Step One To Winning A Gold Rush? Do This, Straightaway.

0:10Hey folks, I'm Ray Lateef and you're listening to the number one podcast for the food and beverage industry, Taste Radio. This episode features an interview with Cy Kane, the co-founder and CEO of Straightaway Cocktails, an award-winning brand of super premium bottled and canned cocktails. Trendy food and beverage categories often elicit a gold rush. The nascent market for ready-to-drink cocktails, in which new entrants are launched seemingly every day, is the latest one. But as we've seen in other segments such as cold-pressed juice, keto snacks, hard seltzer, and plant-based meat, many entrepreneurs seeking to capitalize on a hot business opportunity typically fall short and often lose their shirts.

0:58The ones that found success and sustainable consumer demand were linked by a common thread, an encompassing emphasis on quality. While Cy Kane, the co-founder and CEO of Portland, Oregon-based Straightaway Cocktails, praises growing interest and demand for bottled and canned cocktails, he believes that, quote, there will always be a flight to quality. Indeed, the brand's prioritization of premium continues to pay off. Launched in 2018, Straightaway produces a range of RTD cocktails made with thoughtfully sourced ingredients and crafted to replicate bar-quality libations. The company also markets a company, Straightaway's sister brand of liqueurs, Amari, and vermouth.

1:43The award-winning products are available in 48 states through its e-commerce platform, Whole Foods markets, and select locations of regional chains, new seasons, and market of choice. In the following interview, I spoke with Sai about how years of preparation prior to launching Straightaway gave the brand a strong foundation on which to build, while equal parts of passion and opportunity are driving the business forward, and how he assesses a broader opportunity to reach consumers in other beverage alcohol categories.

2:19Hey folks, it's Ray with Taste Radio. Right now I'm honored to be sitting down with Cy Kane, who is the co-founder and CEO of Straightaway Cocktails. Cy, great to see you. Hi Ray, how are you doing? I'm doing very well. I wish I were there with you in person in Portland, such an amazing city. I've only been there once, but I feel like when people say, you know, I left my heart in San Francisco, I feel like I left my heart in Portland. It's such a great city. The food, the cocktail, the wine, beer scene, it's just really amazing. And I just felt welcomed when I visited there. That's awesome to hear.

2:53Yeah, we would gladly have you back in a heartbeat. The city's open for business, and people care a ton about food and beverage here, and they care a ton about getting it right. and we love hosting and we would count the days until your return. Thank you very much. I appreciate that. The company's based right in Portland, yes? Yeah, I'm sitting right here on the corner of 9th and Hawthorne in the central industrial east side of Portland, just nine blocks from the river to drive across from downtown. Nice, nice. Do you get many visitors coming? We do. Yeah, absolutely. In the summer, you know, tourism is a big thing here in Portland and we'll have folks coming in and checking out the city for a lot of the reasons that you just mentioned.

3:31They're on a food pilgrimage or a beverage pilgrimage or just want to see the sights when the weather's great out here. And so we'll get a bunch of visitors for sure. And we're kind of sitting in this really cool little part of Portland where there's so many upstart makers. Like we're within 10 blocks of salt and straw, of Smith Tea, of Jacobson salts. Stumptown Coffee is a half block down the road is where we get all of our cold brew as soon as they make it. They're just a half block down the road. And so we just have this incredible maker scene just right happening right around here. It's a really fun part of town.

4:07It's a dynamic city in that it feels like all the early stage trends, or at least a lot of the early stage trends, are originating in Portland with an emphasis on premium. Premium seems to be the through line. Yeah, Portland isn't really a town that's, we don't, you have to kind of come strong in the food and beverage scene. And if you're not coming with transparency and authenticity and honoring the craft of what you're after, it doesn't really work well here. We have a pretty good sniffer for stuff that is inauthentic. It's a really interesting town in that everybody's leveling each other up, but it's not competitive.

4:43There's a real collaborative spirit here. Distillers, we have a couple of distillers just down the block, and we're always trading ideas and trade secrets and trying to make each other better. So it's this really interesting thing where the bar is set super high in food and beverage here, but it's not competitive. We're not tearing each other down. There's a lot of lifting each other up here, which is just it feels kind of uniquely special here. And for folks in the Boston area, I believe you can fly nonstop from Boston to Portland via Alaska Airlines. And I mentioned Alaska specifically, and I hope this doesn't come across as sort of like an ad kind of thing.

