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Oh, Canada:  With Glowing Hearts We See Thee Rise

Other emerging regions are getting the publicity, but Niagara is delivering the goods. 

Our neighbors to the north, about an hour and ½ from Toronto (as the crow flies around Lake Ontario) and just 45 minutes from Buffalo, NY are seriously delivering world-class wine.

Prior to a recent visit to the Niagara wine region in southern Ontario, my Niagara frame of reference was a clichéd familiarity with ice wine and an incessant mental replay of a quote from the 80s movie, “Breakfast Club.”

BENDER
(to Brian)
When have you ever gotten laid?

BRIAN
I’ve laid, lotsa times!
                 
BENDER
Name one!
                 
BRIAN
She lives in Canada, met her at
Niagara Falls.  You wouldn’t know her.

My virginal perspective has changed now and my frame of reference for Niagara wines are those that are, “Of the Place” – pure, vital and expressive with ice wine a distant third in quality behind Pinot Noir and Riesling.

In fact, instead of being hampered by unpredictable cold weather and hanging their hat on ice wine, Niagara vintners use the climate to their advantage teasing out a palpable tension in the wines with a terroir-based honesty that is omnipresent.  When you taste wild strawberries, tar and rose petals in Pinot Noir from a number of different vintners in the same appellation, you know you’re on to land-based virtue.  If that’s not enough, just look and smell—the color of the wines are not extracted and plumped up; the aromatics are pure like a newborn nestled in your bosom.

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Yet, what strikes me the most after having spent recent time in Michigan, the Finger Lakes, and now Niagara isn’t palate-based, it’s political. 

“Terroirista’s” with their focus on Biodynamic and natural wines are way off base in trying to fight an ideological battle with the West Coast whilst cozying up with diffident Frenchmen.  Instead, they should embrace the brio of what’s under their nose.  Some of the most honest and interesting wines in the world aren’t coming from the spun and micro-ox’ed left coast, nor are they imported from the avant-gard garagiste’s in France – they’re coming from humble, hat-in-hand vintners in improbable places like Niagara and other cool climates.

Make no mistake, Niagara wine isn’t inexpensive, not with the Canadian government getting their fair share, but a number of wineries are worth seeking out, especially if you’re the type of wine enthusiast who appreciates cool climate wines and has a sense of discovery.

Fortunately, a web site creatively called, “Canadian Wine Shop” based in New York state can help you get a fix.

Some wineries to look for:

Coyote’s Run
Flat Rock
Peninsula Ridge
Tawse
Thirty Bench
Vineland Estates


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Nominations are Now Open for the 5th Annual Wine Blog Awards

A little over a year ago, Tom Wark (PR whiz, wine shipping advocate, blogger at Fermentation and founder of the Wine Blog Awards), and I had an email exchange in which I noted that there seemed to be a, “Been there, done that” sense in the online wine writing scene.  My contention was that the genre hadn’t advanced enough and was, “Running to stand still,” to borrow a phrase.

Tom didn’t respond to my thoughts specifically, a pocket veto of sorts.  Flash forward 15 months and not only was my observation off base, it was off the map.  Tom was right.

Today, online wine writing offers an incredible panoply of voices, niches, and quality, ever-growing and impossible to keep up with.  Whatever your wine fetish, you’re going to find a community within a community and quality writing that will educate and entertain with personality and verve.

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To wit, already populated by great diversity, the 5th Annual Wine Blog Awards are currently accepting nominations until May 31st.  Ceded by Tom for the greater good and now organized by the same group of people who organize the Wine Bloggers Conference, the principal complaint against the Wine Blog Awards has been that they are insider-ish and don’t represent the diversity of writers and voices who are toiling at a high-level in pursuit of the good grape.  I have a hunch that won’t be the case this year; the entire contest could be marked by nominated finalists and winners who haven’t previously been acknowledged by these awards.

To nominate your favorite online wine read, please hit the links below.

Best Overall Wine Blog

Best New Wine Blog

Best Writing on a Wine Blog

Best Winery Blog

Best Single Subject Wine Blog

Best Wine Blog Graphics, Photography, and Presentation


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Wine Politics and Silly Season Go Local in Oregon

Weary from HR 1161 and national wine politics?  Don’t look to Oregon for respite.  There, its silly season for local politics and it’s wearing the patience of the well-intentioned causing furrowed brows as an assault against reason takes place.

By nearly universal account, Ed King, founder of King Estate in Lane County in the southern Willamette Valley, has built something from nothing – with vision and moxie he has created the largest winery in Oregon.  His is an internationally renowned, sustainable, certified organic estate winery on a 1033 acre property in an area that didn’t have much going for it when he started in 1991.

Planted to 465 acres of grapes and another 35 acres in fruits, vegetables and flowers, King Estate is an exemplar of respecting the land as an ecosystem, supporting farm-to-table cuisine as a way of life (before it became trendy), job creation with a staff of over 200 and a payroll of over $5M a year (nurturing a local economy in the process) while paying heed to the so-called, “Triple Bottom Line” – the notion that a business can be profitable, people-oriented and environmentally sound (this interactive map gives insight into the management of the estate). 

