The #1 Opportunity in the Wine Industry

0:00This is the Gary Vee Audio Experience. Welcome back to Got Some Wine Podcast with the master sommelier Carlos Santos and a regular pleb Angus O 'Loughlin and I feel like a real pleb in an audience with these two. Two people with rich histories in wine and just me with an unsophisticated palate willing to learn. Gary Vee welcome to the podcast. For those who you know don't know who you are what is your relationship with wine? Well, first of all, Mem, thank you for having me. My relationship with wine is that I am now 50 years old and 35 years ago, I picked up the Wine Spectator and Stephen Tanders International Wine Cellar and the Wine Spectator and started reading about wine at the register and counter of my father's liquor store.

0:49and realized somewhere in that time between 14 and 16 years old, growing up in a local family liquor store business, that people collected wine and that wine had ratings like 91 and 92 and 93 points. And I was an avid trading card comic book sports collectibles kid as a very young boy, 11, 12, 13 years old, making a buck as an immigrant in the U.S. at shows and flea markets. And the thought that people collected wine was so intoxicating to me because I wanted to help my family business, but I was not interested in selling, you know, beer and vodka. But this wine thing felt elevated, felt collectible, felt communal.

1:37and for the last 35 years it's been a very big part of my life from 16 to 35 it was my obsession I would say that for those 20 years of my life up until I was 21 from 16 to 21 those five years was a astonishing amount of reading less as our distinguished partner here for trying to be a Master Somme or Assam. Like I didn't desperately need to know, you know, every region or every type, but more from a commercial standpoint, you know, whereas later in my career, I did get excited about the sub regions within Burgundy or Assas or the Loire. The first decade was really, I just wanted to know what every consumer wanted, whether it was as silly as Yellowtail or Kendall Jackson from a supermarket standpoint, all the way to single vineyard, Guigal, Cote Rotees, or First Growth Bordeaux's, or Penfold's Grange, or, you know, Napa Valley Colt Wines.

2:42And then at 34 years old, 16 years ago, I started another business with my brother. I kind of left the day-to-day running of the wine business. I did a lot of innovating. I launched one of the first e-commerce wine businesses in America in 96. I built one of the largest wine retail stores in the country for my father. I really hit the scene maybe when you guys both saw me with wine videos in the early 2000s on YouTube. And, you know, started to have real credibility, no different than James Holiday or Robert Parker or Jancis Robinson as a wine critic from 2006 through 2011. and then at the height of it, I kind of pivoted my career and went into being a Silicon Valley investor and a marketing and business personal brand and running a lot of businesses.

3:33And that actually is when my wine journey got even more interesting, I would argue. Maybe not for everybody listening, but for me personally. From 2011, when I left day-to-day, and when I say day-to-day, this morning I wrote the copy to wine text.com a you know a sales engine for my family business so I've actually never have left the business like this morning I read the detailed reports of what's sold in the store and my best friend Brandon in essence runs the business for my father and I and he's my best friend I talk to him every day so I'm still very close to the business but in 2011 I left from being the day-to-day human being that 12 hours a day ran it and by 2015 four years after that I started to enjoy wine like a consumer I was far enough away from day-to-day that going to a restaurant looking at a wine list no longer had me thinking about what they paid for it and what the markup was and what the current rating was and what the market thought it was just a lot of fun and for the last 10 years i've been as much of a consumer as i've been an operator or or merchant or critic and that is my wine journey in a nutshell i'm still i'm still to get to that stage it's uh it's i think um yeah of course you enjoy a lot of wine as a consumer and you go out, you have wine socially and stuff.

5:12But when you're so involved in wine and buying and selling in the restaurant, it's hard to, you are right, it's hard to sometimes sit back and really, really fully enjoy without thinking too much where it comes from, what it is, how much it costs and how much am I going to sell it for and all that jazz for sure. I don't think, you know, as much as I tried to do that when I was in the eye of the storm, I in hindsight when I actually got to that place it you can't you can't detach when it's so part of your true day-to-day commercially and that's okay it was a lot of fun 15 years ago knowing the winemaker the process like I knew everything it was it was I was like a party trick you know you know this car it's like it's kind of cool you know there's times where I miss knowing absolutely everything.