5:17But on that flight, you can drink an Oregon old-fashioned cocktail, which comes in the, is it a hundred milliliter steel can? Yeah, a little hundred milliliter tin can right here. No question. And I know I'm going to offend some people, but no question the best cocktail that you can get on any domestic flights in the United States is fantastic. I actually got one on my flight from Boston to San Diego a couple of weeks ago and I was just like, oh man, I needed this. Thank you, Ray. That is amazing to hear. yeah we are so honored to be a part of that program like it just obviously made our whole year to get the yes from alaska and partner with them and to have cocktails two cocktails be sitting there on a flight or margarita and our old-fashioned that you don't have to be a mixologist at 30 000 feet trying to figure out how to get things from a little bottle into a cup and stir it all in it's just it's been so fun to be a part of that program and and to be there for cross-country flights for someone needs a proper old-fashioned i don't know if i should admit this, but maybe I'll admit this.

6:17I, and maybe we'll cut this, who knows, but I did get a, I did get two cans and they didn't open them. I think they're supposed to open them. And the second one I got, I didn't want to open. I didn't want a second cocktail. So I stashed it and I brought it back to my hotel. I hope I don't get anyone from Alaska in trouble for doing that. So anyway, I doubt you will. No, I think that's the beauty of what the era that we're in is like, you can have a cocktail that's portable and you can have it when you're ready for it versus like we all love being at a bar. It's my favorite place in the world to be is in a great stool right in the, you know, in the hands of a great master mixologist.

6:53But man, having a cocktail ready when you're ready for it, that's of that same ilk and craft and quality is, it's kind of a fun game changer. They can just open that whole patch when you're ready for it. It certainly is. And I think this is sort of an interesting segue because you in your professional career started out in coffee and with the brand and a company that everyone knows, Starbucks. And I think it took a while before Starbucks got into RTD, gotten ready to drink beverages. I'm sure people wanted that Starbucks experience and that quality in a bottle at some point, but it took some time to get there in the same way that I think it took some time for premium cocktails to end up in a bottle and more specifically for straightaway to end up in bottles and cans.

7:36Talk about your early experience in coffee and how it sort of built up into, or how it got into or evolved into cocktails. Yeah. Yeah. I did a startup out of college for three years and great experience. And we didn't make it, which was super formative for me. It was a school of hard knocks. I had to get a real job and there was this upcoming coffee company. I wasn't even a coffee drinker at the time, but there was this up and coming coffee company that people were talking about. And one had just started opening in my college town. And it was Starbucks and it was the mid 90s. And jumping aboard, I was there for 11 years.

8:10That was an amazing experience to be a part of that brand and that company and help build what got built over that period of time. I was there for 11 years and started off in stores, store manager. And throughout my entire career there, everything we did revolved around coffee. and then obviously later tea as well, but we would start every meeting with a coffee cup. And we would sit down and sip through the differences between an Ethiopian harar and an Ethiopian sadamo and tease apart the differences of terroir and altitude and elevation and humidity and all the different things that were playing a factor and a role in how that coffee cups and tasted and the nuance of it.

8:58And I think, you know, after 11 years of that, and then later, we were so lucky to have Steve Smith here, founding Tazo after he'd founded Stash. And we had the ability to go down and spend time in Tazo as well. And I made a point of taking my teams as frequently as I could down to hang out with Steve and Tony Tellen, and the amazing, talented folks they had there, and just doing tea cuppings and teasing out all the nuance and differences that came from tea. And so it was just incredibly formative for so many different reasons. But, you know, it's one of those things when you look back in your rearview mirror and realize, oh, I was doing all those coffee and tea coffins for cocktails.

9:36And that wasn't what I was thinking at the time, for sure. But it really helped inform, for me, my cocktail and spirit, how it came from that side of the fence. Well, the last time we chatted, you talked about a book that gave you a lot of inspiration. and it seems like it's a pretty popular book within the mixology community. What was that book and how did it inspire you? We were getting so down the rabbit hole as at-home mixologist, my co-founder Casey Richwine and I, that his wife, Alison, bought this book for him 11 years ago and it transformed our lives. It was authored by Charles Baker. He was kind of the OG Anthony Bourdain.

