Svöl Aquavit

It started over two years ago at a tasting session in New York City. Now we have a growing team and are in the midst of launching across the U.S.! It wasn't easy to get here and there's still a lot of work ahead, but we believe Svol will become the category leading aquavit in the U.S. and beyond.

Avua Cachaca: Our Founder's First Spirit Brand

Svol Aquavit's founder, Pete Nevenglosky, is not new to the booze business. After spending 5 years in CPG brand management at Danone and Red Bull, he left the corporate world in 2014 to focus solely on his already-launched cachaca (Brazilian sugarcane-based spirit) brand, Avua. That brand has since grown to be a category-leading spirit in the craft cocktail scene, with wide distribution in the US and Europe and over $1.3M in annual sales.

Avua's success proves that there is a large unmet need for new, exciting spirits but the right brand and communication strategy is critical to introduce them to consumers. We started looking for other regionally popular, but globally niche, spirits with the potential to explode in the US and beyond.

An Opportunity Emerges

Back in 2017, Pete and Jay (an early Avua investor) sat down with a panel of bartenders, spirit experts, and marketers to talk about aquavit. We heard about its flexibility as a cocktail spirit and it was clear there was already a buzz about it in the bartender community. But as the group evaluated the range of aquavits available in the U.S., we found that while many were excellent products, none nailed all of the key attributes of a successful craft spirit: high-quality base distillate, distinct and well-rounded flavor profile, beautiful packaging, and a compelling brand identity. 

With no clear category leader, we set out to build the brand that will tell aquavit's story.

Creating the Product

Aquavit is made the same way as gin, by adding botanicals to a base spirit and re-distilling. The main difference is the lead flavor profile in gin is juniper, and for aquavit it's caraway. We teamed up with Allen Katz at New York Distilling Co and Gunnar Gíslason, nordic cuisine expert and owner/chef at Michelin-starred Dill Restaurant in Reykjavik, and took a methodical, gin-based approach in developing the Svol formulas. Our goal was to create botanical flavor profiles that exemplified the best of Danish-Style and Swedish-Style aquavits.

First we tasted dozens of botanicals and did hundreds of test runs to identify the perfect ingredients at the right quantities. Then we tasted a variety of grain-based spirits and test distilled them with our botanical formula. We landed on proprietary blend of a neutral grain spirit and a full grain rye, corn, and barley spirit, all sourced locally in New York State. The blend gives Svol an unparalleled mouthfeel without masking the botanical flavors.

Creating the Brand

After many consumer focus groups probing on dozens of concepts, we found the combination of product story using regional styles, and historically accurate Viking imagery as a hook to instantly queue Scandinavia, to be the most powerful proposition. The country styles have clear distinctions which creates a simple and compelling category narrative which only Svöl, with a range spanning the entire category, can tell.

Launch and Beyond

Svol officially launched in May 2019, and in 8 months of 2019 sales we sold $151K (nearly 2X target) with strong consumer pull-through demand (65% of 2019 sales were distributor re-orders). We've identified three key strategies to continue to grow and become aquavit category leaders:

• Own the bartender. This is the strategy we used to grow Avuá Cachaça ($1.35 million) into a premium cachaça segment leader in the U.S. Craft spirit brands are built in on-premise accounts (bars & restaurants). Opinion leading bartenders at key accounts set cocktail menus where consumers first discover new spirits. Best product + best story + best salesforce will allow us to become the category leader in this space.
• Expand category usage. Svöl will spread the gospel of aquavit. As a brand whose identity is rooted in telling the category story, we are positioning Svöl to not just be a high-quality spirit, but also a driver of awareness and interest in the aquavit category.
• Grow distribution ahead of sales. The Svöl team has relationships with leading distributors in all of the key U.S. markets and deep knowledge of the three-tier system. Distribution is the #1 key business driver for growth, and we will focus on maintaining disproportionate distributor support vs our size even as we grow.

Milestones Hit & Next Steps

• $151K in 8 months of 2019 sales, coming close to profitability with a loss of only $16K (unusually good profitability for a year 1 consumer brand)
• $100K raised (80% industry, 20% friends & family)
• Partnerships with NY Distilling Co for production and Nordic cuisine expert Chef Gunnar Gislason for product development and PR
• Distributed in 22 states, Washington, DC, Quebec, CA, the UK, and Germany with more markets launching in 2020
• What's Left? A lot. Most urgently we need to accelerate our inventory build to ensure we're able to fulfill orders. At the same time we must continue to leverage our sales team to drive pull through demand at accounts and build relationships in key markets to ensure disproportionate distributor support.

Use of Funds

For our first round we are seeking $500K in addition to the $100K we've raised so far. WeFunder will contribute up to $107K, with the balance coming from investors we are actively pitching including industry investors and friends & family. This amount puts us in a position to scale marketing and sales efforts and maintain inventory to fulfill orders. The break down of usage is as follows:

• Salesforce and T&E ($200K)
• Working capital and inventory build ($200K)
• Trade Marketing & Events ($50K)
• R&D for Svol Norwegian-Style 2021 launch ($50K)

Thank You

On behalf of the Svol Aquavit team, thank you for considering investing in our project! We believe the aquavit category is poised to grow rapidly, and are excited to be the compass for adventurous drinkers in the US and beyond.