6:06I used to watch all the videos when I was, you know, back in London 15 years ago, I was watching everything. He actually pretty much got me into wine a little bit as well. I mean, my grandfather would make wine and I used to say only two types of wine. One was bad, one was really bad. It was still the best wine in the world because sitting alongside him and, you know, tasting wine with him was great. But, you know, watching the videos when I was back in London was pretty awesome. And I think it was so raw and so pure and so, you know, without, I guess, without the structure of knowledge from any wine school, but just from a passion standpoint, that was what I enjoyed the most about the videos.

6:49Thank you. And what was really fun was in the beginning, a lot of people scrutinized it because it was less pretentious. It was, you know, in general, I have reading comprehension issues. And so I pronounced things in a certain way, oftentimes not the quote unquote proper pronunciation. But what was fun was by the time I started making those videos, I knew wine and I really knew wine, not only from like information, but in blind tastings and things of that nature. And it was more fun being out and about. I remember early on when I was making a lot of noise, if I would go to the show was getting very big, very popular.

7:24And I would go to a restaurant in Manhattan and a lot of sommeliers didn't like what I was doing. They thought I was dummying down wine and they would try to get me, right? I'd be at the table and they would bring a glass over and they'd be like, what do you think this is? And I could feel, I'm very intuitive, that they were trying to get me. Yeah. That's the bad side. I think that's the bad side of sometimes wine that can be a little bit pretentious. It was great for me because I gained a lot of credibility. They would stick a wine in front of me. I'm like, this is Barbaresco. And they'd be shocked.

7:57They'd be shocked that I knew it was a Rioja or a Shiraz. But yes, you're right. When I got into wine, I was very young. And nobody young was into wine because to your point, it was very gatekept. It was very pretentious. and anyone that had any knowledge, instead of trying to bring people on board like I did with you, they tried to talk down to people. And I still think people want Carlos to fail as well. Every time we do a blind wine tasting and he gets it wrong, and I love that you're pouring a wine, we'll talk about that in a second, but people do want to say, look, it's just grapes and alcohol.

8:32I mean, nothing changes. This is all just bullshit and magic tricks. So people still want Carlos to fail in that same way, whereas there are some people who obviously love it when he gets it right and are more intrigued about it. You've just poured yourself a glass. What have we got here, Gary? Well, it was funny that you guys, you know, the team was like, hey, the team wants you to have a special wine. Okay, I could have grabbed something that meant something to me, and that's a good story. I could have, you know, the first glass. I have some bottles of Empathy, a brand I started. There's Verite in my cellar here, which is the first wine I did on Wine Library TV.

9:07That means a lot to me. There's a 94 Brian family. in my cave right here. That was the first wine I had on my 21st birthday. Some big Napa Valis. There's some incredible Sanceres. And I predominantly drink white wine as a human being. Like I'm very into Italian whites. In fact, you guys may know this if you're really nerdy about me. I was always a very substantial advocate of Simeon from Australia. So there was a lot of things I thought about. I grabbed this minor Cabernet, not because I'm so infatuated with it. it's actually a very good wine but right now i'm not currently drinking a whole lot of napa valley cabs it's you know they thank god from my prime that you know 10 15 years ago they were way over the top yet now you know since i've left day to day a lot of the wineries have done what i was yelling about on that show which is like less oak you know i think we're in a very nice time uh in the wine world where a lot of things are finding their true terroir their true balance i think it's a beautiful time in the world i think a lot of that had to do with robert parker no longer being the biggest voice and everybody making wine for him not that he did anything wrong it was just that era but there's a reason i brought this wine it's because i wanted to talk to you guys about what i think is the biggest opportunity in the world right now which is there's too much wine being made true against the demand and for everyone who's listening I think this is a very special time where the buyer has the power not the producers and for example this Oracle Miner which is a beautiful wine is truly a$125 wine that on WineText we sold for under$30 a bottle and I'm getting 15 emails a month and this is me getting the emails, I'm not even active with the business from people that bought it, that can't believe it and want to thank us, the store's getting even more and I don't think it's an enigma.

