Wednesday, March 14, 2018
Wine startups
Since we've covered the IPO and PE market for wineries in class, I figured it would be interesting to look at the new crop of wine-related startups.
The most popular and most well funded startups range from hardware (Coravin and Plum - pouring wine without taking out the cork) to personalized subscription services (Winc and Penrose Hill). There are even a few playing in the IoT space. Kuvee - a subscription service with wifi enabled bottles that the wineries use to bottle their wines, then send to customers who can use the touch screens on the bottles to learn about the wine and rate it. Aveine is a connected aerator, that you can start with your iPhone before you get home, so your wine is perfectly aerated when you arrive.
Traditional VC investors like Grelock, Bessemer, and Khosla are all getting in on these wine-related startups. These startups are primarily following the direct to consumer model, but some identify hotels and the service industry as potential customers as well.
It will be interesting to watch these companies grow and see what exit paths they pursue. The influx of VC money into the space is likely to drive the desired returns higher and higher. Perhaps this will make wine a space where people go to make their millions in addition to a hobby/trophy industry for after fortunes have been made.
https://www.cbinsights.com/research/wine-tech-startups-to-watch/
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This is super interesting Jane and I found myself reading this report not too long ago so thanks for sharing!
ReplyDeleteI agree that this is an interesting space to watch going forward but for the VC investors I can't help but feel a little nervous. One of the reasons is because none of these companies seem like sustainable businesses with huge markets that can produce large nine-figure revenue businesses; the ones VCs tend to want to invest behind. As far as I can tell many of these company's make expensive gadgets (and any hardware business is a tough business) or yet another subscription service (which I think of as in abundance).
This leaves me feeling like there must be some other angle that the investors are taking and I can't wait to see how it plays out as these companies grow and mature.