The Entrepreneur Podcast
The Entrepreneur Podcast

Episode · 8 months ago

Changing careers and changing perceptions with Eric Brass of Tequila Tromba

ABOUT THIS EPISODE

The mention of Tequila often induces a strong reaction, and Eric Brass was no exception.

 

“I had the same misconception that most people have about tequila — that disgusting shot in a seedy bar at a horrible hour of the night. It’s the most misunderstood and misrepresented spirit in the world.”

But something happened on a study trip to Mexico that changed Brass’ career trajectory, leading him to co-found a premium tequila brand with just a backpack and $10,000. Today, Tequila Tromba is one of the fastest growing premium tequilas in North America.

Together with his entrepreneurship professor, Eric Morse, Brass walks through his entrepreneurial journey: from discovering real tequila, and leaving the world of finance, to creating a modern brand with traditional techniques.

...you're listening to the IvyEntrepreneurship podcast from the PRL Morrissette Institute forEntrepreneurship at the business school. My name is Eric Morris, and I'll beyour host for this episode. Eric and I have known each other for quite a while.He came through our program here, and I've been really fortunate to be ableto keep in touch with him over the years. And I do. I do mean that tofollow his journey and where he's been has been just fantastic. And to see thesuccess that they've gained over the years is, uh is really rewarding for me.So I love it, and, uh, the opportunity to share that with everybody tonight issomething that I'm really excited about. So, Eric, I don't know if you want tojust say a couple words about yourself before we really get into things, maybea little bit more about your history, and then we'll just jump right in. Sure.Well, it's a pleasure to be here. I wish we could all be together in person.Obviously, it's, uh, interesting and difficult year in many ways for manypeople, and I feel for you know, all of all of you, you folks at Western thatthis is this is the year of school that's were taken. But it does bringsome opportunities and unique perspectives which probably talk aboutlater. My story is I you know, I graduated from from Ivy and in 2000 andfive, it seems like it seems like yesterday, but a long time ago. And,you know, one of the things that I did is I went down to Mexico on exchangewith school. Most of my smart friends went to Hong Kong and France andSwitzerland, and I went to Guadalajara, Mexico, to learn some Spanish, get mybutt, kicked a little bit and have a new, interesting experience. And downthere I fell in love with tequila. So I thought tequila was originally my manydays at Western and Seeps, and a bunch of the bars thought to kill was thatterrible shot of that horrible bar that city hour of the night, and ended uptrying to feel for the first time and was amazed. My husband, tequila,actually is came back to Canada, worked a day job for about six years now,asset management and then one day, much to my mother's dismay, Quit my job,went for the dream and started tequila. Brand called trauma and didn't knowanything about the world of tequila. Didn't know anything about boostbusiness. Didn't have any distribution. You know, Eric, before you go too fardown that road. So you were You were working in asset management, right? Sohow was it that one day you decided? Okay, now's the right time. Yeah. If Isaid it was one day and you know which went off, I'd be I'd be obviously lying.But it was, you know, it was just a passion that I had. It was a bug insideof me. And a lot of people ask me, you must have not liked your job. And Ilove my job. I mean, I was you know, I wasn't I was effectively co managing aportfolio of stocks. My boss was terrific. My peers were awesome. Butthere was something inside of me when it came to doing something for myselfand entrepreneurship Bug that you probably helped build in my last mylast year of Western when I was in your class in the first year of theentrepreneurship group and it just didn't die down. And when it came to, Iwould travel back and forth to Mexico and and bring back tequila. Firstpeople would say, You know, I don't want to try that. I've had a badtequila story And then they tried to kill, were blown away, and I started toget invited to parties, for example. And people would say, You can comebring her tequila, you can bring it to school. And I saw the you know theopportunity there, and I saw that gap in the marketplace where there wasn't a,you know, an ultra premium tequila, an accessible price. Tequila was very top,and bottom heavy was either about pounding your chest. Look how muchmoney I'm spending or about Close your eyes, plug your nose, hope for the best,take down a shot. And that would be lucky than smart. A friend of mine onexchange was a guy named Marco Sedano, or it was Rodrigo Sedano. Marco Sedano.His father was the original master distiller of Tequila Brand called DonJulio, so we pitched him. We thought he'd tell us to bugger off. It's likeasking uh, Wayne Gretzky to play your men's team. And how did you meet theHow did you meet the sun? So Rodrigo was in my class. He was a He was adrinking buddy. He was somebody that you know. One of the smart things I didon exchange was I hung out with the Mexican students, not the exchangestudents. And he was one of the people that introduced me to tequila. And, youknow, it didn't really mean too much then that his dad was the master. Youknow, the original Masters still have a great tequila brand. I couldn't evenspell done who you let him know. I don't know what done who it was, butI'm a big believer that things kind of compile in your in your favor. And theopportunity presents itself. And for better for worse, I can go out forbetter that that opportunity presented itself and the stars kind of lined up,and we effectively, you know, we started trauma from there, and it'sjust another way that kind of stars lined up. I don't think about this toooften, but when I went on exchange my first day of the exchange program, Iwalked into the into the lobby of the...

