218 – The Contract Bourbon Business with David Mandell, Co-Founder of Bardstown Bourbon Company

By Bourbon Pursuitpodcast

Some people thought it was crazy to build a business doing 100% contract distilling. David Mandell, Former President and CEO of Bardstown Bourbon Company, told us this back on Episode 019. Four years later, we catch up with him to see how the operation has tripled from its original plan. This podcast covers what it takes to be a client of Bardstown Bourbon Company and how they are making 40 different mash bills for them. From the business side, we talk about building a destination for visitors and what it takes to find the right talent pool and keep employee retention. We look into their recently launched bourbon line and what the future has in store for more collaborations.

Show Notes:

Transcription:

0:00
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0:35
All right, David, you wanna give me some? I don’t know just about your breakfast this morning.

0:40
Protein Shake, protein shake. He said this testing right? Yeah, sound healthier than me.

0:46
And you’re surrounded by bourbon in a restaurant. You really got to be careful

1:03
Hey everyone, it is Episode 218 of bourbon pursuit. I’m one of your hosts Kenny. And as usual, let’s hit some news, barrell craft spirits. You know, Joe, you hear him on the podcast all the time, they have announced the first ever barrell American bad malt. It’s a blend of exclusively American single malt whiskies, which we’ve actually become quite big fans of single malts on the show recently, and barrel has partnered with small and large producers across the country to select whiskies that express the full diversity of American terrier and style. This release was years in the making, and as many of the components in the blend come from emerging distilleries that have never traded or sold bulk whiskey on the market before. And this is coming from Joe who’ve you’ve heard on plenty of times. As we said before, in addition to expanding our ever growing portfolio of spirits, this new project is also an important step in advancing our vision in the next chapter of whiskey in America. We’d love to hear it

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Your reviews and your thoughts on it. So make sure you comment and let us know. Now smooth Ambler is relaunching their old scout brand. This is the same brand that we all knew about when it was sourced from NGP. And now this is the new return of MGP product. It is now a five year old in GP bourbon it will be bottled at 99 proof and widely available in the US starting in the fall of 2019. We have a whiskey quickie where we review the new old scout that will be published here in just a few short weeks. The na WR or the National Association of wine retailers has put out an article stating that after the Tennessee wine Supreme Court case ruling that we’ve talked about so much on this podcast is saying that there are 21 states in violation of the Constitution. One shipping laws and these 21 states violate the Commerce Clause with their bands on wine shipments from out of state wine retailers. The case mandates that states may not pass protectionist

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laws that discriminate against out of state wine stores and retailers by banning them from shipping wine to consumers. Now lawsuits have been challenging these bands on wine shipments from out of states are now underway in Indiana, Illinois, Kentucky, Michigan, Missouri, New Jersey, and Texas. The remaining states with unconstitutional wine shipping laws are California, Idaho, Maine, Massachusetts, Minnesota, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina and Washington state lawmakers in the other 14 states that we just mentioned need to take it upon themselves to start fixing their shipping laws. You can read this article in our show notes that today’s podcast wasn’t intended to air for quite some time. David Mendell had previously been a guest on the podcast way back on episode 19. And as Ryan would say, that’s when we sucked, but this past week, I saw Bardstown bourbon companies, Instagram that there had been a leadership change, David

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is taking a step back and they’ve hired a new president and CEO, Mark Irwin. Everyone actually was part of the bros on bourbon company and was part of their board earlier this year. And he comes from a long history in the US Army and investment groups. Now I’m sure we’re going to have a lot of time to talk about more about mark in the future. But this podcast is all about David, and it’s been a pleasure to watch him spearhead this movement from years ago into what Bardstown bourbon company is today. The growth of this company has seen has been tremendous, and you’re going to hear about it relatively shortly, as well as some of the new product offerings. However, it looks like David wanted to go out with a blast because today also marks the grand opening of the new visitor experience at the Bardstown bourbon company. The expansive development includes curated tours, cocktail classes, exclusive tastings, and multiple private event spaces. Guests can choose from multiple levels of experiences including the main event which is a one hour fully immersive tour and

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The Bardstown bourbon company’s best, which is a top tier 90 minute tour featuring sensory exercises, cocktails, and a personal tour given by the master distiller Steve Nally. The sensory exercises will allow visitors the opportunity to examine distillate taste how bourbon ages and learn how it is used in finished products. The tours will showcase Bardstown bourbon companies experimental distilling process of 40 mash bills for over 24 customers guess will also be able to enjoy the visitor center, which is adjacent to the Rick house tasting bar, which is also surrounded by stacks and rows of Kentucky bourbon barrels, where they will feed whiskey straight from the barrel. Visitors you can book your online experience right now on Bardstown, bourbon.com. And you can read more about all this in our show notes. All right, let’s kick off the show. Let’s hear from Joe over a barrell bourbon. And then you’ve got Fred Minnick with above the char.

5:57
Hi, this is Joe from barrell bourbon tasting whiskey.

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Straight from the barrel was truly a life changing moment for me. In 2013 I launched our craft spirits so everyone could have the experience of tasting whiskey cast strength. Use our store locator to find a retail or bar near you at barrel bourbon.com.

