Palladion Signature Import is a high-end fine wines and premium spirits importer specializing in the exclusive import of small batch, traditionally handcrafted, artisanal products, capitalizing on the underserved nationwide demand for non-mainstream specialties at top-tier market segments. Key components of the company’s strategy include securing exclusivities with independent family-estate producers of top expert-vetted products and building these brands globally through disciplined high-end placements.
Silvia Davi spoke with CEO Billy Starkey at the recent National Investment Banking Association conference in New York.
Full transcript:
Silvia Davi [SD]: Bill, thank you for joining me here at the NIBA conference, it’s pleasure to speak to you about the incredible success of your company. Tell us about the mission behind it, and why you joined the firm.
Bill Starkey [BS]: Well, I actually founded the firm and two real aspects to what we do. The first is client side. There is an expanding demand, really a pent-up demand, for high-end non-mainstream, truly elite level wines and spirits, as America is growing in its maturity and knowledge of wine and spirits. The demand is increased, and a lot of it’s been fueled by millennials whose information and knowledge is right at their fingertips, so they’re very savvy. And then, on the supplier side of what I do, who I import for, these are traditional hand-crafting artisans who make these wines and spirits, and the art is dying. It’s going away because of a lot of consolidation in the wine industry. And because of this large volume consolidation, unless you’re a really high volume producer, they’re not interested. So it’s just amazing timing to be able to serve these artisans who are now being overlooked, and the demand side of the United States for high-end truly interesting and healthy wine and spirits.
SD: It’s a fascinating topic and yes, that everyone really loves to drink great wines, but especially when there’s a story behind them. And you talked about the dying craft. Where are these wineries that you’re importing from? A lot of them I’m pretty sure are private family-owned generational vineyards. So talk to us about the regions and really how you uncover them.
BS: Sure, as you said, they are family estates, multi-generational. They handed the craft and their secrets generation to generation. We show starting champagne, which you see here from the Lemaire family, Roger-Constant Lemaire, and from there, the really tight knit of independent producers. Alsace, France. Burgundy. Beaujolais, France. Bordeaux. I have a lot of imports from Bordeaux. And interestingly, the only distiller license for all of Paris since 1916. All family relationships who have connected with me and requested me to import – either exclusive importer to protect their brands and to build them appropriately to the quality that they’re deserving of.
SD: How has the reception been thus far here at this investment conference? There’s clearly a lot of wine and business affinity programs, and it goes hand-in-hand, so I’ve got to suspect you’re getting good interest.
BS: Yes, most definitely. There has been a lot of interest with the cannabis emerging market, and a lot of excitement and a gold rush direction, really saturation of attention, but this was a great opportunity to say, “Hey there’s this bigger industry out there, and there’s a segment that’s really underserved.
SD: Untouched.
BS: It really, is what we see are the large distributors who are consolidating. They need the higher volume so they don’t even look at these artisanal traditional wine makers and spirit makers. And then when you do have some importers that have an interest in these family estate grow producers, they just don’t have the corporate reach. They haven’t designed their businesses to be able to have MGM or Caesars Entertainment or even the Darden Group, the world’s largest table service restaurant corporation – they’re not structured to deliver coast-to-coast and that’s what we did. So kind of a unicorn. I guess we’re unique.
SD: That’s great. It seems like you’re offering them a springboard, and reach and access. And so you mentioned France. What other regions are you tapping into?
BS: France is our biggest with Bordeaux, Champagne, Alsace, Beaujolais, Burgundy. We import some great wines, some Barolos, Barbarescos, from Piedmont, Italy. Love them, and also we’re expanding into sake, from Japan, never been introduced before into the United States, and some Argentinian wines, so we’re really excited about those. Again, all of these products are expert vetted by master sommeliers, world-renowned oenologists, and the response even from our clients is the same, like, “Where has this stuff been? I’ve never heard of it.” And so, that gives me some joy.
