Episode Summary: They Sell 1 Million Bottles of Alcohol a Year | Matt Jones
The Foundr Podcast with Nathan Chan – Episode 541 | Released December 6, 2024
Introduction
In Episode 541 of The Foundr Podcast, host Nathan Chan engages in an in-depth conversation with Matt Jones, the CEO and co-founder of Four Pillars gin. Matt shares the remarkable journey of building a globally recognized craft gin brand from the ground up, delving into the strategic decisions, challenges, and insights that propelled Four Pillars to sell over a million bottles annually.
Early Days and Foundation (00:00 - 05:29)
Matt Jones begins by clarifying that the essence of their brand lies not in perception alone but in the tangible existence of their business and products. He emphasizes the importance of learning from small mistakes, which act as "near misses" preventing larger setbacks.
Key Quote:
“Small mistakes often make you stronger. You learn a lot from them. Small mistakes are like near misses. Hopefully, you figure out why you had a near miss and it stops you having a big accident.”
— Matt Jones [00:00]
Matt recounts the inception of Four Pillars in 2012 amidst the burgeoning gin market and the transformative digital era. After returning to Australia from New York City, where he led global strategy for a brand experience firm, Matt teamed up with Stuart and Cameron—partners who shared his passion for gin and the spirits industry. Their decision to start a gin business was deliberate, aimed at creating a product with purpose and superior quality in a saturated market.
Strategic Decision-Making and Early Growth (05:29 - 17:16)
Matt highlights the critical initial step of deciding to enter a crowded category not as another entrant but as a brand with distinct purpose and quality. This foundational decision framework enabled them to navigate subsequent choices with clarity and strategy.
Key Quote:
“The decision to make gin was just that. It was a decision. And I think the really critical first step for our business and any business is taking the time to figure out why is this decision a good one.”
— Matt Jones [04:33]
The team invested in a high-quality still from Christian Carl, recognizing that excellence in production would differentiate their product. Naming their first still "Wilma" honored personal connections and instilled a sense of purpose. This deliberate slowing down allowed them to meticulously plan branding, product development, and market entry strategies, avoiding the pitfalls of rapid but unfocused growth.
Funding Through Innovation: Ginvestors and Crowdfunding (17:16 - 41:29)
Understanding the financial challenges of the spirits industry, especially in Australia with its high taxation, Matt and his team sought innovative funding solutions. They introduced "GInvestors," a unique investment model where 20 investors each contributed AUD 25,000 for a 2% stake, positioning themselves as silent partners without voting rights.
Concurrently, they launched a crowdfunding campaign on Pozzible, which successfully sold out within a week, raising AUD 30,000 from 307 backers. This dual approach provided the necessary capital while fostering a dedicated community of early adopters who became passionate brand advocates.
Key Quote:
“Selling $30,000 of gin to 307 people was not material. It didn't demonstrate product market fit, but it sent a signal that there is something here that 307 people haven't just liked a Facebook post—they've put their hands in their pockets.”
— Matt Jones [26:09]
This strategy emphasized the importance of storytelling and signal sending over traditional funding methods, highlighting how passionate communities can drive brand loyalty and initial traction.
Building a Sustainable Brand and Scaling (41:29 - 55:55)
Matt discusses the pivotal partnership with Lion, an Australian beer conglomerate. This alliance was chosen for its respect of Four Pillars' Australian roots and commitment to maintaining operational independence. The partnership provided significant capital, allowing expansion of their distillery and the establishment of a Sydney-based drinks laboratory.
During the COVID-19 pandemic, Four Pillars showcased resilience by pivoting to produce hand sanitizer, fulfilling urgent needs without diluting their brand integrity. This move reinforced their commitment to community and adaptability, ensuring the business remained operational and supportive of their employees during turbulent times.
Key Quote:
“We chose Lion because they valued Australia. They were an Australian beer business that owned brands like Stone and Wood, Little Creatures, Furphy.”
— Matt Jones [41:29]
Despite external challenges, the partnership with Lion provided the stability and resources necessary to navigate crises, ensuring continued growth and brand strength.
Overcoming Challenges and Maintaining Brand Integrity (55:55 - 69:27)
Navigating the complexities of rapid growth, Matt reflects on balancing intimacy with scalability. Initially, Four Pillars thrived on building deep, personal relationships with customers, leveraging direct-to-consumer models and exclusive limited editions like Changing Seasons Gin and Bloody Shiraz. However, expanding into over 30 markets revealed gaps in replicating that intimate connection at scale.
The COVID-19 pandemic further tested their ability to maintain brand integrity while scaling operations. Matt underscores the importance of adhering to core principles, such as prioritizing employee well-being and staying true to their long-term vision despite immediate pressures.
Key Quote:
“Four Pillars is our only love, it's our only baby. It's probably one of 40, 50 brands in that distributor's portfolio.”
— Matt Jones [56:04]
This period reinforced the necessity of strategic focus and the challenges inherent in sustaining brand authenticity across diverse and expanding markets.
Lessons Learned and Future Directions (69:27 - End)
As the conversation nears its conclusion, Matt shares invaluable lessons from his entrepreneurial journey. He emphasizes the significance of learning from small mistakes, maintaining humility, and continuously reassessing the factors contributing to current success to inform future strategies.
Looking forward, Matt identifies the need to strengthen their presence in the Australian market before expanding further into Asia. By reinforcing their established relationships and focusing on what has driven their success domestically, Four Pillars aims to replicate this model internationally with greater efficacy.
Key Quote:
“Spend some time also thinking about why are you already successful and what would it look like to double down on that recipe for success.”
— Matt Jones [58:57]
Matt concludes by encouraging entrepreneurs to balance long-term vision with short-term adaptability, ensuring sustained growth without compromising core values.
Conclusion
Matt Jones' narrative on The Foundr Podcast offers a comprehensive look into the strategic intricacies of building a craft spirits brand. From innovative funding models and strategic partnerships to overcoming global crises, Four Pillars exemplifies how thoughtful decision-making and unwavering commitment to brand purpose can lead to substantial commercial success. Entrepreneurs glean insights on balancing intimacy with scalability, the importance of community, and maintaining brand integrity amidst growth pressures.
Additional Notable Quotes:
“Luck, serendipity being dealt a lucky hand is one thing. You still got to play it.”
— Matt Jones [00:00]
“We didn't price too high. We had a very, very simple strategy, which was we want to convert people from a bottle of Hendrix to a bottle of Four Pillars.”
— Matt Jones [17:30]
“There is nothing wrong with anything we're doing, but we've not replaced the other part of the formula, which is building that direct intimacy.”
— Matt Jones [41:12]
“Four Pillars is our only love, it's our only baby.”
— Matt Jones [56:04]
“If you think about two axes for me... if we're doing it right, we're thinking long term and external and we're sort of going right.”
— Matt Jones [66:19]
By detailing Matt Jones' journey, this summary encapsulates the entrepreneurial spirit and strategic acumen essential for building a successful brand in the competitive spirits industry.