6:14
I’m Friedman again, this is above the char. If you follow me on Instagram, you might have caught me in a story where I did a live tasting. And I was testing the New Orleans glass versus the Glen Karen. Obviously, this is something very unique cannot really do a tasting objectively because you’re touching the glass you have a feeling of what it should taste like and inherently you’re going to like how one glass looks more than the other. So what I did was as I have blindfolded myself with a bandana and I had someone pour the whiskey in my mouth now this is is going to sound weird, but I actually could not tell which glass was which, by the way it was touching my lips, Italy

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Initially, when Jessica did it a second time she liked cram the glass of my upper lip. So thankfully, I did not cut my lip. Anyway, the results were really fascinating to me in that I liked the Glencairn more because it gave me more surface area coverage on my tongue. Whereas like the New Orleans glass, which is very, very nice looking, it came in like a direct point on to my palate like a bead like shooting onto the palate, and I would have to work to get the whiskey all over the place. Now this is good and bad. It’s good if you are a whiskey that you’re trying to mask, like how you feel in different parts of the tongue because you’re going in in a very narrow trajectory, and it’s bad if you’re like me, and you’re trying to be analytical of the whiskey because you’re not getting the full surface coverage that you want. Now, I own the aromatic side. I also noticed that the New Orleans glass only

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offered up, you know, some of the more prominent notes like it wouldn’t let me really assess the spirit as much as like the Colin Karen. And what I mean by that is that with the Glen Karen, I got layers of the aromatic properties, like I could tell what the various notes were and what they smell like. With New Orleans, I got one note, and then a bunch of little bitty other ones, but I could not really discern what some of those other little bitty ones were. Now some of this may be I typically drink with the Colin Karen. So I’m more used to how that hits my notes. So preference definitely comes into here, but I’m asked all the time, what glass should you use, and it really all depends on the moment, you can drink bourbon out of a solo cup, and it would be great if you’re with your buddies. So I would say let’s not focus so much on things like the glassware and let’s focus more about who we’re drinking it with. Now, if you’re if you’re being analytical and you’re wanting to do these blind tastings, you need to have like a consistent glass

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What if it’s just hanging out with your buddies? Your old college friends? The glass doesn’t matter. The company does. And that’s this week’s above the char. Hey, if you want to catch my Instagram stories, make sure you’re following me on Instagram. It’s at Fred Minnick again at Fred Minnick. Until next week. Cheers.

9:23
Welcome back to another episode of bourbon pursuit the official podcast of bourbon Guinea here today riding solo as we are at Bardstown bourbon company, and this is talking to a guest that you may have heard a long, long time ago. This was back on episode 19. This is when we were starting to break ground when they were starting to break ground. It was quite a while ago so the journey on both ends has been explosive and growth which is fantastic to see on both sides of the table here. And if you hear some clinging, some silverware going on, it’s because we’re in their their main restaurant here and you’re

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hear more about that more about really what’s happened here? What are the big plans for everything that’s going on more as we start diving down this this path. So today on the show, I have David Mendell, you might have remembered from back on episode 19. He is the president ceo and one of the co founders of Bardstown bourbon company. So David, welcome back to the show. Thank you, Kenny. You know it, I’ll tell you, it’s remarkable because when you think back to Episode 19, where we’re sitting right here, none of this existed, and we had an empty room, you know, and we were just getting up and running. And it really is incredible. And I just want to congratulate you on your tremendous growth. I think you guys are the leading bourbon podcast out there, aren’t you? Well, we are and thank you so much for saying that. You know, we’ve we’ve gone through a lot of growth as well. I mean, like I was saying at the we started this. We were We were Episode 19 like this is we do these every week and I was thinking like holy crap that’s years ago. And I was thinking of like, wait, you united anyone put a shovel in the ground yet when we started talking about

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This it was this was all just like press release it was pie in the pie in the sky kind of idea and like, how are we going to execute on this? God? That is right. I mean, you were here. That was before we actually even had the building finished. So that that’s tremendous. That’s tremendous. Yeah. So I guess, a few years later, how’s it going? Well, I mean, you look around here it is really, it’s unbelievable. I mean, I oftentimes we sit back and we say, you know, how did we do this? And I’ll tell you it is it’s going incredibly well. You know, since that day, more than three years ago now, you know, we have built one of the largest distilleries in the country. We do custom whiskey production. Now for 24 different companies will do 40 different mash bills. We have probably one of the most sophisticated whiskey distilleries in the world. We build an award winning restaurant and bar here in the middle of the rest in the middle of the facility. We’re opening a visitor center and an experience. We’ve got some really aggressive plans for bottling and a hotel coming and we could not be more excited. Holy smokes. That’s a lot of stuff going on.

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stuff.

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So, I mean, I remember if I if I remember the one of the first things that we even talked about or maybe it was like a it was a rumor that that even said that was like even before like the doors were open, you all had basically contracted out I mean, cuz let’s let’s also make sure we set the precedent that the the the goal of what Bardstown bourbon company is is that you are a large contract distiller for anybody that wants to come in and make their own bourbon, right. And I’ll put a little bit of a twist on that because what’s what is interesting is we’re a celebration, the entire craft of making whiskey. So we bring everybody together here, distillers enthusiasts, lovers, you know, and the community and we do that in our collaborative distilling program in the restaurant and bar as you can see around you, we serve everybody’s products, and you find ours through the lens of everybody else, and we’re really about that. But when you go back to the we call it the collaborative distilling program, because I’d make a distinction between that and

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Custom. It is a exclusive program. If you’re accepted into it, you then get the ability to have us showcase your product. If you look, we sell everything from Jefferson’s to Kentucky owl to many of the companies that we produce for their integrated into our cocktail menu. Then they can bring their guests, the distributors, the retailers here, this is their home. So it is a bit different. But you’re right before we opened our doors, we sold out the first 25,000 barrel capacity of the distillery. We expanded to 50,000 barrels six months later than 130,000 barrels, about six months after that. And we have almost all of that effectively under contract for the next five years. It’s been a remarkable program. I mean, it just it just goes to show you like how big this boom is really getting that everybody really wants to get into this action because yeah, I mean, like that’s, that’s an incredible number of whiskey that you all are producing. And people are saying yes let’s I want to gobble this up. Like I want to be a part of this.

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So where does Where is like the I mean, those are those are impressive numbers begin with right of kind of like, how it was and how it was all contracted out. I guess kind of give me the give the rundown if if if I’m Joe Schmo and I’m like, Hey, you know, I’m ready to do this. I really want to get into get into the whiskey game. Do they call? Hey, David, I heard you on the podcast, like, what’s, what’s the next step? We take you? So the answer to that one is going to be? We’re not the right, we’re probably not the right provider for you. So we get a lot of those calls. We get them every day. But I think, you know, the beauty of our program is that we produce for great brands. So one of the you know, one of the primary considerations if you you know, even be considered as you’ve got to have a great brand, it’s got to be on the market. You’ve got to be a company that has been in the industry. That’s who we focus on. That’s why we only produce for 24 different companies right now. We’ve turned away over the last several years. You know, more than obviously that we’ve accepted we get those calls every day. There are many options.

