I once knew a guy who collected wine. He was addicted. He was also incredibly rich. His various business ventures produced profits that began to overflow, and he embarked on an epic wine buying binge that would soon turn his accountants’ faces blue. His closest business partners started to panic. Whispers of an intervention swirled around the inside of his office headquarters, but who had the guts to do it? Nobody.
The Great Captain of Industry, The Wolf of Wall Street
This guy, let’s call him Edward, had all the stereotypical attributes of a great business leader and a fierce competitor. An imposing figure, deep booming voice, always wearing a suit and tie, a “commanding presence.” Some might even say an “egomaniac.” Edward decided to open a restaurant to go along with his ever-increasing wine collection. This wouldn’t be just any old restaurant; it would be the finest, most exclusive restaurant within a 500-mile radius.
Needless to say, from an investment perspective, building a new high-end restaurant from the ground-up on the same busy street as ten other high-end restaurants is not the wisest or safest return on your investment cash. But Edward needed a place to show off his collection of fine wine. After all, he was accumulating expensive bottles of wine by the case from the best vineyards around the globe. How else would he be able to show he owned the most outstanding wines in the world if he couldn’t print them on the wine list of his own exclusive restaurant. He arrogantly insisted there be no price on the wine list because if you “needed to know the cost before you order, then you probably can’t afford it…”
He had so many bottles of wine he needed to build storage buildings to keep the bottles safe. Thousands, maybe hundreds of thousands of wine bottles accumulated inside the numerous storage buildings. Nobody really knew how many bottles there were in the collection. I think Edward liked the idea that his collection was so vast it couldn’t be counted. First, you would need to count the number of storage buildings, then the bottles in each building. “Not an easy task,” I’m sure Edward reminded his executive assistant. He was the king of fine wine, at least in his own mind, he was.
Maybe I’ll tell you how the story ends someday; it’s full of exciting twists and turns you can’t even fathom. But there’s no time for that now. My point in bringing up Edward and his aspirations to own the world’s supply of fine wine is that thankfully, things have changed now. There’s another way.
Fine Wine Investing for the Pragmatic
Through the marvels of technology, a few recent law changes, and the dedicated spirit of hard-working and skillful entrepreneurs, there’s a way to invest in fine wine that’s smart, responsible, sophisticated, and fun. I like to think of it as fine wine investing for the pragmatic.
Vinovest is an exciting twist on one of the oldest asset classes in the history of the world. Wine has been produced and collected for what, maybe a billion years now? Actually, historians date the first ancient wine production back to Eastern Turkey around 8,000 B.C. For the first time ever, you can own and invest in some of the finest wine ever produced for as little as a thousand bucks.
By now, most people understand the concept of fractional ownership investing as it relates to alternative asset classes. Check out some info on my favorite companies doing great things in the space, no names mentioned. (Rally) If you’re new to the idea, it’s a legal and legitimate way to own a share in some of the finest cars, collectibles, artwork, and wine ever produced. A pool of investors fund the purchase of a particular item and share in the value appreciation (or depreciation) of that item. Shares can be sold at a later date. Straightforward concept, but very hard to do on a large scale until just the last few years.
Anthony Zhang and Vinovest
Anthony Zhang founded Vinovest after noticing the high returns in fine wine investment over the last few decades relative to the S&P 500. He began personally investing in wine and quickly noticed how vast and complex the market actually was. With all the hurdles and difficulties the asset class presented, Anthony realized there could be an opportunity to simplify the process of wine investment.
He also recognized the fact that the state of the industry limited participation to only the top 1% of people who had resources to handle the burden of storage, insurance, brokers, and expert guidance.
When you invest in wine through Vinovest, you don’t need to be an expert right out of the gate. That’s one of their key features. Let me repeat; you don’t need to be a wine expert to invest in fine wine if you use Vinovest. The company is fully-staffed with wine industry advisors and Master Sommeliers. Your wine portfolio is curated by quantitative investment models and expertise, if you so choose.
Breaking Down Barriers
Wine purchased through Vinovest is authenticated, insured, and stored, so there is zero hassle to the investor. They also offer the unique feature of providing the actual bottle of wine from your portfolio if, for some reason, you’d like to have it in your hands. Folks have done this for special occasions and gifts, which is a pretty cool option to have, in my opinion.
One of the things I love about Vinovest is the opportunity to get introduced into the massive world of fine wine investing at a small scale. You can start with a small initial investment, get acclimated to how the portfolio is constructed and tracked through the app, and, most importantly, start learning about the intricacies of fine wine. If it’s something that you enjoy doing, you can easily scale up your investment. If you decide fine wine investment is not for you, or your investment turns sour, your downside risk is limited.
Don’t Be a Jerk
As with all investing, there is a risk of loss. But fractional ownership through companies like Vinovest can be a great learning experience and allow investment in asset classes in ways not available until now. You don’t need millions of dollars to enter the fine wine investment industry. You don’t need to be like our old friend Edward and gamble away your vast empire in an epic and stunning catastrophic collapse because you became infatuated with fine wine.
Use the combination of technology, wisdom, and user-friendly new platforms to your advantage. Thanks to companies like Vinovest we can explore new asset classes responsibly and in moderation. So have fun, be kind, humble, and willing to share your fine wine investing knowledge as it grows.