Starting a wine company in 17 minutes (ITS CLASSIC)

I met a good friend for a few outdoor margaritas last week. With this particular friend, I know the margaritas are working when they start pitching me ideas. I thought maybe the margaritas were busted, but then thankfully, towards the end of the conversation, my friend looked at me and said, You know what? Screw it.

I'm going to start a margarita business. Nope. A wine business. Just let me know if you want to get in on that.

My friend isn't going to start a wine business, but we are today. So buckle up. I'm Brian Scordato, and this is the Idea to Start a Podcast brought to you by Tacklebox. If you've got a startup idea in a full-time job and you listen to this soon enough after it comes out, you might be able to sneak into our next cohort.

We start October 28th, and it's fully virtual. In the words of an alum who's built an incredible business, spend seven weeks fleshing out the idea so you don't spend seven months building the wrong thing. Apply at GetTackleBox.com.

And a quick shameless plug. I had a bunch of people reach out since season three started saying they love the podcast and asking if there's anything that they could do to help us grow. I truly appreciate it. And if you do want to help, leave us a five-star rating and a review on iTunes or Spotify or wherever you listen to this.

And if you want, text it to a friend. It's crazy how much iTunes leans on reviews and ratings when they decide which shows to promote. I would never think to rate or review a show I love. I just listen to them every week.

So a couple of days ago, I went through and rated and reviewed every podcast that I like, and I suggest you do the same, not just to Idea to Startup, but to all of them. It'll really help the people who make these. All right, back to business. The best way to start a startup is to have a unique perspective that comes from experiences few other people have had.

We talked about this two weeks ago. If you didn't listen, we broke down how a chef who'd had a ton of success with a jackfruit dish at his restaurant could spin off a jackfruit company. Last week, we drilled down on it more. We talked about whisper ideas, the villain of the startup world.

Whisper ideas are the ideas people lean in close to and whisper to you in coffee shops because they're afraid that if anyone hears what they're building, that person could just up and build that business themselves. There's literally nothing that makes the person telling you the idea more qualified to start the business than anyone who might haphazardly hear it other than that the first person thought of it. There's no unique perspective. There's no secret.

There's just someone with an idea who sees everyone else in the world as potential competitors. And competition is for losers, remember? The biggest takeaway from last week, hopefully, was that your startup idea should feel like you've been subconsciously preparing to start it for years. And ideally, it should.

But here's the but. A lot of the time, it doesn't. A lot of the time, it sounds a lot more like my friend. A lot of the time, you're a few margaritas deep and you decide that you're going to start a wine business.

You might be genuinely interested in wine and you might have some thoughts on how to build something that fits a need that you have, but you might not have much more than that. Sticking my head in the sand and telling all of you that the only successful businesses I've seen are the ones that look like that unique insight from day one, that would be disingenuous. We've had a bunch of startups that have gone through Tacklebox and been successful and started out with an idea that I maybe didn't think was totally differentiated to start.

It's possible to lean into the process and start with the whisper idea and turn it into something way more. It takes a different set of skills, in particular, curiosity, discipline, introspection, and a ton of empathy. It also takes someone who's an extrovert, or at least can pretend that they're an extrovert for a little while. You're going to have to talk to a bunch of people.

And finally, you're going to need to build a strong team, but you're going to have to do that anyway. So what we're going to do today is start a more realistic company, a company that doesn't begin with an amazing insight, a company I haven't been subconsciously preparing to start for years. Today we're going to start a wine company. I spent the last week actually doing that.

Let's see how it went. As I went through the steps of starting a wine business this past week, I realized wine is actually a great metaphor for any type of startup. Wine is subjective, it's emotional, it's often confusing, and for 95 of people wine isn about wine at all It about everything that happening around you as you drink the wine It the moment the wine helps to create that makes the wine This is the perfect way to think about any product The product doesn't exist in a vacuum.

It exists alongside everything that leads up to the product being used and follows the customer after the product is finished. It's about all the people that are involved or impacted by that product. It's about how the customer feels about the problem that you're solving, how urgent it is, and how it impacts their goals and motivations. The product isn't the product.

The product is what you enable your customer to become. It's easy to miss that for most products, but for wine, we all get it instinctively. No one knows if wine is good or bad in a vacuum, not even the experts. If you don't believe me, check out the countless videos online of sommeliers trying to do blind taste tests.

They constantly mix up the $1,000 bottle of wine in the two-buck chuck. I feel for them. Messing up a blind taste test doesn't invalidate what they do at all. Wine is a story, just like any product, and taste is only a small part of that story.

A Chanel dress may not be as high quality as a Gap dress if both don't have the tags on, but they do always have the tags on. Wine was never meant to be drank blind. The Psalms never stood a chance. So if wine or any product is part of a story, we need to start by understanding that story so that whatever we build makes sense in a specific context.

Most importantly, we need to understand the main character of that story, and that certainly isn't going to be the wine. So I spoke with 10 people about wine, and that's what you should do too, whether you've got a whisper idea or not. You can never know too much about the story you're about to become a part of. I didn't get too specific when I was choosing these first 10 people.