SD: Absolutely, and it seems like in the United States, there’s continued growth. You mentioned millennials really tapping into wine. I read a statistic recently that women are the biggest wine drinkers in this country. What other interesting factoids about our drinking habits particularly of wine and high-end spirits here in the US could you share?
BS: Well, I can thank the information age. A lot of the information and knowledge about finding wines and finding healthy wines, low in preservatives, so that requires a completely different logistics handling. And the sharing – the sharing generation of millennials – they would rather come together as a group, as four or six, and contribute to buy this amazing $500 bottle of wine and share it, as opposed to each getting Two Buck Chuck from somewhere else. But it’s really exciting. The baby boomers are at the stage in their lives where they really want quality, and they’re trying to enjoy their lives now that they’re retired. And of course, the millennials who really appreciate quality, and are of the sharing generation. So that’s exciting. And so we’re seeing this massive explosion at the high-end market segment, kind of unmet.
SD: I think you’re right, given the sharing of knowledge on social media. You mentioned spirits, for instance, and I noticed that over the past two years here in the US, there was a lot of increased attention on spritz and a lot of these aperitifs, for instance. So do you do anything in that area? Obviously, spirits are growing part of what you do, and clearly I think that the US visibility platforms on social media have helped contribute to the popularity of those types of spirits.
BS: Yes, it’s really exciting to, and again, it was connected through this very close-knit network of independent producers. In France, Paris’s only licensed alcohol producer, The Distillery of Paris, approached me to be their exclusive US importer, and we’re talking very high-end spirits, from agave maple (there’s nothing out there that’s really distilled from maple) and of course gins and vodkas. Oh, and perfumes – denatured alcohol. So we took some of the sample products out to Las Vegas, and we had to stop because the demand was like, “We want it. We want it now. It’s the highest price point we’ve seen, but we want it. We can sell it.” And I just had to stop. Let us import it first, and we have to run through the legal wickets to make that happen.
SD: : You mentioned to agave. How is that? Tequila is another exploding and continuously popular drink here in the United States. And now it seems like Mezcal.. Do you import anything from Mexico?
BS: I do not, but from Distillery of Paris, we have that. So it’s interesting. He gets the highest quality agave he can, and he insists that it’s low-temperature slow-cooked And again, it’s not cost effective, so it drives a price point up. He takes that sugar and brings it to Paris, where he produces probably the smoothest agave you’ve ever tasted. Yeah, both the blanco and reposado, we have now.
SD: Fascinating. And so you mentioned a lot of the trends that are creeping up in this industry. I love the perfume and the natural healthy ones. What are others that you find folks are most interested in, and where you still feel like the sky is the limit?
BS: It’s both the spirits – because of the mixologists now and the attention they are finally getting at the high level – but the champagne. I saw a sign where it said, the only meal without wine is breakfast but that’s not even true – that uses champagne.
SD: Or the proseccos.
BS: Sure, yes, yes. But they’re very different climates, soil and grape varietals used. And what we’re seeing with a lot of those products is just very high preservatives. You may hear friends say, “I can’t drink champagne because it gives me a headache.” Well, that’s because of the preservatives honestly. And with the high quality, hand-crafted champagnes using the old traditional methods, you don’t get the headache. It’s incredible. And so people are learning this, and once they taste these champagnes, it’s hard for them to go back. So America is just learning that champagnes, for example, are a good aperitif, like you say. It is approachable, it is something you can consume daily and it’s actually low carb.
SD: I like that. The ladies will like that.
BS: So it’s just an exploding arena. And people are seeing that sometimes it’s worth the price, especially when you share among four or six people.
SD: Absolutely and it’s all about education, right?
BS: It is.
SD: You have a fascinating background. I was intrigued by the fact that you came from a different industry and the segment, Renaissance Minds, really showcases a lot of leaders such as yourself, that have deep interests in different areas and are multi-faceted and multi-dimensional. Can you explain your background? I know cybersecurity was a big part of it. And how are you applying any of your other learnings and other traditional backgrounds into something so exciting, like this industry, wines.
