Ep. 27 Bootstrapping My Liquor Brand & Starting a Distillery

Bootstrapping My Liquor Brand & Starting a Distillery

Bootstrapping My Liquor Brand & Starting a Distillery


On this episode of The Ripcord Moment, host Joe Seetoo welcomes Aaron Bergh, founder of Calwise Spirits Co. Calwise is headquartered in Paso Robles, California and is home to labels like Big Sur Gin and Axe Hole Whiskey.

Aaron’s passion for spirits began in college when he learned how to make his own alcohol. Eventually, what was once a fun hobby turned into a calling. He attended Cal Poly, San Luis Obispo, which offered an entrepreneurship concentration that helped him develop a business plan and connect with investors.

After graduating, Aaron worked in a distillery, got his product started there, and lived out of his car for two years. Now, Calwise has been established for seven years and is available in Albertsons, Vons, Total Wine, and many restaurants/bars.

Aaron recommends other business owners to be open-minded enough to make changes to their product or brand based on what is or is not resonating with people, learn from mistakes, and stay resilient in difficult times.

To learn more about Calwise Spirits Co., clickhere.

Check out previous episodes here:

Ep. 26 Building Trust and Finding Community as a NextGen Business Owner

Ep. 25 Creating a Niche Fashion Brand: How We Made $1M Our First Year

Welcome to The Ripcord Moment. I'm your host Joe Seetoo. We're joined by Aaron Bergh. He is the founder and owner of Calwise Spirits, a boutique custom liquor and spirit company up in Paso Robles and known for specific labels, Big Sur Gin and Axe Hole Whiskey. Aaron, welcome to the show. I'm really looking forward to our discussion today.

Thanks for having me on. I'm looking forward to it too.

So let's start with, you know, why were you drawn to the spirits industry in particular? I'd love to hear how you got your start.

Yeah, back in my college days, I decided to become a hobbyist hooch maker, as some college students do, because I liked to consume alcohol in college and, you know, make sense to make it yourself sometimes.

So I taught myself how to make it. It just started out as a hobby. And then I started realizing this is becoming more than a hobby. This is becoming a passion and now an obsession. And it just continued as a passion project in college. And then I started to notice that there might be a product market fit here. Spirits, especially craft spirits, have been on the up lately. And, you know, especially, you know, within the past ten years, which was about the time when I started becoming a hobbyist and I realized that it would make sense to turn my passion into a company.

And also, I think, you know, if I understand when we spoke before, your family has some roots related to, you know, to the industry, you know, talk to us a little bit about that.

Yeah. So I after I became a hobbyist, I learned that my great, great grandfather named Bill Keever lived in northern Minnesota, and he was a moonshiner back during the prohibition. He was really up in Minnesota. Yeah. And he ended up... his logging company was sabotaged by some competitors and it bankrupted him, unfortunately. So he tried to find other ways to to make some money.

And one way was he found ways to make moonshine. So he built his own still started making moonshine and selling it. And unfortunately, he must not have had very good, very good luck because he got caught again. He got caught by the feds and they came into his still house at night. They took an ax to his still and they they hacked it up and filled it with a bunch of axles.

So. So hence the name like, ah, Axe Hole Whiskey here and. Okay, my great great grandfather.

That's I was going to ask you where you got the name from. And so that's that's a great story. Yeah. So you've got the Axe Hole whiskey, which is one of your, you know, your, your core products, what you're known for. And I think one of the others is the Big Sur gin.

Maybe talk to us a little bit about that, but also the overarching theme that you're going with for these, you know, combining, I think, the sort of California feel with with your spirits.

Yeah, absolutely. So it's our whiskey, which is, you know, our top seller next to our Big Sur gin and we call it Big Sur gin because we're up here in Paso Robles where, you know, right down the street from from Big Sur, practically.

And it's some of their favorite places in the world. And I traveled there when I was a kid. But when I was going to college here at Cal Poly, San Luis Obispo, I would travel to Big Sur quite a bit because it was so close and it's such a magical place and it's my favorite place in the world.

And I wanted to make a gin that tastes like Big Sur and and not just taste like any gin, but taste. And not just this like any gin, but not, not just it's like any sort of beverage, but actually tastes like in experience in a bottle. So the Big Sur gin is made from wine grapes that are grown here in Paso Robles.

So we just saw the wine grapes use the spirit base as the base for the gin, and then we infuse it with native plants that actually grow in Big Sur, like white sage and elderberry and bay leaf. So when you drink this gin, even if you're not in Big Sur, when you drink the gin, it makes you feel like you're there.

So what gave you this... This what inspired you, I guess, is a better way to put it to, you know, craft the spirits that really are experiential as specifically related to where you're living.

I think if you look at every good distiller and every good, interesting, unique spirits category, the one thing they all have in common is they're making spirits that are based on where they live.

Look. Yeah, look at scotch, for instance. And it makes scotch so unique is is there's a lot of peat bogs in Scotland. So they use you know, they make logs out of the peat from the peat bogs and they use that to smoke the barley before they, they, you know, make it into whiskey. And that's what gives Scotch its characteristic like earthy, peaty, smoky flavor.

