Special Edition Round Table Discussion 2024 Review! Part 1

📢I talk🎙️with Julie Milroy, Erica Duecy, Caitlyn LuBell and Katharine Jerkens about the Beverage Industry Recap of 2024 in Part 1! Next week we will discuss 2024 Surprises and Outlook for 2025 in Part 2.  👏🍷 🎇 🎉 ✨ 👏 🥂  😁

📽️ Watch on YouTube! 🎞️ https://youtu.be/nIHS6gXmr_A

I love this conversation. There is so much valuable content in this podcast! I was super stoked to gather these C-Suite Ladies from all around the industry to discuss 2024 and how 2024 was a reset year and evolving consumer culture around alcohol.

We end this episode with a tribute to Icon and Entrepreneur Fawn Weaver. She and her team have charted a road untaken with Uncle Nearest and she received nods of respect from our panelists. Congratulations Fawn on all your success with Uncle Nearest!

Some Major Talking Points:

2024 "A Reset Year"
1) A Start to a Major Correction (much like the post-financial crisis) 
2) Cultural Shift, Younger Consumers "Year of Flavors"
3) Price drop and margin but not seeing a volume increase 
4) Too many Brands and not enough Distributors
5) In Younger generations alcohol is culturally less important

And So many more topics uncovered!
*Raising Money Key to Starting a Brand
*Need $3-$5Mill to start a brand
*Stay Away from California!

Summary

Industry experts reflected on the challenges and opportunities presented in 2024. They explore cultural shifts in alcohol consumption, the impact of celebrity brands, and the complexities of distribution in a competitive market. 

The panelists share insights on consumer behavior, market trends, and the necessity for brands to adapt to changing dynamics. The conversation delves into the complexities of distribution in the spirits industry, highlighting the challenges faced by new brands and the evolving landscape post-pandemic. 

We discuss the rise of entrepreneurship, the importance of adequate funding, and the shift towards alternative distribution models, particularly the growing influence of ready-to-drink (RTD) products. They emphasize the need for realistic expectations and strategic planning in order to succeed in a competitive market.

NOW ON YOUTUBE!!! Thank you for Listening! Join us on Facebook, Instagram or Twitter!

Host Jessie Ott's Profile on LinkedIn

Chapters

• 0:23 Be Sure to Subscribe to be Notified of all new Episodes!
• 1:06 Intro to Panelists
• 4:06 2024 Review
• 18:43 Celebrity Brand Success vs Failure
• 22:27 Celebrity Brand Success
• 25:33 Brand Entrepreneurship Flourished in the Pandemic
• 32:38 Kate's take in the Industry after Celebrating Her 8th Anniversary!
• 40:39 Result: Opportunity to Start a Distributor
• 42:30 Result: Opportunity in B & C Cities
• 44:00 Stay Away from Cali Market!
• 46:44 Costs $3-$5M to Building Brands today
• 51:38 Fawn's Fund Raising & Other Talents. Amazing Success Story: Panelists Discuss Mad Respect for Her
• 54:53 Produced by Fedora J Productions

Transcript

Jessie Ott (00:00)
Hello everybody and welcome to Thursday Thursdays. am Jessie and I have a special panel this year and I can't wait to introduce you all or have you actually introduce yourselves to all of us. And I don't believe we know each other as a group until now. And so that's pretty exciting to get different people from different parts of the industry together to talk about, you know, an industry we're passionate about and love and

and see it transition beyond, I think, what I ever thought we would be. Just to be honest, there's some surprises for me for 2024. so with that, I'm going to turn it over to Julie. Julie, would you like to introduce yourself?

Julie Milroy (00:42)
Hi everybody. My name is Julie Milroy. I am a global wine and spirits US distribution strategist, formerly with Southern Glazer's Wine and Spirits. I was an executive there for 15 years. And now I am in transition, but also working on my consultant agency, JM Advisory.

Jessie Ott (01:09)
Okay, Caitlyn.

Caitlyn LuBell (01:11)
So, Caitlyn Loubell, I'm in New York. am one of the founders of Booze Biz, which is a recruiting agency for the booze industry. So we focus throughout the US, all types of roles, and we're kind of the matchmaker for candidates, jobs, great clients, filling great roles. And our whole team is all from the industry. So we all have industry backgrounds.

Kate Jerkens (01:43)
good morning everyone. I'm Kate Jerkins. I'm the Chief Business Officer for Uncle Nearest Premium Whiskey. And I just celebrated my eight year anniversary. I actually was the first employee to come on with Fawn, our founder. And this was actually my first foray into the spirits world. And boy, did I choose a time.

Jessie Ott (01:51)
Yay!

Caitlyn LuBell (02:00)
Yeah.

Jessie Ott (02:01)
man.

Caitlyn LuBell (02:00)
Really.

Kate Jerkens (02:00)
Nice to meet

everyone.

Jessie Ott (02:03)
Definitely. Yeah, I can't wait, Kate. can't wait to hear more. Erica.

Erica Duecy (02:08)
Yeah, Erica Ducey. I have to say, Kate, we just had Fawn Weaver, everyone knows from Uncle Nearest on the Business of Drinks podcast, which I run. And so far it's one of our most listened to episodes of all time because this company is just making waves. So a little bit about me, I've been leading teams in content, data, tech, both drink side and non for about the last 20 years.

Kate Jerkens (02:17)
right.

Jessie Ott (02:24)
Amazing.

Erica Duecy (02:35)
So I've held director level roles at big publishing brands like Architectural Digest and Saveur Magazine, and then Editor-in Chief and chief content officer roles for drinks publications and platforms on both the trade and consumer side. So Seven Fifty Daily, PICS, Vine Pair. And in the past few years, I've been working as a strategic consultant.

building both marketing and data and insights programs for companies like Drizly, Union. I do a lot of market research. I, for example, I'm just finishing up a big study that I did for the New Zealand Trade and Enterprise where we're looking at different generational cohorts and how to market to each of those generations. And I share a lot of my insights on the Business of Drinks podcast.

And that's the format of that podcast is we track trends and we interview the most innovative people in the drink space, which is why Fawn was on and talk to them about how they've built their brands. Yeah. So that's, I'm excited to be here with everyone today.

Caitlyn LuBell (03:36)
Yeah.

Jessie Ott (03:38)
Awesome. all right, let's get started. So I think I have some notes I can always put up on the board. But the idea is just sort of just for the audience is kind of just talk about our industry from, you know, where we started in 2024 and what happened and then, you know, kind of move into some of the surprises and then where do we think 2025 is going to be? And so I guess.

Starting out with 2024, I do have some notes I'll share on here and they can spark your thoughts

Alright.

here we go. So I think we have some obvious things, right? We've got the low and no alcohol growth, CBD and THC beverage growth, the premium high-proof spirits, particular bourbon, and I'm seeing that also in through my interviews that I've had with people that are companies that are new that are actually, you know, using staves, wood staves.