11:05I think that it is a preview that I wanted everyone to know because I'm getting all the offers. I'm still very involved in the buying for Wine Library and Wine Text and the insanity coming out of your side of the world from both Australia and New Zealand. And when I say insanity, high caliber Pinot from Central Otago, wildly tremendous Chardonnay from Margaret River, Barossa-based Shiraz that are normally$80,$100 Australian, and you guys have your versions of discounters in your beautiful country. I just want everyone to be very thoughtful if they're listening to this podcast to do some real homework to find the aggressive discounters because I've never seen anything like this.

11:53There is so much wine compared to demand and there's tariffs and all the things going on in the US that this is a window of being able to buy remarkable wine for a fraction of the cost. This is bad for the wineries and remarkable for the consumer. And I thought, if I do this podcast, how do I bring value? And I just did. I want to challenge everyone who's listening to explore other options to buy wine because there's deals running around that are crazy. That's true. Yeah, I think, rightfully so, the China tariffs sort of affected a lot of Australia, not being able to get a lot of our wines from particularly South Australia over there when we've got millions of leaders just sitting in steel barrels at the moment going unused.

12:40And yes, it is a buyer's market, which is great. A question for you then, Gary, in that intersect of business and wine, how much does that come into your life as a business person? Do you find yourself doing a lot of your business deals because you're an international business? Do you find yourself doing things face-to-face? Do you do at a restaurant with a bottle of wine? Do you celebrate with a champagne? How do you close a deal? That's a great question. Yeah, it's actually a substantial part of my life given my background. Champagne's interesting. I'm glad we brought it up. I just mentioned I drink a lot of white wine.

13:14I lumped sparkling into that. I have forever. You can go back to the videos. You probably remember this, Carlos. I talked about sparkling wine and not just champagne, cava, you know, by the way, sparkling Shiraz is one of my favorite discoveries. I got that with you. I got that with you, yeah. It's a very big part of my life. From a business standpoint, you're absolutely right. Like it is subconscious, not even conscious that I book important meetings at really nice restaurants where wine's a big part of it. Oh, I got a big one for you. I now do a monthly wine dinner where I bring eight to 10 people together of prominence in my world who normally don't like or know, not like, don't know each other.

13:57And we drink eight to 10 incredible bottles of wine. I had a Chateau Lafleur Petrus 98 Magnum where a CMO of MetLife, the large insurance company, couldn't believe how good it was. And I put the cork in and let him leave with half a third of the bottle. So it's become a very big part of my business life because I'm hosting these business dinners around premium wine once a month, which has been phenomenal. And then birthdays, anniversaries, business meetings. I mean, wine is a very prominent part of it. And I like going high, low, meaning if I have very bougie people, high net worth people, I like bringing out a$15 Gavi that I just discovered to show that stop being pretentious and then on the flip side if i have like you know i just had a meeting with my cto of v friends my marvel pokemon brand he's into wine a little bit but he buys 20 bottle wine for him i want to bring a 500 you know red label bruno giocosa single vernier barolo for him to be like what is this and i'm like i'm sorry i've boomed in your life now you'll never see you'll never get a 20 again so i play a lot of games in a positive way like that with wine nice no that's awesome and those wine dinners all ticketed events or people that you invite or literally in this literally i'll shift like in this little dining room i'm in i just in friends it's very you know i realized i was missing wine that's a really fun topic to talk about about a year ago two years ago I'm like, I miss wine dinners.

