Craft Spirits Exchange

A new venture that blends commerce and content

Join. Taste. Share. Explore. That’s the motto of an online startup looking to help craft startups.

CSX Promo (Large Banner)

If you find yourself, as I do, leaning more and more toward high quality craft and small batch spirits products, availability and purchase are often a problem. All levels of the business – craft producers, retailers and consumers – face hurdles.

The craft producer has limited budgets, a cluttered marketplace and is generally ignored by the mainstream distributors. Consequently, it is difficult for these producers to build awareness and to gain significant national distribution.

Retailers have low margins, need to depend on large brand deals and face limited shelf space for new craft products. In fact, the first question from a retailer when you walk in to pitch a new craft brand is very likely to be, “Which of the products that are selling do you want me to take off the shelf for your new start up brand?”

For consumers, lack of availability is a problem. If you live in a large metro area you may find a nearby store that might carry what you’re looking for and maybe they’ll deliver it. But, what about in the suburbs or smaller cities?

You can use companies like Drizzly, Thirstie, Flaviar, DrinkupNY, Binny’s and Caskers but for the most part you need to know what you want and you don’t always have the opportunity to get a range of reviews and/or ratings.

The Craft Spirits Exchange (CSX) approach

CSX describes itself as “the first and only online community and marketplace exclusively focused on artisanal craft spirits

 

from around the world.” They provide consumers with discovery of craft products, detailed information and access to hard to find or unavailable products.CSX_logorelease-02

They see themselves as a platform that, well, is like TripAdvisor and Amazon rolled into one. The CSX community provides loads of information about brands, events, recipes, and interactive tasting notes and reviews. There are more than 1,100 spirits profiled on their site.

At the same time, CSX works with spirits retailers nationally to provide a single online resource for a wide range of quality spirits. You name the brand and chances are they can provide it.

As to producers, CSX does not, at this stage in their development, charge a fee for being listed. Instead, they have a brand partnership program that provides links to websites, social media, product offerings and more. In the program so far are distillers such as Tuthilltown Spirits, New York Distilling, Mezan Rum and Finger Lakes Distilling.

The people

This new venture officially launched on October 1st and is founded by Luis Troccoli, a man passionate about being an entrepreneur and a craft spirit advocate. I asked him what makes CSX different from other sites. “We’re both about content and exchange of information as well as an ecommerce site. I don’t know any who do both.”

The CSX team -- Kelly Magyarics, Luis Troccoli, Steve Gilberg
The CSX team — Kelly Magyarics, Luis Troccoli, Steve Gilberg

He also seems to appreciate that craft spirits are more than just about the process. “More than just batch size, type of still or yearly production, these spirits have a unique story or heritage, often produced through artful or otherwise creative methods.”

The Chief Marketing Officer is Steve Gilberg, a real pro in digital marketing and communications with a string of successful ventures under his belt. Rounding out the team is Kelly Magyarics, an experienced published wine and spirits writer and educator. Kelly’s postings are fun to read.

Startup Woes

Unlike many new ventures, they have the product and marketing under control. In fact, here’s an interesting article from New York Business Journal about their launch event, which was top-notch. And, their website has a great look and feel and is easy to navigate.

Like many new ventures, funding is an issue but CSX is handling it better than most. For one thing they raised a quarter of a million dollars pre-launch and have increased their seed round to $750,000.

Here’s a link to their current fundraising effort. Their demo video is here.

Worth looking into, folks.

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Sorel Liqueur Moves Up a Notch

Sorel Artisanal Liqueur has a new partner

The Buffalo Trace Newsletter (Industry News Update) and Wine and Spirits Daily have announced that the Mahalo SpiritsScreen Shot 2015-03-31 at 2.03.09 PM Group and Sorel Liqueur have joined forces. Here’s the story behind the story.

Mahalo cofounded Angel’s Envy (recently acquired by Bacardi) and also Papa’s Pilar Rum.

Sorel Liqueur is owned by Jack From Brooklyn Inc whose CEO is Jackie Summers. If you have been a reader of this blog then you’ve met Jackie, starting in 2012 with this post. In fact, I’ve written about him and Sorel at least four times since then.

From the first time I met him, I knew that he and his unique product were here for the duration; that he was destined to move forward and beat the startup odds.