I sort of just leaned into friends who I knew enjoyed wine, and honestly, I just wanted to catch up with. Each call was maybe 15 minutes long, and they all started with the same question. I said, finish this sentence for me. When it comes to wine, I wish I never had to deal with blank again.

I got some great answers. I heard about hangovers. I heard about feeling insecure ordering at a restaurant. I heard about forgetting bottles that you loved at a restaurant.

But the one that got the strongest reaction came up four separate times, pouring out half a bottle of wine that had gone bad after only drinking two glasses one night and then leaving the half-drunk bottle on the counter for a few days. I heard stories about people with their significant other each split in a glass on a Monday or a Tuesday, and then never finishing the bottle and having to pour it out. My next question once I heard that was, well, how do you solve the problem now?

All four of these people said something very similar. They'd each bought that suction thing that extends the life of the wine by a few days, but that didn't really help them. They all also mentioned that they knew there were products out there around $300 that snapped onto the top of bottles, stuck the little needle through, and kept them fresh for weeks. but they could never justify the cost.

In tackle box speak, I tried to zoom in on an inflection point where it was painful enough for them to buy that higher priced fix, but the pain was never that acute or intense. They just had this feeling of waste. Finally, they usually solved it by just being judicious about when they opened a bottle. They wouldn't have wine on a Tuesday, even if they wanted to, because they likely weren't going to have wine again until Friday or Saturday and it wouldn't be fresh.

I tried to dig for other solutions, and two of the people I talked to mentioned they'd bought cans of wine before. But they really thought cans were for things like picnics or travel. They were hesitant to open up a can on a Tuesday because what if they wanted to go for a picnic later that week? Seems like a waste of the portability.

And that's what the can was for, portability. All right, 10 people, 10 conversations, maybe 15 minutes each, and we got some stories. That's our first step to moving away from a whisper idea. What we're really looking for here is someone who's got a problem painful enough to take some sort of new action to solve.

We don't want to build anything until we're sure we've got that. So what we need to do is set up an experiment. Get in front of someone who we think will feel the pouring out wasted wine problem strongly enough to change their behavior. We'll certainly test this with the people we've already spoken with, that's the low-hanging fruit, but we'd like get some cold people too.

To do that, we need to find some unique acquisition channels. I circle back with the four customers for a second conversation to learn more about where they hear about wine, what channels they're active in, what communities they're involved in, what they do after work all of those things in order to try and find more people like what you looking for here is the niche stuff We know they on Facebook and Instagram but that not helpful For validating an idea Instagram and Facebook ads are lazy they untargeted they wildly expensive and they very rarely actually useful.

We're better than that. We can learn the story better than that. My second conversation dug in around the Tuesdays that they had that glass of wine. What made them do it?

What made them risk that moment of having to pour it out? Three of the four had the same story. They had dogs. After a long day of work on a Tuesday, all they wanted to do was take a glass of wine with them to the dog park, let their dogs run around, and talk to all of their friends there.

They mentioned that lots of people at the park, specifically since COVID, came with a beer or a cocktail. It was a great feeling. It was a community. They saw the same people every night.

They'd gotten to know them. They enjoyed talking with them, and they had things like WhatsApp groups to schedule when they were all going to go. Okay, it's a start. And obviously, if I weren't starting this in just a week, I'd have done a lot more interviews, had a lot more stories to tell, and would be able to dig in on a bunch more data points.

But what we've got is people like to drink wine at a dog park on a Tuesday. It'll have to do for now. So let's run a test. I can hear you through the speakers.

What are you actually testing, Brian? You don't have anything. True, but as I said, the product doesn't matter. It just needs to be part of the story.

So here's the story that we have. People who like wine but aren't wine obsessed feel bad tossing out half of their $20 bottle of Pinot on a Saturday. So they don't have a glass on Tuesday and miss out on the dog owner's version of a happy hour. Also, the person we're talking about lives in New York City.

They're a pretty high earner. They swing by Sweetgreen on the way home. They have succulents and all the other millennial tropes. They're also really into organic wines because they know that they don't give you a hangover if you ended up drinking a little bit too much on Tuesday and wanted to get to work Wednesday morning.

That's the only other big thing that came up. Organic wines matter. So our product needs to fit into that story. My first take at what a product could be is the obvious one that you're thinking of too.

Why don't we just make bottles of wine that have two cups in them? So why would this be different from a can? We talk a lot about categories with the startups in Tacklebox. Customers will toss your product into a category immediately, and it will be hard to break out of.

The wine-in-a-can companies have been tossed into a category. Portability. Portable for trips to the beach, portable for picnics, not portable for something as low stakes as a dog walk on a Tuesday. That's a waste of the reason the can exists.

That's why customers don't do it. We need to make sure that our product stays out of that category. It needs to be very much for Tuesdays. It's not for special occasions.

You don't save it. It's your Tuesday glass of wine. Okay, perfect. Now we have a company name, the Tuesday Wine Company.

Quick story on categories, which will be your basis for differentiation. I heard this story about rosé while doing some wine research, and it kind of blew my mind. Do you know when or why rosé got so big? Selling any wine is tough.

