A smaller point, but I think in that segment, you are also competing against a number of others who are not all or mostly in it for a profit.
Competitors who may spend money and price their product in ways that are not profit-maximizing.
Which only makes it even harder still to compete if your project needs to make ends meet and turn a profit in order to survive.
Very true!
At an industry conference a few years ago a speaker differentiated between the âfor profit segment of the wine industryâ and vanity projects, postulating that the former are in the minority.
There are numerous wineries in the Willamette Valley that are built on ego and hubris, backed by people who are so financially secure they can shrug off ongoing losses. Their actions make it even more challenging for those of us who are actually striving to be âsuccessful real businessesâ.
I assume it is equally problematic in other wine regions.
@Roy_Piper for that post to be âoff the top of your headâ was pretty amazing. Very very well said.
As for starting a winery now versus 2010ish, I would say the last 6-7 years have definitely had their challenges but I am not sure I thought starting early was much easier than now.
The piece that resonated with me a ton on your post was the section about the team. I believe the team you build is such a massive piece of the puzzle. I do think many donât seem to give that enough focus.
The other thing I have found interesting on the second winery I started at the later date was I thought there would be strong brand transference from Memento Moriâs mailing list to Vida Valiente. But that did not happen. When it didnât I had to laugh. I have probably started 12-15 companies over my life (most of which failed) and every time you think the wind may be at your back and things will be easier the next time, they never are. Get your blood, sweat, and tears ready cause youâre gonna need them. I received a ton of feedback that the sites Vida was sourcing from were unknown and people wanted to taste before they bought. Without an estate or vineyard based tasting room this became a bit of a chicken and egg situation. Even after a 99 and 98 point score on the first vintage we didnât see much of a pick up. (Supporting that scores arenât what they used to be.). We also tried to get approved with the county for an estate back in 2019 (pre covid) and after massive drama weâre able to get approved unanimously this year (5 years later) only to have a neighbor who owns a law firm sue trying to stop the development. I am not complaining on any of this. In fact it really flies exactly into the ethos of Vida Valiente and living a valiant life. You just need to plan for setbacks when you start. And you have to really have a driving force within you that you will persevere no matter what.
At this point, 7 years after finding and purchasing the walnut grove that would become Vidaâs home, I feel like the winery has its legs under it. As to whether it will turn a profit within the first decade? Since we want to build an estate and need to get cash flows to the point it could support a construction loan, I highly doubt it. Break even is the constant goal. That doesnât mean we donât want to make a profit or are pricing in a strange way to make up for lack of cash, it is just a business plan that takes 15 years to get a return. So as I said in the original post, wine is for passion. It is for those that take their shoes off and put their feet in the dirt and feel a little magic. You have to love it. If and when we get the estate built and can host all the people we meet and love there it will be a dream come true. It isnât so much about legacy, it is about making something we love and getting to share it with others. It sounds corny I know. But my wife and I get unbelievably excited about it.
I just wanted to comment of the brand transference piece. I thought early on as a consumer that would be an advantage for owners. However, its easier to see now why it isnt.
1). Prices across both brands are very similar. Prices are already quite prohibitive in napa. In this scenario, why would i buy vida if i already buy momento mori? Especially given the cost. If im only willing to allocate a certain amount of capital to specific brands, why would i take risk in purchasing vida if i already love MM? Now if vida was 50% less than MM, i could see more people purchasing accross brands as the value propisition is there, especially without being able to taste the wines.
2). Homogeneous wines. As many people have mentioned before, it gets to a point where i ask myself "do i really need 10 different vine hill ranch wines from 10 different producers, or BTK wines, or Dr Crane wines? No, ill chose my favorite one and stick with that. I think a lot of people are doing the same now. I know its not apples to apples as your vineyard sources are not exactly the same across brands, but there is some overlap (Beckstoffer wine). Also, using the same winemaker. Ive heard Sam Kaplan is great and im sure he is. Ive actually been told by people i trust that he is. However, im guessing there isnt huge stylistic changes between MM and Vida. So again, people ive talked to dont want 10 different Melka wines or 10 different TRB wines or even 10 different Nigel ones. They only want 1 or 2 of their favorites. Not only due to the costs, but they dont want or need 10 wines of similar styles from the same winemakers at 300 per bottle. At least on WB, people want variety. Not the same homogeneous wines across the board.