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still out there for people like that, you know, that want to get in the business have never been in it before. They’re much smaller options were not the option for them. But, you know, what’s been most exciting for us is how we have really changed the the whole kind of dynamic and landscape of the contract whiskey production, you know, market. And it’s that it’s that program, and it’s been really, really exciting. Yeah, I mean, it’s, it’s, it’s, it’s fun, right? Because other than you all, like there’s only like a few places where you can go and do something like this. Yeah, let me tell you what I think is what is one of the most exciting things about it. When you look at what happens in that distillery, we bring together of those 24 companies. We have massive companies and we have some small craft distilleries and a number of them in the middle. They’re all working together with us there. We’ve got their teams coming in. And we’re learning every day. They’re learning. We’re learning. We’re pushing innovation. We’re balancing art, and science, but we’re pushing innovation. It’s all happening in there.

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We’re sharing best practices. And that’s making our team better. And the result of all that is now coming out in our brands. So we’re taking all that knowledge that we have created in a short period of time doing a lot of innovation. And you’re seeing that now come forward in our brands, that’s never going away. The collaborative distilling program is a core piece of who we are. It’s something that will drive innovation drives, you know, has us pushing the edge all the time. That’s really one of the most interesting I think an exciting pieces of what’s happening here is by having everybody work together, you’ve never had that before, in the whiskey industry in one place. Absolutely. Most the time. It’s like, hey, David, here, here’s the magical, I won’t go make it well, and you know, even more than that, what you had in the past was you had effectively, you know, a couple of companies, you had one where you got to choose one of three different mash bills, and you got it, great whiskey, great bourbon, but there wasn’t a lot of choice, or you had, you know, another large distiller producing for you and the problems you had, there’s

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You didn’t get great customer service. You know, you were kind of seen as you know, we’re not we’re, you know, we’re selling extra capacity. And other cases, it was kind of behind the scenes, you don’t really want to talk about it. And sometimes you’re not allowed to talk about it. And we were the first to really embrace this kind of production and say, we want to do it, we want to be proud of it, we’re going to put it out there, it’s going to be about transparency. And everything now that we drive with our customers is full transparency, access to the data in real time chemistry, we just put in a system called ignition that is used primarily the food manufacturing business that gives complete historian and transparency at every stage of the production and the customer gets to watch it in real time. They’re kind of like really powerful. What What is it? Is it Volkswagen or BMW somebody where like you, you buy a car like you can brand new you can actually go to go to Europe or Germany and actually, like watch it as it’s made in the last essentially the same thing. They get a portal, they can watch their production, they can see their barrels in the warehouse. We just implemented it in this last

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upgraded the distillery when we just came off of shut down a couple weeks ago. Really, really neat, really neat software I was about to say I was like is do people get like push notifications like an app like it’s like it’s dominoes delivery dude. That’s what this was. So it’s really crazy about it is extremely user friendly, john Hargrove and Steve now I can, can can access the distillery from their phone at home, they can see it and they can control it. So Sierra Nevada, Coca Cola, a number of you know, very large companies are using this platform. And it is amazing because the data that comes out of it in the control of the system in the transparency, it also feeds into your financial, you know, software, it’s really really powerful. Something that people like can could totally geek out on Yeah, so let’s let’s keep going down this path because you know, as a as the business side of it, like what, what more value do you think that that you get out of this by being able to give the power to Steve and john and be able to be able to do that. So it goes

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Even one level beyond so we’re giving not only this power to Stephen, john, but we’re handing that power to our customer. And so that is really our partners in the collaborative distilling program. Never before have they been able to watch their production in real time, you’re getting literally you’re getting the chemistry is on each firm enter in real time as it’s taking place, you’re able to see it, you’re able to, you know, work with us, there’s something that, you know, you see that’s wrong or is out of line, you can make immediate changes, you know, to production, but that kind of transparency. And that kind of data is really valuable for the consumer when they’re used to an industry here. Again, when you talk about traditional contract whiskey production, you had no transparency, you had no data, you got what you got. And that was it if you didn’t like it too bad. And that was the attitude. You know, don’t tell me how to make bourbon. I know how to make bourbon. Well, what if the customer doesn’t like it? So we’re going we’re going to make it and we’re going to get it exactly right under your specifications, because you’re our partner. That’s what we do. And so it’s it’s been very neat when you talk about 40 different Nashville’s

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One facility. Most you know most, yeah, most facilities are one to five, maybe

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two to three. So it’s, it’s really neat what’s happening in there. Now it’s making me think of like, remember Willy Wonka. And he was trying to put a candy bar like through the TV. Now it’s like whiskey, like just be like sampling through the app like,

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hey, if we could figure out how you could drink product out of your out of your smartphone, I would change social media advertising, it would it would change that might be a whole new business venture like let’s just go Yeah, let’s just get out of this. We’re gonna do whiskey by the phone that’s right.

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Now but it is it is really neat. And then when you carry over what is taking place there and then when we built the the restaurant and the bar here when we invested tremendously in terms of bringing incredible talent here, we’ve got chef, Felix Mazda, from the Greenbrier, Chef john Castro, who just joined us who ran Sullivan’s

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Culinary Institute in Louisville incredible background he is in charge of all of our culinary Dan Callaway on our beverage team who ran deca and built an incredible team. What happened is organically, they started working together with the distillery and that is how we got here to our products. And so we’re no it’s no longer just about one singular person making decisions about a product. It’s about a team of experts, beverage commentary and distilling, creating these very unique blends, and bringing lots of different perspectives and pushing innovation and that’s what I think of everything right now. That’s one of the things we’re most proud and most excited about where we’re headed there. But when our own brand Yeah, before we before you’re touching your brands, because I think that’s that’s gonna be a very big part of this. Talk about what it meant to actually like build bottle and bond kitchen because you know, you think about Bardstown there’s something that is missing. Right there is you can go to Miami. There’s nothing wrong Miami, right but like this

