Kim Brandi: The Rocky Road of an Innovator

A woman’s journey to succeed in the booze business

This is the story of an amazing and gifted woman who followed her dream to develop her own brand and start her own company. The ups and downs she confronted are important lessons about business in general, and the booze business in particular. It’s also a story about violated trust, duplicity, and outright thievery. Most people, faced with the difficulties Kim Brandi has endured, would close down and move on.

Not Kim Brandi. Her tenacity and resilience, coupled with a can-do attitude, sustains her continued innovation journey. Folks, she is among the most creative and outside-the-box thinker I’ve meet in very long time. If I were still at Seagram, I’d hire her in a heartbeat. But, she would turn me down in favor of the American Dream to own her own business.

There is a lot to this story so this will be one of a number of articles on Kim.

How I met Kim Brandi

A mutual friend, Ted McDonnell, introduced us under some interesting circumstances. Ted, owner of the Liberty Lighthouse Group, a sales and marketing agency, called and asked if I could assist Kim in a pending lawsuit by helping to ‘value’ her brand. Ted is a great guy and I was only too happy to follow up.

The brand? KAH tequila.

The circumstances? Well, that’s a long and complicated story.

KAH Tequila

In her own words:

Inspired by the spiritual meaning of Dia de los Muertos and the calaveras—the ornate decorated sugar skulls used in the rituals of Mexico’s Day of the Dead celebrations—I began to research and develop my own tequila brand. I came up with the new concept of marketing a quality tequila that would be sold in unique hand-painted, calavera skull–shaped bottles.

She named the brand KAH which translates to “life” in Mayan. In 2009, Kim formed Elements Spirits to import and market the brand. The manufacturer she found produced a very premium tequila and the relationship between Kim and the owners was warm and friendly. Or so she thought.

By 2010, consumer demand exceeded Kim’s expectations and she put expansion plans in place. No sooner did she do that when the folks from Crystal Head vodka sued her claiming that the KAH Tequila bottle, with its hand-painted calaveras skull, was somehow confusingly similar to the clear glass bottles used by the company Dan Aykroyd owns to sell Crystal Head vodka. Seriously? I don’t understand how a consumer would be confused by the two packages.

(Just to fast-forward for a moment… the Crystal Head lawsuit was first dismissed in 2010 by the United States District Court based upon the Judge’s determination that there was no likelihood of confusion; Crystal Head appealed and insisted it should be allowed to present its case to a jury; an appeals court agreed and sent the case back for trial; in 2013, a unanimous jury also found there was no likelihood of confusion ; an appeals court reversed the jury verdict on a technicality, and now the case is again set for another jury trial in March of this year.  In short: the lawyers are making a bundle.)

But that was only part of the problem. Kim partnered with the owners of the distillery in Mexico that produced the tequila for the KAH brand, who turned out to be less than trustworthy. Based on what I know about evil human inclinations—I believe they looked at her being “a woman of color” as an easy target. They were wrong; Kim is as tough as can be.

How KAH was lost

This is the long, somewhat difficult and potentially litigious narrative, so I’ll tread softly and succinctly.

  • The owner of the Mexican contract bottler brought an investor to the table. Elements Spirits (Owned by Kim) entered into a Stock Purchase Agreement with WXYZ
  • Before she knew it, WXYZ assumed a majority interest in Elements and took control.
  • A series of unpleasant events and attacks on Kim’s role in the business followed. Lawsuit after lawsuit ensued and the cost to Kim to defend them rose and rose.
  • The worst part was that the new owners began attempting to remove Kim from the KAH history and claimed others had created the brand.
  • To protect herself, she filed copyright registration in 2011 for all parts of the KAH brand and package and all applications were approved.
  • In the fall of 2013, Brandi and Elements (now controlled by WXYZ) attended a court-ordered mediation in the Crystal Head litigation in order to work out a resolution of various disputes. They needed peace, so they could fight the Crystal Head suit.
  • The binding agreement called for acknowledgement that Kim was a shareholder of WXYZ (they had previously cut her out) and also acknowledged her ownership and copyright rights.
  • The agreement was ultimately breached and WXYZ and the Mexican co-packer began a series of actions to infringe on the copyright owned by Kim. Assorted other deceptions and outright illegalities followed. A vicious fight in the U.S. and in Mexico ensued. In the end, the U.S. court acknowledged, Kim’s rights to the intellectual property ownership of the calavera shaped bottle. She won the battle but not the war.
  • Meanwhile, WXYZ continued to sell KAH with no royalties or proceeds going to Kim. She was forced, therefore, to file suit to block the KAH importation and to notify U.S. distributors to cease selling the brand.

