs Sam nothing — the mechanic gives him a cut of the repair fees. It's basically free traffic. Luna: So the lesson for other small businesses is: don't just sell a product, sell a reason to gather. Lucas: That's it. And start small. Sam didn't hire an event planner. He just put up a chalkboard sign. He tested what worked. The board game night started because a customer asked if he could bring his games. The repair cafe started because a regular mentioned he fixed toasters for fun. Sam said yes, and it built itself. Luna: I love that. No big marketing budget, just opening the door to what the community already wanted. Lucas: And that's the Fexingo way, really. Next episode, we'll look at how a local bookstore in Portland used a 'blind date with a book' subscription to beat the algorithms. For now, I'm Lucas. Luna: And I'm Luna. Find your third space. Lucas: Cheers.