And you have, you know, another example would be tequila. You know, in Mexico, a lot of agave grows down in New Mexico, it's endemic to the area and they make that into tequila. And it's it's what gives tequila its characteristic and a, you know, succulent, earthy tequila flavor. Got it. Okay. Now that makes that makes total sense.

But then specifically, one of the things I think that's unique to, you know, your story and even where you live is sort of your extreme climate.

I would think initially that would be such sort of a disadvantage to what you do, but yet you've somehow taken that and turned that around into, I think, a competitive advantage.

So maybe talk to us a little bit about, you know, about that in terms of, you know, Yeah. Again, how are you using that to your to your advantage?

Yeah. So here in Paso Robles, I mean one of the things that people know Paso Robles is we grow some of the best wine grapes in the world here. So our climate, which is really hot in the summer and provides for, you know, great ripening conditions for the grapes, but actually it cools down at night. So the grapes have a chance to rest at night. That makes for some of the best grapes in the world. And the other benefit that I have is when it comes to barrel aging.

So when you put spirit in the barrel, you have, you know, 53 gallon barrel, wood barrel with spirit in it. As the temperature fluctuates that barrel kind of beats like a heart. Imagine it like expanding and contracting as the day goes by. It’s kind of crazy if you think about right like it really is like if you were to put a time lapse camera on it, like, it would be like a heart beating, you know, one beat per day.

Yeah. It expands and contracts and but with our, you know, extreme temperature differentials because it'll be 110 during the day here in the summer, but it'll cool down to 60 degrees at night, which is crazy. So as that happens, as that barrel expands and contracts, the spirit actually ages even faster and quicker.

Wow. So that's something that's that it sounds like unique to your your spirits versus, you know, there are those that are made in other parts of the United States or even the world.

Yeah. I mean, going back to the whiskey, for instance, and the actual whiskey have a single malt whiskey, you know, scotch. Usually if you want a good scotch, you're having to drink like a 12 year old scotch, right?

Yeah. The reason why it is you have to wait 12 years is because Scotland. So it's kind of cold there. So they have to age things a lot longer where I can only age. I only need to be aging for 2 to 3 years. Oh, wow. Good as any scotch you're going to get from Scotland.

So yeah, it is that I mean those are orders of magnitude quicker it sounds like. Mhm. Within years.

And then with regards I mean like you know you describe yourself as you know a California entrepreneur or as it relates to again you, you've said, you know, I think you liken yourself to being sort of an artist, a bit of a scientist and a bit of a businessman all rolled into one.

That's the whole reason I really went into distilling was I found it was that that happy medium between being both a scientist and an artist. And I think the science side is, is relatively obvious.

You know, there's a lot of chemistry that goes into blending spirits together and the distillation itself, there's there's a lot of biology that goes into fermentation and managing, you know, the yeast and their conversion of sugar into alcohol. So the science side, I have plenty of opportunities to to geek out there. On the creative side, I'm an artist, so I get to create, I get to blend new flavors together.

And it's like being a fly, being a chef in a way. It's really a culinary art that we're doing here. And business wise, you know, I have to sell people on it and I have a lot of fun getting out there and doing sales. I love looking at the numbers behind everything to distilling was just, yeah, that's happy blend between sort of the three disciplines it sounds like.

Yeah, it's a great confluence of all these different areas that really speak to who you are. And so maybe we can pivot to more the business side for you. So you started this business from what I understand about seven years ago, you know. No family money where, you know, you're able to launch it. So you kind of you know, how were you able to get the company off the ground and get it to where it is today?

I was very fortunate to go to a great school like Cal Poly, and Cal Poly is one of the few universities in the state, if not the country that has a an entrepreneurship program and it's called the Center for Innovation and Entrepreneurship. And when you graduate from college, most colleges' goal is to feed you into working at a large company. Poly has this alternative route where if you want to start your own company, they're going to empower you to do that out of college. So when I graduated college, I went through this entrepreneurship program and they helped me get my business plan together and, you know, bring my head down from from where I was in the clouds a bit and help me, you know, be a little bit more realistic.

And you know, how to put a supply chain together, how to even go out there and do sales, how to, you know, evaluate your consumer market. So I had a lot of help there. And I was very fortunate to to go through that program. And because that program is known for being so great, it attracts a lot of investors, those who are looking for, you know, young, fresh startups to invest.

So I was able to raise a little bit of capital to get going and then I bootstrapped it from there. I raised a little bit of capital enough to, you know, pay a graphic designer to get a brand design and to fund creating my first batch.

And I actually created my first batch out of another distillery because getting your own distillery started up take takes quite a bit of capital. So I worked on a distillery, got my product started there, and I basically lived out of my car for the first two years just driving up and down the state, selling my spirits out of my car and bootstrapping it.

That's amazing. And well, and then, I mean, at one point, you know, COVID was a big pivot. I think you were having some success. You were in something like 400 stores and then you had sort of an unexpected event. Walk us through what that was like and what occurred.

