I was sat at dinner in Waco, Texas, when Keith Bellinger – then COO and now recently announced President of Balcones Distillery – asked me a pivotal question.
“What do you think about this whole situation, being from the UK?”
And I told him quite clearly: I thought he would have a problem. That the man behind the brand – Chip Tate – had become so well known amongst its consumers in the UK market, that they would have a lot of trouble recovering if Chip didn’t come back.
I’d arrived at Balcones at a most interesting time – it was mid-October and the tension in the small Texas town where this cult spirit is made was so thick the air felt claustrophobic.
At that time, a major dispute had broken out between Chip – who I’ve written about before and who founded the distillery – and the people he’d brought on board to invest in it to help it grow into a much larger operation. Nasty things had been said by both parties and it was clear as new make spirit that this was turning into a divorce gone wrong – neither side seemed to be calming down, and the things that were said (for instance, that Chip had threatened the life of one of the board, something he’s always denied) could never be taken back. The Waco Tribune has covered this at length, and its latest piece can be found here.
I’d planned and booked my trip out to the distillery in much happier times – having seen Chip in the UK in March during Whisky Live London, he said repeatedly that I should come out to visit. I’d been saving up to take myself around the distilleries of Kentucky and educate myself on bourbon, so a quick hop to Texas seemed a logical addition to my planning and I worked it in, excited as the summer drew to a close about getting to visit one of the most interesting whisky distilleries on the scene.
Balcones has become an icon in the craft distilling world – the products that have been created by Chip and his team have gone on to win numerous awards globally. It doesn’t always sit well with all consumers – and, admittedly, I still can’t get to grips with its beast of a release called Brimstone. But, overall, it’s been seen as an inspiration to the dozens of new whisky start-ups around the world.
And the man behind it – with his focused manner, opinionated stance and welcoming smile – have undoubtedly pushed this forward to a degree that others simply haven’t managed. It is Chip people often know before they know the taste of the whiskies or bourbons get bottled by the company.
I wasn’t entirely sure until a couple of weeks before if I would even be going to Waco, such was the intensity of the fight, the boldness of the headlines. But, despite the chaos, I was told I would still be welcome. And, in some ways, what better time to see the distillery than in its time of flux?
I was only at Balcones for just over a day but seeing behind the scenes at that time was fascinating. Key was the fact that most of the team – Jared (co-distiller/blender with Chip), Winston (brand ambassador) and Tyler (trainee distiller) were mostly keen to just get on with their jobs. You could tell they felt caught in the middle and as they took me around the current site and the old Texas Fireproof Storage building that is to become the new distillery, we were all avoiding talking about the elephant in the room, the fact that none of them knew exactly what was going to happen.
That night over dinner, we relaxed a bit more as did our conversation. After I voiced my opinion that the brand would have a hard time moving forward without Chip, I was surprised by Keith’s answer to that:
“The truth of it is that it’s not going to end well for him. And it may not end well for us. But whatever happens, Balcones will go on. That I know. It’s not all going to go back to normal. But we are going to keep moving forward in the same way and you need to know that.”
And, in some ways, that has been what’s happened, just not necessarily as many people in the public space would have imagined. Chip had always held to the statement that either he needed to buy them out, or they needed to buy him out, because – as mentioned – too many things had been said to go back to a happy working relationship. He and I managed a brief, 20 minute catch up during my time in Waco (there was a gag order in place against him until the day I landed so I didn’t think I’d actually speak to him) and he seemed surprisingly positive, despite the sadness that he inevitably felt, and he also echoed his same statement to me then.
As it happens, Chip was the one who was bought out – which I do believe, regardless of what Keith says, will impact the brand amongst its current consumers.
Since this news has come out, the resounding comments from bloggers and people on social media that are in the know about the Waco situation have been around the idea of a boycott: that no more Balcones will be bought.
Interestingly, the people I’ve spoken to in the whisky industry have had a very different slant – they haven’t been surprised at the developments at all. Bring in outside investment, decrease your share in a business, and you’re bound to encounter some problems. Not, necessarily, to the extent which Balcones has, but almost certainly some friction as all parties learn to deal with eachother.
Overall, I genuinely feel sadness about how everything has gone. Not only for Chip’s dream, but for those people who are now just trying to move forward with their jobs. Possibly the most interesting part of my visit to the distillery was hearing from Jared, who has been there since the beginning with Chip.
Over a beer at the Dancing Bear Pub after dinner, the focus with which Jared had undertaken duties earlier in the day – blending Rumble Cask, drinking coffee, being somewhat upbeat – crumbled a bit and he looked undeniably sad saying to me: “I have been there since the beginning. I’ve built this with Chip. I’ve blended with Chip. It’s really sad. And a lot of people, intelligent people, are saying: ‘Well, if Chip’s not there, who’s making the whisky?’ But there are all these other people that make this. It’s not just us. Yes, we create, we blend, but there’s a whole workforce behind this. It doesn’t make sense that people don’t think about that fact.”
It’s a good point – after all, while Chip is the face, the passion and the excitement around this brand, he wasn’t on his own.
“I’ve got all these other people to look after. And at first I was angry. I still am angry. What am I supposed to do? What do you do in this situation? I think there was a thought from Chip that we were supposed to walk out. But if I go, we stop producing. And what if these people lose their jobs? I feel responsible for everyone,” concluded Jared.
All of this made me wonder what I would do in the same situation. And I can’t say with certainty that I would have walked out. But I can say that I too would have been conflicted, and saddened.
The story certainly doesn’t end here. While Chip has been bought out, what will happen with the Balcones brand as it moves forward will be the most interesting part and, most importantly, a good case study for those wanting to enter the small-scale distilling sector. As a polar opposite example, I also visited Tuthilltown Distillery in New York State (which makes the Hudson brand) during my recent US trip – there, the team had also undergone a partial buy-out, in their case selling the brand rights and distribution to William Grant & Sons. From what I saw there, everything seemed to be progressing just fine, though Gable Erenzo (son of the founder who took me around) did admit there can be challenging times when you bring in outside investors, ones that have happened to go more smoothly for them, but which could easily have caused greater friction than they did.
All in all, my honest belief is that Keith is right – Balcones will move forward, potentially with a new consumer base who is not aware of the company’s timeline up until now, but move forward it will, one can hope with the same quality and innovation that it has done so far.
But in losing its founder, it has lost a spark. Regardless of who said what or exactly what happened (because, to be fair, only the people who were actually there know exactly what went down) Chip is a visionary in the world of distilling. But, while he has a ban against undertaking any distilling activities until March 2016 in place as part of the buy-out, I have no doubt he will surface again and be triumphant in some capacity in this industry. It is but a mere chapter in a long history of the world of whisky, but one that new start-ups and those getting into whisky would be wise to study and learn from.