Chronic Cellars owners Jake and Josh Beckett sold 100 percent of their shares in the brand, which they began together in 2008, because it had reached a point where it could not expand without more financial backing, Jake Beckett said.
Based out of Peachy Canyon Winery, the Becketts produced under 20,000 cases of wine a year, Beckett said. They operate a tasting room at 2020 Nacimiento Lake Drive in Paso Robles, as well as a wine club. A bottle of one of the 13 Chronic Cellars wines costs between $15 and $20 on average, Beckett said.
In the past five years, the pair borrowed about $2 million to grow the brand to its current size, Beckett said, but recently got to the point where they could not borrow any more without larger collateral.
“We definitely needed more backing,” Beckett said. “The only way to grow a brand is to borrow money, if you don’t have it.”
Enter Winery Exchange, which supplies a range of wine, beer and spirit brands to retailers such as Safeway, Fresh & Easy, Costco Wholesale, Cost Plus World Market and Whole Foods Market. The venture-backed company manages over 100 brands in 16 countries, according to its website. Recent financial information could not be obtained, and company officials declined to respond to Tribune phone calls.
The company wanted to acquire the Chronic Cellars brand because it “posted strong growth through its tasting room, wine club and wholesale channels, despite having limited distribution and availability to this point,” according to a Winery Exchange news release.
The deal was completed March 20, with the guarantee that the Becketts would continue to work on the brand: Jake Beckett as lead marketing and brand development, Josh Beckett as the winemaker and Dawn Beckett as the tasting room and wine club manager.
The company will also keep all seven of Chronic Cellar’s employees, Beckett said.
No major changes will be made to the brand, Beckett said, besides possibly increasing production in the next few years. “It’ll probably be very slow and calculated,” he said. “We don’t want to ruin a good thing.”