Wine Talk: Kevin O'Leary

The investor and Shark Tank star is also a wine lover and has partnered with one of California's larger wine companies on a new venture

Wine Talk: Kevin O'Leary
Linda and Kevin O'Leary enjoy wine while visiting Napa's Clos Pegase, owned by their business partner Vintage Wine Estates. (M.J. Wickham)
Nov 17, 2021

Kevin O'Leary is an entrepreneur, author, politician and television personality, perhaps best known for being one of the Sharks on ABC's Shark Tank and for his nickname, Mr. Wonderful. The 67-year-old Canadian is chairman of O'Leary Financial Group—a group of companies that includes a private early-stage venture capital investment company, his Shark Tank deals and a growing roster of other businesses.

O'Leary is also a passionate wine lover, and after experimenting in different aspects of the wine industry, he has launched Shop Mr. Wonderful. The website, which partners with Vintage Wine Estates, features wines personally curated by O'Leary from the Vintage Wine Estates portfolio. Since its founding 20 years ago, Vintage Wine Estates has become a top 15 U.S. wine producer, selling more than 2 million cases annually of wines from California, Washington and Oregon.

O'Leary recently sat down with Wine Spectator senior editor MaryAnn Worobiec while wearing a beret and tastevin to chat about his wine passion.

Kevin O'Leary: I've decided we should have some fun with this. I put on a little accoutrement here.

Wine Spectator: I've seen you wear the beret and tastevin before. Tell me about them—are you getting into character?
KO: The truth is, I've been wearing a tastevin for decades because I am a member of the Chevaliers du Tastevin, which is a Burgundian Society.

You may be aware that we are bound by the old code to wear our tastevin and our ribbons every time we gather. I usually don't wear my colors when I'm promoting my own wines. But when I go over to Burgundy, I'm wearing my tastevin and wearing a beret. That's just how I roll.

WS: How did wine become a part of your life?
KO: When I was young—seven years old—my biological father died. He was only 37. My mother remarried, and my stepfather was extremely knowledgeable in wine.

He worked for the United Nations. So, we traveled to different countries every two years—Cambodia, Tunisia, Ethiopia, Morocco, Cyprus, Japan, Switzerland, France and Germany. Even at that age, wine is not a big taboo in Europe—children drink wine at the table. Sometimes their parents water it down. My stepfather started introducing me to different grape varieties at the age of 8 years old.

I became pretty knowledgeable about the differences between the Left and the Right bank in Bordeaux. All of these things I just thought every kid learned.

As I got older, I started collecting and trading wine futures. I was pretty good at it. I knew my vintages, and I always consulted with winemakers, and my father was really knowledgeable. I now have five commercial cellars around the world. I'm very active in collecting and investing and trading.

I eventually said to myself, I wonder why I can't be in the wine business. Our family makes our own wines. We became an investor in over 3,000 acres of vineyards in Sonoma and Napa and Washington state. And I'm an investor now with Vintage Wine Estates. They make my wines [O'Leary Wines]. I'm in partnership with them on a direct-to-consumer business, and I'm really happy. But it's really about the love of wine.

WS: At one point you had the brand O'Leary Fine Wines of Canada, right?
KO: I've always thought the Cabernet Franc that they grow in the Niagara is the best on Earth. And they also grow Pinot in Canada. So, my first relationship with a grower was Vineland Estates and we partnered in a series of O'Leary wines and were very successful. They got listed by the LCBO [Liquor Control Board of Ontario], which is one of the largest buyers of wine in the world. You can still find them, and that was the genesis of the relationship that started the same idea with Vintage Wine Estates, on a much broader basis.

The Vintage Wine Estates story is a little different because it involves a rather unusual crossing of paths that goes back years to Shark Tank; there was a deal to sell wine in an individual serving, nine ounce glasses. It was a very famous deal on Shark Tank, and of course I got involved.

WS: I remember that: Zipz Wine. It was the largest investment made on the show at the time, right?
KO: Yes. The whole idea of single-serve wine really appealed to me and I thought this is such a big idea. I've got to go the biggest retailer in the world, and that's Costco. I've got to partner with Costco, and at the time Annette Alvarez-Peters was the legendary head [wine] buyer of Costco.

So I just took a chance. I thought, maybe she's a Shark Tank fan. That episode aired on a Friday at 9 o'clock. Saturday morning I called her cellphone number. I knew she wouldn't answer because she wouldn't recognize my number, but I left her a voicemail. I thought, what's the downside? She just never returns my call.

Well, 20 minutes later, the phone rings. It's Annette. I said to her I've got this incredible idea. You saw it last night on Shark Tank. She said, Look, single serve wine—I don't think so, but I'll take a meeting at an airport. I'll give you one hour of my time.