...exchange school in Guadalajara, Mexico,and a tall, lanky Australian fellow comes up to me first. God spoken toReally? And he says, How you doing, mate? I'm doing okay. And he said, uh,you know, we live in And I said, I don't know. I want to find a find aplace. Um, I didn't want to live in the residents there and he said, Well, howabout we We live together and this is the Yeah, that's pretty preposterousthing. And I said, Okay, no problem. And so he actually became my businesspartner in trauma. So I'm not really. I didn't know that story from that fromthat chance. You know that chance thing and be saying yes and be open to it.And he became one of my best friends and my business partner in trauma, andhe ran the Australian market. Wow. So, Eric, when you went, you went back home,you got your job, and obviously you must have kept in touch with these guys.And was this something that have you guys talked about it way back then? Orwas it really an evolution over time that led to this? No, we never evenjoked about it. I mean, if you'd have told me back when I went in exchange, Iwould effectively be running a tequila brand. I would have said, You'reabsolutely You're absolutely your mind. It just, you know, certain stars justkept the lining and opportunity presented itself and putting yourselfin an uncomfortable position like me going down on exchange was a gamechanger for me in a lot of ways, That still impacts me today. And I'm a bigbeliever of doing that both personally and professionally, because I had a lotof friends that went to place business have to be obviously exchange related,but went to I had the opportunity to Sweden, for example, where two of mybest friends were going. And, you know, I would have had my family there, and Iwould have had effectively my social life lined up. But instead I pickedGuadalajara, Mexico, and I opened up that exchange for Ivy, and I think itclosed straight after I was there. But I don't think it was your fault, but Ithink that is true. I didn't know any Spanish. I didn't know anything aboutMexico. Um, and I just decided to have a go and do something different and andchallenge myself. And from that challenge, it's, you know, all of this.All of this arose where, if I would have picked quote unquote the saferoute, then who knows? Who knows? Who knows? Yeah. Okay, so let's get to the,uh you guys, I guess Start talking again about, you know, just catching up.Where did the idea come from? And how was it your idea? Was it one of theothers? You know, how did it come up and what? We're kind of the first steps.I mean, it was I think we all you know, I went back to Toronto. My roommate,business partner, Nick went down, went back down to to Melbourne, Australia,and we both saw the epiphanies that we could bring when we brought goodtequila back to them after we either bought it, bought stuff in store,brought it back from Mexico. And, you know, we both just absolutely loved thespirit. And there was such a great misconception. Still is today aboutsure what tequila actually is that it can actually be sipped. Enjoyed saver.Now it's obviously a much more of an evolved market, and it was really aboutfollowing something we loved. We were an alcoholic spending stretch of theimagination despite my background, but But we really did, you know, love thatopportunity. And again we saw that gap in the marketplace that the big playersjust we're not addressing. And for us, I mean I mean, so many people said,You're you're completely out of your mind. I remember my boss's face whenwhen I told her that I was to do this. I mean, it was, you know, she could seeit. Are you Are you crazy? Because it was not the safe bet. It was not aquote unquote the smart, the smart bet. And, you know, when I graduated fromfrom school in 2005, you know, and and even even 56 years later,entrepreneurship wasn't nearly as sexy as developed as it is today. I think inmy there was there was one guy that just to the entrepreneurship route, andpeople said, Are you is he out of his mind? He's kind of a little start up,start a wind farm, and he was he was wildly successful, but I think it's,you know, it was an incredible thing in terms of it was, it was obviously theright thing to do is to leave a very cushy job in fantastic management. Anddo you do this? And it wasn't it wasn't a one day thing. It was a progressionof ideas, and I can't quite point to one epiphany moment, but it took. Ittook me a good amount of time to work up the courage to actually actually doit and take no salary for for two years and work, you know, you know, work outof my parent's basement and storage unit in their garage and all that stuff.It was I remember you telling the story of, uh, kind of going down andconvincing the master distiller to join you and make you know, make the jumphere. Could you share some of that with everybody? Yeah, I mean, so again, likeMarco Sedano, the guy that we were effectively looking to bring on as ourmaster story again, it is literally like asking Wayne Gretzky to play inyour men's team. You're expecting him to tell you to go. You know, we go to abugger off and effectively, you know, with him. He's We gave him anopportunity that he never had before. So we didn't want him to be able tostore who wanted to be our partner. He...

...said, you know, he was the originalMaster Stiller for for a priest to kill for 17 years. And when he left, all hegot was a watch for his efforts. Which a nice watch, which was which ended upbeing robbed at gunpoint, which is another story all together. Um, but yougotta watch. And he felt rightly or wrongly, that he was instrumental inbuilding that brand, which is worth in the billions today. And he didn't wantto make that mistake again. And he's not a money hungry guy, but his legacyis nowhere attached. That brand he wanted his legacy attached this brand,he said, Make me a partner. Make me part of this of this brand may be partof this tequila and rule number two. No gringos in the kitchen. Give me controlto do what I want to do. I'm going to bring my son Rodrigo in your drinkingbuddy. from school. And what's really nice is, you know, usually it's not alegacy business in the sense where it's passed on from grandfather to father toson. It's father and son building it together. So it's their family legacyas much as it's mine. And, you know, those were the two main conditions thathe asked for, and we had about 10 grand and we raised, You know, I caught pitymoney from friends and family. We had about 10 grand left over and effectiveafter after our first production run and went with our backpacks, bar by bar,bottle by bottle and built trauma to number two in Canada number two inAustralia. Uh, that's amazing. And I don't know, you know, this isn't anovernight success. I I know you had bottles of Trump A and your backpackgoing bar to bar, trying to get people to carry it. And can you just tell us alittle bit about how you got? You know, it's a tough business to break into.How did you start to get it out there and and start to see some of theacceptance? Because I'm like most people and I'm guessing most people onthe call, right? They've had tequila. But it was either, as you said latenight before the bar closed or it was in a margarita or you know somethingelse. So not kind of sure is a fine tequila. And, you know, yours wasactually a revelation to me. I hadn't really had a great tequila, and I thinkyou were the one just pretended Scotch. Drink it the same way and you'll befine and you know, it's wonderful, but it's sure not what I kind of knew. Sohow did you convince people that hey, you need a high quality tequila here inNorth America? I mean, it was, I think, being it's it's funny. A couple coupleadvantages don't realize where advantages back then, that there arecertain advantages today when when I noticed the number one is we startedwith and this is a little bit of attention, we started with no money,right? We started with effectively 10 grand in marketing, so we had to bereally out of the box and think differently. Quote unquote outside ofthe industry standards as to how to effectively penetrate the market placebecause if somebody would have given me 23 million bucks to start off. To bequite honest, I probably would've wasted two or $3 million would have aheck of a time doing it. But that's not what building shareholder value is forfor your peers and for yourself. So that discipline, because I thinkoutside the box and effectively build a culture within trauma, that is, are webase that effectively is there today. I think one of the one of the things thatwe had in our favor is being a small company, and it's probably testament toanybody that wants to start their own companies. Competitive advantage wehave is we're agile, you know, we have that agility where we can go and turnon a dime and effectively cater our the locator against what the industry sayswe should do. And I remember giving our business plan to a industry expert andhe took it and then he gave it back to me a week later, and I think it hadmore red ink on it than black income. And words like Impossible can happenneed at least a million dollars to launch the Toronto market he wasn'twrong, but we didn't know that he was right. And that allowed us toeffectively open up our eyes to do things in a different way. So while thebig boys would go and they would, you know, beeline for the bar manager, forexample, to sell their product, we would be line for the bartender andtheir thought process. Where the bartender doesn't have to say it's abar. Manjula is a product, but our thought processes where things arechanging. The bartender. If you get the bartender on your side, any bar worththeir salt is going to convince the bar manager they need to buy this product.And who's pushing the product to the customers? It's the garbage, and weliterally went bar by bar, bottle by bottle and continue to do that And whatyou know. If we would have over analyze things and went with industry experts,we would have gotten nowhere, would have done the same thing that the bigboys do, gotten a pissing match, capitalized and would have lasted notime with them at all. So thinking outside the box, being agile and reallyfor us, it's it's out. It's out working our competition, that loving ourcustomer base. I mean, we just showed so much goodwill and so much love to,you know, to the hospitality community. And, you know, without with and everytime you get paid back. But you know, seven or 10 times review and that whensomebody when somebody discovers, for...