Yeah, so the first two years of my company, I spent bootstrapping, you know, and selling my spirits out of my car. And then when I was able to generate some success that way, it made sense to open up my own distillery. So I got my own distillery. And when I did that, I had to actually give up my distributor license because I got a distillers license and this is in California, doesn't allow you to have both licenses. So I had to find a distributor.

So I was producing spirits out of my distillery, selling it to my distributor who would go and sell it to my accounts, which was 400 accounts that included some pretty big chains like Whole Foods and Bev Mall and Total Wine. And they were distributing them to these accounts for me. And then when the pandemic hit, they had to lay off about a third of their sales force.

My distributor did. And it was so it was just like overnight, like a switch. I went from making quite a few sales and being distributed throughout the state to absolutely nothing. Nothing. Yeah.

Oh, gosh. So that I mean, that, that just must have been really heartbreaking and challenging and which kind of leads me into my next question. What do you find is being the most challenging thing about being an entrepreneur?

I mean, management is certainly tough as far as managing both employees and customers and then just being able to read the market because especially when you're small and you're a small startup like this, you have to be nimble and quick on your feet.

You have to see where the market's going and be ready to change, you know, and be able to pivot on a dime. Yeah, I mean, it sounds like flexibility is incredible when you're starting out and you don't have a ton of market share that you can can command that you have to maintain that level of flexibility is critical for your success.

And then the other thing, I mean, it seemed like what I was gleaning from it is just the fact that you've got to have a lot of great you know, if you're living out of your car, if you're doing those kind of things to, you know, to get to sales and let me actually even asking that taking a step back and asking you, I mean, you're... You're very young when you started this business and you've while you maybe had sort of a textbook learning from college and the programs you went through, there's a lot of difference between that and actually real world.

How did you get, you know, people to buy into your vision, into your products when they said, hey, here's you know, here's this nice guy. So he looks young, but and he seems nice. But again, he's young. I mean, I take him seriously. But you knew you had a quality product. How did you get them to buy into what you were selling?

Honestly, like you said, it takes a lot of grit and a lot of trial and error and know that the first few people I talked to didn't buy into my vision and that it's like, okay, if people aren’t buying into your vision, maybe you have to pivot a little bit and you have to change your vision a bit.

So it takes a little bit of tweaking and just being open to, to being quick and nimble and, and learning and yeah, just honestly take took a lot of trial and error. So it's just learning on the fly, figuring out what was resonating, what wasn't, and changing your messaging to, to fit the market into to fit the audience.

So I love that. And you know, one of the things that I'm passionate about doing on the podcast is getting real world stories from, you know, in this season, season three, we're focusing on the young entrepreneur. And if you almost took the last, you know, seven years under your belt like some of the lessons you've learned over these seven years.

And what would you say to your younger self, right, in terms of, hey, here's two critical things that, you know, you would impart to your younger self to get you up to speed quick or that even those in the audience could glean from your experience. What were those two bold action items be?

That is a really interesting question because there's certainly things that I would tell my younger self now, but I don't know if my younger self would listen. Well, there's that, right? Yeah. And I think one of the main things and it sounds so cliche is that you don't understand how hard it is and how hard it's going to be until you actually get started. Yeah. And it's just it's never not going to be hard. Okay. So, well, if I'm reading between the lines there, there's no substitute for experience.

There's, you know, being what's the right word, You know, I guess going back to what you're saying about grit and resilience, like it's going to be challenging, but certainly having the the belief that you can do it and just intuitiveness is is ultimately like just reinforcing. That would be one of them.

You know what something else you know, I think we talked previously about like just your experience in management and how you've navigated some of those, you know, more challenging discussions and how you handle, you know, conflict or challenging discussions.

So what have you learned along the way related to that as far as as management?

I again, like you just said, there's no substitute for experience and and you're going to fail and you're going to approach a conversation or a conflict in a way that it shouldn't be approached and it's going to blow up in your face and you're going to have to learn to lick your wounds and, you know, take the L and figure out how to do it better next time.

Yeah. So if we fast forward, I love that. First of all, thank you that I those are really, really good words. If we fast forward, you know, three or four or five years from now, what does what's on the horizon for you, for Calwise Spirits. I mean are you going to be launching a lot of other different, you know, labels within your brand?

I, I do want to expand again. So, you know, I mentioned before, when the pandemic hit, I lost almost all of my distribution. And I, in a way, hunkered down and circled the wagons and really focused on having a successful direct to consumer model outside of my room that my distillery in Paso Robles.

And it's been going great for me. It's been profitable. I've kept my business afloat and, you know, actually more than afloat, very successful over the few years since the pandemic. And and now that the pandemic seems to be winding down and, you know, we might be returning to at least some sense of of normalcy, the plan is to get back out there and expand back into the distribution market.

Thanks for having me on this morning.

Absolutely. So we're going to get wind up, this is Joe Seetoo from The Ripcord Moment and we’ll catch you next time.