Julie Milroy (04:14)
Mm-hmm.

Jessie Ott (04:35)
to age whiskey and bourbons. So that's become quite a thing. Rise in celebrity brands. I don't know if it's a rise. It's just a continual circle of celebrity brands. Certainly growth in e-commerce, innovation and flavored spirits, growth in private label. I feel like that kind of goes up and down. well, we're interested. No, we're not interested. And this seemed to be this past year where they were. Obviously, there was a lot of...

bulk wine that was really cheap. So if you wanted to start a wine brand, this was the year. And then growing demand for sustainability in eco-friendly practices, which I think we're all seeing everywhere, especially the younger generation are certainly kind of pushing for that. And, you know, the flavored ready to drink, you know, bulk spirits to produce those and whatnot. So Julie, do you want to start and kind of give us your thoughts on these?

Julie Milroy (05:24)
Yeah, I mean, I think you've really captured 2024. I feel like it was, in just my own words, I feel like 2024 was like the start of a major correction. I relate it similar to the post-financial crisis period. And I think that a lot of that was

Kate Jerkens (05:38)
Mm-hmm.

Julie Milroy (05:49)
driven by really stellar economic years in 2018, 2019. A lot of people had additional funds and it was just really the peak when you compare it to back in 2007, 2008, right before the financial crisis. So people were drinking and buying a lot more and spending a lot more.

COVID obviously stalled everything, right? Where we had a complete stop in the business. But with wine and spirits, and I'm speaking from my world in distribution, is that a lot of, we had tremendous growth during that time, right? So even though the entire on-premise channel, restaurants and hotels shut down completely,

retail, you know, made up for those losses and actually exceeded those losses. What restaurants could continue to order were not being able to take advantage of any kind of pricing discounts or quantity discounts. So they were all buying, you know, at frontline pricing, even plus frontline pricing, you know, with breakage charges. So bottom line was

Erica Duecy (06:42)
and

Julie Milroy (07:05)
incredible. mean, our margins were incredible, you know, during COVID. And then you saw a lot of price increases, right? And just to keep up with demand and probably not going to be popular for saying this, but some price gouging as well. so coming out of COVID, you know, I think 23, 24, I think everybody just thought, we're going to pick right back up where 2019 was and continue our growth from there.

Jessie Ott (07:22)
Okay.

Julie Milroy (07:33)
And

I think 24 was like that hard, it's not happening, right? And I think all of our suppliers that we love so much were like, no, 2019 is the baseline, it's the baseline. If we can just hit 2019 numbers, we're good, you know? And that's not the reality, right? 2019 was a high year. So even to make 2019 numbers, before COVID hit,

Jessie Ott (07:49)
Okay.

Julie Milroy (08:01)
is impossible I mean you know when we look specifically at you know a wine or a spirit supplier so I like to describe 2024 as like a reset year where we have so much going on right and and innovation opportunities as as you went over here you know the low and low

Jessie Ott (08:01)
you

Thank

Julie Milroy (08:25)
non-ELC, CBD, THC, celebrity brands, every celebrity has their brand. Innovation still continues, but there's a lot more competition and it's really difficult to get in front of that consumer and be that choice that they go with. yeah, just,

Jessie Ott (08:40)
Okay.

Julie Milroy (08:47)
Summarizing, think 2024 is, and of that, okay, you know, things aren't where we thought

they were going to be and it is a year to rethink.

Jessie Ott (09:00)
Okay. Yeah, that is definitely an echo of what I've heard from another executive at probably a top 15 supplier about competition. You know, she's the phrase survival of fittest, right? That's where we're at with all the competition that is happening out there. Not everybody's going to make it, but there's room for a lot.

Right? We have room for a lot and a lot of companies don't need to be in 50 states. It's not their goal. Right? So it just depends on, you know, how they stand out and what their goals are and the teams that they, they hired to put behind those goals. Erica, do you want to kind of talk a little bit about your thoughts?

Erica Duecy (09:40)
Yeah, definitely. mean, echoing what Julie said, think a reset is a perfect way to characterize the year. And a little bit of a reckoning in that there was kind of like bombs coming in from all directions. But I think in particular, probably the biggest thing that I see happening is that

there's really a cultural shift happening, right? So, you know, this was the year of the World Health Organization saying that no amount of alcohol is safe. And, and it's, it's not just that conversation, you know, we also see these huge influencers like Andrew Huberman, who have like 20 million followers on their podcasts, listening to their podcasts saying like, look, you know, if

If it were our recommendation, we would say just have one to two drinks a week for health, right? So there's all of this conversation happening around alcohol that didn't used to happen. And there's a lot more choices than there used to be. you know, so one of the, there's an interesting slide that I like to share from an organization, like a polling organization, GWI Core.

And it's very indicative to me because it showed that, you know, a decade ago, alcoholic drinks, they ranked at number 12 in the topics that younger people ages 16 to 24 were talking about online. So if you look at like online conversations that are happening, alcohol was like ranking up there, you know, with like sports and music and like all these sorts of things for those younger consumers. Now,

Caitlyn LuBell (11:10)
Thank

Erica Duecy (11:19)
the same age set 10 years later, it's dropped down to 26. So it just shows that the cultural relevancy of alcohol is changing. And with that, especially for younger consumers, it comes like changing consumption habits. So it's not just the conversation, it's also the consumption habits. And what we see is that there's just a lot more choice out there.

there's a, it's a, more of a flavor driven world. So the things that I see, really over indexing for younger audiences are things like, Stella Rosa, right? That is a, flavor driven, wine brand. So we have, I just had on Steve Reibole, talking about how they grew that product line to 4.1 million cases last year.

and continues to have double digit growths. And the thing that I think is really interesting about what is over indexing for younger consumers is that it's very clear flavors. So when you pick up the Stella Rosa, right, you see that it says Ruby Red Grapefruit, or they're the number one selling new wine skew of the year last year, according to Nielsen, was their chili, pineapple and chili wine.

Right? So like those sorts of products, along with like the massive influx of RTD is like those types of thing where it's very clear of like, this is the flavor of the thing I will get be drinking without any confusion. Those are the types of products that are over indexing for younger consumers. So it's very interesting to me that like some of the more traditional categories,

Caitlyn LuBell (12:38)
Wow.

Jessie Ott (12:38)
Interesting.

Erica Duecy (13:03)
don't really market on a flavor first sort of basis. So I think that type of, I think like that's a sort of shift that I anticipate happening in the years to come. And I do think that portfolios are going to become more diversified in order to stay competitive because I think like this flavor forward ordering, which we see, you know, obviously not just in.

wine and the alcohol space, but across literally every single CPG category is just going to continue. The way I think about it is like you walk into Starbucks and you look at the menu board and there's a million flavors or you go to Whole Foods or even a convenience store. And again, those things are just packed with all the coconut, pineapple, mango, all that, you know, all the flavor, the berries, all it's just very clear what you're ordering and picking up off the shelf into what you're drinking. So I think that

that shift to me became cemented this year in a way it hadn't been before.

