James Watt, the controversial co-founder and chief executive of BrewDog, is to step down after 17 years at the helm of the Scottish brewer and bar chain.
Watt, who navigated the Aberdeenshire-based brewer’s meteoric rise from “punk” challenger to mainstream beer brand, informed the board last year of his plan to step back.
He will now be replaced by the company’s chief operating officer, James Arrow, who is expected to focus on returning the loss-making company to profit. Watt still owns 21% of the business and will hold the newly created title “captain and co-founder”, as well as remaining a non-executive director and continuing to advise on strategy.
His departure comes after several controversies over the group’s treatment of staff that have complicated its long-held ambition of floating on the stock market.
But the brewer’s co-founder said he was stepping down to make more time for travel, friends and family, and to focus on new business ventures.
In a LinkedIn post, Watt said: “During my time at the helm of BrewDog, there have been highs and lows, up and downs, crazy successes and incredibly hard challenges.
“When I look back on the last 17 years (119 dog years) my overwhelming feeling is one of gratitude.”
Watt and his co-founder, Martin Dickie, started BrewDog in 2006 in Dickie’s mum’s garage in Fraserburgh, Aberdeenshire, naming it in honour of Watt’s late chocolate labrador, Sweep.
A series of risque but carefully orchestrated publicity stunts helped the business cultivate its self-styled “punk” image, which proved popular with drinkers who embraced the UK’s “craft beer revolution” and rejected mainstream corporate brands.
But over time Brewdog has grown to become the seventh largest brewer in Britain by sales, according to figures from consumer behaviour company Circana, which tracks retail sales.
The brewer’s flagship Punk IPA has become one of Britain’s most popular beers, while the company has rolled out a network of more than 120 bars across the UK and overseas.
Its aggressive expansion, partly funded by an army of “equity punk” crowdfunders, has delivered a tenfold increase in revenues in less than a decade, from £30m in 2014 to £321m in 2022.
As BrewDog grew, Watt struggled to cling on to the image of cheeky challenger, amid investment from private equity group TSG, rumoured plans for a stock market float and a string of controversies.
In 2021, Watt was accused by former workers in an open letter of presiding over a “culture of fear” within the business, with “toxic attitudes” towards junior staff. He apologised to staff and has said the group made changes after the open letter was published.
In December 2022, the group lost its B Corp status, awarded to companies that follow ethical principles.
In January, the company faced a backlash after revealing it would no longer hire new staff on the “real” living wage and would instead pay the lower legal minimum wage.
The Trades Union Congress (TUC) named Watt its worst employer of the month in response to the pay row.
On Wednesday, TUC’s general secretary, Paul Nowak, said: “My message to the new chief executive is simple – pay your staff the real living wage.”
Brewdog’s chair, City of London veteran Allan Leighton, said: “Few have accomplished what [Watt] has.
“From very humble beginnings under his leadership, BrewDog has grown to become the world’s leading craft brewer, employing 2,530 people across its head office, four breweries and over 120 bars.”
Watt said he would use his newfound freedom to travel, spend time with family and loved ones, “nurture fantastic start-ups” and would, in due course, launch a new venture of his own. His investments include Yum Bug, an edible bug business.
Arrow, who was hired as chief operating officer last September as part of BrewDog’s succession planning, was previously managing director of Boots Opticians. He is expected to focus on profitability, after the company reported losses of £30.5m last year, despite soaring sales.
