Americanized coffee brand Black Rifle Coffee Company (BRCC) of Salt Lake City, Utah is going public via a SPAC. The move is bold considering the recent backlash after Black Rifle denounced far-right extremists.
The coffee brand has always appealed to conservative Americans, especially working-class veterans, gun advocates, law enforcement, and Trump supporters. However, the company has drawn a thin line separating itself from the far-right extremists despite historically riding on President Donald Trump's coattail.
Black Rifle Coffee Company stock is coming.
In a Facebook post on Nov. 2, BRCC wrote, "Today, we’re excited to announce our next evolution: to become a publicly traded company. Serving great coffee and culture to people who love America is still our passion, while keeping our focus on supporting the veteran, law enforcement, and first responder communities."
Black Rifle is merging with a blank-check company called SilverBox Engaged Merger Corp. I.
SilverBox Engage SPAC values Black Rifle at $1.7 billion
The SPAC is taking Black Rifle public in a deal worth $1.7 billion. Black Rifle sells gun-themed coffee blends, apparel, and merchandise.
Under the deal, BRCC will restructure as a for-profit public benefit corporation that prioritizes social good (including a goal of employing 10,000 veterans).
Donald Trump Jr. supports Black Rifle Coffee, BRCC denounces far-right extremists
BRCC founder and CEO Evan Hafer is a veteran himself and makes it his mission to employ veterans and support first responders, law enforcement, and more. He has also historically supported Trump and his policies. Hafer has even garnered support from Donald Trump Jr., but that still isn't enough for some conservatives.
When Hafer made an effort to distance Black Rifle from far-right extremists like those who attacked the Capitol building in January, many conservatives got upset. Republican customers got in a tizzy thinking that BRCC was distancing itself from conservatism as a whole.
Hafer said that isn't the case at all. He responded to the criticism and said, "I don't participate in the daily dialogue of what's happening, you know, in the fringe aspects of Twitter. [...] I participate in real conversations with real people as I'm serving coffee at my coffee shop; those are the people I talk to, people that I can put a face to a name."
In 2018, Black Rifle published a satire YouTube video about a son "coming out" as conservative to his liberal father. The video shows the family having a violent outburst about the news. Right now, Hafer and his team seem to be stepping further from political leanings—even if marginally. Still, the company is striving to be the Starbucks of the conservative community.
The reality is that Black Rifle is a company made up of American veterans who have fought overseas. Despite that, the company doesn't want to be a one-sided stereotype.
Will BRCC sales outpace the controversy?
Despite the controversy with the far-right community, BRCC's book values look good. Subscription and non-subscription sales soared 92 percent in 2020, which brought the yearly sales to $126 million.
The company hasn't disclosed YTD financial data yet, and it's possible that the controversy could have impacted the bottom line. Currently, BRCC predicts its sales will grow about 40 percent YoY to $230 million.
Investors can expect the BRCC merger to finalize in the first quarter of 2022, which means that it won't be long until the public gets a thorough view of Black Rifle's metrics.