Jessie Ott (14:02)
Interesting. Yeah, I have never thought about that before. So it's kind of like a new way of being a consumer, if you will.

Erica Duecy (14:11)
Yeah, I mean,

I think it's going to be very interesting to see. And I do see some research from like wine market council and other places suggesting that millennials that when they age into their 40s, they do start to adopt more traditional wine drinking and wine buying habits and spending more per bottle than prior generations. So I think that for traditional categories like wine and spirits, is hope that

Caitlyn LuBell (14:40)
Yeah,

good, good to hear.

Erica Duecy (14:42)
The entire ship is not going to capsize. But I do think that especially at the younger level, at the younger ages, we definitely see a shift happening.

Kate Jerkens (14:52)
you

Julie Milroy (14:52)
Mm-hmm.

Jessie Ott (14:53)
Yeah. Interesting. Kate over to you.

Kate Jerkens (14:58)
Yes, and I apologize for stepping away for a moment. have an eight-year-old home sick today and he was calling for me, so I had to check on him very quickly. That's what working moms do. It's what we do. So I also have a teenager and I found your conversation to be interesting. We have a very like open, transparent relationship and I agree like the way they talk about parties and alcohol and their priorities is very different than even how I grew up.

Jessie Ott (15:02)
no! It's okay!

Caitlyn LuBell (15:05)
Yeah.

Kate Jerkens (15:24)
A lot of them don't care about it as much, they're also not sitting around kegs anymore. They have all those flavored, like all the kind of flavors and all that kind of stuff. And that's more appealing to teenagers. I'm not selling her out, but like in general, I always ask when she goes to a party, was there a keg? What's a keg? It's like,

Jessie Ott (15:42)
Hehehehehe

Kate Jerkens (15:45)
Okay, life has

changed. But yeah, so I just think it's very interesting and a lot of the younger kind of 20 somethings that I know are also just in a more like health conscious moment. And then moms and stuff like that, even those of us in our 40s, there's a lot of people that have just started to drink less in general, and just making health choices. And this is all women here, but a lot of that like perimenopause and all that kind of stuff, a lot of what you're reading is that alcohol does not serve us as well. So think there's a lot of different

Caitlyn LuBell (16:09)
Mm-hmm.

Kate Jerkens (16:11)
things going on, but I agree 100 % with the reset. I kind of, I feel like this is the year where every company wants you in the office again, four or five days a week. And I live in Los Angeles, the traffic is back to normal, right? Like we've kind of, we went through this, you know, 2020 reset with COVID and we're all going to work from home and people started happy hour, sometimes a little too early and you know, you weren't driving anywhere, right? And so,

Jessie Ott (16:36)
Yeah.

Julie Milroy (16:37)
all day.

Kate Jerkens (16:40)
it is very much a reset. you know, I think a lot of spirits companies and distributors were living living high in 2020 and into 2021 and beyond because drinking habits and in the so called pantry loading was all happening. And God forbid, you didn't have six bottles of something in your house. What if you wanted to have outdoor gathering and you know, whatever it might be. So I just you know, we've looked at a lot of graphs and looked at

where the growth should have been, if you want, 2019 and just kind of did some normal growth. we just really are in the middle of a reset and it's tough. the bigger companies, I think, are hurting the most because they have to report those numbers. And so what I'm seeing out there, truly, I live in Los Angeles. And so in California, you can sell booze anywhere. I spent a day in the market a couple of weeks ago, just going from anywhere from grocery to just a regular liquor store to the more

of chain liquor stores and boy the pricing has gone crazy. It's gone, people are dropping prices like crazy but if you look in the Nielsen right now that is not helping to drive volume so I think we there are some companies right now setting themselves up.

Jessie Ott (17:41)
Yep.

Julie Milroy (17:41)
Mm-hmm.

Kate Jerkens (17:52)
for some disappointment in the years to come because they've now dropped pricing margin and they're not getting the volume in return. And I think that's going to be a big challenge and it's going to be a big challenge to get consumers to start spending that money again when they're used to some of the deals that they're seeing. I mean, it's mind blowing. And I know not every state can do this type of discounting, but when you're seeing in these kind of open markets is game on with some of these big companies right now.

And in regards to the celebrity piece, I thought that was an interesting, you definitely see the rise of it, but I think it's interesting to also just talk about the success of those. that's not the same, right? You look at, I don't want to name the call out names, but you look at some of these like heavily celebrity backed brands and some of them have taken a huge dive this year. And the ones you see that are actually succeeding are the ones where you see the celebrity actually out there. So.

Jessie Ott (18:26)
The success, it's not the same.

Caitlyn LuBell (18:43)
Yeah.

Kate Jerkens (18:43)
I

will give a pro give a the Brothers Bond I think is that that's those guys. Those are the guys from was the show that everybody loved. I'm too old for it though. I think anyways, two handsome guys Brothers Bond Bourbon. And I saw them out at a Whole Foods in Venice about a year or two ago and they were out there pressing the flesh and signing every bottle and he's like this is

you know, day 10 of this like tour they've been on where they're out there really working the market. And I've seen some other celebrity brands doing that. I think that's going to make the difference. just having a celebrity on your brand, if that's not willing to work, it's not it's not helpful at all. And I think we'll see less and less of these deals because unless you're willing to truly work it, it's it's they're not doing that. They're they're not going to do that. Well, they'll have a big spike and then. Yeah.

Julie Milroy (19:16)
Mm-hmm. Yeah.

Jessie Ott (19:28)
I think, yeah, I think with that

too, Kate, I think it also depends on how are they creating the brand? Is a supplier going, hey, I have this tequila, let's go find a celebrity. Or is a celebrity going, hey, I'm going to find the right people to build this like Teremana, like The Rock did, you know, with the Avion tequila team basically went to him and said, let's, create this brand. Let's make it really good.

Kate Jerkens (19:36)
Mm-hmm.

Yeah.

Caitlyn LuBell (19:44)
Yeah.

Julie Milroy (19:44)
Mm-hmm.

Kate Jerkens (19:47)
Rock works hard, Yeah.

Caitlyn LuBell (19:48)
Yeah.

Kate Jerkens (19:51)
Yeah, they work hard.

Jessie Ott (19:56)
They wanted to sell it for 50 bucks or 49 bucks. And he's like, that's not the tequila of the people. We need this to be $29 and $31. And so even though the quality is there, but he's behind it. Obviously he's popular. He's on Instagram. His tequila is very good in my opinion. He owns his own distillery. He's just created and he just keeps creating and building them as they grow. I think, I think it just depends on the level of commitment to your point, Kate. Like that's how you build a brand.

Kate Jerkens (20:12)
It is.

Jessie Ott (20:24)
You hire the right people.