10:16He was a writer for The New Yorker and some other publications in Manhattan in the 20s. bon vivant, covered food and wine, amazing pros and super passionate about what he was covering. Prohibition hits and he's like, what the heck with this? I need a drink. I'm out of here. And he starts floating the world for the next 13 years. And he catalogs his favorite food recipes that chefs would share with him. He catalogs his favorite cocktail recipes that bartenders would share with them. And honestly, that's what I had been doing in case he had been doing. And my work took me all across the country eventually.

10:48And I was asking bartenders about what decisions they were making with this vermouth and this gin and why. And Casey was doing the same thing. And so Casey was reading through A Gentleman's Companion Volume 2, and he comes across this moment where Charles Baker had spent a month in the Hotel Manila in 1932. And there's this recipe for this cocktail called Lintick that Charles Baker had never seen before. He orders it. it's technically a classic punch. It's gin aged over lemon peel, lemon zest, bitters, simple syrups. And Charles Baker orders it and he writes in his tasting notes, dishonorable but electrifying.

11:27For his tasting notes, we thought that was the best thing ever. And we're like, oh, that drink, we need to try it. And so 11 years ago, we batched the cocktails that we painstakingly been making one at a time. If it was Martinez or Hanky Panky, I remember the main, you know, we were making that for guests, but we're getting up and making those drinks one at a time. It takes a lot of time to do that, and you're not spending as much time with your guests. And so batching that Lintick for the first time 11 years ago really, for me, was the double light bulb moment of, whoa, Lintick's incredible, people should know about it.

11:57But B, why have we not been batching these before? Wine's batched, beer's batched, cocktails should be batched. And that's how we got going. That book put us on a whole different path in life. Did you ever consider working for a bar or restaurant to sort of learn the business of cocktailing? Because at the time, it didn't seem like there were a lot of ready to drink or bottle cocktail options out there. The ones that were, were on the bottom shelf of some, you know, dusty grocery store. So there really wasn't a category for it. But did you think about, you know, getting into the hospitality scene with what you learned and what you wanted to do?

12:36Yeah, you know, in college, I worked at restaurants, and I've always kind of been around food and beverage. Probably would have been smart to go in and sometimes bartender. You know, barista and coffee language in Italian is, you are bartending, you're just doing it with coffee and different ingredients. So I had a pretty good sense of, you know, how to put things together and how to think about beverage. But yeah, on some levels, it would have been probably good to test the waters and learn some more things. But also, you know, if you if you're aware of a lot of the obstacles and you just don't go charging headlong through them, not knowing that they're obstacles.

13:10And I think there's a certain amount of not knowing that probably fuels our ability to to do what we did. I hear that a lot from entrepreneurs, but it's a little different when you're building your own manufacturing facility or production facility and and learning how to actually distill alcohol. I mean, talk about obstacles to building a business that might be the biggest one. You essentially had to be like George Costanza from Seinfeld. You had to be a bootlegger, you know, for some time before you actually started the business. But I mean, I think this is an important point in that you really learned how to make great liquid before you launched the brand.

13:51Yeah, I think for us, job one was, well, A, we weren't trying to be all things to all people. We were trying to honor the craft of cocktail at its highest level. So we really wanted to come to the table, understand what made mixologists at the highest level tick, like how they were thinking about building cocktails and, you know, what was the framework and structure that was getting, you know, it was a commonality or a thread, whether you're drinking in New York or Miami or, you know, Dallas. us. How are mixologists coming to the table thinking about it? I think understanding that really gave us our true North Star, which is balance is everything.

14:24Like no cocktail, you know, should be a singular note. It should be a symphony and you shouldn't have one ingredient really standing out over the other. And so we really approached it from that lens from the get-go. It's like, we want to make really complex, nuanced cocktails that are geared towards folks who really love cocktails. And we set out to honor that craft. And 11 years ago, we really jumped in both feet. And we were kind of bootlegging for five years. We had an underground distribution list for the holidays that we put out. There's about 12 drinks on a standard menu that we would build.

