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Vinovest: Investing in Fine Wine
130 Plays3 years ago
Zencastr sits down with Michael Burke- Head of Growth Marketing at Vinovest. We are partnering with Vinovest to help them promote their business through podcasts. Vinovest helps people invest in wine, which can pay off quite well. But it was difficult to do, which made it only possible for elite people with lots of money. Not anymore. Vinovest is changing the game. Listen and see if Vinovest is a good fit for your audience.
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Transcript
Introduction to VinoVest Partnership
00:00:01
Speaker
Hey Podcasters, it's Sunny with Zencaster. I recently sat down with Michael Burke, Head of Growth Marketing at VinoVest. We are partnering with VinoVest to help them promote their business through podcasts, something they hadn't tried before. VinoVest helps people invest in wine, which can pay off quite well, but it was difficult to do, which made it only possible for elite people with lots of money.
00:00:27
Speaker
But not anymore. Vinovast is changing the game. Take a listen to my interview with Michael to see if Vinovast is a good fit for your audience.
Understanding Wine Investment
00:00:37
Speaker
All right, Michael, what is your elevator pitch for Vinovast? Tell us what you guys do. What Vinovast does is it allows people to invest in fine wine as an alternative asset. And so basically fine wine has been around as an investment asset for hundreds of years. Basically lots of
00:00:55
Speaker
You know, a wealthy gentleman's club used to buy kisses of wine from Bordeaux, store it for 10, 15, 20 years, and that would pay for the next year's wine, that they would sell some and then consume the rest. And so it basically paid for their drinking habit. The reason it was kept to those elites was that the barriers to entry were really, really high.
00:01:18
Speaker
So first of all, if you wanted to buy it, you'd need to know which wines to buy, which wines would increase in value, what was a good price to pay. You'd also need to know where and when it was being sold. And so that was only like the purchasing of it. Then once you bought it, you had to authenticate it to make sure it was legit. You had to know how to store it. You had to ensure it. And then also you'd have to pay for it being shipped to your storage facility.
00:01:44
Speaker
So there was all this really complex things that you had to deal with. And then also then on the selling side, you had a lot of that again. And I should also add when you buy it and sell it through auction houses, you'd have to pay 20% commission to the auction house.
00:01:59
Speaker
So there was like these huge barriers to entry. So it was really only something that was done by the very elite or people who had a lot of connections. We wanted to
Breaking Investment Barriers
00:02:09
Speaker
change this. One of our co-founders, Anthony, he was doing some research and stumbled across the idea of fine wine as an alternative asset. It was something he'd never heard of before.
00:02:18
Speaker
So he started looking into it and found that you had these really impressive returns. And so he was like, okay, great. This sounds fantastic. Like, how can I do this? And then this is where he stumbled upon all these barriers to entry.
00:02:32
Speaker
Tell us a little bit more about some of the benefits of wine investing.
Benefits of Wine Investment
00:02:35
Speaker
Sure. Yeah. So I think one of the first things to call out is really the robust returns that wine investing provides. You know, wine investing generally sees pretty solid returns. VenaVest investors in 2020 saw 17 percent returns in their investment. And then in 2021, those investors are seeing double digit returns.
00:02:57
Speaker
Secondly, there's really low volatility with fine wine investing. So when you see, you know, the other indexes like S&P 500 or other asset classes like gold, there is a lot of volatility. So beginning of 2020 with COVID, you look at the Great Recession in 2008, and even the dot com bubble, you saw all those like huge swings ups and down over, you know, over those periods, where during those periods, wines did pretty solid and consistent.
00:03:24
Speaker
So people who are looking for that low volatility, it's a really great asset class. Another thing, especially for VinoVest investors, is they actually own the wine that they invest in. So unlike some other asset classes, with fractional ownership, you don't actually own that thing. Or in the case of stocks and bonds, you effectively own pieces of paper. With wine investing, there is a case of wine in a warehouse somewhere with your name on it.
00:03:50
Speaker
And for VinoVest investors specifically, if you want to get that bottle of wine, we can ship it to you. You are the owner of it. So if you decide, you know, hey, I've got a big birthday coming up and I want to celebrate, I want to ship that bottle of wine to me. We will facilitate that for you and we will send you that wine. Now, obviously that's not great from an investment perspective, but you know, it's a really nice perk and benefit that you have. Also, adding diversity to your portfolio is another great benefit of wine investing.
00:04:18
Speaker
Making sure that, as I mentioned, there's market downturns, different things affecting the markets. Wine really isn't impacted by that. Actually, what impacts wine more so is things like the weather, things like production levels. So very few of those are very closely tied to market effects.
00:04:36
Speaker
which makes it really great for someone's portfolio. At least your entire portfolio isn't going to fall by the wayside. Wine is pretty inflation resistant, which, again, makes it really attractive to people kind of trying to maintain their buying power.
Accessibility to Wine Investment
00:04:52
Speaker
Okay, so you said previously it was for the elite. Do people have to have a certain amount of money to get involved? Obviously, you're breaking barriers down for people, but can anyone get involved with this from a client or customer perspective?