In sum, for six years, Kim Brandi was embroiled in a fight for her intellectual property rights. Finally looking forward to ending the pillaging of her life’s work and livelihood, a trial was scheduled for December 8, 2016.

Seeing the handwriting on the wall, WXYZ and the Mexican co-packer sold KAH Tequila to the Amber Beverage Group (a division of the Stoli Group) for an undisclosed amount.

That’s Where I Come in

Kim and her attorney, Jon Miller (Miller Johnson Law), asked me to appear as an expert consultant to assist at a mediation session. My role was to address the value of the KAH brand and help explain what the spirits industry was all about—in terms of operations, finance, sales, and other matters.

The valuation of KAH was difficult, since Kim Brandi was kept in the dark. The records and information about sales were not easy to come by. A friend provided some public data and Kim’s ingenuity located some import sales data, so we knew the number of cases sold.

On November 2, 2016, Amber Beverage – the new owners of Fabrica de Tequila Finos, S.A. de C.V. (producers of tequila for the KAH brand) and Kim Brandi settled their disputes over the ownership, sale and distribution of tequila using the unique calavera bottle design. The intellectual property related to KAH (calavera-shaped bottle, trademark, various artwork) was transferred for consideration and is now under the control of Amber Beverage.

I can’t go into the details, but suffice to say that—for better or worse—the matter was settled.

Lessons learned

  1. Be careful with whom you do business. That smiling friendly face across the table can easily become evil when money is around. Of course, you never really know at the outset, so protect yourself with all the paperwork you can (or that makes sense) right at the beginning.
  2. Surround yourself with knowledgeable, experienced booze business people and take their advice.
  3. With all due respect to my lawyer friends, don’t assume the courts and the legal process will come to your aid. Even when you win, if the other side has deeper pockets, the system allows them to keep going at your expense. (Although if you end up in court, try to find someone like Jon Miller to represent your interests.)

What is Kim doing now?

Tenacity is a word that gets bandied about a lot. It’s defined as the quality or fact of being very determined. In Kim’s case, I’d have to say that she is beyond tenacious. She gets going and is fueled by her creativity, passion, and desire for innovation. When she lost KAH, she created a new vision for the Sangre de Vida (Blood of Life) brand, to be released this Spring, which I’m sure will be no less than amazing. I’ll show it to you when it’s released.

Her other tequila is called Apocalypto Tequila, an award-winning product, it is handcrafted in packaging made from artisanal glass.

The most interesting product, Deadhead Rum, is produced by a special slow process and aging that makes the product unique in taste and complexity. There is also a Deadhead Dark Chocolate rum, coming this spring. I have not tried it as yet but the back story is incredible and from what Kim has told me, the taste is extraordinary. And, so is the package.

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The Booze Business needs people like Kim Brandi. If you haven’t figured out why as yet, stay tuned, I’ll be telling more of her story in the future.

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On the Road to Success

Checking in with Bom Bom Brands

A little over a year ago I wrote about the launch of this interesting new product and Kevin Mowers, the person behind it. You can find the story here.

I caught up with Kevin recently and asked him how it was going and what his experiences were as a startup brand.

What I did not mention in the original story is that the Bom Bom team consists of Kevin and his wife Eva Maria. Both bring different skills to the brand and, it turns out, that she played a crucial role in the brand’s development, as you will see. So, this interview was with both of them.