15:01And we'd make product and batch bottles in our living rooms and our kitchens and little black electrical tape on that bottle and then drive it around in the trunk of our department deliver it to folks for the holidays. And that kind of just took a life of its own. People were asking for more of it. Every year it kind of went a little further than the year before. And it really gave us an opportunity to test and learn. And this was not a move that my wife loves, but I just remember we were bachelorette and I put it up in my window in my kitchen where we had Southern exposure and just exposed it to light.

15:39I would leave those bottles up there sometimes for two to three years just to see what would happen. And, you know, we had so much tests and learn like this works, this doesn't work. We want to use the best ingredients. We want to use fresh juice. How do we make that happen? And so we had five years of really learning what can work and what doesn't work. We also had help along the way. This was not, you know, just Casey and I figuring this out. We have some amazing food scientists here in Portland, Oregon State University has an amazing program, the Food Innovation Center. They call it, it's right here in Portland and they work with so many huge brands and food and beverage is their specialty.

16:14And we were able to work with them on some of the science for years before we ever put it in a bottle or can as straight away properly. Was there ever any concern that, you know, if you gave some of your products to someone, they might go blind, I guess. That is the old, you know, myth about, well, it's not really a myth, but I mean, moonshine is really what would make some folks go blind, but that's really, really high tests, poorly produced moonshine. I mean, most of our bootlegging days, people could get their eyesight back in 24 hours. Like, it's fleeting. Our proof levels are so high, you know, the way we're honoring kind of the craft cocktail and how a bartender is going to make it that there isn't really much room for anything to go wrong, which is super comforting on that level.

17:00But yeah, we have a lot of science supporters. And Casey's background, you know, we spoke about mine, but he started off in a winery out of college and he came out of Oregon State. He was making beer in his dorm room in college. And so he's been a consummate maker his whole life of liquid too. And so we had some acumen coming into it. But yeah, it was a lot of exploration and this category is restarted, right? Pre-Prohibition bars doubled as distilleries and batch cocktails. When you were getting your drink, you often were taking drinks home with you and Prohibition shut it all down partially because people weren't making or distilling correctly and people were having issues or going blind And partially just because of Prohibition being what it was, shut everything down and innovation just stopped forever.

17:41And now we're back and this idea deserves to exist. Batch cocktails should be here and they're here to stay. And that's been a really fun part of being a part of that narrative arc. When did you realize that this could be a viable category? Because at the time, I believe you still had a day job, you know, and to get to a point where you could quit that day job and launch a brand and have a sustainable business, like anything in entrepreneurship, it's a risk. But if you have data, if you have market research, if you have clarity in the path forward, I think there's some mitigation of that risk.

18:23Yeah, I think for me, you know, the aha moment for me was honestly 11 years ago when we batched those cocktails for the first time and we tried them. And I was like, oh, this deserves to be a thing. This is a need state. People, how many of us are trained mixologists? Like 0.05 % of the population. And yet we all want to have a great drink at home. And what's expected of us to know how to make a great drink at home and have the acumen and the time and the ingredients all there and ready when we're ready to pour. Like I just was looking at behavior at that moment in 11 years ago. Like we just come to the party with a bottle of red wine.

18:59And we cork it and people can pour it at their own leisure. When they're done with their glass, they pour more. You put another bottle out. We put a 12-pack or a six-pack of great beer out. People just get up and help themselves. Why can't we do that with cocktails? Why is that answer not there yet? And it was instantaneous for me. And I think part of my background, just seeing standardization at a really high level, really craft, meticulously made product, it can be a huge unlock for people. And it just felt like this is going to be a thing. I couldn't tell you 11 years ago, it was going to be as big as fast as has unfolded.

19:34The pandemic had something to do with that for sure. But it just felt, I just felt crystal clear the moment we had bottled those and tasted them or like, in my mind, I was like, well, there is a train coming down the tracks and we want to be in front of it. And so to your point, like we had to test and learn, like, do people want what we were making? And we got the opportunity to learn that over five years before we ever launched five years ago. So we were gaining more information every year, learning more about what might be happening every year. And we were learning more about our customer because we were working directly with them about what they liked and what they didn't like and what they wanted from us.