15:32When I was selling, I would get clients together who didn't know each other. Brown paper bag blind. And they would have a blast. They would make new friends because of me. They would become deeper relationships. So they became better customers. And most of all, I was able to prove what I cared about, which was when they would discover new wineries that did not get 95 points parker were not opus one or chateau margot and so i was expanding their palettes yeah i was creating deeper relationships and so i brought it now to my marketing and investing world and it's been a blast obviously you know high net worth individuals half of them are already into wine the others are kind of curious or it's been really really fun and it's been a new last two years thing and i'm doing more of it that setting where you are looks like the original where the wine videos came from.

16:26That's exactly right. There was those dinners. It was such a seed of why I did the videos. And I used to do brown bags on the videos, as you know. When you take away knowing, you know, back to I guess what you said about Carlos, like, you know, what Carlos and I know and what even Master Sommel, I mean, I've spent time with masters of wine who can get something wrong blind. It's so humbling. No one knows everything. I think that's what people don't understand is that we are still human. We blind tasted a white Merlot yesterday. Oh, Bianco di Merlot was amazing. It was really fantastic. And this is one of those discoveries that I'm not sure how much that bottle cost, but it's incredibly amazing to try something that you have never tried.

17:10And you get into blind tasting and you just absolutely don't know where to go at all. and as you say it's humbling and you know you've got to be honest with yourself as well it's like no one ever knows everything it's impossible like the wine is growing so fast and well the other thing that's going on with wine for everybody who's listening why it's so humbling is I've seen and I've it's happened to me and I'm sure Carlos this is very nerdy but it will make sense to you you have winemakers that come along that do things stylistically different so I'll taste something and I'll be like blah blah blah you know um um crow's hermitage from the and and then you're like what it's some spanish wine and then what you realize is you were actually more right than your friends would think because stylistically you were tasting the pepper and the but but a winemakers they're playing they're they're innovating they're trying new things i mean and you know this carlos like one of my favorite things to do when i got really educated i would bring things to blind tastings that no one would be able to figure out because I knew I had this Australian winemaker making Pinot Noir, you know, from Adelaide that tasted like red burgundy because he was doing this thing.

18:24And that was a way for me to show people to not just like blindly look at the label or the rating. And so sometimes you're right and you're wildly wrong because a winemaker was doing something very incredibly innovative. One of the best examples you can ever put out there is Rioja, you know, Reserva, Grand Reserva, you know, with French oak, you know, like that completely throws you off because you're expecting American oak, that big, sweet, coconut bomb, and then it becomes, you know, savory and more, you know, perhaps more elegant and finer where you think you're drinking a Bordeaux, you know, so it completely...

19:00In fact, because I'm going to make it contextual to Down Under, I was there when Dan Phillips really exploded in the late 90s and started importing a very stylistically different Australian wine. I mean, when I was growing up with Penfolds Grange and Henschke Hill of Grace as like the gold standard, and here came in the late 90s Dan Phillips with wild duck muck, you know, and all these wild wines. And I remember I loved them because I was young in my career and that was the time much like young people in general especially young americans you like everything bombastic right and so you had these wines coming burge family and like he was bringing these incredibly over-the-top wines and i fell in love with them i was promoting them and then one of the signature moments of my career for four or five months i'm selling these wines to people that were buying colt napa caps and they were loving them you know they were buying $90 Colt cabs and I was giving them$20 Australian wines that they loved.

20:06And now Robert Parker came out and gave all these wines, 98, 90. I mean, he's when nothing got higher than 95. These numbers blew everyone away with the scores. And it kind of made me American famous amongst collectors because I was peddling it before anyone knew what it was. And I had most of the allocation in America. And so there's just these fun moments of like styles and different things. And none of those Australian wines tasted anything like the gold standard from Australia in the eighties and nineties. And then it became too much and people really hated the style. It was almost like eating cake at every meal.