...example, about tequila from yourproduct is first educated about tequila, your product or any sort of you knowany sort of products, they build that inherent loyalty to your brains. Rightwhere I fell in love with tequila with trauma. I you know, I fell in love withthis juice with X X company and education training out loving ourcustomers, not thinking our competitors were the They didn't quite pay verymuch attention to us until we started to get some scale. And then they Yeah,we were quite an instance. Yeah, you know, I know it took a while. And butas you said, uh, both in Canada and Australia, fastest growing tequilabrand in the market. I don't know how many years, and that's led to gettingpicked up in the US I know it was public announced that you just signed areally a great agreement with a distribution company out of the U. S.Can you tell us a little bit about how that came about and how you were ableto secure, You know, a really great distributor? Yeah. So? So we're nowaligned with We will be a line, actually, with to about a week and ahalf. February 1st with Sazerac, United States. Those aren't as familiar withSazerac. They are the largest urban seller in the in the world. I believethey're the number two and number two or number three player in terms offlicker in the United States. And some states are number one. So there aremassive and, you know, for us we you know, for us, it was a tremendous shiftwhen it came to covid, where you know, we come March of last year. We werevery bar restaurant focused brand, right. 70% of our sales are in thewhat's called the on premise bars and restaurants. And it doesn't take agenius to figure out that when covid hit, that's a very bad place to be. Andso our sales didn't go down, You know, 30 40% in the on premises What theywent they went to zero over a period of, you know, like like that. And then someprovinces and states. They still are pretty pretty close to zero in theworld of on premise. So we made a lot of changes during during covid. And oneof the changes was partnering with a larger player. And we have beenapproached quite a bit over the last year and a half. We didn't what wewanted to remain independence. We wanted to effectively Carver on way. Weknow that there is no such thing as a free lunch. But what we realized whenit came to covid is is the impact. The current impact of covid is one thing,but the after impact of covid is structurally going to make it verydifficult for brands like ourselves, which are strong independence to growthat fast. And I don't want to bore you with with exactly why. But the U. Sdistribution structure set up where large suppliers have a lot more closewith the straight years, and it's always been the case, and it's going tobe more and more and more focused on the larger, larger suppliers aftercovid because they have a lot of ground to make up. And so something thatprobably wasn't that we would have said, Heck, no to a year ago. We said Heck,yes to effectively because the rules of the game have shifted. What becamestrategically unappealing to us 12 months ago became strategicallyappealing to us and not from the point of desperation or anything like that,because those guys, they could have picked 1000 other products. But it camefrom the point of structural shifts within the industry that we had torecognize, and we couldn't bury our heads in the sand and say, We don'twant to do this because of an ideology and what we've seen. I mean, it kicksoff, kicks off again very shortly, and we've seen already. They've already presold a heck of a lot of products. Um, and they are picking up. We've actuallylaunching, are ready to drink portfolio as well that they're. But they're alsopicking up across the United States. So it also checks another box for us tomove more into retail or two grocery warrants to large scale liquor stores.What you can do is an independent. But if you have big brother Sazerac behindyou, it makes life a heck of a lot easier. Texas. Was that part of thedecision behind going with some additional products? As you said, Iknow the tequila based, but you have more skews out there now. Was thatpartly because of the distributor, or was that a decision you made beforethat? No, it was. It was a decision we made before that. And better to belucky than smart. We ended up watching. One of our are ready to drink are trumpand soda and the l C B l actually, with the bat so different, differentpartners, Um, in in effect in June of this year. So obviously ready to drinkhas been a good place to be in the summertime of the pandemic. But youknow, one of the things as soon as we're always thinking about our TVs,but as soon as the pandemic, you know, kind of kicked off, we really thoughtabout ready to drink this another way to effectively continue to move thebrand towards. You know what is going...