I think MacDonald and Beta / Jasud hit every single one of your points.
I would add a strong social media and marketing effort even if it is grass roots.
Iâve thought about this a lot recently. Sorry, slight drift.
I just did the statistics from my sales site. And you know how active I am on Instagram - always posting stuff, videos etc. During 2024 not a single sale came from someone pressing the buy link in the bio on Instagram. Not one. All sales were via website or otherwise organic from mailing list.
That statistic did set me back a bit, I have to be honest.
Now, of course, the Instagram can be seen as marketing tool for awareness and probably drove people that way, but this canât be measured. My hunch tells me it does, but what if Iâm actually wrong? Whatâs the point of all this content and social media-ing then? I think we sometimes attach too much value to it - when everyone can post content, the value of that content also goes to zero.
I keep thinking of Marcassin. No website, no social media, just send a letter/catalog out where you can order by sending a check. Sells out every year. Of course, she has legend status, but still. Beta is another good example - no real website info, no real social media presence. Sells out in 30 min. Kobayashi, same thing. MacDonald same thing.
Sometimes I feel like by constantly posting content on social media, you just become like that dog in Garfield - waving his tail constantly, eager to please, but nobody takes him seriously.
Humans need to find the clique or niche only they know about. The hunt for that special thing that only you and a few others have discovered. Social media ruins that mystique by design.
I can say with 100% certainty I have never purchased wine on my phone. Always on my laptop. No real rhyme or reason as to why.
Adam,
I deactivated my personal account (and stopped posting on FB completely) awhile back, and basically as I was asking Megan to deactivate the company account Jamie Goode posted on one of our wines. We agreed that we would keep the IG presence as a way of thanking people who post on our wines but we donât use it to post content (that I am aware of).
As one of the least active businesses on IG, I donât miss it.
That doesnât mean that IG isnât useful, I think some of the newer cult Burgundians could probably demonstrate significant revenue to IG influencers, and possibly to their own accounts.
But itâs not mandatory at all, and the time spent managing social media that often produces very little to no results is very significant/not cost effective. Not to mention that âworkingâ on IG is generally more fun than pouring wines at a grocery store or retail shop, so itâs easy to rationalize the âworkâ even if there isnât a demonstrable benefit to your business.
Thank you for your perspective here. I like your angle on pricing and there could be some validity there for sure. As far as the wines being the same, I think that is a perception that will go away as people taste the wines. We only have 1 site that other people can source from (Memento Mori has Crane, VHR, and Las Piedras). For Vida 3 of the 4 sites are all ours. 
And though people may say Napa is Napa, or that Sam has a certain style, the should try Arkenstone (Howell Mountain) versus Memento Mori (grand cru sites) versus Vida Valiente (mostly brand new sites). All the wines and masterfully made and have amazing balance even at a young age; but they are pretty damn different. I actually think the breadth of sites Sam works with is part of what him so great.
@Zachary_Mancini i would love you to try them and hear what you think.
Perhaps a non-starter, but given the likely surplus of grapes available the next few years, why not attempt to create the best value wine in Napa with a $40-60ish price tag? In Bordeaux, there are a multitude of classified growth (and non) in this range that offer real value. In Napa this is essentially the entry-point for the larger, institutionalized wineries, and these wines are often the most anonymous and formulaic of the Napa wines.
I would imagine that this requires some scale, but without knowing the market for growers its impossible to know how feasible it is. Heck, you could have a fixed margin model that allows the wine to go up and down in price depending on the quality of the vintage (and cost of the grapes). If your brand or identity is based on delivering tremendous value, then even an $80+ wine could be a compelling buy in a great year.