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In fact, King Estate achieved what many aspire to, but few attain in the wine business:  The creation of a national brand that doesn’t compromise on its core values of agricultural stewardship.  Editorial note to Ed King:  Start name-checking obscure literature reference points, footnote your missives and hire Randall Grahm’s PR apparatus to super-size your well-deserved mojo.

Yet, despite being a beacon of light for how to run a business, King Estate finds itself in the middle of a political sticky wicket from land use advocates.

A tiny operation, the Goal One Coalition is a public interest group that serves to mobilize citizens on issues related to global warming and a “limited number” of land use issues.  My interpretation of, “limited number” means they get their knickers in a twist at least once a year on a minor issue that justifies their existence in the annual report.

Using McCarthyism as a tactic, Goal One has picked a fight with King Estate and the nexus of the issue is a case study in the pointless nature of most politics, absent reason and distinctly partisan in nature.  Let it be said that sometimes a democracy is a drawback, nothing ever gets accomplished in a committee and while all opinions are equal, some are more equal than others.

You see, King Estate had the temerity to establish a restaurant on their grounds in 2005 and pair their wines with estate-grown comestibles along with foodstuff from local farmers and food artisans.

While the restaurant wasn’t an issue for several years, the formerly lackadaisical Lane County land management division encouraged several of the larger wineries, including King Estate, to start submitting for permits for special events and restaurant activity on a volunteer basis in 2009.  King Estate did just that – submitting an application in October of 2009 and their application was approved in December, 2010, some 15 months later (Lane County officials are, apparently, very busy … ahem).

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Unfortunately, in the intervening months, the state of Oregon passed Senate Bill 1055 and, well, when it comes to politics the state and the local folks don’t much communicate (see also:  formerly lackadaisical)

Under Senate Bill 1055, newly signed into law, a winery is only allowed to sell things that are incidental to the retail sale of wine, including items that would be in a limited-service restaurant, as defined by another Oregon statute.  That statute dictates that a limited-service restaurant means, “pre-packaged” food.

So, what do you think happened when King Estate finally received its permit from Lane County?  Yup, you got it – the Goal One Coalition appealed it on the basis that the newly installed Oregon law from Senate Bill 1055 meant that King Estate’s restaurant that had just received its permit from Lane County was in violation of the new law.

Do you see where this is going?  King Estate, an all organic estate vineyard with a five year old farm-to-table restaurant voluntarily submitting for permitting, waylaid by a new law, was being poked in the chest by radical land use extremists and might have to serve pre-packaged food at its restaurant based on a small technicality…

This makes perfect sense doesn’t it; it’s completely rational, right?  Paging Bizarro Superman... 

And, of course, the land use Nazi’s realized that King Estate has been operating the restaurant for the last five years, has never had a complaint from a neighbor, serves farm-to-table food that supports the local community and treats its land like the crown jewel that it is in the Southern Willamette Valley.  Right? 

Flash forward a couple of months and House Bill 3280 is introduced to right some of the wrongs from the former Senate Bill 1055 including giving the capability for a newly designated, “Landmark” winery (a winery that produces 150K + gallons of wine per year in at least three out of five years) to operate a restaurant.

As of May 2nd, House Bill 3280 passed the House with a resounding vote of 52-3 and it moves on to the Senate for vote, as well.  Thank goodness somebody is demonstrating some rational thought even if it probably took thousands of dollars in lobbyists’ money to do so …

Signing the King Estate petition is still a valid exercise until the Senate bill is approved.  If you’re so inclined, you can do so here.  Personally, I like the notion of a national readership carpet bombing a local petition, but then I’m a benevolent anarchist at heart.

Hopefully, reason beholds the Oregon legislature giving King Estate a clear path forward in continuing to serve food and wine together at the sustainable table, as they should be, and we can turn our focus onto other nefarious activity including HR 1161.

Politics, man.  Got love it.  Or, not.


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Signs of the Apocalypse #2036

Forget the incongruity of having an elephant garbed in an Indian motif representative of a California Riesling.  No, that’s the least of the situation.

It’s the trunk that jumps out mostly … the elephant trunk that is about 2/3’s longer in proportion than it should be with a snout that looks like a hand from a dead body being dragged by a zombie.

Then, the name throws off the entire thing.  Longhurschlong—faux German enough to throw off Aunt Millie, but cheeky enough to draw snickers.

The web site has user quotes along the lines of, “A surprisingly explosive finish.”

I ask you reader:  Brilliant or despicable?

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Lot18 and the Art of New Market Models

The funny thing about business models is that when start-up businesses position around new market dynamics they do one of two things:  They paint the exact picture of their business for casual observers (and competitors) in Manet-style realism or they don’t, leaving the mind’s eye to make Monet-style impressionistic leaps.

Perhaps this is why Philip James’ new venture, Lot18, is being lumped into the “Flash wine site” category when it appears to be much more significant (even if impressionistic).