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There’s definitely that that sort of, like, finer dining experience that was really missing. So what, why create this this large, you know, place where people can come and eat and have a really, really good meal, rather than than just like, Hey, we’re going to serve sandwiches out of the back of the truck over here. Well, I’ll tell you so again, like everything, you know, I’d love to say that, you know, we had, you know, full clarity of this vision when we when we walked into this, but when, you know, when you get into the business and you start going, it’s an evolutionary process. And so for example, you know, with this, we like to say, you know, the distillery is our heart, you know, bottle and bond is a soul, you know, all of us and so, it really kind of brings together everybody but if you back up to 2017, you weren’t allowed under Kentucky law, late 2016. You are unable to sell by the drink. So we worked with the state legislature, we got sell by the drink pass, we got vintage whiskey passed, and that changed everything. And we had not yet built this out at that point. So we stopped

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And we said now that we can sell actually sell cocktails in the distillery, let’s look at doing a full restaurant and full bar. And let’s really complete this whole idea of the Napa Valley destination experience. And so, like everything else here, we launched into it without having the history and the perspective of the industry. So we did something completely different. And we worked with the community and we build something that I think really remarkably balances, the visitor on the trail coming in, and the community member of Bardstown and what do I mean by that? That’s everything from food style, to pricing, to having a place where people can come and just enjoy. It’s not pretentious, it’s a high level of style and service. But you can come in here you can spend $30 for a bottle of wine, you can spend 1000 you can have a $4 pour whiskey, you can have a 20 $500 pour whiskey, you can come in and have a meal that is comparable in price to chilis, you know and to Cracker Barrel, but you’re getting fresh food scratch

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Me local ingredients. That’s, that’s the goal is to bring everyone together. And it’s worked. Yeah, it really has worked. Yeah, I mean, I’ve done here a few times. And it’s it’s always fun to do that. I mean, there’s, you’d mentioned i think that’s that’s one of the things that I think Bardstown was really key and missing, as well, as was having that sort of experience. We can have this sort of, like elevated dining experience, where it is good, it’s good food. I mean, from local, we’ve got massive amount of restaurants around us and good places, the but like, yeah, Bardstown was really missing some of that, that key and great war and the community is so supportive, and they are so proud of what we’re doing out here. I know, Ryan’s gonna kill me too, because he’s from Barcelona.

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And, but you know, and it’s great. And because, you know, we’re very proud to be here. We’ve all moved here. We moved, you know, probably 20 people here, you know, of our team that have come from all over the country here and settled here to build this great company. But you know, what I would I’d say is we’ve created what I would call and we call the modern bourbon experience, and what is that

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It’s no longer just about drinking bourbon, just straight, all day long going through a formula tour and tasting. When do you want to have these types of products, when you want to enjoy them, a lot of times it’s going to be over a great setting or a meal, you’re gonna want them in cocktails, you’re going to be sitting outside, you’re going to want to enjoy them, along with a great culinary experience, because that’s, that’s a lot about, you know, the, the fun of having great high quality alcohol products. And so it’s not about over consumption, it’s about good, responsible consumption of better products. And so, and that’s where the trends are going. And people want to see they want to know everything about their products. They want to know where they’re from, they want an experience, and that’s what you get here. And that’s what this is. So let’s talk more about the business side here because I think you bring up something relatively like a good point about finding it in moving 20 people here at least 20 people and finding the right kind of staff

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kind of talk about like how that search really went and you know we john and Steve like they’re great guys we know them like they’ve been in the industry for for a while but like talk about everything else that that goes into this from the marketing the promotional the restaurant everything like that to to find the right staff and really what it takes to look outside of just the local area Bardstown. Yeah, I mean, I think you know, at the end of the day, you know that the story of this company is the story of the people that have come together here to build this union of all this fancy equipment and all these great furniture, but it’s it is the people and the culture and what we have created here and it starts from the top at my level and it goes all the way on down. And we have focused on building the best team from the day that we got here. And we knew it myself, Garnet black, who was our executive vice president hospitality, Dan Lind, our CFO and COO, our chairman Peter loft, and you know, we had to, we had to make sure we were here and so we moved here and

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We started the company. But when you get into each piece, every piece is different. So in the restaurant, for example, we have a program with the State Department. Jay, one program we bring in 20 culinary students from South Africa, India, in the Philippines. We have them in four different locations. Wow, I didn’t know that. Yeah, we provide transportation educational program, they stay with us a year. Amazing program. We’re in our second class now of students, because the culinary talent is just not here locally. We then supplement that too, with as much as we can get from the community. You know, our beverage team comes from all over many of them move from Louisville, from some of the best places there. But we try to recruit the best people we can and and show them what the opportunity is here. And to be part of something really exciting. Yeah, we’ve done it across every aspect of the business. So you have to make those investments and you have to invest in the people and create the right culture in order to do what we’re doing. That’s in our opinion, is the is the miracle

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town shaking your hand yet, like thank you for bringing in more people in business. We’re at about 120 employees. We’ve had very, very fast growth, we’re hiring at least another 20. More here. In the next couple of weeks. We’re opening the visitors experience here. We’re just a couple weeks away from that the warehouse bar, we have a second kitchen that has just gone in that’s triple the size of this that’s going to be covering our all of our catering, wow event opportunities here. So there’s, you know, there is so much and a lot of hiring. We work closely with the city. We work closely with economic development. We work closely with the Chamber of Commerce in both Louisville and in Nelson County, to really help attract

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the folks and we’re very invested in and and we think ultimately all of this investment you look at heaven Hill $65 million facility down the street, you’ve got 2.3 billion over the next eight to 10 years and investment projects in bourbon. A lot of hospitality

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It’s coming. We’re going to attract the talent here. It’s going to be great for the state and it’s going to be great for the community. Yeah, I mean, it’s, there’s, there’s no shortage of the money that’s getting pumped into this. And, and it sounds like you all mean it. As as like, you know, starting this business and starting another business, I know that it’s hard to sit there and be like, all right, where can I see return for a little bit? Let’s keep pumping money into it until we start, you know, figuring out finding our groove. So like, where do you all see the end of like, the investing into the business until you can sit back? I mean, I don’t think you I mean, any good business.