20:50You eventually don't like it. And now when I drink Australian wines, it's very clear to me that similar to Napa it's found its equilibrium and there's a nice balance even in Barossa that is known for bigger wines I sense so much more balance and that's been very enjoyable you know everything comes and goes in fashions right you know Shiraz Shiraz is gone a little bit out of fashion big Cabernets etc which you're absolutely right I think years ago there was you know everyone was drinking them obviously price was super super high and now I think to your point like you know you can find bargains now but uh i think australia is is somehow coming back to for example you know let's say chardonnays where at some stage no one wanted to drink uh big buttery chardonnays now suddenly slowly they start coming back happened with me in a big way post me leaving wine i was gonna bring it up i'm glad that's amazing you brought it up i was unaware that there's a trend to the buttery oaky i was the i was there in a real way it was funny brandon again who I just mentioned my best friend who runs a business was making fun of me when I left I mean you can watch all 1 ,000 episodes of Wine Library TV all of them and 99 % of the time I was bashing on buttery oaky chardonnays two years after I stopped doing the show I gravitated to those wines heavily I was eating a lot of fish and I love crisp like I was drinking plenty of Sancerre and Chablis long before they got hot, quote unquote.

22:27But my palate for like a year or two went to the extremes. I wanted Rombauer Chardonnay. I wanted Kistler. I wanted oak, butter, oak, because I didn't care about the judgment. I just was going with what my palate was yearning for. Yeah, fair enough. And I think that's how it should be. And I feel like, yeah, people is coming back to that again. And suddenly it became quite hard to recommend, you know, a young vintage of something that is really buttery, creamy, and oaky, you know, because everyone is just going completely the other way. But they are coming back, which is good. Yeah, it is good.

22:59I mean, especially, I also think they're more delicious. I think they're not as nerdy and not as cool for people like us. But I do think for the general population, they are more delicious. It brings more people. I think it's a style that brings more people into wine, for sure, because they're rounder, they're warmer, they're more sort of generous. the fruit scents of kind of almost sweetness is dry, often dry, but the fruit ripeness bringing that sweetness character, I think it brings a lot more people to wine than not, probably than something too austere, like a Shabli, you know, occasionally.

23:37I agree. Speaking of a renaissance, you've been calling this for years, Gary, but collectibles, they're back. I mean, of course, you've got the NFTs, the new version of them, but of course, basketball cards, baseball cards, um pokemon cards i sold my char as i back that pre-covid which is very disappointing my base set but do you think wine will enter have its own error um you know a lot of people holding on to old wines i see and i'm starting to see sort of you know younger generations drinking less therefore that passed on um cell and not meaning so much when grandpa or father passes away and maybe they started to hit the markets do you think there'll be a collector's edition of uh the wine industry in the next 10 years?

24:19I do. And let me tell you why. Because of the blockchain. So I know NFT is a dirty word now because there was a lot of greed and it kind of was similar to what I saw with internet stock in 2000. You know, the bubble, the web 1.0 bubble. But let me give you an example. Penfolds comes out with Grange, right? Now they ship those cases. Now let's make pretend as a future, they sell an nft that represents a case of it now you buy it you own it because with the nft it's on the blockchain it means you own it which is different than the internet like bitcoin when you own a bitcoin you own it that's what the blockchain does and i know i'm going nerdy so bear with me everyone who's listening carlos is all about his dogecoin i love i believe what you're about to see is a massive explosion of real world goods on the blockchain.

25:15So I, Gary, can buy four NFTs that represents four six-packs of Grange. I have them. I wait four years. It's still sitting at Grange or maybe at a warehouse. I want a six-pack for a party. I burn my NFT, redeem it. I give it. It gets shipped to me. I drink the wine. I don't want to hold on to it and want to sell it. Somebody can buy it off me on the blockchain. This episode is brought to you by Google Chrome. You think you know a browser, but Gemini and Chrome, that's new. It can help you with practically anything on the web, like restoring a vintage motorcycle from a 50-page restoration block, or finally break down that long article you've had open for weeks.