...to be a medium term new reality. And so,in addition to the trauma and soda, we launched a margarita. We launched aWe're launching Margreiter launching diploma, All US based and Sazeraceffectively put put a gun to her head and they said, If you're going tolaunch it, we want it all. So, to your question, we didn't think aboutlaunching it. Well, that was kind of seated before. But having a partnerlike that in a space that's getting more and more crowded makes us a lotmore confident to launch it and gives us again the distribution that we need,both retail and with the distributors to effectively move products. And oneof the things I've learned is having a Sazerac. They're not a distributor.They're an important for their suppliers. So having having distributora big distributor, take your product now, care if it's if it's liquor. Ifit's food, if it's whatever it is, whatever widget you're making, that cansometimes be the kiss of death. Because distributors are not in business,generally speaking, to detail your product that belongs to a brand owner.And so having Sazerac with us to push things through the distributor gives usa chance for success. We have to execute on it. Where if we're doingthat ourselves, that's a lot. A lot of manpower to distributor work for you.And I've seen it so many times. It's the kiss of death. Sometimes you get abig distribution deal, and then the product sits in the warehouse with thedistributor. Yeah, I think you know, it's funny. You say that because I seethe same thing. I think too many entrepreneurs think that. Okay, we'redone. We've succeeded. We got it into the distributor, right? Your works.Really? Just starting. At that point, you've got to make sure it's pullingthrough the distributors to be successful. You talked a little bitabout covid, um, and really had to pivot the business. Are there otherkind of changes you've made during covid Or, you know, kind of lessonslearned through this period that you could share? Yeah. I mean, have beenquite a quite a few. So obviously a tactical shift from retail to or fromfrom on premise to retails one. Obviously, the Sazerac deal is anothernew rescues. We actually are right now toying with another toy. And we do havethe product but we actually started creating from our the waste of our ouragave plant started to make single use disposable, environmentally friendlyproducts. So straws, cups, cutlery, all that type of stuff instead of the fiber.The fiber is that that's a sister company actually working to continue toexpand that hiring. But that's been really, really interesting becausethere's a massive waste problem that happens with tequila. And there's amassive call to action right now when it comes to providing sustainablesolutions. And so we effectively began better be looking and smart. A friendof a friend made straws out of corn and sugar, and he said, Can I try it withyour with your waist? And you know, sustainability is really important tous and we gave them our waste, and he made a straw that absolutely blew mymind. I mean, it doesn't take a genius to figure out there's a straw problemin the world, the double fused plastic or the double newspaper, and so thestraw doesn't get soggy. It's using hot and cold beverages, and from thateffectively we invested in a factory down there, and because we have tocontrol our own destiny, and we partnered with Cisco in the UnitedStates and effectively now have a whole sustainable disposable line. Is asister company in combination with Trump? So and we probably wouldn't havedone that if it wasn't for wasn't for Covid Because, you know, I neverthought I'd say the word wrapped cutlery in the same sentence sentence.But not everything now has to be, You know, that sustain that sustainabilitytheme is not going away. It's getting more and more Covid has not won. Andnow the customization ability to adapt, to be agile island make products thatpeople want. And that's that's what with the fact that we've done. So we'vewe've, you know, it's been a really, really interesting part of our business.That's very cool. And I'm assuming all the same partners still involved withthe business at this point, amazingly enough all the same, all the samepartners. And that's I think, really, really interesting for us, where we dodisagree on a lot of things. But we all tend to agree on the larger goal andhow we want to operate the business and, you know, and our personalities, and Iknow so many peers that have effectively had partnerships breakdownand things happen here. You probably know a lot more than I do, but we've,you know, we've been able to have the same founders involved in that level oftrust with between each. Each one of us has been a recipe for success. I couldleave any one of them with my bank account. Details come back in a year,and every every cent will be there. With this small amount of interest. Thebanks are not. Yeah, well, it's clearly what happens when you meet over tequilalate nights at a bar. It's always it's works perfect. Hey, uh, I've got acouple more questions for it, But if...

...you're in the audience and you have dohave some questions yourself, go ahead and type them in and we'll try and getto as many as we can here in just a minute. You know, I know you're gonnatell me you've made a lot. But if you think back at some of the pivotalmistakes, perhaps that you made in this journey and, um, maybe if you couldshare one or two of the mistakes and kind of what you learned and how youwere able to recover and move forward. Yeah, and yes, I've certainly made aton of mistakes and make mistakes every day. Thank, Thankfully, I'm I'm a bigbeliever in of just trying to be instead of trying to be very, veryintelligent, trying to just be not not stupid. There's a There's an old saying.I think it's a Charlie Munger one where you know it's a strong swimmers whodrown, right? So if you try to be too clever sometimes and I know a lot of alot of the companies that blow up is because people take uncalculated risksthat farm on things, and sometimes it works out. But a lot of times, a lot oftimes doesn't they're not. They're not stupid by any stretch of imagination,just, you know, wrong risk at the wrong time. So thankful I haven't made onebig mistake that cost the company, you know, millions of dollars. But I thinka big mistake I've made that I can think about quite clearly is the way Iused to hire. And you know, it might be a bit early for, for from some aspiringentrepreneurs, but maybe not. But I used to think that if I get somebodysuper experience with the great contact list or rolling actions as big as weused to say, I can kind of ignore the down side of things. And one of thethings that I can't overemphasize is always higher, whether it's whetherit's somebody running your sales or even someone down someone down the line.Make sure that cultural aspect is a line, because I've I have been higherfor. You know, I I knew that the person didn't believe in what we were doing toan extent or wouldn't buy in and very talented. But I said, You know what?The short term impacts of getting those contacts, getting those sales up andthe impact it's going to have on our brand is going to weigh over way thatand there is a short term sugar high you get from from that from having thatperson involved. But in my experience, it always doesn't work out because thatperson has had the experience of doing X really, really well for 20 years.They've done X really, really well and you're doing why, Because things havechanged good luck in that person to go from X. Why and you know there's an oldmilitary action where education is easier than reeducation or simplisticterms, trying to teach an old dog new tricks. And I haven't been successfulin doing that in every single time. It's it's cost me a lot. I'd also sayon the on the hiring side, I made the same mistake hiring, hiring what I callgrumblers So because and and it's it seems pretty simple. But you know, yousay that you know that a person can be a bit of a pain or can bring the stuffin or be pessimistic, but they're so talented, they do so much for sales.All that stuff that's going to that's going to mitigate that. It's like acancer. It eats on the culture of everybody else, and it's always really,really important to us is making sure that our team comes in. They love whatthey're doing. They have a passion for work, and our turnover rate when itcomes to our brand team is extraordinarily well. I mean, we wedon't have people. In a lot of cases, we leave the brand on the brand side ofthings, the same side of things, because we always try to make theenvironment work really nationally strong. So I mean I made I mean, I canpoint to a bunch of other mistakes I've made on the hiring side of things. Ithink that's probably one of the most important things that an entrepreneurCEO can do is inspire really, really good people that align with yourculture. And that makes it enjoyable to come to work. Yeah, attitude andculture really important. And I love the idea of trying to stay away fromthe grumblers because they pull everybody down with you, right? Theyreally do is it's almost a death by paper. Cut it. Really? Every day justknocks on, all right, so we're kind of covering some lessons learned as wellas we go through that, which is the sign of any good entrepreneur. Welearned from our mistakes, right? If you were to say there were two or threethings, maybe to pass along, I don't want to put a number on it, But But anykind of lessons learned that that you wanted to share with the group. I mean,I would say that, Um um and there's there's so many money There's sothere's so many I would say just just to aspiring entrepreneurs. And it's notsupposed to be easy. Anybody that says it's easy is is effectively is lying toyou or as alternative motives. It's hard no matter what field you go into.And you know, passion and persistence really does conquer so much, conquer somany obstacles a big, big part of our success. And I try to hire people thatalso embody this is folks that you know, get told No, I've been told now moretimes than I can. I can count and...

