Meeting with Steve Burman

Meeting with Steve Burman

Date: 2/8

Title: Former Partner at 3 Steves, a Small Napa Vineyard

Notes

• Contact: Steve Harrison
  • Top wine shipper and a huge Stanford alum
• Who he sold to?
  • Before wine – was in Silicon Valley
  • Ford – paid one student to go get their master’s changed life for the better
  • Wine industry – a lot of romanticism
    • Espoual relationship kinda thing
  • People that are really into wine – evokes memories
    • Very emotional – connected to memories
  • Business itself – really challenging
    • Whether business, D2C, is a huge decision
  • A smart winery does D2C only – no reason to discount
    • Whatever retail price is, you get all of that
  • If you go into restaurants – some places want 40% off
    • Some have to go through brokers and distributors
    • Makes no sense to put wine in a restaurant unless you’re paying for a social media ad
  • Discounting wine so much to go into a marketing budget
  • Have to be real, authentic, etc. Food isn’t good enough, etc.
  • If you create ideals – never went to restaurants outside of those where we lived
    • Get 40% off the top – we’re gonna attract people that like those bottles of wine
  • Most wineries can get into most restaurants
    • Any wine can get a decent score
    • Fortunate to have had a wine writer
  • Restaurants were fun, always near where one of the 3 Steves were fun, you do it for marketing
• Great about wine industry
  • As a competition – everyone helps each other
  • Some business plans – want to tackle restaurants as much as we can
  • Just Steve’s opinions – most of them have big egos
• Oversupply
  • Friend made a shit ton of wine
  • Costco bought wine below its cost structure
  • If a winery is making too much wine and they have to dump it, the Costco and the bigger restaurant hold all the cards
  • Winery should make a little bit less wine compared to what they’re gonna need over the year
  • There is a problem of wineries making too much wine since getting burned
  • $68 is average price for cab
  • Shifting trends in demographics — what if i went to a cool winery that made cool spritzers
  • Napa – has been getting hammered because they overexpense their wine
• Selling to retail
  • Costco, Total Wine, and BevMo
  • Will expect a little respect of return
  • Develop a relationship, neither one tries to screw the other
  • BevMo – kinda cute, has their shit together, buy good wine
  • There is a hierarchy of who is cool and who’s not
  • Total Wine is the coolest
  • Would never diss a restaurant
  • Total Wine, BevMo, and Costco
• Complicated part – distribution
  • All the different channels you can get thrown in
  • Going to a restaurant – doing the restaurant a favor
  • Already don’t make enough wine to meet my wine club demand
  • Absolutely detest distribution – all have different motivations
    • Trying to juggle in prices to go to your distribution channel
  • Never spend time with a distribution channel of any kind
    • Turn a group of romanticism into a group of business
  • Partnership throughout industry
  • Distribution channels – would do anything but make wine to distribute
  • All the crazy business options, selling wines to distribution means that you just surrendered the art of winemaking to become the janitor of winemaking
  • 300,000 case will have a different motivation than other places that have smaller margins
• Any general problems and painpoints?
  • Wine – very left brain people, but all of us have a set of food and music demographic that we like
  • Wine – allowed me to have that creative side
  • At 3 Steves – probably 600 times every day of every week and every month, came up with an idea
    • The practical side of this would work for me, but I don’t think I would have to bring it to market
  • So many ways to make wine, keep records, keep clipboards
  • What oat did you keep in your 2012? Lots of old school clipboard kinda guys
  • Nothing to market that I would’ve invented
  • Some Stanford folks – looked for preventing spoilage (smaller devices),
  • Wine industry is somewhat perfected
  • Never want to get stuck in the “nothing has been invented”
  • Winemaking has a weird “I haven’t screwed up my wine yet, I’m ging to be really proactive”
  • Wine is a unique, one-off industry, it’s hard to think about marketing an idea across the entire wine industry
  • Demand for wine is starting to go down
• Pandora – come and gone
  • Use algorithms to figure out if you liked a Crescendo, piano, etc.
  • By you giving thumbs up, thumbs down
  • Use rec algorithm – create something for wine to move