Briefly put, Jackie and Sorel have, what I like to think of as, the 4P’s of growth.

Product

Sorel is a modern twist on an exotic classic. An artisanal hibiscus liqueur, handcrafted in Brooklyn, Sorel is based on a traditional Caribbean recipe. Its ingredients read like a World Almanac – Brazilian clove, Nigerian ginger, Indonesian cassia, Moroccan hibiscus, Indonesian nutmeg, blended with organic New York neutral grain alcohol. Its unique taste, aroma and distinctive flavor have caught the attention of consumers and mixologists alike.

What I especially like is it’s a terrific product over ice, neat or with a mixer. But, it’s also an awesome addition to other products like whiskey, rum, vodka, and sparkling wine. That’s why mixologists and consumers love it. In some respects it reminds me of St. Germain, but more universal in its use.

So, check the box marked, “it’s what’s in the bottle that counts.”

Perseverance

Screen Shot 2015-03-31 at 2.01.33 PM
Jackie Summers

And… persistence and patience. Three years ago, all Jackie had was an idea and a dream. Four years ago, he had a life-altering event (golf ball sized tumor on his spine) and was given a 5% chance of survival. He survived and decided to change his life “by doing something serious.” Jackie founded the company and Sorel was launched.

As if startup growing pains and headaches weren’t enough, along came Hurricane Sandy. Together with most of the Red Hook section of Brooklyn and other fledgling distilleries, Jackie’s facility was literally under water. Five feet of seawater, to be exact.

Jackie didn’t give up. Just worked harder. When I blogged about him and Sandy (Oct 31, 2012), I said that he reminded me of one of my favorite expressions: What doesn’t defeat me makes me stronger.

People

Here is this newcomer to the booze business and right off the bat he does a few things – simple things – that most startup entrepreneurs don’t do. He listens and learns and surrounds himself with people who can offer advice.

In the three years I’ve known Jackie we have had dozens if not scores of conversations about the business. Truth be told, I’ve learned as much from him as he did from me.

And, by way of full disclosure, I am now on his board. Also on the board are Stephen Lewin of Lewin Brand Group and Diana Sonis, a successful entrepreneur and startup founder. Rounding out the team is Summer Lee, VP Sales at Jack From Brooklyn and among the smartest salespeople I know.

So add people skills to the mix.

Partnership

As I’ve written many times, the booze business is about people and relationships. All it took for the Mahalo people was to listen to Jackie talk about Sorel and share his vision for the future. They haven’t really worked on other people’s brands so Screen Shot 2015-03-31 at 2.00.43 PMSorel is a departure for them.

They get to partner with a brand that’s poised for future growth and Sorel gets a world-class sales and distribution network run by Bill McGough, an accomplished industry marketing and sales executive with an incredible track record.

This is a ‘marriage’ made in heaven.

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Koval Distillery: Black Sheep of Booze

Chicago’s first distillery since the mid-1800s

 

KOVAL-5

The word Koval means “blacksmith” in many Eastern European languages. In Yiddish, the word also refers to a “black sheep” or someone “who forges ahead”…or, someone who does things that are out of the ordinary.

I can’t think of a better description of the company founded in 2008 by the husband and wife team of Robert and Sonat Birnecker. Both came to Chicago from Washington DC and gave up successful careers to start a family owned business that paid homage to their grandfathers. One was considered a black sheep of his family for leaving Austria to become a Chicago businessman and the other was a distiller whose last name was Schmidt which is German for Smith, as in blacksmith.

That grandfather, by the way, was the person who taught Robert the art of distillation.

Kothe Still
Kothe Still

Koval Distillery is more than just a craft distiller. Much more.

What makes them special?

Let’s start with Robert Birnecker’s background. He’s a 4th generation distiller whose family still runs a distillery and winery in Austria. So, you can safely say that he combines traditional techniques with contemporary equipment.

This is a true craft distillery making grain to bottle products. The grain is certified organic and sourced from the Midwest Organic Farmers Cooperative. The water is from Lake Michigan using a natural charcoal purification method. All the enzymes and yeast are also organic. To top it off, all their products are certified Kosher by the oldest and most trusted certification body.

But wait, there’s more.