...usually not in such a point point way.But it's going from that sale to the next sale, with the exact same amountof enthusiasm drive that makes you successful. And you know it's all aboutbelieving in your product, believing in your brand and continue to work harderthan than the next person. And also, I would say it's really, really importantto, you know, if you talk to any, you know, forget about business person, butmusician, actor, author, comedian, be different. Bring something unique tothe marketplace, mimicking things is just a regression to the mean. You haveto effectively get out of your comfort zone and be different and challengeyourself. And that's another thing that has always been to help me. And I thinkit started with me going down to Mexico, putting myself in uncomfortablepositions, challenging myself to effect we do. Things I didn't want to do haseffectively made me a better not only not only better professional but abetter person and giving me a wider perspective as to what's going on inthe marketplace. Yeah, fantastic. I think it's a great lesson. Um, we havea number of questions. If you don't mind, I'll read something out here foryou. And so Aaron Lee wants to thank you for taking the time to speak withthem tonight. You know, would you say that your corporate work experiencedhelped with running the business? Or would you suggest students in similarspots? You know, if you knew, would you have pursued it earlier? That's areally good question. I was in a unique position where I was managing aportfolio of stocks of equities so I would go and I would dig into the tothe companies and figure out the internal drivers of them. I realize nowhow much the CEOs were effectively, you know, feeding me b s all the time. Youknow, for me, it really worked out. I got to I got to kind of quote unquoteword on somebody else's dying. I think it depends on what you want to do inwho your boss is. I had a tremendous boss. I learned a lot from you know,she she was. She's a female in the finance world, which, you know, it wasthere for 30 30 plus years. And that's the That's an amazing accomplishment,given how difficult it was for her female 30 years ago to rise up in theworld of finance. And that's because she had to be better than her malecounterparts to effectively to succeed. And she she gave me so many lifelessons and so many things that effectively help me. One of the thingsshe told me was, which has helped me today, and it certainly helps with someof the cultural aspects I deal with in some countries. But she said, you knowwhat is what do you think is the greatest, you know. Why do mostcompanies fail? What's the greatest destroyer of value? And I said, I'm alack of lack of cash flow. Yeah, textbook answer probably weren't forlife and this and she said no. And I said Profitability. She said No. And Isaid, What is it? She said, Ego. She's seen more businesses and more moneybeing burned based on geological, irrational and ego based decisions.Lessons like that, you know, you can take that lesson and take it out of thetext book and put it into any business environment you want have beentremendously valuable invaluable to me. And I think about that conversation tothis day when I'm having a difficult conversation with folks that I knowrely a little bit too much ego for their decision making process. So whatI would say is, do something. You enjoy Number one. I mean, it sounds pretty,pretty intuitive, but don't follow the money. And if you do have a path, ifyou're smart enough to sort of, and I was having path as to what you want todo, try to link link that up because that passion will effectivelyeffectively bleed bleed through. But I would also say that today there's, youknow there's so much more resources for entrepreneurs to go out of school andand have a crack at it. And there's, you know, there's there's fundsavailable and all that stuff that didn't exist nearly as much back oneback in 2000 and five. I mean, nobody. Nobody would give me a nickel offtrying to start something. But I think I think it's wonderful. Yeah, thanks.You know, I think that idea of humility is really important for entrepreneursbecause that means you're open to learning. And I really do believe to besuccessful as an entrepreneur, it's it's Can you learn quick enough to keepup with the business? And, uh, clearly you've got that kudos to you for thatreally interesting question from Justin Duff. At the moment, the waste fromMugabe from your tequila products is feeling your sustainable straw venture.What happens if the straw Venter material outpaces the tequilaproduction? A very good question, fortunately, or unfortunately,depending on what So I do want to take it. That's not really a short termissue, because it's not our waste there's there's a whole lot of wastegoing on the world of tequila so that raw material is not, not really,unfortunately, going anywhere. And it creates a lot of environmental problemsin Mexico. Mexico. I've probably ever heard about it because MexicoSustainability not really at the forefront of of some of the things thatgoes on down there, but that's not, you know, it's a very logical assumption tothink it's a risk, but that is not a...

