Bent Paddle Brewing Co. is only two years old, but it’s already nearing capacity at its production brewery in Duluth’s Lincoln Park.

It’s a point the owners - Laura and Colin Mullen and Karen and Bryon Tonnis - didn’t expect to reach for 10 years.

But last year - with its 7,850 barrels produced, up from 1,560 barrels their first year - it was already the ninth-biggest producing brewery in Minnesota, according to rankings compiled by Minneapolis/St. Paul Business Journal.

And this year Bent Paddle is destined to move to No. 6 or No. 7 with a projected production of 16,000 to 18,000 barrels of its flagship and seasonal brews. Its sales that edged past $2 million last year should double this year as distribution expands in the state, according to Laura Mullen, who oversees the company’s outreach and events.

“Everybody is growing, but we’re growing faster,” she said.

Within its first year, Bent Paddle’s production quickly surpassed that of Lake Superior Brewing Co., a 21-year old production brewery nine blocks away in Lincoln Park, that has grown slowly over the years. Last year, it produced 2,100 barrels, coming in as No. 20 on the Journal’s list.

But there’s no hard feelings.

“Good for them,” said Dale Kleinschmidt, Lake Superior Brewing co-owner and head brewer. “I’ve had people come and say they’d like to start a brewery. But once they look at what it takes to get started, they find out it’s frightfully expensive.”

But Bryon Tonnis and Colin Mullen were different, he said. They had been brewers in brewpubs.

“The advantage was they were not starry-eyed homebrewers,” Kleinschmidt said. “They started with a healthy chunk - $1.5 million. We started with $16,000. That’s a big difference. They started in 10,000 square feet; we started in 200 square feet. And we’ve never been flush with investment capital.”

When Bent Paddle Brewing Co. started up as a production brewery in 2013, its equipment filled half of Bent Paddle’s 10,600-square-foot production center at 1912 W. Michigan St. But as the brand took off and distribution grew, the startup equipment’s production limit of 5,400 gallons was reached within six months, Laura Mullen told a Duluth Area Chamber of Commerce luncheon gathering last month.

So another row of brewing tanks and other brewing equipment was added. And soon another row, allowing for four times the original capacity.

“After three major equipment expansions, we’re basically out of space,” her husband, Colin, told the chamber group.

The recent addition of a 6,300-square-foot off-site warehouse in West Duluth, which houses a 1,300-square-foot cooler to store beer for state distribution, has freed up cramped quarters at the brewery for more beer production. And it bought the owners some time.

This fall, they will swap their 60-barrel fermenters with 120-barrel fermenters. But even with the added capacity, in a year or two Bent Paddle will likely reach the production limit for the site - 22,000 barrels a year. One barrel equals 31 gallons.

With business growth continuing to be the goal, the owners are working on their next expansion plan to increase brewing capacity. But they don’t want to move, especially after investing heavily in the current space which they lease.

“We put a lot of infrastructure here,” Laura Mullen said in a recent interview. “We could move but that would be ridiculous.”

Rapid growth

The launch of Bent Paddle in 2013 followed six months of construction led by Johnson Wilson Constructors. It turned a former rebar manufacturing plant into a sophisticated production brewery with the city’s first bonafide taproom.

The experiences and skills of the owners combined to make them a dream team. Bryon Tonnis and Colin Mullen each were experienced brewmasters with 21 years experience between them. Mullen also was skilled in website work. Laura Mullen had done community outreach and was a professional event planner, including coordinating craft-beer festivals. Karen Tonnis had 15 years experience in food distribution.

The two 30-something couples moved to Duluth from the Twin Cities to start up a brewery. The craft beer industry was getting crowded in the Twin Cities and they saw opportunity for another brewery in Duluth with its lifestyle, community and the quality of its water. Three had ties here - Laura Mullen grew up in Duluth, and Karen and Bryon Tonnis met while attending the University of Minnesota Duluth.

They did their homework, and with the help of a consultant, set out with a solid, detailed business plan that allowed for future expansion. That plan, coupled with their skills and passions, won over 23 investors, Republic Bank, the Small Business Administration and the Arrowhead Regional Development Commission to get the needed startup financing.

Within months, thanks to effective marketing and the quality of the beer, Bent Paddle seemed to be everywhere. Now, just three months into its third year, Bent Paddle is in year nine of its business plan.

Accounts have grown from 22 to 850. Besides the Twin Ports, distribution extends up the North Shore to Grand Marais and south to Hinckley. It now includes the Twin Cities, Brainerd, St. Cloud and Moorhead. Expanding to Southern Minnesota is next, with distribution to St. Peter and Mankato starting in coming weeks, followed by Rochester.

Secret of their success

So why has Bent Paddle been so successful?

“They planned their work, and they’ve worked their plan,” said Lake Superior Brewing’s Kleinschmidt, adding that Bent Paddle’s marketing efforts have been especially strong and effective.

Ask Bent Paddle owners why they’ve grown and they are ready with answers.

They say their beer, made with Lake Superior water, is really good, and they point to their string of awards to prove it.

They say their brewing and other professional experience has allowed them to combine quality beer with good business practices. Planning and preparation, industry connections, a good team and staff, community outreach and local support also have played a part, they say.

And they say they love what they’re doing.

“We’re busy, but we expected this,” said Karen Tonnis, who is head of company operations. “We don’t mind it, because we wanted to build something.”

But growth doesn’t come cheap.

The company has invested $2 million in its expansions, according to Bryon Tonnis. That’s on top of the $1.5 million startup costs. Expansion has included more tanks, utility upgrades, hiring contractors and more staff, buying a truck and renting more storage space.

“We have to continuously invest in tanks and with staff,” Karen Tonnis said.

A year ago, they partnered with a Twin Cities distributor, Artisan Beer Co., to expand their distribution to the Twin Cities and elsewhere in Minnesota. That’s another major expense.

As Bent Paddle grows, it faces another challenge. They do their own deliveries to their 225 Duluth-Superior customers, including liquor stores, restaurants and bars.

Under state law, breweries that produce 25,000 barrels a year cannot self-distribute. At that point, they will have to partner with a distributor to deliver in the Twin Ports as well.

“We have at least until the end of the year and part of next year before that happens,” Karen Tonnis said.