Unlike some distillers who purchase or bottle premade spirits, Koval makes its organic spirits from scratch and using only the “heart” cut of the distillate for a cleaner whiskey taste. All of the whiskies are single barrel and aged in 30 gallon charred barrels. In fact, each of the bottles identifies the barrel number from which it came. They control every step of the production process.

The Products

Koval Whiskey products
Koval Whiskey products

So far I’ve tasted three of their whiskies – Bourbon, Four Grain and Rye. Sensational. The mashbill of the Four Grain is oat, malted barley, rye and wheat and it’s smooth as silk. The Bourbon is aged under four years and tasted smoother than products I’ve had that are twice as old. Most of all, I loved the Rye whiskey.

When I interviewed Sonat Birnecker, I told her how much I liked the rye and how different it tasted from most ryes I’ve had. She called my attention to the back label, which indicated that the product contained 100% rye. Many ryes on the market are 51% (which is the minimum amount necessary to be called rye whiskey) plus other ingredients (usually corn or malted barley).

In fact, what you see and read on their ‘transparent’ label is what you get. No coloring, no added ingredients, no neutral grain spirits, no nothing but what you are paying for.

By the way, their Rye Whiskey was awarded 1st place at “Best International Whisky” at Europe’s 2013 InterWhisky Competition. Who said I didn’t have good taste?

The Master Distiller

I have not as yet met Robert Birnecker but from what I’ve heard or read, he is a distiller’s distiller.

I found this about him on the Chicago Sun Times website:

The Birneckers are the stateside and English-speaking representatives of Kothe, the German still-maker responsible for the copper behemoth eating up their warehouse space. With that job, the couple’s workshops and their craft-distilling consulting business, Sonat estimates that the pair have advised one-third of the craft distillers that have opened in the U.S. and Canada in the past five years.

Yes, that’s right, in addition to running Koval, Robert and Sonat consult and teach distillation. Robert is also a key lecturer at the Siebel Institute in Chicago. Among the distilleries he has helped set up stills are Journeyman Distillery in Michigan and Few Spirits in Illinois (see my earlier blog post on Few). These are top of the game craft distillers, I might add.

Other products

KOVAL_2014-Millet Web
Millet Whiskey

In addition to the three whiskies I mentioned earlier, Koval also makes Oat and White Rye products. Interestingly, they

Koval Gin
Koval Gin

produce a whiskey I’ve never heard of before – Millet Whiskey, described on their website as, Millet is a prized grain in Asia and Africa and popular base for spirits in Nepal, though this is the first whiskey to be made out of millet.”  Definitely on my ‘must try’ list.

There is also Koval Dry Gin, which my friends in Chicago think is the best on the planet. Here’s how Koval describes it…  Made with a unique variety of woodland spices… Juniper and wildflowers envelop the nose, while the taste is dry, yet vibrant – clean and nuanced by emerald grasses, golden citrus, and white pepper with a round, floral body.

Finally, there is a line of seven liqueurs ranging from the expected (coffee, ginger) to the exotic (orange blossom, rose hip, chrysanthemum and honey, caraway, jasmine).

Marketing

At the risk of offending my craft distiller friends and readers – most craft distillers are outstanding at production but very few seem to realize that there is a consumer at the other end of the bottle. Koval gets it.

Their labeling, or should I say award winning package design, speaks to the product and it’s craft/artisanal composition. As I mentioned, the label tells you which barrel it came from and what it’s distilled from.

The website is top notch, easy to navigate and easily lets you know where you can buy it locally or online.

They understand consumers and how to break out of the clutter with excellent PR and very highly praised distillery tours. They even have a barrel program in which you select the barrels and it’s customized to a store, bar, restaurant or even an individual. (Unfortunately, you have to buy the 25 to 30 cases that comprise the barrel. I’m saving up for it. Maybe a Kickstarter campaign?)

They are also available internationally in Europe and Japan.

*           *           *

Koval Distillery is a company in the finest tradition of the spirits industry. A company where they care about what they produce and how they produce it… where tradition and heritage are embraced and built upon… where state-of-the-art is not marketing hype. Above all, this is a company that’s here for the long run and building for the future.

There aren’t many like them these days.

Koval Liqueurs
Koval Liqueurs
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