...short medium and probably not a longterm risk. Yeah, yeah, Okay, this is anonymous. So I'm not sure why.Question seems pretty fair. Was there every time you didn't think the companywas gonna make it. And, you know, if so, how did you overcome that? Oh, yeah, a really good question. Iremember we There's one story where we effectively gave a wound a slushiemachine to a to a bar and restaurant in Toronto, and the slushy guy was thereand he was installing it. And he said he before he left before he actuallyplugged him, he had to get paid, and we looked at our I told my account to payhim, and he said you don't have any money. So what do you mean, he goes?You don't You don't have any any money in the bank. And I said, What do I do?I mean, this is he's there, he's going to take the machine out. I mean, theguy like this doesn't give terms, and it's going to be, you know, it's goingto be a terrible impact on the fact that not only am I going to meet theword's gonna spread all that stuff, and I actually had to basically borrow themoney from my accountant to It's nice, Not now. I mean, Oh, yeah, you know,all the time was, you know, there was an uncomfortable excitement early onwhen, when, you know when we didn't know what was gonna happen the next day.And there was a lot of times were just like our competitors are multibilliondollar corporations with hundreds of not thousands of people on the groundaround the world. Hundreds of millions of dollars of marketing budgets. Howhow the hell are we going to compete with them? With me on the street? Mypartner in Australia, Two backpacks and a couple of bottles. I mean on paper,we had no chance. And how do we persevere from it? I guess I guess wejust basically, you know, someone once told me to always kind of be childlikewhen it comes to when it comes to business. That doesn't mean throwing,throwing, temper tantrums. But that means effectively throwing away, youknow, you know, taking your past problems, hopefully learning from it,but moving on very, very quickly and having that mentality to adapt andadjust and saying Okay. Not holding any grudges or worrying about what happenedthe past, which has continued to move on to the to the future. But yeah, no,there was. I mean, there was all kinds of times or you wonder what X What?That's going to happen with this brand. Yeah, but But also it was it was kindof was it was really nice as well, because when you started a business,those first initial wins the first bars you get first. You know, firstlistening, you get in the liquor store. I mean, those are huge. You areecstatic. You can life get any better than that. In some ways, you do. You domiss that just that a little bit because it's just just It's incredible.An incredible feeling. Some of those. Each one is a big win at that stage.Huge. Remember, we got into the L C B L. I sat out on some of my parents, but Isat up that their deck and I just basically stared into the sky for agood 40 45 minutes. But yeah, it's it's it's, uh, interesting times for sure.Cool. I have a question here from Deborah Kennedy on the on the product,actually, So you know, what's the point difference of your tequila that makesthe consumer want to buy it over the competition? Why is yours good? Sure.So I mean, I think it's effectively, you know, in a lot of cases, the brandsin the bottom. So who's making it? You know you have, you know, it's stillaround tequila, which is very rare, if not non existent in the world of ofTequila. He's making it with his son, handcrafted batch by batch andeffectively, it's, you know, not only is it the product, but how we messageit. So we're very, very big in terms of education, training telling that storyin big in terms of word of mouth as well. So you know, having we find thateven today, with all the elements in terms of digital and social tellingthat story, whether it be again actually through social or throughboard of milk and recommendation has been a huge success. And one of thethings that's been very successful for us, which we think will be verysuccessful again, is that is that bartender alliance. That bartenderstorytelling and hospitality right now is is in the dumps. But we're seeingand really, really interesting recovery going on in some states in the US andin Australia, for example, they came out of their lockdown and, you know, itshouldn't be any big surprise that the Australians went, went bananas andstarted, started, started drinking like like there's no tomorrow going outmeeting. And we didn't just see it with, you know, the 20 year olds we soughtwith kind of every demographic was going out. Sales went from You knowwhat? We would sell it in a month and a half in the last year and selling aweek we're selling in a week now in Australia, and it hasn't so damn. Andyou know, in some ways the world will change. In some ways, the world will goback to normal, and I think the world...

...of hospitality is going to be impairedfor the next 6 to 8 months. But after that, it's It's going to be a really,really exciting place to be again. Cool, cool. That's exciting. Neeraj Gandhiwants to know. What advice would you give yourself if you were starting over?Mm, I think again, there's so many mistakes that I've made. I think thatthat hiring pieces is just would have saved me a hell of a lot of headachesand forget about the money. It's, you know, when you hire poorly. Not only isthere is there a monetary cost, but there's that intangible costs that somepeople can never recover them because you spend the time. The effort thatperson builds a brand that person brings their relationships and forgenew relationships which may or may will probably not be around after thatperson's after that person is gone. I think it's effectively, you know, it'sagain, it's it's a state, of course as well, because starting a business isextremely difficult, especially in this environment. And but there's justthere's so much I could I could tell myself. I think I think that hiringpiece is probably the the biggest mistake that may cause I didn't justmake it once. I'm not that smart. I made it two or three times because thatintention that the temptation is just so so incredibly so incredibly well, a couple questions kind ofrelated to that. Um, you know, we're in the COVID lockdown. You have parts ofthe company in Mexico, parts of the company here. I'm probably in theStates or soon. I'm not sure. How do you foster a culture in a remoteenvironment like that? It's obviously very difficult because it is such a,you know, face to face interaction. Relationship based business, like mostbusinesses are, you know, you effectively do the best you can. Youschedule. You have as much communication through zoom or eventhrough the phone with your with your team as possible. You do a lot morecheck ins with some and, you know, and effectively you try to share as manywins as possible going through, and it's a really interesting time toeffectively build, build culture and get on this main plan with with yourteam. But we've actually been able to do quite well with the team, andthankfully, we have a team of professionals and folks thateffectively that have been around the block a few times and can adapt to allkinds of crazy things. But I just think that good people as well are generallyspeaking resilience. And they'll find a way to get to get things done andweeding out those ground boards and weeding out the bad apples. If I wouldhave had them involved in the organization now, it would have madethat that culture building and fostering that stuff heck of a lot moredifficult because I I usually am down at the factory at least once a quarter, and I haven'tbeen down there since since March, uh, before that, But it's been over a yearand I have such a wonderful team down in Mexico and such a great office downthere, and that's my business partners are that we haven't missed. We haven'tmissed a beat in a lot of respects and it's also me getting more involved inthe in the process, not micromanaging, because I'm a big believer ofdecentralized management as well. People effectively hiring great people,letting them have their own way to do things and not not over be overbearingon control. So I think that's an old school in a poor way to manage. But Ithink it stems from having the right people on board from from Day one, whenthis pandemic hit were, luckily to effectively gotten rid of some badapples beforehand. You know, just as an outside observer, I think you know,your business grew up in some ways doing really good job telling stories,whether it was to the bartender and and making sure that those stories were,you know, told again and again and again and and And that can go so farand helping you build that culture when when everybody knows those stories andcan pass them on to the new kid as they joined the business, you know, I thinkI think you've done a great job with that as well. Do you think I appreciatethat storytelling and a reason for being as to why you're here is a veryimportant factor because the world probably doesn't need another tequila.Uh, did clearly did a question for you. Uh, this is again anonymous. It's areally interesting question. What are some of the ways you stayed organizedor kept your thinking clear? Even when maybe it wasn't clear what the nextstep should be. Wow, that is a It is a very, very good question. How are theways that kept? I think I think a few things. So number one, I always try toreserve some time during the day to think, which means close my computer,grab a pen and paper, or actually, one of the pencil guy and effectively write,write, write things down and turn on Turn off the noise because you know youcan get inundated with day to day distractions. And so having that timeto think and reflect and plan is big...