Kate Jerkens (20:24)
And it's no different than anything

else. It's no different than Fawn Weaver, who was not a celebrity going into this, right? Like, you cannot build a brand from scratch right now unless you are willing to fully roll up your sleeves and work around the clock for it right now. It's too competitive of a space. And it's not enough to just have a celebrity name on it, you know? But boy, they will spike. Like, Reserve Bar will tell you, I talked to Derek at Reserve Bar, and he can tell you some of the best sales they've ever had are on these certain celebrity releases.

Julie Milroy (20:35)
You don't

Mm-hmm. 100%.

Jessie Ott (20:43)
It's not, but you go.

Kate Jerkens (20:53)
But then some of those companies have gone out of business since then, right? Like they'll have these big wow moments and then it's, you know.

Julie Milroy (20:59)
Mm-hmm.

Yeah, we always said we never, know, some of these celebrities that we've worked with. And I think that difference, Jessie, is, you know, the difference is, are they an owner or are they contracted just as a celebrity? And you see the difference when they're an owner, they work, you know, I mean, I, Curtis Jackson with Sire Spirits. I mean, that is his baby. He worked.

Caitlyn LuBell (21:18)
Yeah.

Kate Jerkens (21:22)
It gets after it, right? Yeah.

Julie Milroy (21:25)
it like, you know, and we, you know, we joke around and be like, I've never seen a celebrity have to work so hard, you know, until they had their own drink.

Jessie Ott (21:31)
He's a hard worker. He tried

Erica Duecy (21:31)
you

Jessie Ott (21:33)
hard with Effen. He would go so hard on the military bases that he'd sleep through the events at night. Yeah.

Kate Jerkens (21:38)
really?

Erica Duecy (21:39)
Wow.

Julie Milroy (21:40)
Yeah, I mean, and

with Effen, that wasn't his own, right? I mean, that was partnered with Jim Beam at the time, but now it's his baby, you know? And he realizes, and I think a lot of these celebrities do that. Yeah, I mean, that'll give you that extra marketing push and whatnot, but ultimately it's like every other brand. It's going to come down to that consumer loyalty, the brand story, the quality. I mean, I think...

Jessie Ott (21:43)
It wasn't his own. He was held back. feel like.

Kate Jerkens (21:44)
Who just said, yeah.

Jessie Ott (22:07)
quality.

Julie Milroy (22:08)
When I think about when I got in the beverage business over 20 years ago, nobody knew the difference between, you know, a Cabernet and a Sangiovese or a bourbon and a scotch, right? And now just the U S consumer is so knowledgeable and they just keep learning and learning, you know, and, and so I think really being able to speak to the quality of your product and,

Caitlyn LuBell (22:25)
Yes.

Julie Milroy (22:35)
and consumers believing in that makes the difference.

Kate Jerkens (22:39)
100 %

Caitlyn LuBell (22:40)
we'll just fill out this credit app.

Kate Jerkens (22:40)
Yeah.

Erica Duecy (22:40)
you

Caitlyn LuBell (22:42)
I don't have the authority to do that. Like, and then that's it. Dead in the water. So this is something that I've been talking with, like MHW and Park Street about is like, there's a little broken piece here. So we're still fixing. We're still fixing the the chain, the daisy chain here because we're not fully there yet. But that is the way that it's

Kate Jerkens (22:45)
Yeah, dead in the water, yeah.

Caitlyn LuBell (23:07)
going to go, as smaller distributors will start popping up because we need them. But we do have to fix that piece to the puzzle.

Jessie Ott (23:11)
think so, yeah.

Kate Jerkens (23:17)
Yeah, definitely.

Jessie Ott (23:17)
Yeah. And I'm also hearing,

seeing a lot of pass through for these new brands. Say I just need your distributorship so I can pass through so I can sell to my, customer here, there, and everywhere, you know, which is kind of, which is, you know, Lib Dibish, you know, right.

Caitlyn LuBell (23:24)
Yes. Yep.

Right, correct.

Kate Jerkens (23:31)
But if you don't go to a distributor right now with even having like so if you I I saw we as part of the Nearest and Jack Advancement Initiative we have a company we work with and they were fully authorized in all Whole Foods in California. They're like we just need the distributor and like we've got it, you know, and that's like

that's how they got their distributor so quickly, right? But it's like, if you don't have some guarantee, it's very hard for someone to bring you on right now too. So there is a lot of work that has to be done. You can go to these distributors now and just be like, okay, I have this contract. Please take me on. That's all you have to do, which isn't really how we should be doing business, but it's where you're at.

Jessie Ott (24:11)
Yeah, definitely. I mean, it's survival of the fittest, right? It's do you have, do you have the goals? Do you have the right people and do you have the money behind to get to those goals? And I think you see a lot of people, a lot of startups struggle with that because I mean, not everybody's The Rock and has money to put behind his, that, that type of growth. I know Fawn was able to raise a good

portion of money. Didn't I see in one of her interviews you spent 50 million or something on marketing? I can't remember what the exact figure was but...

Kate Jerkens (24:42)
Yeah, likely.

Yeah, I mean, it was $50 million to build out the distillery. I mean, she's talked to, I think she's raised over $230 million. So yeah, there's she's she's an incredible fundraiser and not everybody has has that ability, right? And in a commitment to not being, you know, to not being bought.

Caitlyn LuBell (24:49)
You

Jessie Ott (25:01)
Yes. And to grow and expand. Yeah.

Kate Jerkens (25:03)
Because we're, yeah, exactly.

Caitlyn LuBell (25:07)
Well, and just to

go back to 2024 for a minute, I think that one of the other big things which created all of this is that people learned entrepreneurship and got attracted to entrepreneurship like most of us on this call actually. you know, once the pandemic hit and people lost their jobs or people realized that they were working insane amount of hours at their jobs or whatever.

Kate Jerkens (25:27)
and

Caitlyn LuBell (25:33)
They were like, let me take this as an opportunity to do my own thing. a lot of that was create my own brand. well, I've always wanted to do this and I don't wanna go to work back at the office or I don't wanna go back to that job that I was unhappy with. Let me start my own thing. And so I think that's contributed to the oversaturation as well because we just talked to a guy this morning, super lovely guy.

Kate Jerkens (25:36)
Yeah.

Correct.

Caitlyn LuBell (25:59)
He's from, I won't go into details, but he's from other, he's from South America. He's currently living in another country and he's from the hospitality industry. And he started going to Mexico and fell in love with tequila. This is like my standard story. And now he wants to create his own tequila. So he's working on it. And you know, it's, think a lot of people got their little entrepreneurial bug.

through the pandemic. And I think that without a doubt, and then they're like, I can can this or bottle this RTD. And, you know, I think that that contributed to a lot of it too, is like, so many people it was a pipe dream to be an entrepreneur, but then the pandemic almost forced it, right? Especially for people in hospitality. I mean, we all know how that went down. I was recruiting for

Kate Jerkens (26:27)
All those home bartenders.