29:35
You’re never stopping the investment. I mean, especially when you’re doing something, you know, as you know, innovative like we are in cutting edge. You’re constantly pushing the boundaries here. And I think that’s one of the things that really is exciting is we’ve got a very nimble team, we can move quickly. We see opportunities we go after them whether they’re on, you know, on all of this, even just and to the brand side, pushing innovation, creating

30:00
Very interesting collaborations, testing, trying not everything works. But you’ve got to be bold enough to give everybody especially the folks on your team, the freedom to run.

30:11
And to you know, you have a good vision set out, you’ve got good people, you’ve got a nice structure and you give people the freedom to create any of the right folks on board. You see, amazing things can happen. And that’s how we’ve done this in three years. And that’s the story. Well, it seems from from you know, from your level, that you’re giving them the freedom and flexibility to go and try things right because it’s it’s tough to be able to say like, hey, let’s go experiment. Let’s do these things. When we know that we’ve got to we’ve got to do a lot of things right to be able to make sure that we are we’re pushing the boundary our first things out there going to be home run stuff like that, too. I mean, it’s it’s hard to have that experimental mentality Come on. It’s like a lot of things. I mean, you can overthink things and you know, you can over test things, but the real test

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doesn’t come until you put it in front of the consumer. So you can plan, plan, plan, test tweak. But until you take this and you stick it in front of the consumer, and you find out, do they like this? Do they love the fact that we have complete transparency on the label? How are they going to react to that? Well, the consumer really likes it. Are you going to like these unique finishings where we’re taking different companies and we’re pushing the envelope on some of these types of finishings with bourbon?

31:27
You don’t know until you put them out there. But I think one of the most interesting things is having bottle and bond kitchen and bar in the middle of the facility is like having a laboratory with the consumer. So every day, we’re experimenting, and we’re getting direct feedback. So it’s, this is like our focus group test. You create it, you put a better way to do it, right. I mean, you’re right here you have, you know, you have an audience that comes in here every single day from all over the world. And we’re able to try with them lots of different things. We’re able to get feedback, we’re able to tell

32:00
So we’re getting it in real time from consumers. And it’s a it’s a another very interesting component of the business that you wouldn’t necessarily think about. You know how you would use that when you first coming up with the idea. So thinking of ideas and kind of rolling back and I can’t remember everything we talked about back on episode 19.

32:22
But kind of what was what was the idea of you even wanting to get into this wanting to do this?

32:31
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33:00
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What was what was the idea of you even one

34:00
To get into this wanting to do this, you know, we had been in the spirits business before. And we had a vodka company in the early 2000s. And we learned a lot about who’s we, by the way, myself, Dan Lind, who’s our CFO and CEO and Garnet black, who is our executive vice president hospitality, we’d started this vodka company. And, you know, we, we sold that in 2009. And we stayed in the business and we worked. We did a lot of work with lots of different companies in the spirit space, and we connected over that period of time with our chairman and main investor in the company, Peter loft and, and we all you know, sat down and we had this vision for creating something in bourbon, we saw where the market was going. And we wanted to do something and it at the time. It wasn’t necessarily this, we didn’t come here with this exact vision in mind, we had another idea. And as we all got into it together, that changed from that to here, and it continues.

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evolved as we learned more, and we saw more every year every year every month as I say that the business changed and everything from standing over there when the when the city was showing this property right across the road a small parcel the turning of looking across here and seeing the hundred acres you know and saying you know what, we can see where this is headed this the Napa Valley style destination experience, you know, begins that you plant begin to plant the seed. And so nothing happens immediately overnight. It’s it was evolutionary.

35:34
And so you had the idea let’s get into bourbon, let’s do this, I guess kind of talk us through those those days to of dealing with the city of, you know, weather permits where they’re like, hey, was this was this like you saw this place and said yeah, or I mean, how many? How many other like locations where you? First I the city leadership was and is not only extremely supportive, they’re one of our greatest allies.

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Just in the, you know, in building our business is very important to make sure you have a great relationship there. Kim Houston, who has economic development, our current our current mayor, judge and judge, Dean watts, who is a county judge executive.

36:15
And Bill shackles, who was the former mayor at that time, all So, so supportive, but the funny story is, initially, they didn’t want to sell us this property, they had it. They had it, you know, slotted or thought out for different business, you know, and when you have an unknown entity coming in, and wanting to buy 100 acres of your best city property, you know, not always

36:38
making all sorts of promises. And like a lot of communities across the country, they get burned with these, you know, people come in, they make promises, they don’t deliver, they buy things and it doesn’t materialize. So there’s a lot of trust and a lot of faith that goes on and I think that’s one of the things that I am and we are a team most proud of is we have over delivered here in Bardstown, and we’ve been able to

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Do it with their support. It is had been a team effort across the board with the state with local government. And with the community members, we named we named the company after the town. I mean, we really believe in this place, and we believe in where it’s going. Yeah. So I know you’re dying to talk about these kilometers. So let’s, so let’s let’s, let’s talk about I will, we’ll talk we can cover this and cover any subjects.