When I covered so-called “Flash” wine sites last July, Lot18 hadn’t yet launched and my opinion then (as it remains today), was to urge caution with many of these sites because most don’t appear to be businesses with a vision that can grow into full-fledged ongoing concerns with an impetus bigger than capitalizing on the short-term oversupply of luxury-priced wine as a retail operation.  The word “Flash” has been equated to, “Flash in the pan” meaning that these sites will be here today and gone tomorrow.  Many others have opined similarly, including a recent run of punditry from the New York Times, Wines & Vines and Palate Press.

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While each of these articles touch on the obvious vagaries of the model with a winery-slanted spin about whether the online wine sales sites are predatory vultures, there’s a much bigger view to look at – a market dynamic that I think Lot18 sees as an ownable market space where other sites (and writers) see an ecommerce retail operation.  And, it has virtually nothing to do with being predatory.  Instead, it’s about creating a solution for a problem that has existed for ages.

Instead of viewing Lot18 like another in a long list of ecommerce sellers responding to the here and now, I think James sees a much bigger business model that can bypass the three-tier and capitalize on the age-old problem of winery inventory management vintage by vintage, a problem that has typically been handled very quietly in the three-tier, a system that is closed off to the majority of the boutique wine market.

It’s a subtle change in perspective, but rather significant.  It’s the difference between selling a few wines that can sell at $60, but not $80 as a one-off deal based on the current economy and creating an entire mechanism for inventory management that has bedeviled the boutique wine market.

As one small Mendocino vintner without a distributor infrastructure said to me, “I’m ready to release my ’09 Chardonnay, but I need to move 70 cases of the ’08 first.”

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Yeah, him and about 5,000 of his winery brethren, too.  Likely, that’ll be the case next year and the year after, as well.

By common analogy, I think Lot 18 sees a wide and deep market-altering Amazon.com-style opportunity where others see Fatbrain.com, a little known ecommerce bookstore for technical books circa 1999.

Sure, I groaned when I read a recent article on Lot18 at Business Insider.  There, James was quoted as saying, “No matter how fast we hire, we have more openings than we can actually fill.”  In total, the short piece smacked of hubris.  But, James also said something really insightful when he noted, “(Wine) is a $30 billion niche.  It’s bigger than music, it’s bigger than Hollywood, and it’s bigger than DVD’s and cinema.  I guess you can call that a ‘niche.’”  That was on April 26th. 

On April 29th James wrote a blog post at his personal site discussing in very obtuse terms the arrows that companies take in the back when they have, “First Mover Advantage.”  He noted, “There’s a first mover advantage to what we do, and we’re happy to be leading the way. It’s not cheap going first, and that is the flip side, but by leading and paying to pave the way we do get to define a portion of the landscape.”

An alleged “Flash” wine sales site that launched in November having “First Mover Advantage?”  What the …?

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On May 2nd Lot 18 announced a $10 million dollar round of series B financing, adjoining a $1 million dollar sales month in March and April.

Clearly, there’s more here than meets the eye.

Despite having worked at three venture capital-backed companies, I don’t profess to know much about the VC game.  However, I do know that in this day and age, VC guys aren’t throwing $10 million into the 40th wine-related “Flash” site and the 196th social commerce business plan they’ve seen in the last 12 months unless there is a vision for something that the rest of us can’t yet discern.

What precisely Lot18’s VC’s see is between Lot18’s business plan and the banker’s in wingtips, but what I think they see can best be typified by a quote from Jeff Stai, owner of Twisted Oak winery in the Sierra Foothills who was quoted in Palate Press regarding a sale at another flash wine, “… We sold 683 three-packs, which is roughly three pallets of wine. I’ll sell three pallets of wine all day at near-FOB!” 

FOB is a wine industry term for the winery sale price to a distributor.

What Stai didn’t say, but he could have was, “If I can close out a vintage and maintain a margin that I’m happy with and not have to deal with the incredibly inflexible, non-partnership oriented three-tier, who greedily eat my discounts instead of passing them to the customer,  I would love to.”

So, if we go back to quotes from James about how big of a market wine is and you consider that closeout discounting to this point has only occurred in the three-tier system, you can start to see the seeds of a business model emerge that’s much bigger and will surely outlast the “Flash” sales sites that operate like retailers in a short-term bubble. 

There currently isn’t a vintage closeout or inventory liquidation mechanism in the wine business outside of the closed off three-tier system.  Every other consumer packaged good vertical has a closeout function typically handled by brokers.

Ding, ding.  This is why Lot18 is nationally hiring, “Wine Procurement Specialists” – these are the equivalent of brokers who facilitate the sale of goods that need to be closed out.

It sounds so simple, but really the business perspective difference in between being a small-time “Flash” operator and building the infrastructure that Lot18 is putting in place is significant in vision.

So, are these sites “predatory vultures” perilously taking advantage of wineries in short-term time of need, as has been alleged?  It’s all in your vision of the business model – a model that I suspect is more Manet than Monet for those who look for the fine detail.

Photo credit:  Demetrios Vlachos

Philip James on the funding


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