Jessie Ott (26:29)
Yeah.

Caitlyn LuBell (26:52)
restaurants through the pandemic for New York and New Jersey, it was insane. We couldn't find a sous chef to save our lives because they all left, you know, so like Kate, you left, right? And went into, well, you left prior to that, but, but it's, that has.

Kate Jerkens (27:04)
Yeah. No, my friends

in the hotels, they were all doing seven jobs because so many people left. They were done. They didn't want to do more. Yeah.

Caitlyn LuBell (27:11)
Yeah, right. So

a lot of people became entrepreneurs and a lot of people launched brands and then they don't really understand the budgets, Jessie, that are needed to, you know, we tell them if you don't have three to five mil, even just to roll out, you're going to be in trouble. And they, you know, they're going for a hundred thousand dollar round of funding or like.

Kate Jerkens (27:33)
That's not going to do the trick.

Erica Duecy (27:34)
Yeah, that's

not enough. I mean, I do wish that some of these entrepreneurs would open small distributorships because I think that's what you did.

Caitlyn LuBell (27:35)
Yeah.

Jessie Ott (27:35)
Yeah.

Caitlyn LuBell (27:41)
So again, it's

something that we actually preach a lot. A lot of people I talk to, like friends in the industry, are kind of like, I want to do something. Do I want to create a digital platform? Do I want to be a consultant? And I'm telling them, go open a distributor, open an imported distributor. But we have to, there's evolution that needs to happen as well with that.

Jessie Ott (27:42)
Right?

Erica Duecy (27:57)
Yeah.

Julie Milroy (28:03)
Yeah, I mean, I can speak from my own experience. My first job within this industry was working for a small distributor importer, Vinifera Imports. And I can tell you, like, it might be a great opportunity, but, you know, and I remember the the founder, think he's still the owner, Dominique Nocherino was like, it is harder to import and distribute wine and spirits than firearms.

Kate Jerkens (28:03)
Mm-hmm.

Caitlyn LuBell (28:30)
Yeah,

Erica Duecy (28:30)
Mm.

Julie Milroy (28:30)
You know, mean, the

Caitlyn LuBell (28:31)
true.

Kate Jerkens (28:32)
Honestly.

Julie Milroy (28:32)
legalities

state by state, county by county, the laws that are required are insane. then, you know, being a salesperson working at a, when I first started with Vinifre selling fine Italian wine in Miami at a time when nobody knew anything about Italian wine, I was one of those smaller distributors. And, you know, a lot of people would be like,

Jessie Ott (28:33)
Yeah.

Caitlyn LuBell (28:36)
yeah.

Julie Milroy (28:56)
wait, you know, they taste the wine, they love it, they want it. you're not with Southern R &DC breakthrough. I don't remember what they were called at the time, but we can't work with you, you know? And there are so many small distributors in Miami, in New York. We used always say like, people are like selling wine out of the back of their car. know, right.

Kate Jerkens (29:02)
Yeah.

Caitlyn LuBell (29:07)
Right.

They are, they're delivering themselves because

they can't get into a distributor and they want to sell their products, so.

Julie Milroy (29:21)
And the

Kate Jerkens (29:22)
Yeah.

Julie Milroy (29:22)
amount that we would have to write off, because with 10 day net and COD and the different payment plans that are required by law in every state and every market, the smaller distributors wouldn't list them with the state. So that's kind of how we would still be able to get the business because they can't legally buy, but we would still sell. And so it's just,

I kind of that, you know, we don't talk about the big elephant in the room, but you know, it is a, you know, the three tier system, right? And I can tell you, I recognize the value of distributor. Obviously that's my background and that's what I do. you know, when you consider the safety of alcohol, the regulation of alcohol, being able to track where the product went, right? Through the three tier system.

And you hear of episodes in Mexico and I think recently in Laos where young people have died from drinking something that they think is a vodka or, you know, they're offered for free and there's no way to track it, you know? So I think it's just, it's really complex. I know that there are some...

Caitlyn LuBell (30:29)
and it's unregulated.

Kate Jerkens (30:34)
Yeah.

Julie Milroy (30:40)
big suppliers that are really pushing, you know, and it's an ongoing thing, right, to disseminate the three tier system. But there has to be, you know, you can't just like get rid of it and free for all, right? But it's a major challenge. And I think that's why my focus and what I try to do with my suppliers is you have to have

a national strategy, right? A distribution strategy. And Kate, I love that you said that, you know, coming in this industry that that was the big, we have to work through a distributor, you know, like, who's this? You know, it's like, and I think a lot of our like executives that

Kate Jerkens (31:16)
Nick what? This is nuts!

Jessie Ott (31:18)
Hehehe

Caitlyn LuBell (31:21)
Yeah.

Julie Milroy (31:21)
come from CPG and stuff, they're like, what, hold up, wait, what? There's a middle person that we're having to navigate through and also sell to and also market to.

It's, it is challenging, but it is possible, right? It's, is working through making sure that you've got that five year plan. You've got that annual strategy and then the tactics that back up each of your strategies and how to go to market, right? And, and you know, like you said, Jessie, it's not, maybe you don't need to be in all 50 States, right? You don't need to roll it out. And I can tell you at Southern, that was like the national, you know, that was the

the business model is you get a brand and you want it in all states, right? Like we don't want you unless you're in every state. I'm sure there's going be a lot of that rethinking.

Jessie Ott (32:06)
Mm-hmm.

So Kate, I have a question. So you're the kind of the newcomer, even though eight years is still pretty solid and you're new to the industry. can you kind of talk? So you saw what life was like before COVID and during COVID and then after COVID. So do you have any kind of reflections of stepping into a new industry that's not exactly easy? Well, probably any industry is the same. And we have, you know,

more firewalls with the TABC and whatnot, but is there any kind of big, like, I don't know, ah-has or any kind of things that you want to talk about that, you know, as you kind of learned the industry coming into it and then seeing how this evolved?

Kate Jerkens (32:55)
Yeah, so I came from the hospitality industry. So I worked in hotels and hotel management for 15 plus years and did some consulting. And I led sales and marketing teams there. Well, the sales there is very straightforward, right? And you can sell and see your product and you can see people literally putting your heads in beds, as we would say.

I think for me coming from a sales and marketing hospitality background was, wow, this is not as satisfying as you would want it to be because there's so many layers to the work you do. it's not, it's, you know, people like, you sell. I'm like, yes, we go out and we market and we sell, but we still have to get through several layers. So we, it's this business that's really, it's a B2C and it's a B2B business. And I think the distributor relationship and the distribute,

Caitlyn LuBell (33:21)
Yeah.

Kate Jerkens (33:39)
of the distributor was something that really shocked me. I remember being super excited. We'd gotten our first distributor contract and we're like, they placed their PO and I was like, all right, we're in business and nothing moved. And it was like, okay. Yeah, you got to go. You got to go do it. Right. And so what we realized in those first few years is, and you know, it's not disrespectful because I think most district people who worked on the distributor side too would say they're really just

Jessie Ott (33:52)
you

Erica Duecy (33:56)
Yeah.