37:25
I mean, like I said, you gotta get a lot of knowledge on the business side of it. I know it’s, it’s not a, it’s not an easy feat to sit here and think like, okay, let’s, let’s dive head in. Like let’s really go all in on this and, and, and, you know, really, I mean, let’s be honest, like, you look around here, there’s not you hit the nail head modern type of operation. There’s no there’s no corners that have been cut here. There’s a heavy heavy dollar investment and, and I think, you know, in me personally, that I really want this all to succeed too because there’s it’s a different kind of experience than what you see

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Really anywhere else on the drill and this is the funny thing Kenny is this there was a very significant investment made here and there has been in there has been over time. But when you compare this investment with other similarly situated companies, we spent a fraction of what they spent and that is a tremendous testament to our all local construction team. Busa construction that has been with us for six years. And so I still conduct the same construction team meeting at 9am, every Wednesday morning, and we’ve done it for six years with the same team that has built everything on this site, and will be building everything else. And so it’s a small team. We’re nimble, we make decisions immediately versus bringing in huge construction companies and giant engineering firms and architecture firms and nobody’s really understanding the business or distilling and you know, you get into spending a tremendous amount of money it goes over, you know, goes over budget it goes over time. We have done this again for a fraction of what others have spent. And that’s really an untold

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portion of the story. We couldn’t have done this without the use of construction and that team till more of the story then because I mean, that’s it seems that’s that’s really that’s interesting, right? Because I mean, a, I guess on the other side of it too is is you do get some more of that upfront capital because you can kind of pre sell some of this sort of stuff, the contract, distilling the barrels and everything like that beforehand. It’s not like me, if I wanted to build this over again, I would have to be like, Oh, I gotta wait five, six years until I have a product right? You can spend a lot of money creating a distillery and especially one of this size. I mean, we are now you know, but we did look, we did it. And I think we did a very smartly in terms of we built, we did it, so we had a modular expansion. So we could go from 25,000 to 50,100 30,000 barrels, we just didn’t expect to do it in two and a half years.

39:47
It was more like the five to 10 year plan exactly, originally. But you know, so, but the ability to make those changes to say, okay, we’re going to expand now and now we’re going to expand again and we’re going at the same time we’re going to build a real

40:00
restaurant and a bar and Oh, wait a minute. before we’re done doing that, we’re going to start the visitor center. And we’re going to start bottling. And that is only because we have this relationship, but the construction team that lives with us is effectively an in house construction team. We want to build something, it gets built. We have a problem, it gets fixed. You know, we’re able to do that now. It’s a blessing and a curse. You want to build something it’s all of a sudden you start building something, but it is fun, like the Bochy ball court out there. You know, that showed up a couple weeks ago. Yeah, it was just that was Dan Callaway, his idea. And then now we have a professional Bochy, ball court, you know, construction team goes out there and builds it overnight. So it’s fun. It’s also it’s also good for,

40:40
like employee satisfaction and stuff like that, too. Right. Like, let’s, let’s go, let’s go have lunch play given Bochy will go have a few meetings. That’s right. Yeah. Yeah. And that’s right now, so it is, but it is. It is a very important part of the story of how we develop this so quickly, because if you tried to do it with big, conventional

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construction firms, it would be extremely hard, it takes a long time, and it would cost a lot of money. And, you know, I won’t, you know, point two examples, but you can find them out there in this industry where you have, you know, seen those problems. So talk about as well as, you know, I guess, again, business side, what do you do to like, have employee retention, right, because this is, this is an industry that most of the time people look at account managers, they look at marketing professionals, they look at, you know, you have your culinary side of things, that it’s a lot of turnover and some of this industry, what do you do to help keep that employee retention and make this a positive working, so we do a tremendous amount there. And a lot of that work is led by Garnet black, who runs is our executive vice president hospitality, but she also is our head of HR and our HR team here, that starts with the culture and it starts with day one, you know, we created our mission, vision and values with our employees. We wrote them together. They participated in writing the employee guide

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lines with us, you know, they we give them we did it all of this together every employee, the first 18 barrels that rolled off the line at this company went to the employees. And most people set most companies sell those for a lot of money. They went to the employees, every employee that starts here, I get a in whiskey gets a barrel of bourbon. Right? Yeah. You know, it’s everything from, you know, the way you recognize the right way you reward, you know, and the type, the type of culture we create by bringing people’s families together here too. And so, you know, we look at we emphasize all of those things, and that there’s appropriate work life balance, and that we support the community and, you know, the charities and the organizations that the employees care about. So there are multiple different levels to this. And in a company that is growing so quickly, we I think we spend a very significant amount of time focused on culture.

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And, and it’s important, yeah, no, absolutely. I mean, because I come from a tech background. I know most listeners know

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Already and, and so I, I venture out to Palo Alto in the valley very often. And I get to see the ping pong tables and the arcade machines and the puzzle room and also that kind of stuff that most companies around here would be like flabbergasted at. Right. Right, you all build about you ballpark, right? So yeah, you’re trying to create a culture that makes you feel like you really want to be here, that it really helps, as I said, helps the employee retention but really helps create that sort of like positive environment that you feel good about coming here in China. That’s exactly right. And that’s what we try very hard to do. And you know, you’re running, you know, very different businesses to you have the distilling side of the business, which is very different from the restaurant and the bar, which is different from the visitors experience, which is different from brand sales and marketing with our team that’s out there in the marketplace. Now. You know, we’re building world will be in six states with the product by the end of the year, and that is an entirely different business and architecture and one of the most important pieces of the business and we have just this year now ventured into that.

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It’s actually the part of the business that we know the best, ironically, because that was the business we were in before. We did a lot, right? We did a lot wrong there. But we learned a tremendous amount and it’s one of the most exciting You know, one of the areas I am certainly most excited about with where we’re headed is the brand All right, let’s talk about that. Okay, let’s talk about I know I’ve been I’ve been taken off the rails here and there’s a lot going on here it well it really is and it’s it’s fascinating and talk about what this what the multi do do this and we can keep talking let’s not wait 200 episodes to do another saying come back here what’s going to be a different place a year from now as it is six months from now, so So talk about you know, the first three expressions that you all put out what did it take for the collaboration side of this to really make it happen and I should mention that you also you there was the the collaboration series that kind of came out in this like square bottle? Yes, I think about a year or so ago, correct? Well, we have one case of that left. But that would that sparked an idea and so all of us