And that's exactly what happened. We went to the airport and I brought Linda with me. We met with Annette. She took the sample of the single-serve wine, and she was holding it over her purse and she tipped it. . . and it leaked right into her purse. That was the end of single serve wine in Costco.

But then she said to me, Kevin you're well known as the wine guy. You have a brand. But you can't play in the wine business at 50,000 cases. You'll never make any money. If you want to play in the wine business, you've got to know that 97 percent of the wine sold in America sells for under $15.99 a bottle. You have to be able to ship a lot more cases. Now, you're not going to do that by yourself. You have to partner with someone like Vintage Wine Estates. I'm going to introduce you to Pat Roney and Terry Wheatley.

And that's exactly what happened. And we never looked back.

WS: That's pulling together some important corners of the wine world.
KO: She took mercy on me, and we never looked back because we're now one of the largest purveyors direct-to-consumer in 42 states. We are going to really ramp this up because it's only very fine wines.

WS: Let's talk about that website. I know you're curating the wines, but are you tasting 100 percent of the wines you recommend?
KO: Every single one. I taste every wine. In fact, every night, I am trying something different. I curate wines for my friends and my wife and it's a big deal every night.

I want to really be clear on this in particular talking to Wine Spectator. This is not me slapping my name on a brand. This is me.

WS: I've seen some videos of you talking about wine and it seems fairly effortless to you. Do you have any advice for people who are getting into wine but might be a little intimidated by it?
KO: Well, I've been doing this for years and here's what I've learned, and I've learned it from my own friends and family and I've learned it through the business. We do direct-to-consumer in all of these states and the feedback we get from people in America? Start with the building blocks, the classics. That's going to be Chardonnay and Cabernet Sauvignon. Those you're going to find everywhere, and at every price point. That's what people start with.

Sometimes they only drink red and that ends up being Cab all the time. Sometimes they only drink white, and it's a Chardonnay whether it's un-oaked or whether it's an oaky Chardonnay.

What I've learned is the best way to get people to expand their horizons is by trying something different. If you like a Cabernet then try a Zin, try a Meritage, try something else that you don't have to buy 10 cases of it. Just try one bottle of it and go slow. I've been encouraging people to try different varietals. Even Moscato, an ancient wine. It is immensely popular. If produced correctly, it will be crisp, not overly sweet with lots of that beautiful flavor.

I do a lot of video wine tasting notes. I know I can't pass the glass to you through the lens, but in my description of these wines, in the experience of them, I think I communicate the opportunity to people.

WS: A lot of people that get into wine had another career before. But even if they were a successful heart surgeon or tech entrepreneur, not every skill translates to wine, because it's such an unusual business. With all of your different business ventures that you're involved in, have you found other knowledge you can apply to wine?
KO: That is an excellent question. I have been in and around the wine business for decades in one way, or another, as an investor, a futures trader, a collector of wines. There is no point in getting into this business if you don't love wine, that's number one. It has to be something you dream about all day. You can't wait to have your first glass. You have to really love it.

But in terms of the business aspect of it, there are many, many people that have this romantic sense of buying an estate and making 25,000 cases, selling it for $500 a bottle and getting a following. A few people are able to achieve that, but the majority just lose money and they eventually sell off their land because it's so painful to lose that much money for that long.

Wine is half art and half science. But the number one metric in terms of becoming a good investment is logistics; the ability to make it at scale and reach large markets, and that was the lesson learned with Annette. She gave me a priceless piece of information.

Customer acquisition is very, very hard. It's really, really hard. I have a huge advantage—hundreds of millions of people see me every year on television. They know I'm a wine guy. But here's the number one thing: I don't bullshit them. I'm not some person saying I know something that I don't know and then slap my name on it. I live and breathe and drink this stuff every day.

When I talk about a wine, it is because I know it, I love it. I know how it was made. I know the varietals in it. I know the blend. I know exactly the tannins. the sulfites, the sugar, the alcohol content. I know it inside out because I want to know it.

WS: Does a part of you still want that little vineyard on the coast, or is that not for you?
KO: No, that's not for me. I want to play with the big boys. I want to compete in this dynamic, digital 2.0 America that's emerging with the direct-to-consumer model. It is changing the wine industry forever. We are taking away those archaic three tiers of distribution, which are so inefficient.

There will always be a place for restaurants, there will always be a place for retailers, always going to be a place for that wine store you love at the corner. But there's also millions of Americans who will never go and buy a case of wine. Those who never carry a 39-pound box back to their home. And I can ship direct to them and have a relationship with them and in the years ahead, curate for them and be their wine partner.

People Economy California

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