Kate Jerkens (34:06)
delivery people for you until you really establish yourself. Yeah. Yeah. But it really became that way. So was like, okay, here, I went out and did this. Can you just like get, can you just deliver the bottles, please? Like, you know, we're really, and I think that was probably the most challenging thing. In our company, we also do a lot of support for other BIPOC and female owned brands. And that's really the common thread is

Caitlyn LuBell (34:08)
Now, now, it didn't always used to be, but now it is.

Kate Jerkens (34:32)
The path to distribution is very, very challenging and it's getting more so because distributors in the past would maybe take on almost anybody. Now the big guys have actually left suppliers behind. They're starting to close their books. They are not taking on as many brands. They just can't. They know that they can't. They don't have the money to do it. The cost of money is too big right now and they really have to focus.

keeping the big guys, which are the guys that are keeping their lights open. And that was hard learning to understand. But like, yes, we have this amazing story and look at us and everyone agreed. Yes, amazing story. know, so and so, it's 80 % of our business. And if we can't make them succeed and hit their goals, we can't afford to lose that. So those were the tough learnings. And I don't think much of that has shifted. Post COVID, I think

Post COVID, we saw everybody wanting to really be the helper. was post the murder of George Floyd and the Black Lives Matter movement. And there was a lot of distributors coming out and they want to bring on smaller brands. And so a lot of them connected with me and I did a lot of connecting with smaller brands. I think in the last three years, last two years, now this year, is they're realizing they really don't have the bandwidth to help really develop these brands. They just don't have it. And we've seen some pretty significant distributor cuts this year.

across very, very large distributors. so I think where we're at right now is it's going to be a very 2024 and going into 2025 new brands. It's going to be tough going and being able to maybe change your expectations or really focusing on one or two key markets or focusing on the markets where you live and where you have connections is really going to have to be the way to do it. Gone are the days. I we rolled out 50 states in two years. don't think I would ever

Caitlyn LuBell (36:06)
you

Kate Jerkens (36:19)
We did it, but I don't think it's feasible unless you have just the deepest of pockets at this point, it would not be doable.

Julie Milroy (36:24)
Thank you.

Erica Duecy (36:25)
Yeah, I think, you know, an interesting data point I have there is I was reading this article in Meininger's International and they had this quote that in 1995 at the beginning of the US wine boom, there was about 1800 US wineries and 3000 wholesalers. Today, there are 12,000 wineries and only 1000 wholesaler and that's only wineries. We're not even talking about

Caitlyn LuBell (36:48)
So.

So yeah, it's actually

Kate Jerkens (36:53)
Wow.

Caitlyn LuBell (36:54)
worse. we talk about this all the time. So they're actually all in. There was about 10,000 distributors back in the day. And now there are about 3,000 and three times the amount of brands. So we're working at like a nine X.

Erica Duecy (36:54)
and all of that.

Caitlyn LuBell (37:15)
And it's not their fault. worked at Southern too back in the day and it used to be you could get into a distributor and boom, you have 212 salespeople hitting the ground running. the over saturation of the amount of products, it's not their fault. again, think Kate, you said it. They have to focus on who's really bringing in the money and the large distributors, the product selling itself. And they just don't have the time, the bandwidth.

Jessie Ott (37:33)
Mm-hmm.

Caitlyn LuBell (37:42)
My friends who are reps used to have 74 accounts and now they have 186 and they just don't have the bandwidth to sell anymore.

Kate Jerkens (37:52)
They're not even making

it to their key accounts every week or every other week right now, which is... You can't. You can't.

Caitlyn LuBell (37:56)
Not with that workload, how could you possibly? And then when you

are, you're busy doing surveys for, I won't brand drop either, but like larger brands. You're just going in and doing surveys. You're not presenting, you're not carrying a product in your bag anymore. I mean, I used to schlep a wine bag up and down the subway steps in Manhattan in the snow and nobody's doing that anymore. Like I'm not nobody, you know.

Kate Jerkens (38:05)
For sure.

Julie Milroy (38:19)
Stay stings.

Caitlyn LuBell (38:21)
my God, every Friday I

Julie Milroy (38:21)
Enough training.

Caitlyn LuBell (38:23)
was doing tastings, staff trainings, all of the things. And it's so sad to see, this is the evolution of the industry. there are, as you listed, so many reasons, and there are other reasons too, that this is all happening.

Kate Jerkens (38:37)
Yeah.

Jessie Ott (38:38)
Well, do y'all remember-

Kate Jerkens (38:38)
And it's more expensive for suppliers to do business then, right? Because we then have to supply salespeople.

Erica Duecy (38:42)
Yeah.

Caitlyn LuBell (38:44)
a thousand percent, you have to have your own feet on the street or you're not going to get anywhere. you know, we have this we have this conversation multiple times a week with new brands and really like, what's your strategy? What's your game plan? And like, you know, how can we help you? We're not consultants, but also you have to be realistic because we don't want to waste our time or our candidates time. You know, if if your expectations are just not.

Kate Jerkens (38:50)
100%.

Caitlyn LuBell (39:11)
you know, in line with the market. If you had a consultant somewhere that told you, just get into distributor, get into Southern and you'll be set. And then, okay, now we have to have a reality check here of what's really happening, you know.

Jessie Ott (39:21)
Yeah.

Well,

do you remember when it all began like 20 years ago when Diageo had, I think the Boston Consulting Group do analysis on how to like be more efficient. And that's when Diageo aligned with, I don't know if it was Southern or R &DC or whoever it was, but Southern and R &DC weren't really that big at the time. Right. And so, but that's when the big contracts of the top 20 started.

Caitlyn LuBell (39:30)
yeah.

Kate Jerkens (39:43)
Mmm.

Jessie Ott (39:55)
And that's when everything changed. And that's when you saw the mergers and acquisitions and that's where all the small guys got, got eaten up, right? They're, gone. Like, like, like you said, so now you're left with these big companies that are trying to manage these big markets with fewer people, higher costs. And like, like you said, three or four times the brands. And so, now I feel like.

Kate Jerkens (40:13)
Yeah.

Jessie Ott (40:20)
I have an entrepreneur over here that's saying, I want to start a distributor. There's an opportunity here. I see Greenlight in Texas. That's kind of, I don't know if it's existing or not. People are pulling their brands away. But that was a good example of like, yeah, you can do it. You can take these innovative brands and creative distributorship and be successful with it, but it still takes money, right? And so.

Caitlyn LuBell (40:42)
Yeah, and there's

challenges to that as well, unfortunately, because we've been talking a lot about this as well, because that's what I keep telling people is like, you want to do something, start a distributor. However, we're still having challenges with the buyer level of they don't want to fill out an application there, there, or they're not there. They can't. They're not allowed. I'm a bar manager. I can't fill out your credit app. And so

Kate Jerkens (41:00)
Yeah, that part.