Kevin and Eva Maria

 

BB: How is it going? What were the highlights of 2016?

Kevin: Great – keeping busy!  We launched mid-year in CT and then branched out into MA, DC and NY (Westchester County and Long Island). Our distributors did a great job getting BOM BOM into retailers while we were focused on getting BOM BOM into consumer’s hands. We did this through a lot of in-store and in-bar sampling promotions as well as showing the product at larger tasting and charity events. One of the most important things for us was to make sure we keep having fun and celebrating every victory and every milestone, however small.

BB: What are the biggest obstacles or challenges you face? What have you done about them?

Eva Maria: The biggest challenge for us, like for any new brand, has been awareness. Since we are not national, the typical PR and marketing playbooks were not relevant for us, as we needed a more market-by-market, grassroots approach. We have pushed ourselves to really think outside the box, leave our corporate models behind, and leverage local PR, especially bartender contests, magazine profiles and social media. There is still much, much more to do. As we grow into more markets, we’ll be able to expand our PR outreach accordingly and that’s a top priority for 2017.

BB: Many new product entrepreneurs have told me that the single most important element in developing their brands has been in-store tastings, as you’ve just mentioned. I’m not surprised that this would be particularly true for Bom Bom.

Kevin: Indeed. We love doing in-store tastings as it allows us to engage with consumers. For us it has been just as much about getting feedback (and new drink recipes!) from consumers as sharing the BOM BOM story. BOM BOM Coco Mochanut recently received 94 points by the International Review of Spirits, which means it is the highest in its category. As such, we love seeing the excited look on people’s faces after they’ve tried it, especially when they themselves start selling it to complete strangers in the stores for us!

BB: I’ve known you for a few years and watched the development and launch. But I never wrote about how Bom Bom came about in the first place. What’s the brand’s back-story?

Eva Maria: Like a lot of today’s modern romances we were introduced by a common friend — Tracy — Who to this day takes credit for our awesome relationship and by association, BOM BOM.

Kevin had spent the better part of his career designing great tasting products for the industry’s top players and so of course tried to impress me with his extensive knowledge of luxury spirits. But it wasn’t really doing it for me as I was never really into alcohol…. this was both a disappointment and a challenge to Kevin… and good thing for me (and our BOM BOM fans) that Kevin happens to love a good challenge.

After a few dates, Kevin changed his game and mixed up something special just for me, made with my favorite flavors — coffee, coconut and of course CHOCOLATE! And BOM BOM was born!

I loved it so much that I started asking him to make it for friends and with time it was a standing order from friends and friends of friends…. We were making it all of the time and decided to go for it and formed the company “BOM BOM Brands” to share our fun with the world!

BOM BOM is all about the right mix of flavors, having fun and being authentic.  Our business partnership really is the same idea…. we have very different skill sets and so together we’re able to accomplish what neither of us would be able to do on our own.

And, to make the deal even sweeter, Kevin’s wooing is still going strong after three wonderful years of marriage….

BB: What does the future hold for the brand – line extensions, geographic expansion, etc. What do you think will be coming down the road? 

Kevin: BOM BOM is all about having fun and being authentic. As all small companies, we are excited to bring this fun to additional markets but also cautious not to dilute our efforts and grow too fast. From a new product perspective, we have a few new innovations in the mix. As with Coco Mochanut, all of our new products will be great tasting and in fun, fashion-forward packaging.

Kevin making cocktails at an event/tasting
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Over a Barrel

How home barreling of spirits changes everything

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It all started earlier this summer when I read a blog posting from my friend, Al Milukas. Al publishes a blog called Live the Live and I follow it avidly. It’s a great source of information on all matters of food and drink. This story, in particular, called Aging Spirits in Oak Barrels at Home, caught my eye and interest.

The next thing I know, I am the proud owner of a one-litre barrel from Red Head Oak Barrels and spent the next few months experimenting and aging liquor. But first, let’s talk a bit about barreling and aging spirits.