...set goals set long term goals as towhere you want to go and try to figure the map is how you want to get there.The map will never work out. I promise you that. But a lot of those times,those goals, if you want the bad enough will just have to take an interestingtime and find yourself. You find yourself a mentor, find yourselfsomebody who, if you have problems, to effectively bounce ideas off ofunfortunate that my father was a It was an entrepreneur and built his businessout of selling, you know, 70 selling extension cords out of out of the trunkof his car and built it up to, you know, medium sized business and ended upended up exiting, exiting the business for, you know, Tim is what is, you know,great exit. But you know, he's a guy that's been there and done that. And sohaving somebody to give you that advice that effectively is it's been there isreally, really helpful. So I always encourage young entrepreneurs to findthemselves a mentor and somebody they can effectively share things with andgive them that path. And whether it's encouragement or advice, it's supersuper helpful. Well, I have a kind of a comment. I think you answered thisquestion, but I'm going to tell you the comment anyways. It's from Crystal BallDeploy. Congratulations. Eric is a Mexican is super interesting to seetequila flourishing in other parts of the world and how a new strategy helpedyou position the brand in countries like Canada and Australia. Socongratulations on that. His question was, What? What would you have donedifferently back then? You know, knowing what you know now, anything youmight add to that. It's a really difficult question. And, you know, Ithink that it's hard. It's hard for me to answer because we didn't make a bigcalculated mistake and I would have I would have liked to say that we wouldhave liked to, you know, go out and been more aggressive in funding thecompany, getting this more capital to effectively start. But I think thatthat could have effectively been a kiss of death for us as well. Because again,as I said before, if we would have had all that capital of the business, R. Ly culture would have never really would have probably never materialized. I'm abig believer again of life, you know, if you want something and you plan forit life giving you those opportunities and setting you up and I don't think wewould be here today if we didn't you know if we did things drasticallydifferent than we did then we did, you know, just kind of starting out. Yeah.Okay, I have a question here from Bruce Lamb, and I have to ask you because youwouldn't let me forget if I didn't, uh, word about advertising this huge.Obviously, Uh, do you also do a lot of social media or or digital marketingfor the brand? We do, We have. We have a team that that effectively does that.We you know, we probably should have been doing a better job pre covidbecause when we were having our main pillar was on the bars and restaurantsseen where that storytelling was happening. But obviously, Covid isaccelerating from Gare restaurant to digital into social. It's somethingthat we're certainly looking at continually improving. We have We haveimproved it. I don't think it's where we want it to be yet. And also ecommerce is obviously doesn't take it too. Mr. Parodi commerce is has changedthe landscape for not only not only liquor, but pretty much every productnow, and that's been an area where we're putting a lot of budget as wellas to improve our e commerce, improve our our social and partnering withSazerac is one of the reasons as well as doing that is, they do haveeffectively those very small platforms, most more so on the commerce side,where if you want to order a bottle of trauma in Los Angeles, you effectivelyput the order through in 30 minutes. It's at your doorstep, hopefully withsome delicious margarita mix. But yeah, no, it's It's obviously the world's.The world shifted, and that's and that's and I think it will probablyshit back a little bit more towards hospitality and stuff like that. And Ithink that will be a strong place. But I don't think it will. I don't think,uh, e commerce and social will give up, give up that much ground. Okay, what doyou think is different in today's world? Somebody wants to start a craft spiritcompany than perhaps when you started. Wow, it's it's completely different. Imean, we tried to pitch some institutions starting trauma, and wewere effectively laughed, laughed out of the room. I mean, investment banksand venture capitals and capital companies and stuff like that. Theywouldn't touch spirits with a 10 ft pole and I think now that the amount ofexits that have gone on in the development of craft spirits and thegrowth has attracted a lot of investors, institutional investors and obviouslyindividual investors. And it used to be folks that wanted to get into thebusiness because it's, you know, it's a sexy, fun business to be involved with,say, I own a piece of vodka and a piece of particular. Now there's folks thatdo that still, but there's a lot more folks that say, Hey, this is a really,really great investment we can make. Not only can you have fun and be proudof this investment, but also also you can effectively make good money off it.And one of my main things is I'm a big,...