Caitlyn LuBell (41:09)
There's a broken piece to the puzzle that needs to be fixed, which is that these small distributors, especially particularly on-premise, they don't have that whole date. So we'll help somebody hire somebody. They'll go in, they present the product. Here's my new tequila. I love it. Great. Send me a six pack. okay. Great. Who you distributed through? we don't work with them.

Julie Milroy (41:34)
that's not the strategy. You maybe like you said, Kate, focusing on, okay, I want to start my own brand. And I still tell people all the time if this is better time than ever to start your own brand, but like really start small, like do those foundational

Caitlyn LuBell (41:34)
Yes.

Kate Jerkens (41:34)
Yo for sure.

Julie Milroy (41:51)
brand building, like actually build the brand. Don't just try to distribute it, right? Get it out there and then it doesn't sell through, which is a big problem we have, you know, so.

Kate Jerkens (41:55)
Mm-hmm.

Erica Duecy (41:59)
Yeah.

Yeah. Yeah. I've been talking to a lot of suppliers lately, who tell me like, they're not even like looking at the coasts right now that where all of the growth is happening is really like Illinois, Indiana, Ohio down in the Southeast, you know, like really all the other areas and in some of those markets that you're seeing like 300%, 400 % growth on sales.

where both coasts have completely stagnated.

Caitlyn LuBell (42:34)
We tell them all the time that they all want to go into New York. Like we're like, all right, where are you launching New York? And we're like, okay, I worked in New York market for many, many years. Let me remind you, it's a bottle by bottle market. And like, and I tell them all the things and then they're always like, yeah, yeah, but we still want to be in New York. And I'm like, okay, I tried, you know, but we do eat.

Kate Jerkens (42:34)
And then the button.

It's a terribly difficult market to be in.

Erica Duecy (42:55)
Totally.

Kate Jerkens (42:57)
It's not a strong

retail market, though, but it's a prestige market, right? It's like being in London or somewhere like, I want to be able to go to New York and see my bottle in every hotel lobby bar, right? And so it's really, it's to me for New York, it's for the on-premise and that's not going to make you a lot of money. So it's really tough.

Caitlyn LuBell (43:03)
Yeah.

Yeah.

No. And Erica, we tell them

too, and sometimes they tell us and a lot of times we tell them, we're like, pick a secondary market and just do exactly what you said. Just dig in, blow it up, build your brand. And then you can roll out to other markets and say, hey, look what we've done here. We can do this here too. And you have like your proof of concept, but like trying to get your proof of concept and Cali, good luck.

Kate Jerkens (43:40)
Yeah, it's an impossible market. I California is its own country.

Caitlyn LuBell (43:44)
California is just

an impossible market right now from what we're hearing.

Kate Jerkens (43:48)
And it's also not,

it's also, wouldn't have, I wouldn't suggest anyone launch here. The market is, is negative. And I, and I haven't done enough research digging into it, but I think you think about, I know how many people I know that left Los Angeles and left California during the pandemic and now they're in secondary market. So I do think if we like really all dug into it, they're New York, a lot of people left New York. A lot of people left California. It was expensive. They were like, we want to be placers with like open, you know, with Hills and

Jessie Ott (44:08)
Hmm. Yeah.

Kate Jerkens (44:17)
outdoors and all the things, you know?

Caitlyn LuBell (44:18)
walks more than

six feet.

Jessie Ott (44:20)
Lots of trees! Imagine that!

Kate Jerkens (44:21)
Yeah, all the trees and things. so

I think there's some to contribute a lot of some of that to that. I mean, yeah, the California market is actually the whole coast is struggling.

Caitlyn LuBell (44:33)
I hear that biggest complaint every single company we talk to, their biggest pain point is California. I don't know what's going on over there, but I know that.

Kate Jerkens (44:42)
Yeah, but they're not all doing

the right things because all they're doing is just dropping prices like I've like I already said it and it's just that's just not that's

Jessie Ott (44:50)
It's because they're all moving to Texas.

Julie Milroy (44:50)
Mm-hmm.

Kate Jerkens (44:53)
I agree. Texas and Florida and Tennessee. When I go back to Tennessee, because that's where our distillery is, are like, where are from? Los Angeles. Don't worry, I didn't move here. I still live there because they're so annoyed by all the trans. There's just so many transplants everywhere now.

Jessie Ott (44:55)
Yeah.

Julie Milroy (44:55)
in

Caitlyn LuBell (45:04)
Yeah.

Jessie Ott (45:04)
hahahaha

Erica Duecy (45:04)
you

Caitlyn LuBell (45:09)
We have a great small vodka that's pretty startupian and they want us to hire people for them in Atlanta and DC. And we're like, smart, smart. Yes, that's what, but one of the founders is from one of the large companies. So he's actually from the industry. So he gets it. But we're like, good for you. Good for you for picking.

Kate Jerkens (45:20)
huh.

Actually,

we can sidebar, I'm fairly certain, 99 % sure I know who you're talking about. So we talk to them quite frequently. Yeah, it's great.

Caitlyn LuBell (45:36)
You probably do. Yes. You

Erica Duecy (45:36)
you

Caitlyn LuBell (45:40)
probably do. And it's great because you're doing it the right way. You're doing it right. Yeah.

Kate Jerkens (45:46)
They're very smart about what they're doing.

Jessie Ott (45:48)
And I think that's the difference

Kate Jerkens (45:49)
They all have roots there.

Caitlyn LuBell (45:51)
Yeah, exactly.

Jessie Ott (45:51)
to your point, Caitlyn, it's like, how many people are starting brands that actually have experience in the industry? And because we all know how hard it is. would like, in your research, is there any data points for that, for us to have any kind of understanding? Because it has to be very low percentage of people.

Caitlyn LuBell (46:01)
Don't get me started.

very low.

Erica Duecy (46:13)
Yeah. I mean, haven't

Caitlyn LuBell (46:13)
From my experience, Erica, I would love to hear statistics. Tell me.

Erica Duecy (46:17)
seen any data points on that at all, but just anecdotally, would say that, you know, I mean, get outreach just because of the podcast and some of the advising I do, I get outreach daily from brands and the vast majority of brands looking for advisory, obviously, are brands that, you know, people are not already veterans of the industry. So,

I do see just so many people from a super wide variety of industries really coming on. And I think that probably a lot of it has to do with the success of some of the celebrity brands that really just shone a light on like, hey, this is like, you could make a lot of money in this sector, but when it comes down to it and you really realize how much funding has to go into actually making a product.

you know, hit the market and be able to, sale is just, it's, it's a huge amount of money. And I think, you know, whoever said like $3 to $5 million, think that that is, absolutely accurate at minimum number. and you know, companies again, like that, that whole idea of companies looking for a hundred thousand dollars, like I do see a lot of that. And it's like, this is just not going to be,

Caitlyn LuBell (47:15)
I made a month.