Wood, Time and Magic

Among the websites I visited about the effects of barrel aging included this with an article on the Science of Barrel Aging. As they simply put it, “Aging softens the ‘burn’ of the ethanol while smoothing out flavours and adding even more pleasant ones. The question is: what exactly is happening inside that barrel?”

They go on to talk about the effects of time, air, temperature, the role of different types of barrels (especially oak), barrel char, and humidity.

To be totally candid, I know very little about the science of barreling. Hey, I barely got through high school chemistry, so if you want to know more, I suggest you either look it up or talk to someone who knows. All I care about is the impact on my favorite libations.

Meet Red Head Oak Barrels

red-head-logo-sign

Following the advice of my friend Al Milukas, I ordered a 1-litre barrel from Red Head Oak Barrels and went to work.

The company is owned by Steve Mayes who was born in Baton Rouge, LA and now lives and works in the Dallas area. After playing around with the barrel and doing some experimenting (more about that in a moment), I gave Steve a call to learn more about him and his company. He started the company in 2013, is a Navy veteran, has a background in Internet marketing, and knows a good idea when he sees one. He’s also a very nice guy and could teach most major companies about customer service.

Here’s an example. In addition to my nonscientific knowledge, I’m also world renowned in my lack of mechanical and manual dexterity skills. (Just ask my wife who often calls the building’s handymen to change a light bulb.) Anyhow, I had some difficulty  assembling the barrel (putting in the spigot) and contacted Read Head Oak Barrels for some help. The problem was solved immediately. I was struck by how they handled and resolved my minor issue.

When I talked to Steve we spoke about his customer service philosophy and he told me they believe in “lagniappe,” an expression in Louisiana that means “a little extra.” It’s his way of saying that they specialize in over delivering and delighting their customers. There are many companies out there selling barrels, and in fact, some are resellers using Red Head’s barrels. But, I doubt if any have Steve Mayes’ attitude and business practice.

I had the barrel I bought engraved with the Booze Business logo (of course). It arrived shortly after I ordered it with very detailed instructions and appropriate paraphernalia.

The idea behind home barrel aging is pretty clear. Distilleries usually use large 53-gallon oak barrels to age their products because they need the large volume to satisfy their customers. But for home use, you need much smaller sizes. In fact, home barrels come in 1, 2, 3, 5, 10 or 20 liters and age the product inside much faster. That’s because of the ratio of wood to liquid is greater in a smaller barrel so it takes less time. That also means the taste and flavor is enhanced more quickly.

2-liter KY Bourbon kit
2-liter KY Bourbon kit

And now, the results of my experiments

I started simply and poured some mid-price rye whiskey into the barrel, waited two weeks and it was the smoothest, most flavorable rye I’ve had in a long time. Hmm, what would happen if I used an inexpensive rye? So, Old Overholt Straight Rye Whiskey went in next for about ten days and I could have made a fortune betting my friends what they were tasting was 10-year-old rye.

Gin followed and I ended up with batch after batch of outstanding barrel aged gin whose taste, color and smoothness was unbelievable. In effect, I had a barrel with complex flavors of rye, gin, and even rum.

But the coup de grace was a gin cocktail – my new favorite – the Negroni.

Last year my wife and I spent a long weekend in Santa Barbara and had dinner at the Stonehouse restaurant at the San Ysidro Ranch. We ordered Negronis before dinner and were asked if we would like a barrel-aged version. It was unbelievable.

That idea became my favorite experiment. I mixed a liter’s worth of Negroni (with Koval gin, a decent vermouth and Campari, of course), aged it for a little more than a week, removed it from the barrel into a bottle (to stop the aging) and it was great. I’ve since played with the recipe, brand of vermouth, and time in the barrel. It gets better and better.

My do-it-yourself barreled gin
My do-it-yourself barreled gin

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I could end this post with any number of clichés about barrels. But I won’t. After all, I covered the subject lock, stock and barrel.

Please stop groaning.

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