I like the idea.
But please skip any whispering about âwe are forbidden by a NDA from telling you which ones, but this comes from vineyards which feed into $300 98 point cabs!â and so forth. I hate that stuff.
Good quality wine made by someone with a good reputation at an affordable price. I can get behind that.
Currently my fastest moving $100+ plus wines are 95+ rated CdPs and Priorats. Iâve been sucking my distributors dry on them. A quote from one of our good customers after his return from a week in Napa: â Iâm now bored of UCD Masters of Enology cookbook Cabs. 35 brixs and the cookbook are destroying vintage, terrior, and the soul of the wines.â
There are at least a couple out there, at least the wineries market as such. E.g., Robert Craig Howell Mountain Cuvee ( not their HM Vintaged SV) and Anderson Conn Valley Napa bottling. I think Caterwaul aims at this, maybe Beringer KV reserve. Probably more.
Thereâs certainly a few. White Rock Vineyards is close ($65) as is Frogâs Leap (Listed at $75, but can be found for less). Groth, Buehler, Round Pond and many others do too, but these are all their entry level wines. To Chrisâ point, I donât think the model would want to follow the NDA wine style / relabel, but rather find some quality vineyards, disclose them, and try and make the best possible wine each year. For example, Matthiasson makes an $85 Cabernet from a multitude of vineyards and lists each of them. (their Single Vineyard from Dead Fred is $95).
This is definitely an intellectual exercise, but I think the point is simply that thereâs a dearth of âaffordableâ Napa wine of real substance. At least compared to the number of mailing list bottlings.
I wonder what is the cheapest you could make a Napa cabernet that would be tough to distinguish in a blind tasting from at least the weaker half of the $200+ luxury segment.
Like if you werenât worried about the brand name of the winemaker and vineyards, or creating a prestige product, or having a fancy tasting studio, or using it as a stepping stone to more expensive wines in your portfolio, how cheaply could a smart winemaker and savvy businessperson create a wine of that quality?
And then, would there actually be a lot of demand for it? Or would the lack of prestige and all keep it from getting traction?
I think you first need to determine what that âstyleâ and âflavor profileâ is - and see if there already are wines out there that deliver similar notes at much lower prices. My guess - strip the label and the story and there might be already but Iâm not as âin the knowâ as others up there or who regularly drink these wines.
How about Educated Guess?
Cheers
Iâve always thought A ârock starâ winemaker could do this. Just start with the most important stuff and acknowledge that you canât have the best of everything.
Problem is the rock star is used to the best and is probably afraid that they can actually make a wine close to/just as/scores better than their flagship wine.
Thatâs no good for the money maker.
Truthfully, perhaps a bit hard if youâre looking to match the style pound for pound. However I donât think is due to quality, but moreso style. The sorting can be incredibly aggressive on some of these prestige wines. If youâre sorting out anything that doesnât look like a perfect blueberry, and are already paying a good amount per ton, I bet the cost can climb quite quickly. That also assumes that heavy handed sorting on long lines plus an optical sorter is necessary to make great wines in good vintages. Personally, these wines arenât for me, as I find the singular nature a bit boring and I think you can quickly tease out the impacts of the winemaker as these wines can come across as a bit technically made.
But I do wonder what a top quality value Napa Valley wine could be if you didnât need Cabernet Sauvignon on the label (therefore using a fair amount of Merlot or Cab Franc too), didnât need the super prestigious vineyards, avoiding heavy handed sorting and used a limited amount of new oak. The big question is whether the consumer would actually want or buy that, but in times of headwinds it seems worth re-considering the dogmas of the region.
I have blinded people on Snowden Ranch and Drinkward-Peschon as part of a cult flight. Both have done really well.
+1 on Drinkward, and sadly they are not going to produce wine anymore