25:57Gemini and Chrome is here for it. Ready to make anything online make sense? There's no place like Chrome. Check responses set up required, compatibility and availability varies 18+. without it having to be moving across um all those domestic travel now you got temperature changes or wine the blockchain is going to be huge because this way could just sit in temperature controlled warehouses but the commerce can happen on the blockchain because there's ownership i know this is like not what people are paying attention to i know some people like i don't get what he's saying but i do think we will clip this clip in 10 years and everyone's going to understand exactly what I'm saying.

26:34And I think for wine, that will be a renaissance of collectability and because of the friction gets eliminated by that technology. And so I'm looking forward to that. And in fact, it's funny you bring it up. I've actually been thinking about buying a lot more super premium wine in anticipation of this era. Creating your own warehouse. We love that. Last question before you go, Gary, and thank you very much for your time. We actually met each other. I've got a photo. I'll bring it over so you can see it but i mean it doesn't really matter leave a photo of us back in 2019 um at a vino mofo event for empathy wines when you brought it to australia i've got a i had a signed bottle of the rosé i remember that very well yeah rooftop in melbourne um but that was a big project for you as a businessman you found the opportunity to exit it but can you tell us about the rhyme and reason for starting that brand because there's quite a beautiful holistic approach to it there was so much to that wine.

27:32First, a lot of it started with my two co-founders, Nate and John. You know, there were two kids that started with me as interns in the wine business. Two, I thought there was a way to build a direct consumer brand. Three, I wanted to make farmers more famous. If you look at the back of every bottle of Empathy Wine's ever made, there are sketch drawings, like the Wall Street Journal, of the faces of the growers. And then four, I knew even back then there was a wine glut and I knew that I could make$40,$50 wine for$20. And so it was kind of like no different than a good wine is maybe a nice blend of a couple different grapes.

28:09All these different business truths created a scenario. And in fact, we were overly successful. What I mean by that is it went so well that Constellation came along and offered a pretty big number very quickly. And truthfully, I didn't want to sell because I wanted to build it much longer. I thought there was more room for it to grow. But it was definitely life-changing money for my two partners. They were both ironically engaged, both got engaged while we were building that company. And looking at these two faces, you know, and they felt like sons to me, these two, you know, looking at their two faces when the offer came through and knowing that if I said yes, it would really be meaningful at a time that was important in our lives.

28:53So, you know, learned a lot. There was a lot that went into that wine, but featuring the growers, bringing remarkably high quality wine to the consumer at a lower price, starting something with, you know, kids that grew up at my company and marketing in a different way and selling in a different way. All of those things were intoxicating. And it was a very fruitful uh chapter in my career good wines as well good nice nice beautiful fresh rosés yeah rosés were bonkers we really that was you know rosés were so hot at that time we wanted to make really real rosé that really blew people away and you know actually buy a lot of rosé from australia for wine text um but what we made there was a different level and caliber of rosé.

29:41Okay, there you go. Well, thank you very much. Gary? Yeah, I was just thinking that obviously we're having a wine chat and you have a glass of wine. I mean, on this side of the world is 8.30 a.m. We have nothing in front of us. I feel like Gary must be thinking, oh, what are these guys doing? They're not even having, sharing a glass of wine. That just means we have to do a part two where I do it in the morning. We'll do that, man. Thank you for having me. Otherwise, we have plenty of wine here. We could do a quick cheers. Gary, thank you so much for your time. We really do appreciate it. And look forward to maybe joining one of those wine dinners once upon a time.

30:13I'd love that. I'd love that. Stay watch. Cheers, Gary. Hey, everybody. If you enjoyed this podcast, please go back and look at the prior episodes. They're loaded. I appreciate your attention. And thanks for being part of this. Push your limits. Train with precision. See the results. At Equinox, that's high performance loving. Iconic spaces that inspire. Personal training backed by real data. unlimited group fitness classes from yoga and Pilates to strength and conditioning. Elevate your post-performance ritual with saunas, steam rooms, cold plunges, and more. Everything you need to lock in and unlock your potential at Equinox.

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