BS: I would have never guessed, even five years ago, I would have never guessed. So like you say, 15 years in federal service, from space, cyber and engineering, and then 15 years of executive roles in industry for aerospace defense. And through that path, I really learned a lot of the fundamentals and the importance of team, cross-functional expertise, everyone contributing and always thinking ahead. And when these producers approached me and begged me to consider being the rep, I thought, you know, I need to study this industry. Maybe this is a neat segue to my second career, and I’ll admit, national security, it can take its toll over three decades. It’s a great mission, but it’s really from those fundamentals that I learned through those 30 years that I can apply, and I designed this business from the ground up targeting the segment that is most in need.
SD: That’s fascinating, and I’m a fan for continuous reinvention. You said it, from an innovation standpoint, you clearly have started a new track, but have applied all of your key learnings. What advice would you give to entrepreneurs that may be watching that maybe are considering what’s next for them? What would you say to them?
BS: Well, first, I think you really have to study the market, and not just the market, but where it’s trending. What’s the outlook? So it’s good to pursue your passions, but you kind of need to know what you’re getting into. And then the second thing is, build your team. And from that team, you need some humility to listen. And I’ll tell you, there have been things that I just wasn’t so sure at, but my advisors were very intent on letting me listen and I’m glad I did. A lot of decisions I could have made would have really given me trouble, and so that team, that collaboration, is so important.
SD: Absolutely. It sounds like you’ve had a great track record and you have a good plan. Just finally, what is next in terms of your model and your strategy? Are you looking at new products, new markets or new asset classes? And you mentioned some of the cosmetic tracks as well.
BS: Truly. The only perfumes that can be produced in Paris are through the Distillery of Paris, so we’re really happy to represent them, and of course we’re being really selective and so we’re really vetting. There’s a whole pipeline of people who are approaching me. I think they see how I built brands, and I’ve taken care of the families. And so it’s more than just business, and we’re evolving these relationships. So I have a huge pipeline, but I’m vetting them. They really need to be top, top notch, and they need to have a future to them as well. And so, where we’re headed is we’re actually seeking the right partner for our next stage. We’re in this A round for fundraising. We have the mechanism in place to really take this forward. We’re just ready for the extra working capital. The seed funding was a self-provided. It’s really exciting, we’re going to generate revenue and margin on day one, so it’s just ready for the next step. We hope to get the right partner for that.
SD: And what type of partners are you looking for?
BS: Well, it would be nice to have not only the working capital, but a partner that can actually contribute in a meaningful way. We’ve got a great network of advisors and connections, and actually our customers are our biggest marketing resource because we’ve spent no money on marketing. It’s all been word of mouth, but it would be nice to take this to the next level in terms of enterprise and a large portfolio. We’re going to need some help to manage a lot of these moving parts, and so I want an actively engaged partner.
SD: It sounds fascinating. Well, I hope you’re getting the word out here at the conference, and I am very excited to see what’s ahead as you continue bringing a lot of that great product to the United States. So, congratulations.
BS: Thanks.
SD: And best of luck to you. Actually, one final question: What is your hobby? What are you doing in your spare time? Are you actually consuming and tasting a lot of these new spirits or wines, or is there something completely unrelated to the industry that you’re passionate about?
BS: I’m passionate about a lot of things, but truly what brings me joy now is seeing not only myself but my family who’s involved, spend time with these families, our suppliers. It’s so enriching learning about their culture, and just their family practices, and it’s very fascinating and just really uplifting. And so all my spare time is just quality time with our supplier families.
SD: That sounds amazing. Well, there’s nothing like experiencing some of the dolce vita, the good life. So enjoy it, and thank you again for being here, and best of luck to you.
BS: Thank you so much.
SD: Take care.
Equities Contributor: Traders Network Show
Source: Equities News
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