Do you invest in wine and spirits? Fintech startup Vintage believes that everyone should do this and hopes to facilitate this. But don’t expect bottles to be shipped to you: Investments through Vint are fractional. Depending on how deep your pockets are, this is probably for the best: A recent offer that sold out on Vint was for a $130,000 Macallan 78-Year-Old Collection whiskey bottle.
There is no doubt that alternative investments are on the rise, with financial advisors stating that the age-old 60/40 portfolio – 60% in stocks, 40% in bonds – no longer good enough. But “alts” come in all shapes and sizes, and wine and spirits aren’t necessarily the most accessible, which is what Vint and others are working to change.
Vint also now has more money to pursue its goals: After raising $1.7 million in October 2021, it recently closed a $5 million fundraising round led by Assembly companies.
It doesn’t detract from Vint’s pitch, of course, that fine wine and spirits have often outperformed other major asset classes, such as stocks, in recent years and appear to be immune to some of the recent problems in the public markets.
For example, the Financial Times recently quoted data from Scottish investment bank Noble & Co showing that “the value of ‘fine and rare’ single malts had risen by more than a fifth this year, with volumes up 23 per cent.” In contrast, it noted that the UK’s leading stock market index, the FTSE 100, has “traded flat this year”.
However, Vint CEO Nick King said the story is also about diversification and warns against false hopes. “This is an investment. Personally, if someone tells me ‘it only goes up right,’ I get skeptical,” he said.
Still, King is proud that Vint has achieved a 28.3% annualized return on asset exit since inception. This refers to wine and spirits collections that have already gone through the full Vint lifecycle: “Source, Securitize, Store, Then Sell.”
Since its launch a year and a half ago by King and his co-founder, Patrick Sanders, Vint has made 50 “donations,” which are analogous to a crowdfunding campaign. The analogy doesn’t end there: the startup spent eight months acquiring the ability to launch of US Securities and Exchange Commission qualified collections.
That Vint’s offering is acceptable to the SEC was made possible by the creation of the regulated category known as Reg A+. It is itself part of the JOBS Act, which has led to tailwinds for alternative investments.
The process was quite time-consuming for a young startup, but King felt it was worth it. “For us, this is a long-term game. You’re not going to create a new asset class overnight, so it’s very important to do things the right way and work with regulators to ensure a … to build a structure that adds confidence to this asset class.”
Despite this framing around “a new asset class”, Vint already has competitors such as cavissima, Investment in cult wine, iDeal Wine, Vinovest and You’Wine. But even more so, the company is dealing with legacy options: DIY and wine exchanges.
Interestingly, King thinks the fact that he’s not from the wine world is a plus – much more than a wine company, he sees Vint as a fintech. However, buying exceptional bottles is still a big part of what Vint does, which is why the company recently hired Adam Lapierre, who holds a Master of Wine certification, as its head of wine.
Vint’s recent round now supports the expansion of its existing team of 12, adding business development and general counsel associates. As for the rest of the roadmap, here are some things King has in mind:
“We are looking for new offers. We’ve done wine, whiskey, whiskey barrels and futures, so we’re looking at the opportunity to add bourbon as well, as well as new styles of offerings. Then we want to add more data to the platform. We look to US market data, UK market data and auction market data to inform our buying and selling decisions, and that’s something we want to continue to share with our users. And finally, most importantly, continues to leave assets.
It’s too early to tell if market conditions will be as favorable to Vint’s collection sales as they have been recently, but the rise of wine and spirits as an asset class will be worth tracking anyway. With inflation and uncertainty on the rise, it wouldn’t be surprising if alts become a fixture in more and more portfolios.
