When Ryan Lake and Stephen Rooney scan a bar menu, they might spot a drink they once evaluated — or helped sell.
The JPMorgan bankers cover the beverage industry, talking to everyone from executives to beer distributors to lawyers to retailers to figure out where consumer tastes are headed.
After a slowdown last year, partly due to tariffs, the pair is prepping to leverage that expertise as beverage M&A is expected to rebound in 2026, according to the investment bank Capstone Partners.
“There’s been so much activity in the smaller space — bigger players buying smaller brands that are higher growth, maybe more health and wellness focused,” Rooney said.
Lake, who joined JPMorgan in September and is based in Arizona, has covered beverages for more than 20 years and now focuses on mid-cap and fast-growing insurgent brands. In his previous role at Arlington Capital, he advised Stone Brewing on its $165 million sale to Sapporo. New York-based Rooney, who focuses on large-cap brands like Pepsi and is a leader on the investment bank’s consumer and retail team, has spent nearly 15 years in the sector. He recently advised Alani Nu, an energy drink brand, on its $1.8 billion sale to Celsius, a deal that helped Celsius diversify its portfolio and reach more women.
Their partnership fits into JPMorgan’s middle market banking push, working with a team of nearly 300 bankers across the company focused on founder-run companies rooted in local economies. Business Insider spoke with Lake and Rooney about opportunities in the beverage sector and the advice they’re giving CEOs.
Large companies are eager for growth and increasingly turning to acquisitions to expand into new categories, price points, and geographies, the bankers said. That requires them to collaborate closely, since together they share insight across the market.
Spotting the next trend
The pair relies on what Lake calls an “early radar system,” built on continuous communication with an ecosystem of companies, buyers, and investors. They might, for example, be able to spot a hot regional brand before it blows up on a national scale.
In a small, tightly knit industry with high barriers to entry — from dense liquor laws to understanding the cost of shipping water — relationships are crucial.
“If you do things the right way, it’s a massive accelerator, because people will give you good referrals and talk well about you,” Lake said. “If you do things the wrong way, everyone knows who you are pretty quickly.”
Right now, large and small brands are trying to cash in on the boom in functional beverages, whether that’s in the form of energy drinks or protein shakes. But Lake said that trends shift quickly, and today’s protein maxxing could give way to something else, like a fiber craze.
Even so, he and Rooney caution clients against chasing every single trend, and often talk about staying focused. While M&A can drive growth, exploring too many options can risk losing or diluting a brand’s identity.
Gen Z’s drinking isn’t so simple
If health drinks are having their moment, alcohol is struggling — but some of the issues may be overstated, Lake said.
Gen Z and those on GLP-1s are often cited as drinking less, and the rise in GLP, though the bankers said the reality is more complicated. Some Gen Z consumers are under 21, and those who can legally drink might be financially strapped.
“You’re paying out the arm and the leg for housing and healthcare and for fuel — it’s hard to actually go out and drink when you don’t have the money for it,” he said, adding that it could be years before we know whether alcohol is in a structural decline.
Just as the long-term alcohol trends are unclear, the beverage sector generally is as volatile as consumer tastes, which Lake and Rooney said can make it especially exciting. They’ve started lending to a company doing $5 million in revenue, only to watch it grow into a brand worth hundreds of millions.
“You do see that sort of meteoric rise of companies, because of the ever-changing consumer demand,” he said.
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