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I’ll take back to that. But just to start this, this is the Bardstown bourbon company that you see in front of you, this is our brand format, so that this style bottle, you know, and label, this modern presentation of a cohesive brand. And I think the challenge that you have with any young whiskey or bourbon company, is how do you create and begin to create a brand, when your whiskey that you’re making here is still maturing in the warehouse and take some time to mature. We don’t cut corners. We don’t plan on putting anything out that is young, we made a very early decision that we weren’t going to put out a six month rye and a one year old, right? That we were really going to wait and we were going to put it out when things were ready because we’re not under a rush. But in the meantime, we want to do we want to create really exciting things. So what’s happening, what are the trends in the industry? Where are things going? blending, blending is a very exciting trend. It started in scotch. It’s been going on for a long, long time, but it really is becoming you know more

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Prominent now bourbon, we want to be great at that. And what’s unique about it, we got a Distilling Team, a beverage team and a culinary team that are now all different flavor experts in cocktail team is looking at I mean, a beverage teams looking for cocktail balance, colonnade teams looking at for pairings distilling teams work looking at traditional methods, and they’re blending for those reasons. So as we began to get into it, how do we bridge that gap? Well, we start with, you know, a couple of different expressions fusion. Our fusion series tells the story of our blending capability but begins to introduce our young bourbon in with a fully mature or older bourbon and we put it all on the label. So we have 60% of this is two year old bourbon. One is a 20% wheat one is a 36% rye, blended with a 11 and a half year old Kentucky, so it’s a Kentucky straight bourbon. And what you get is these bright notes from the younger bourbon with kind of the heavier

47:00
You know the notes from the older bourbon and it makes a very complex blend, where you would get much more of just a uniform product. If you had just the 11 and a half year old here, you’re putting these really neat notes. And we went this process went through 50, blind tastings with the Distilling Team, the commentary team and the beverage team to arrive at this unique blend. Its series one, because it’s going to adapt. Next year at 6040, maybe several months from now, it’ll be 7030, then at 20, but you get to really kind of see how this is going to change as we move to our fully mature product. Then Discovery Series. Discovery is our series that just is about making phenomenal blends using whiskey and bourbon that we didn’t produce ourselves. So Discovery Series, one is a blend of four Kentucky straight Bourbons, the core of it being 11 and a half year old, but you’ve got some, you know, sprinkled in 13 year old 10 year old and five year old and again, went through the same process with the

48:00
Teams blending. And instead of having one singular product, they’re adding these like, it’s like little notes like little spice notes into the blend, so that you’re getting something much more complex. And it’s really neat again, went through multiple blind tastings with those teams to arrive at this. Yeah. So I mean, that’s and that’s what I think is what you’re starting to find that a lot more prominent now is being able to get these, these these older Bourbons and then do this blending and there’s going to be varied amounts of the type of one product, a proof of another product. And really, you’re not going to find the same thing everywhere you go when you do this as well. It really makes it fun because the consumer is looking for interesting things. The consumer is open to innovation, which is where the collaborative series comes in. And you go back to the square bottle. So that idea started over dinner with Joe Harris, from copper and kings. And I was sitting with him and we said, let’s Why don’t we just start

49:00
This was three four years ago. Let’s just start making some neat stuff. We had this glass, we actually owned inventories of 10 and a half year old MGP Indiana bourbon 21% rye. So we took Muscat misspell barrels. And we finished, selected the bourbon finish this bourbon in the Muscat misspelled us for 18 months with the same with American brandy. It was a remarkable product. And it sparked this idea of why don’t we create a series very limited edition that tell the story of two great companies working together to produce a really unique product. So then we did the fight for Patrick reserve with Suzanne Fiverr private, great winemaker out in Napa Valley 18 month finish in her Napa Valley cab barrels 18 months is quite a quite a long time. I mean, usually you hear about finishing it’s like two to three months, maybe a few ways. Yeah, we were doing 18 month finish on every one of our products at a minimum. And it’s a major investment. But you see a remarkable difference. You know, some people will say oh, you know, the products done

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It’s going to turn. We have never seen that yet. And I you know, Joe Heron is a huge, you know, believer in this to just keep waiting. And so we have 10 more of these products, projects coming out. We’ve got three more with copper and kings. We have a really neat one one coming out and beginning of next year with prisoner one. So fabulous that’s been that has been finishing now over 16 months. We have great Armagnac house a really neat run one again, we’re not held on whole story of the two companies working together. And so these remarkably long finishes produce exceptional products. We actually go one step further to we make sure that there is no degradation in the underlying quality of the wine or spirits. So for example, our wine cast, we ship on refrigerated trucking across the country, they never sit out in the heat, not even for a second they come off the truck, they’re filled. And so you prevent all degradation. So tremendous care and making them as well to say I was like, that’s a that’s

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Investment right there, just I mean, I know what it takes to ship a barrel, you know, across

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state lines and everything like that. But now to put in a refrigerated truck here, it’s, it’s a lot more expensive. But at the end of the day, you know, our goal is to create exceptional products. Because if you make really good quality things you’re going to do great. And that is, we just firmly believe that, you know, if you go take the extra steps to make an exceptional product with a really deep authentic story. You know, that’s what consumer, that’s what many consumers are looking for these days. And we see it every day. Absolutely. And so I mean, it’s it’s good to see that this is where the brand’s heading, you’re doing a lot of good things here too. When do you start seeing it? Because granted, I know you contract with a lot of stuff, but you’re also distilling for yourself. Oh, yeah. So all right. Oh, yeah. A lot for yourself. So what’s the what’s the next phase of, you know, taking fusion to its its own so you’ll see you

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You’ll see that fusion blend change, you know, multiple times. And then what you’re really looking at is about 2022 when our whiskey and bourbon is, you know, really hitting that, you know, about five to six year sweet spot, that’s when you’re going to start seeing it. And so you’ll see rye and different bourbon mash bills. We’ve been doing a lot with malt whiskey.

