How Dogfish Head, Delaware's most famous brewery, became its biggest distillery

An old piece of machinery that brewing genius Sam Calagione thought looked like a pot still hisses away at the old Dogfish Head Brewings & Eats in Rehoboth Beach, a testament to a past that can be MacGyvered into a future in liquor for the region's most famous brewery.

The scrap metal-turned-pot still found in Billy Warren's scrap yard off Route 404 near Greenwood was dubbed Frankenstill, and it still produces innovative spirits to be tested by an ever-growing audience of craft consumers, with the same far-flung exploration of ingredients Calagione made famous with his beer.

The Compelling Gin, for example, offers a tangy citrus flavor with notes of cinnamon, cardamom, orange, lemon, lime, juniper and peppercorn, just as Dogfish uses "off-centered" ingredients such as black limes, bacon, coffee and various grains and fruits in its beer.

Fifteen years after Frankenstill was first commissioned, Calagione and a crack staff have elevated its distilling profile, adding a distillery arm to its Milton brewery while committing to and laying the foundation for a spirits business set to leap into the future.

The elevation and evolution of the distilling arm of Dogfish has resulted in higher sales in the four markets where the company sells products (Delaware, Maryland, Virginia and the District of Columbia), and, earlier this year, a semifinalist nod for best bar program in the country at Chesapeake & Maine by the James Beard Foundation, the top award program for food and beverage in the United States.

Calagione looked to spirits back in the early 2000s when he wanted to do more than just beer and food.

“Why can’t we apply this off-centered philosophy to the distillery world in a similar way that we’ve applied it to the brewing world," Calagione said his mindset was back then.

Talking to him these days, it still sounds the same.

Bending style guidelines

Wanting to elevate the business, Calagione brought in two new team members to help guide the movement. Dogfish hired James Montero away from beverage conglomerate Diageo in New York. Montero brought years of experience in spirits marketing and new product development and innovation.

Additionally, Graham Hamblett, who came to Dogfish with experience in commercial distilling, was hired as head distiller.

The inspiration behind everything Montero and Hamblett do comes from the brewery side of things. Montero said they look at all the innovation Calagione has done for their inspiration. 

Hamblett, a New Hampshire native who will talk for hours about the intricacies of distilling if allowed, spent the first part of his career at Dogfish making spirits out of Rehoboth. He said he would hang out in the kitchen looking for inspiration from various ingredients to use in his liquors.

The result is a product portfolio that includes the aforementioned Compelling Gin, Analog Vodka, Whole Leaf Gin, rums, brandy and more, all with unique blends of flavors.

Compelling Gin is available in all four of the markets Dogfish distributes spirits in. So, too, is Analog Vodka. Whole Leaf is sold in Delaware and Maryland. And the rest of the portfolio is exclusively in Milton and Rehoboth.

And while the production of those products isn’t on too high of a scale, they’re making waves already.

At Chesapeake & Maine, Dogfish’s seafood and spirits-driven restaurant, mixologist Rob Bagley works closely with Montero, Hamblett and Calagione to come up with a beverage program that pushes the boundaries. Those innovative tastes and flavors found Dogfish on a preliminary James Beard list. Milton and Rehoboth were on the same list as the culinary meccas of New York, Los Angeles and Philadelphia.

“I’m not surprised that other people were surprised because I know the talents of our distillery team, not just James and Graham but Allison (Schrader), a woman who’s been on our distilling team for over a decade and is truly the bedrock of that team,” Calagione said.

Early success is good, but Montero, using the same approach Calagione used to build the beer empire, preaches patience.

Beer is a $100 billion industry and craft beer makes up about 11 percent of that, Montero said. Spirits, he said, is a $42 billion industry that the craft sector makes up only 2.5 percent of.

'They've got more money than we do'

Dogfish is selling about 7,000 cases of product per year, which Calagione said is growing at about 30 percent a year. But liquor, with aging being so important, is a long game.

Calagione, who himself won a James Beard Award this year (in his seventh nomination) for Outstanding Wine, Spirits or Beer Professional, said whiskeys and single malts, some that take 3-4 years to produce, will be hitting the market in the next 10-12 months, adding to the portfolio of product.

And while Dogfish continues to release new products, its footing in the region will need to expand.

“We’ll be entering new markets,” Calagione said. “Without giving too much away, we’re looking at markets contiguous to Delaware first and even those contiguous to the states we’re already in.”

The end goal, Montero said, is to be in all the markets that the brewery is. 

Calagione said he just wants to be known as one of the most innovative craft distillers.

But competition is growing as craft spirits literally come of age. Last year, Ocean City entertainment mecca Seacrets launched a distillery that owner Leighton Moore says has been “gangbusters” so far. The Jamaican-themed facility is unsurprisingly rum-focused.

Up in Smyrna, Painted Stave Distilling has seen quick growth since opening in 2011.

Former Dogfish employee Greg Christmas in 2015 opened his own distillery, Beach Time, in Lewes.

Moore, who gives tours almost daily at the Seacrets distillery, says he likes the experimental side of distilling

“You can do things, you can experiment and then once you say that’s the profile you’re after, you can’t change it again,” Moore said. “It’s almost like a statement that will last forever, beyond my grave. I think that’s pretty amazing.”

In terms of the future of his business, which is only operating in Maryland for now, he said he hopes to be nationwide in 10 years.

That seems a bit ambitious compared to Dogfish’s timeline, which Montero said they don’t really talk much about.

“One thing is for sure, they got more money than we do to get the stills and God bless them for it,” Moore said of his counterpart to the north. “I don’t know that we’ll ever catch them. But that’s a pretty good person to follow.”

The path he'll follow is one that was forged by Frankenstill.

But when the old brewpub gets torn down, Frankenstill will be decommissioned with it.

His job is done.