Startup Aims to Democratize Winemaking

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winemaking

Spanish winemaker Carlos Rodriguez got his start with Naked Wines

Starting up as a winemaker has traditionally been a complicated, expensive process. Not only does an aspiring winemaker need to learn winemaking, but he or she needs to find or produce fruit, have the correct facilities and tools for making wine, and ultimately, be able to distribute the wine. On top of that, purchasing a vineyard and either building or buying a winery can be multi-million dollar expenses.

It doesn’t have to be a nightmarish process, though. UK-based Naked Wines is helping democratize winemaking by investing in talented independent winemakers from around the world, now including the United States with the opening of its Napa, California office in January and the launch of its U.S. site on Friday.

With seed money to get started, winemakers are now able to focus on the core of their passion — winemaking, not financing. “Because winemakers don’t have to waste their time and money selling to us, they make a profit, with massively reduced risk,” says Gormley. “And we get great wines at an exclusive price.”

Naked Wines is always on the lookout for the talented would-be winemakers stuck in assistant winemaking or cellar rat positions. In many cases, these wine aficionados know the trade, but it can take years, even decades, to work up the ladder in the winemaking business. With backing from Naked, though, these aspiring winemakers are able to get started on their own projects — instead of working for the man — much sooner.

winemaking

A screenshot of the Naked Wines website

Naked Wines was founded in 2008 by Rowan Gormley, a South African born entrepreneur who also founded Virgin Wines and Virgin Money. After leaving Virgin Wines, he launched the startup, bringing 15 of his teammates with him as founding partners of the new company.

So, how does it work? American customers invest $40 per month in Naked Wines — while UK users invest in at £20 — and Naked Wines is then able to invest in winemakers, who make wines to be distributed directly to the customers, cutting prices for consumers by 40-60%. To date, the site has more than 100,000 investing customers — or “Angels” as Naked Wines calls them — who invest $3 million per month.

winemaking
An assortment of wine labels designed for Naked Wines winemakers by Marketing Manager Adam Reiter

Winemaker Carlos Rodriguez of Spain, for example, started out as a consulting winemaker, with clients all over Spain. He never had the cash to start his own winemaking business, though. But with €100,000 of backing from Naked Wines, he started up and now produces a variety of wines out of Rioja, Navarra, and Galicia. In the 18 months he has been working with Naked Wines, he has built up a following of 2,500 users and his wines have been rated 22,000 times.

Without Naked Wines, Rodriguez says realizing his winemaking dream would have been nearly impossible. He had no luck securing financing from his local bank, which “thought I was crazy” for not having a foolproof business plan and existing cash flow, he says. Naked also comes with an added benefit of having direct consumer feedback, Rodriguez says. His Naked Wines profile page enables users to rate and review his wines. “[It] lets me know consumer opinions and improve the quality of my wines… The best way to thank all consumers and Angels funding me is to give them the best quality wine at its best value.”

Next on the agenda for Naked Wines is the opening of a winery in Sonoma this harvest season. The company will open up the winery to winemakers in need of space and equipment. Essentially winemakers need only bring their fruit and themselves, and they’re set.

Over its three years of existence, Naked Wines has brought in a total of $40 million in revenue, Gormley says, having raised $6 million in investment to start up in the UK and securing additional funds to enter the U.S. and Australia. With ever-increasing demand for wine in the United States, Naked’s launch in America should be a fruitful investment, and they’re sure to have the support of aspiring winemakers.

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