...big believer of making as much moneyfor your shareholders as possible. If you make money for your shareholders,you never have to worry about anything again in your life because you makemoney for them once they'll come back and they'll continue to effectivelygive you capital whenever you need it and give you support. Having a greatshareholder base is super super important. And looking back on it. Youknow, we did pitch some VCs. They did tell us that, but it off. But thank Godthey because, generally speaking, they be effectively in our face, making usdo ridiculous quarterly due diligence and would try to tell us how to run thecompany based on quote unquote with the industry. That's thank goodness that webuilt a shareholder base of really remarkable, supportive folks. And again,my job is not to make as much money for me personally. My job is to make asmuch money for our shareholders. So anything I ever want to do again, if Iwant to do something again, I have a wonderful base of supporters ofshareholders. Cool market that leads right into the next question. I wasgoing to ask you from Ask the model to If you were going to go for anotherventure. What would it be? What's next? Maybe your partner shouldn't belistening to this one. I don't know. I mean, we'll see. Probably, you know,probably not in the liquor space. But it's, uh, you know, maybe maybesomething on the on the sustainable so space, because I think it's somethingthat I'm passionate about and it's a And I think it's, you know, people arelooking for solutions right now when it comes to effectively sustainable andenvironmentally friendly products. So I think that those two boxes definitelycheck for me. But I don't know. I mean, it's it's, too. It's too early to tellbecause I'm still in love with drama and still still my baby. And, you know,I have no plan to exit over the over the short term. So maybe maybe ask methat question. Two or three years of something changes. Uh, we just havetime. Maybe for two more questions. I have, uh, one I think is interesting.You know, Hendrix, Thanks for being here today. They're a little bit lostas to what happened in the middle part of your story. So you're running aroundbar to bar with your backpacks, and now you've got this great partner andsupply What? You know, When did you start to scale? And maybe what weresome of the things that tip to that for you? It was really slow. The bills, Imean, I mean, it was I I believe you build you build your brand. It wasreally borrowed by by a bottle by bottle. And when you do that, you buildit right. The foundation is really, really strong. We would never reallycompete on price because if you do, then you're effectively commoditiesyour brand. People always pay more for a bottle of trauma than our competitors,you know, When did when did it scale? I mean, it's really difficult because wenever got one Big. Probably Sazerac is probably well, it is our biggest we'veever had, but you know, it just effectively. It grew and it grew and itgrew slowly and so and so And I can't tell you what it was. But there is atipping point where we did hit where I think, I think, kind of what I knew itwas I was sitting at at a bar and having a drink. I'm obviously having atrauma, and they know who I am. And the person next to me sits down. Who Iwould you know then and says, can I have yeah, two tequila traumas on therocks and I look over at the person I said, Well, it's not it's not my friend.It's not my cousin I don't know which is which is which is exceptional. Andso you know, how do we build? And then effectively my my belief is to go beregionally strong versus national mediocre. So we launched Ontariolaunched in Melbourne. We really just launched in Toronto. Melbourne built upthose cities, built up a groundswell there. If you're not successful in yourown backyard, you're not going to be successful anywhere else. Then affected.We took our product to Chicago, built it up there and took it to New Yorkbecause we took in Chicago first. Because if you tell somebody in Chicagoyou launched and there before New York, they care if you tell somebody. NewYork He launched their before Chicago and say, I don't give a shit And so youknow And so it's so it was effectively just going around telling the story barby bar, bottle by bottle. And you know, a lot of people say we grew really fast,but it was really, you know, hard work, doing the blocking and tackling and notgetting tempted by shortcuts and then effectively building that base. Andpeople do talk in that word of mouth. Does produce a groundswell, and fromthere we expanded to Florida and Los Angeles and Texas and until the Sazeracdeal effectively came along and now we're you know, we're going to beavailable nationally with triple skews that we had last year. But it's yeah,that middle. Part of the story is there's not one specific thing. Wedidn't get one deal that effectively transformed the company. It was just alot of hard work. A lot of people putting their blood, sweat and tearsinto the business to build it up, bar by bar, bottle by bottle, keeping thatpassion and and and really lovely what they were doing. Cool arc. I think it'sa great answer and I think a great...

...lesson for everybody. It's, you know,there's never a magic pill. It's it's a lot of hard work and keep after it andyou know, you're you're able to step back a little bit now and watch the guynext. You order your product. That's really cool. You know, I love that.Alright, we're kind of out of time. Any any last words that you wanted to sharewith everybody or I mean, it's closed on. I think it's well. First off, thankyou very much for having me in the Forum and the really, really goodquestions, some of the very thought provoking they'll probably still bethinking about later tonight. But I think it's you know, as much as itpains me to do this via computer versus doing it in person, I think it's areally interesting time and in some ways a wonderful time to be an aspiringentrepreneur. I think that you know what I've seen. The last year has beenwhole lot of disruption, with the world being shaken up more so than I've seen,probably the last 10 years. And Eric, you're probably probably the same boatas I am and I've seen effectively, you know, What I always found was when Istarted, you know, I started Trump, and probably when you entrepreneurs go andstart your own business, you're generally speaking, talking to a buyerthat effectively has a misalignment of needs. Where you're an entrepreneur,you need to effectively provided wonderful solution to them. That'sgroundbreaking, and they need to effectively their measure. They'reincentivized to grow 5 10 15% mind their manners put their head down andmake sure their margins are okay. And if as an entrepreneur, if you grow 5 1015% you're dead, you're not. You're not in business anymore. So you're trying.So you're trying to effectively shove a solution to somebody that is prettyrisk averse once just not hit wire. What's happened in the last year hasjust been the eye opening of. And I think every industry people looking fornew solutions, looking for ways to effectively improve their business. Andthey're looking to both young and old to find those solutions. And so I wantto, you know, for entrepreneurs, think about what the world needs to know whatyou're passionate and look at providing those solutions to the world. And, as Isaid before, the game has changed. And for a wonderful way, Where again, whenI when I left school, one guy in my class who we thought was a lunaticbecame an entrepreneur because there was no there was no infrastructure forit. Now there's a tremendous amount of infrastructure is a tremendous amountof firms that you know that our entrepreneurial, based in terms ofgiving capital buyers are a lot more accepting to new and innovative thingsright now. Effectively, the Pause button has been hit with a lot ofindustries where they can go and they can take the time and look at newsolutions. So as one hand where it's really crappy that we're doing thisthrough the computer screen. The other hand, what a really, really, reallyinteresting time. And I would argue, hopefully once a generational time tohave the opportunity to be disruptive in a world of entrepreneurship. And ifit doesn't work, you know what you learn A heck of a lot. Figure out whatmistakes are. Words move on from there, Eric. Thanks. Uh, you know, I thinkwe're really lucky to have you with us tonight. I really appreciate everythingyou've said. Words of wisdom for everybody. I think that was reallyimportant. Love the closing. I want to thank everybody that joined us thisevening. And those of you in the business plan competition. I want towish you the best of luck tomorrow and what you're doing. And it is anexciting time. And, uh, yeah, the world's, you know, going through a lotof pain and a lot of suffering But there's a lot of opportunity as westart to turn the corner and come out of this, and it's time to be looking,and it can be an exciting time. So let's run. Let's run that one and keepit going. And Eric, you know, thanks again so much and continued success. Uh,everybody, get out there and try a real tequila trauma tequila, and we'll takeit from there. You've been listening to the Ivy entrepreneur podcast to ensurethat you never miss an episode. Subscribe to the show in your favoritepodcast player or visit ivy dot c a forward slash entrepreneurship. Thankyou so much for listening until next time. Mhm. Yeah, okay.

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