Erica Duecy (47:28)
enough funding to get to escape velocity for this brand to be able to succeed. I mean, it just isn't. There's just so many, there's so many barriers that external, you know, people external to the industry just don't really realize. And even those within the industry, you know, I think there's a lot of wishful thinking that's going into brands and like, because we're insiders, we can do it for less, but that doesn't always translate to the realities of the marketplace.

Jessie Ott (47:54)
Yeah.

Caitlyn LuBell (47:54)
I could

talk about that for hours, but I will say I see some very smart people who don't know the industry, but know how to lean into the right people to help them build it with realistic expectations. But more so on the other side that don't they just, you know, we get the common, well, the person that we hire needs the sales that they generate need to pay for their

Jessie Ott (48:04)
right people.

Caitlyn LuBell (48:22)
salary and we're

No, it doesn't work that way. Not in the first three years of the business. Like, it's just not realistic. You have to invest. You have to spend money to make money in this industry. It's just, I'm sorry. I don't want to bust your bubble, but I also don't want to see you throw money out the window because your expectations aren't realistic.

Kate Jerkens (48:29)
No.

under percent.

Julie Milroy (48:48)
What

I've also seen is, you know, it costs a lot of money to grow, right? And if God forbid your brand takes off, know, big retailers, big chains, they want continuity. They don't want to just buy it and then you'd be out of stock. And what I would notice with some of these brands, you know, is if they don't have the funding and they're like, well, if you get us the placement,

and you buy the product, then we'll be able to get more money. And I'm like, it doesn't work like that. You've got to have the funding in order for us, for the distributor to take a investment in your brand to then pitch it to these big chains. I think it's just, well, when we get that business, we'll be able to raise more money. it just doesn't.

Caitlyn LuBell (49:19)
No, it doesn't work like that.

Julie Milroy (49:43)
work that way. think that, you know, with this startup world being so, you know, with all these other startups outside of the wine and spirits industry being so lucrative and raising all this money for like just the concept of an idea and not even a, you know, and they're getting all this funding. think that wine and spirit suppliers need to step up.

their game in raising money,

right? And Kate, you mentioned that about Fawn like that was her background, right? So I think it's like really important to always, you know, learn how to raise capital and treat your wine and spirit brand like a startup and not just everybody thinks their product is great and it's just going to take off because it's just good.

Kate Jerkens (50:17)
All right.

Caitlyn LuBell (50:28)
Yeah. No, and the

guy we talked to this morning that I mentioned before, like he's super nice and at least he's from hospitality. And we asked him what his budgets were and what he was doing for funding. And he had the right answers and we're like, okay, we're actually excited to work with you because we think your head frame is in the right space. And like, yes, now we want to help your brand be successful and do what we can for you. you have your game plan and it's realistic, which is like so nice to hear. And we told him that.

Julie Milroy (50:41)
Mm-hmm.

Erica Duecy (50:41)
Yeah.

Julie Milroy (50:55)
Mm-hmm.

Kate Jerkens (50:55)
Yeah.

Caitlyn LuBell (50:57)
like a breath of fresh air to hear realistic numbers, realistic, you know, he is going for funding and he's got some good avenues for his funding. And we're like, great, you're smart. You're doing it right. Keep

Erica Duecy (51:00)
Yeah.

Kate Jerkens (51:09)
Yeah.

Caitlyn LuBell (51:11)
going and call us when you're ready.

Erica Duecy (51:13)
Yeah. And I think the funding question is really interesting because, you know, that was one of my best takeaways, I think from the conversation with Fawn was that she raised, you know, over 200 million, but it was all from private investors as opposed to venture capital or private equity where, you know, her point was like, look, if I raised from funds, I, I would have like a three year grace period before they're, they, they now are

Jessie Ott (51:26)
Mm-hmm.

Kate Jerkens (51:38)
Correct.

Julie Milroy (51:39)
Mm-hmm.

Erica Duecy (51:40)
majority owners of this business essentially and before they sort of push me out. And so I think that concept, like I don't think that anyone in the wine or spirits industry has been as successful as Fawn was just to advertise for Uncle Nearest like it needs it. But I think that honestly Fawn was a groundbreaking founder in that way that she

Jessie Ott (51:56)
Heh.

Kate Jerkens (52:04)
Sure.

Erica Duecy (52:04)
did

she found a new way to raise money that no one else has been as successful with. But that template of being able to raise from private investors, while still maintaining more than 51 % of your company, I think that is going to be a new template that we start to see more brands move towards. And that that is actually like the smart way to do it.

Julie Milroy (52:26)
Mm-hmm.

Kate Jerkens (52:27)
Yeah. mean, and the other thing is really these people who are creating brands is just thinking about the story and the authenticity of what you're doing is a big deal because, I mean, Fawn,

Caitlyn LuBell (52:27)
Yeah, I love it.

Kate Jerkens (52:38)
The reason she's so successful is because she's made this her life mission. This is everything. This is what she does. It's all she does. And her ultimate goal is about lifting up the legacy of somebody. And I think that's the piece you have to be able to share and share that dream with people and people really able to look in your eyes and see who you are and what you're going to do. that's just, that's, she is like a unicorn in that regard, truly.

Julie Milroy (53:02)
Mm-hmm.

Jessie Ott (53:03)
Yeah, she's, she's really amazing. I have learned a lot, just, just, just watching all her interviews throughout all the different media. And she really is a special human, honestly, and an amazing, amazing woman, but just a human being the way she is and the way she wants to tell the story and how she saw the picture to building a distillery and being, you know, so successful is really, it's one of a kind. Truly. Yeah.

Kate Jerkens (53:29)
Yep, absolutely.

Jessie Ott (53:31)
Yeah, we all love her.

Kate Jerkens (53:33)
I

was like 25 years old. We used to work together in hotels, which is how we met and she's been, yeah, yeah. But that she's been on, she's been who she is since then. You know, when the rest of us were like, it's six o'clock, we're gonna go drink cocktails and smoke cigarettes and like be naughty after work. Like she was focused.

Jessie Ott (53:36)
No way!

Erica Duecy (53:37)
wow.

Caitlyn LuBell (53:49)
Thank

Erica Duecy (53:52)
you

Kate Jerkens (53:55)
the same. But she was always doing something else. was entrepreneurial always.

Caitlyn LuBell (54:01)
Hmm.

Jessie Ott (54:02)
Yeah. Cause she talked about starting her own, was it a PR firm or marketing company at 19? It's incredible.

Kate Jerkens (54:07)
Yeah. Yeah. Yeah. So while she was like, she

came into hospitality really just to kind of learn it. Like, you know, the rest of us, that's all we did. But she was, mean, I feel like I remember she was taking classes or she was, you know, also writing her book and like, you know, she always had other things going, you know.

Jessie Ott (54:27)
Yeah. Super