52:20
We have a lot of experimentation taking place to so I think there’s a lot of exciting things everything also, you know, we’re going to be launching a single barrel program here shortly for the public and for retailers, which is different because because we do 40 different mash bills and we create so many different things. You’re not limited as a consumer you’re going to come into our new bear can be quite the quite the experience and like I don’t know if we’ll be able to make it through all these Nashville’s exactly so you go Rick house bar here, which is beautiful. I you know, I think we’re going to take you out and see all these things today. But that structure, you have all glass looking into the warehouse, it’s all lit, beautiful setting intimate bar, we’re going to be able to provide

53:00
The consumer the retailer with five six different selections different mash bills you’ll be at a try those barrels you’ll be able to secure them now you’ll wait several years will bottle them for you and you know you have a very different single barrel you know pick program where you’re not just limited to one tiny let’s do a whole array of different things yeah, I mean that’s that’s gonna be impressive when that when that comes around because a lot of fun Yeah, well Sign me up

53:29
great Yeah, no, I mean it’s it’s it’s cool because there’s there’s definitely room at of what you all are doing and pushing the envelope not only just in regards of the whiskey production, the kitchen, the single barrel program and one thing we even talked about was the vintage whiskey you all are doing as well like that’s it that’s the way it is here. It is so exciting. And as part of the new visitors experience, we have a whiskey library that we have built a little secret hidden library back that you can do dinner for up to 10 people in it. And we’re that’s where we display and showcase our 400 bottles of vintage whiskey.

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that date back to the late 1800s. We secure that and curated the collection with Fred Minnick. It’s all for sale by the poor. And it is we built the product we built that collection based on stories. And we didn’t wasn’t based on volume it was based on what is some really hard to get very unique products that tell great stories. And so some of the some of them back there are absolutely incredible. And they further the whole discussion about whiskey and bourbon. So you come here and again, carry everything but you have discussions like why is you know, the Old Crow chess set considered one of the best whiskeys made? Why is this 1929 see grams Canadian bourbon, which we have, which was before you know, the the statute went into place. Why was that at eight years old? so unbelievably rich. Why are some of these products so terrible? Yeah, that’s right. That’s, that’s

54:56
a stuff and you’re like, Well, that was Yeah, that was good.

55:00
And you know, and so, but it starts a conversation. And, and that’s what this is all about. That’s what I mean, the enjoyment of whiskey, and bourbon, and all of these things is all about a conversation. It’s all about an experience. It’s all about trying things, sharing things, talking about them. And that is at the core of who we are, and what this place is about. All we want all those conversations about all different things happening in here. It’s not just about one brand, or just about our brand, our brands great. And we will put it against anything. But there are also other wonderful producers out there, and it’s a big community. And we want all those discussions taking place in here. Now, absolutely. And you know, as we kind of wrap this up and start thinking about really what’s on the horizon for you, like on the business side, like where do you Where do you kind of want to see this year? I mean, shit, you already talked about, hey, we’re expanding every six months, but like, do you want to stop expanding? Like is there is there a time when you’re like, hey, like, let’s let’s pump the brakes on this for a little bit. I mean, you are seeing the expansion is we’re not in

56:00
anticipating further expansion in distillery, so are now our focus we have you know, upgrading yes improving our capabilities always. But we are now focused on building the brand building the visitors experience and the elements around that including bottling and the hotel. And so those are things that we are looking at right now. And we’re really excited about that’s what’s on the horizon and making this a fully not only a fully integrated production entity from you know, from whiskey production to storage to bottling but also on the vent on the visitors experience side, from restaurant to bar to lodging to being able to stay here in the heart of the bourbon capital of the world and make this a full destination experience Am I gonna be able to use my Marriott Rewards points here you know, and I went on a yet

56:49
so we’ll leave it on that you know, David, I want to thank you again for coming on. You know, like I said, For for Ryan and myself and Orion’s on here, but we always like to hear, you know, we can always talk about like, oh,

57:00
We can do this many barrels a day able to love but, you know, hearing it from a business aspect, I think is one one crucial component that I think a lot of people need to understand as we start getting this and, and you you really talked about it earlier about how you create the culture. And the culture is what builds everything around it right that point and, and really what ultimately makes any venture successful. That’s right. And I look and I want to congratulate you guys, because your growth has been as significant as ours and you know, up to 200 podcasts now. It’s incredible. And you guys are the leading and if you know, for those of you who are out there, I mean, Kenny and his team, they are the leading bourbon podcast out there, period. And so sign up, listen to it, we encourage it, and we love what they’re doing spreading the word here and helping educate everybody about what’s happening in this industry. So congratulations to you. Well, thank you, David. I appreciate that mean, I always like a good

57:53
great, it’s wonderful to see that, you know, rising tides is lifting all boats across all of this and you know, we’re all

58:00
Part of this, you know, bourbon journey together. Absolutely. Well, hopefully we’re going to be a part of it with you. And we’re going to be excited to kind of see where this is going to go here in the next year too. So, gonna be happy to see that. So before we kind of close up, if people want to give them the address, where can they find it? And they can type in Bardstown bourbon company, and Google Maps with Bardstown, bourbon, com, you know, our website, you can find us on Instagram On Facebook chest, check us out, follow us. We’ve got a lot going on, particularly on Instagram, we’ve got an IG TV show that’s going to be launching here shortly too. So maybe doing a lot of fun stuff in here and broadcasting to the world what’s going on in this facility? You know, in real time, that’s what we need to do. We need to get the get the bourbon audience continue to grow and really that’s right capture that mindshare, so make sure you follow them make sure you follow us bourbon pursuit on Facebook, Twitter, Instagram, if you like what you hear, consider supporting us patreon.com slash bourbon pursuit and if you have any other ideas, ideas for shows more sides of the business, more sides of this

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building a brand you want to know about whatever it is send us an email team at bourbon pursuit calm. So David, thank you once again for joining us pleasure and we’ll see everybody next week.

59:24
The world’s biggest music and bourbon festival is even bigger September 20 21st and 22nd at Highland festival grounds of the Kentucky, Louisville with Foo Fighters.

59:37
Zac Brown band

59:40
Robert Plant and this insatiable spaceship,

59:43
Daryl Hall and john Oates, john Fogerty, cc top Leon bridges and more complete lineup of musical artists and celebrity chefs at forbidden beyond calm

Transcribed by https://otter.ai

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