You're in a wine store next to 1,000 bottles of wine that look identical, or a supermarket next to 1,000 bottles of wine that look identical. Rosé got big when a rosé manufacturer took their bottles out of the wine area of the grocery store and put them in the flower section. That's the story of rosé. You're going to a friend's house.

you're bringing flowers, it's a fun event, here's some wine that you can take too. The category is gone. People aren't deciding between red or white or pinot or cab. It's do we bring fun wine with our flowers for our fun day or not?

If the answer is yes, the wine is the rosé that's sitting right there. It's brilliant. It's an amazing way to differentiate, and that's why they grew. So back to the Tuesday Wine Company.

We'll sell bottles with two glasses of wine in them for Tuesday so you don't have to pour any out on Saturday. It's your dog park wine. Treat yourself to that moment. Last piece of the product to test out is the business model.

How much do we want to charge? Two things here. One, I don't want to build a shitty business. A shitty business would be one where I looked at how much our customer spends on wine now and priced either a little bit above or a little bit below that.

That sucks and I won't build that business. I'm not competing with bottles of wine. We've already established bottles of wine don't solve the problem. What I want to do is price the moment.

The experience of saying, screw it, let's do a glass of the dog park. That the value we creating So I don want people to think of this as a wine alternative and compare prices to that I want them to think of it as their Tuesday night experience And that fits nicely because I only want to sell subscription businesses when marginal costs are relatively high aka anything that's not a software business. So our price is going to be a subscription, maybe four bottles per month, maybe $75 a month.

When I look at wine prices, that gives me the margin I need to continue to build out the product and marketing channels and eventually grow horizontally. I won't build this business for margins lower than that. If people won't pay it, I'll find another customer or I won't build it. And no, I'm not going to worry about the actual wine yet.

I don't care if it's red or white or pinot or cab. I haven't learned that part of the story yet. And as I mentioned, that part doesn't really matter. Sommeliers can't even really taste the difference.

If I get organic wine to people in the dog park and the problem is actually real, they'll be happy. If they know that I've looked in and I've noticed this problem and I've solved it for them, they'll have affinity to the brand. The story is what matters, and we're getting closer. Here's where I spent a few bucks.

A hundred bucks, to be exact. I got a mock-up of a ceramic bottle made from Upwork. It kind of looks like a really nice Greek olive oil ceramic container with a wooden cork stuck in the top. It's actually pretty beautiful.

And it's got a Tuesday Wine Co. label on it with the phrase, one glass each of organic wine for a Tuesday night. I thought a lot about the bottle. If we're targeting people going to a dog park, we want that bottle to be distinctive.

I want everyone to see it and ask about it. That's our acquisition channel. But I also realized that most people are just going to pour the wine into two travel mugs. So I considered maybe having one glass in each bottle.

Then it would be more portable. I considered mason jars. All of this is just a test, though. I decided to test out the two-glass ceramic bottle first, and we'll go from there.

I then headed over to Leadpages and made a quick, free website. All the links for this stuff will be in the description of the pod. It says, Tuesday Wine Co., two glasses for your Tuesday night.

Then it says, our first batch is for the dog owners. Bring your significant other and one glass each to the dog park on a Tuesday, and never throw away another drop down the sink. Sign up to get notified when our limited first batch is released. I don't know if that's the exact messaging I'll land on, but we'll try it.

Next, I texted the link to the people who I'd interviewed. I asked them to share it with their WhatsApp dog group chat. I went to a few other dog parks in the city and shared it with people there. I walked my dog around, and when my dog played with someone else's dog on the sidewalk, I shared it with them.

And that's how I started getting emails. More people to talk to, more people to fill in the blanks of the story. I think about startups as a big seesaw. If you have a ton of insight into your customer, your product doesn't have to be that good.

You know the problem and no one else does, so you just need a solution no matter how clunky. It's like your kitchen table. When your kitchen table wobbles, you're going to stick anything underneath one of the legs to even it out. When you're picking out silverware, there's a lot more that goes into it since the problem isn't that urgent, unless you literally just moved into your apartment, in which case you'll probably get disposable for the night.

When you start off not knowing much more than anybody else about your customer, you've got to be amazing at product. You've got to make objectively the best silverware in the world for that customer. You need to compete, which we don't like doing. Don't do that.

Recognize that your seesaw is out of balance and start running small experiments like Tuesday Wine Co. to start filling in the blanks. Balance out the seesaw. Get to the point where you know enough about your customer to know the problem no one else does so you can stick something under their wobbly table and they're going to love it no matter what it is.

You'll be successful when your differentiator is customer knowledge, not product expertise. Build towards that. So what's next with Tuesday Wine Co.? Nothing, really.

My plate's kind of full. I also don't think the problem is important enough to solve, but I did have fun going through the exercise. And if enough people respond to this podcast with desperate pleas for the Tuesday Wine Co. to live on, then maybe.

Anyway, have a great week. And if you've got a startup idea, head to GetTackleBox.com and apply. Also, if you just like this type of content, I send out newsletters with content like this that has a bunch more pictures and graphs and things that don't work well on podcasts.

Just sign up for that at The Idea to Start Up Newsletter at GetTackleBox.com. Thank you.