00:05:05
Speaker
Yeah, so we have a minimum of $1,000. Okay. So it's pretty accessible to a lot of people. There's obviously a lot of other investment platforms out there with different kind of minimums, but this is something that's pretty accessible to everyone because not all investment grade wine is
00:05:27
Speaker
$20,000 a case. It can be that, you know, especially when you buy it really young, it can be those like three, four, $500 cases. But over 15 to 20 years, they're going to become a lot more expensive. Do you need to have any kind of prior knowledge about wine in order to get started?
00:05:45
Speaker
Absolutely none. You know, if you want, you can hand over your money to us and never look at it again. You don't even need to check the wines we bought for you. You can just look at your top line returns. We do have a tiered service. Our first tier is the starter tier, which is 10K and below. Basically put your money, the robo advisor picks everything and you know, that's it.
00:06:04
Speaker
But as you go up through the tiers, premium and grand crew users, they can be a lot more involved. So they have the opportunity to sit down with their portfolio managers and they can say, well, actually would really like to buy some Italian wines or Napa cabs and really kind of have a lot more detailed input. But that's totally optional. Like if we have some pretty big investors who say,
00:06:29
Speaker
Listen, I know very little about it. You guys are the experts. Take my money and do what you want. I'm still happy to take it.
00:06:37
Speaker
Who do you guys primarily help? The people that are coming to you now, do you find that there are certain type of demographic or have certain things
Target Audience for Wine Investing
00:06:45
Speaker
in common? Are they already investors of some sorts? What are the common denominators there? Yeah, so we generally see a pretty broad range, but it's generally not your first time investors. If you're a few years out of college and you have your first job and you're thinking, OK, I want to invest a little,
00:07:04
Speaker
You may go for an alternative investment, but generally, it's going to be more people who are looking to add some diversity to their portfolio. So, wine investing is definitely something. It's kind of a slow, solid burner. You do definitely see wines and we have wines that appreciate
00:07:22
Speaker
you know, four, five, six, 700% over the course of a year, but that's kind of outliers a little bit. It's a good fit to those who are looking, as I say, to just kind of play that slow and steady game. If the stock market crashes, I'm not going to like, you know, lose everything on this. It's a pretty safe, solid bet. So people with that kind of mindset, I think are ones that it really resonates with.
00:07:46
Speaker
OK. And you kind of touched upon this and what you were just saying, but why do you think your brand is important right now? You mentioned the stock market. There's a lot of volatility, not just in the stock market, but I feel like in life in general over the last couple of years. So some people may be wondering, wow, investing, I'm just trying to do XYZ. Everything's so up in the air, right? So what would you say to someone who's like, well, why is it important for me to do this now if I'm interested in something like this?
00:08:15
Speaker
In general, the investment space and especially alternative investments is really opening up.
Rise of Alternative Investments
00:08:22
Speaker
So all these kind of assets that were basically closed off for a long time are now suddenly open and available to people. So I think that's the part of why there is this kind of a lot of movement in this space. People are just becoming more aware, like we've had this long run of really solid returns in the S&P 500.
00:08:42
Speaker
other indexes and stocks around the world. And if history taught us anything, it's like, that doesn't last forever. And I think people are just kind of becoming very aware that they can't be totally exposed to market and market forces. Average people are now kind of having access to better information and a lot of things that haven't been there for them before. And I think that's why opportunities like VinoVest are really becoming a lot more interesting and intriguing to folks.
Podcasts as a Medium for Engagement
00:09:12
Speaker
So why promote your brand on podcasts? Have you guys done this before or is this the first adventure into podcasting?
00:09:18
Speaker
This is our first venture into podcasting. And I think it's a platform that really, really suits us. Because as I mentioned before, most people haven't really heard of wine investing. And so when you try and explain it to them in a Facebook ad or a banner ad on a website, it's really hard to get people to kind of what I call that aha moment. So we're kind of clicks with people.
00:09:44
Speaker
and to say like okay right now I get it I understand how this works and so we always kind of felt that podcast was a great opportunity to do that because you're you kind of have that luxury of kind of digging a little bit deeper into it and kind of giving a little more explanation as to how it works and how you know how it fits and
00:10:02
Speaker
and getting people to that aha moment. I think it's really good for us anytime our CEO Anthony has been on any podcast and kind of had that ability to discuss the brand a little bit more. It always resonates really well and people always respond really well to it. And so that's kind of something we always felt that podcasts was a natural fit for our brand. Yeah. What about your expectations with these ads, right? What are you guys hoping to accomplish with these podcast ads?
00:10:31
Speaker
So, yeah, so, you know, we'd love if every user signed up and funded straight away. But a big part of what we want to do is increase the knowledge of the area and, you know, when they think of wine investing, think of VinoVest, but also just increase that understanding that this is a NASA class that people can invest in. It's not, you know, some underground city, you know, trap to take your money.
00:10:55
Speaker
As I mentioned, the asset class has been around for hundreds of years and it's now, you know, for the first time, it's now something that's very accessible.