20:09So we just had a lot of time, a lot of runway to kind of get everything vetted and done correctly before we move forward. I think when people talk about ready to drink cocktails and bottled cocktails, a lot of the conversation is about portability. but I don't feel like portability is as, I guess, as much as part of the need state as I thought it might be. Because as I mentioned, when I brought that can off the plane and I just put it in my hotel fridge, I was just so happy to have a great cocktail ready for me, ready and waiting at home without me having to do anything. So what is driving greater interest in this space You know, I do liken this category to beer and wine.

20:59Like we have just not really considered the fact that those are also RTDs. Like unless you probably do host differently than I do, right? And you might be stomping grapes and making Merlot when someone asks for a Merlot at your house. That might be happening. You might be milling and roasting hops and making something really beautiful, a hazy IPA. But for the most part, that's all made. And we just carte blanche accept that. But it's already put together for us. So we're just pouring and enjoying. There's no acumen required to make wine at home. There's no acumen to make a great beer at home. It's just created for you.

21:32And there's RTD throughout our lives, juice and milk, and you just name it. It's already been there. So I think the idea that, you know, you could have a cocktail that you could take anywhere is really transformative. It is novel. And I think to your earlier point, like the act of craft hadn't really entered into this category until the last five or six years. And now there's a really compelling reason to look at this category. if you're a consumer. And we don't always have the ability to go into a bar or restaurant. We're not always near one, or maybe we're watching our pocketbooks for a second or whatever may be happening.

22:03It doesn't mean we don't want a great old-fashioned. It doesn't mean we don't want a great margarita. And having that at our fingertips is really like, I still think culturally, we're still getting our arms around this as a concept. We are in early days of adoption of this concept and idea. And I think you and I, we're in this bubble. We see it every day. We understand it. But most of America, like most of us are just coming to the table of like, oh, wait, I can have an old fashioned and have it anywhere. Just the occasion idea of like, where can I have this is starting to unlock in people's brains.

22:34How do I host? I can bring this to a party. I'm taking this to a holiday event that I'm going to and I'm going to show up with a bottle of, you know, 12 old fashions in this bottle versus a bottle of four glasses of wine. And I think people, it's very early days of adoption and the runway is, it's going to keep getting bigger and broader as we go. Yeah. You mentioned to me a stat last time we spoke that was pretty mind blowing in that you said by 2026, and I'm assuming you're quoting some market research, the United States or U.S. consumers will drink more liquor than beer. And that is pretty mind blowing.

23:13And, you know, if you continue that conversation, if you go a little bit further, you would think that it's not just beer that's going to be affected, it's wine as well. So given that opportunity, how do you think about trying to reach consumers in a different kind of way? Or is it just saying, you know what, we can target the occasions where they're drinking beer, say, watching football. Or, you know, instead of having wine with your dinner, maybe you'd have a cocktail. I guess it feels like there's so much opportunity. How do you narrow your focus to the most poignant opportunities for the brand?

23:52Yeah, that's a great question. And I think the Cajun is a big driver for folks. I think they're landing on those ideas of like, okay, I'm posting a Super Bowl party. I normally would have a half rack of beer and that's great. And now they're starting to think, well, maybe if I had, I like Palomas and now I can have a half rack of canned Palomas. And before people would have been getting up and squeezing grapefruit and making that all happen or pouring off some grapefruit juice and it's more laborious. And so I think that is working its way culturally into our society. People's behavior and habits are starting to change around.

24:23It's why you see the ascendance of this category, beer and wine, it's been flat down for the last few years. Still plenty of amazing liquid in that category. I still drink both of those things, but people are exploring spirits. The permutations and some of the things excite me about this category is what you see with mixologists and bars and what you see distillers doing is it's really endless. Like what you can do is botanicals and spirits and how you bring those life and flavor profiles and then add to that how you mix those with juice or modifiers, syrups, bitters. It's so endless. And I think there's a curiosity factor that people have of wanting to explore new flavor profiles and try new things.

25:03It's really a major tailwind driving this category too. People are in an exploratory type of mindset, I think right now around spirits and cocktails. and it's helping drive this moment. One of the other ways that you can reach consumers is just to have a lot of products, pretty wide variety of products and straightaway makes a ton of stuff. I mean, you have bottles, cocktails, you have canned cocktails, you have canned sort of refreshment cocktails. The ones I've talked about, like the margarita and the old fashioned are both in a hundred milliliter cans, but you do have a Paloma, a nitrogen fizz and a Negroni spritz.