Built Oregon -Oregon's Entrepreneurial Digital Magazine

Category - Willamette Valley

Swallowtail Spirits leverages passion, hustle, and fortitude to build a growing distillery

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Kevin Barrett was spending hours upon hours researching and experimenting with home brewing and distilling, and consuming any content on distilling that he could find. He did all this while only putting a fraction of his time researching geography for his degree from the University of Oregon.

Given how he was focusing his time it only made sense that if he was to carve out a career, one that he loved, it should be around something he was passionate about. Thus, the journey from home distiller to Swallowtail Spirits began.14379769_568685866675742_4984882555288960865_o

Early Beginnings

Kevin started making home brewed beer around six years ago, and did so knowing that it would be the first step to making whiskey. The first spirit he made was a brandy, from 5 gallons of leftover wine from Silvan Ridge Winery in Eugene.

And so began his journey in the distilling craft, characterized by much experimentation.

“ I made a couple of stills and talked with local distillers about the production and permitting process. I made a few whiskeys, brandies and vodkas. Some were good, but most were bad so I researched more to find out how to make them better.”

But through trial and error, the whiskies started to taste better. The taste improvements led to people inquiring if Kevin could make special batches for weddings and one of a kind gifts. But the demand for the early batches led to a bit of dilemma.

“ The aging process is the toughest part though because no batch of whiskey that I have made has lasted for longer than 6 months on oak. Everyone drank it.”

The initial interest in the spirits he was making provided him with the validation needed to pursue starting a spirits brand. But in a crowded market, having a strong brand upon which to build is critical, and Kevin had help from a close supporter in creating it.

“ I wanted to link the distillery to the state in some way. I threw around a few names, but then my girlfriend suggested Swallowtail Spirits after Oregon’s state insect, The Swallowtail Butterfly.”

swallowtail-2With the brand locked in and the distilling process fine tuned, it was time to move past small batch production and bring Swallowtail to a larger market. But ramping up liquor sales is not simply about having a solid marketing plan, it’s about having the fortitude to grind it out.

“ Liquor sales in Oregon are all about the hustle. You or an employee have to be out there with the consumer, engaging with them, explaining the process and getting feedback. Nobody will sell the product better than an owner. We know every detail of the process and are passionate about the business. It’s why I am still out there doing the tastings in the liquor stores. Customers like talking with the owners and when they see how engaged we are they get pretty engaged as well. If you can get them engaged and passionate about the product then you now have a customer for life.”

Kevin and his team hustled. They met customers at markets and stores, and talked about the brand to liquor shop owners. The consumers really liked the Swallowtail vodka, with many folks comparing it to top shelf brands. But Kevin was conservative as he entered the market, and even though he believed passionately that their vodka was as good as many highly regarded brands, he entered the market at a lower price point, a move they looked to remedy as they scaled up.

“ We actually listed it at too low of a price initially. Price point reflects a lot on consumer opinion. If you don’t have a premium price, you don’t have a premium product. We’ve increased the price twice over the last year and have seen no drop in demand.”

The premium level of spirits that Swallowtail produces can be traced back to their distilling process. A process that begins and ends with an intense attention to detail.

The water used in the distilling process comes from the lowland Willamette Valley Aquifer System, which has been filtered over many years through the volcanic sediment. Kevin and his team continue that filtration process to an incredible degree. The vodka is filtered through activated carbon sixty times, which produces a very polished vodka and helps to eliminate the by-products of the distilling process.

“ By-products like congeners and fusel oils are left behind in small amounts in vodka. They are what’s responsible for off flavors, odors and colors. They are also responsible for hangovers. Activated carbon pulls these by-products out of the vodka like magnets, with positive and negative charges. We filter our vodka an insane amount of times to get the cleanest product we can in a reasonable amount of time.”

Given the bounty within Oregon, Swallowtail has a vision to use as many locally sourced raw materials as possible in the making of their spirits. But with scaling up fast, finding those sources takes time, and they are actively searching for local suppliers to make that goal a reality.dsc_0082

Connecting to the community and putting down roots

The distilling process, especially with vodka and whiskey, takes a very particular equipment setup to produce. Swallowtail recently purchased a 300 gallon pot still to make their whiskies. The new equipment will allow them to produce about a half a barrel of whiskey a day. The goal is to effectively ramp up sales and production, and purchase equipment to the point where they can produce at least a barrel of whiskey per day. In addition, they also now have a tasting room where they can really connect to the community and consumer.

In addition, the new equipment allows them to ramp up production of their gin, and Swallowtail is taking steps to expand their offerings even further.

“ We will be producing our own single malt (Scotch style) whiskey and bourbon. November marks the launch of two gins as well; a Navy strength (114 proof) London Dry gin and a American gin (90 proof) as well. A goal of our tasting room is to start sampling 2 different products each month to get input from our consumers. Once we find out what they like, we will produce those liquors as well.”

In addition, Swallowtail has partnered up with fellow Eugene-based Ninkasi Brewing to produce a whiskey based on their OATIS Oatmeal Stout. They recently launched a Kickstarter campaign to raise funds to purchase the oak whiskey barrels and necessary equipment needed to produce the collaboration.

The time Kevin has put into building the brand to this point has been immense. But he has also connected to, and worked with, a diverse mix of organizations.

“ From the start I have never stopped asking questions. Anyone who would give me their time was on my list. I started with NEDCO in Springfield then moved to SBDC at Lane Community College for help with the business plan, forecasting and strategy for funding.”

The SBDC’s feedback around Swallowtail’s business plan was a huge asset. Multiple people took the time to go over a series of revisions, and as Kevin notes, it still changes every month.kevinbarrett1-300x216

In addition to the help NEDCO and the SBDC provided, Kevin was also accepted into the RAIN Accelerator program. Just like he did with the SBDC, Kevin continued to ask questions, which led him down the accelerator path.

“ I talked with Joe Maruschak at RAIN in February of 2015 about what I was doing. In September I met with Joe and Shane Johnson and finally convinced them that I really had no idea what I was doing. They let me into the program in September and it was one of the most amazing experiences. It’s like taking an MBA crash course in 12 weeks, but you get to focus in on where you really need to.”

But even a crash course MBA program and support from a myriad of business resources can’t speed up the time it takes to launch a craft spirits company. The wait time for permitting can put a serious dent into any solid plan, as the distiller continues to pay rent and insurance without revenue coming in during that time period. Luckily Kevin planned in advance, which allowed him to save close to $60K.

“ I started contract bottling a year and a half before I applied for a permit at my own facility so I already had a foothold in the Oregon market and had revenue coming in.”

That forward thinking and the hustle to get the product onto shelves has led to a 10% monthly growth rate in the state of Oregon, and with the addition of new products, their local growth will continue to grow while also looking towards distribution in other states.

So we’ll certainly keep seeing Oregon’s state insect on shelves in Oregon and beyond over the next few years.

For more information, visit www.swallowtailspirits.com.

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Verifying the Offers: A Q&A with Jake Weatherly of SheerID

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SheerID is an eligibility verification service for online commerce, based in Eugene. Co-founded in 2010 by CEO Jake Weatherly, President David Shear and CMO Marci Hansen, the company currently provides its service to companies like Spotify, Foot Locker, PGA TOUR, and Costco.  We recently sat down with Jake Weatherly to talk about the company and its history, and find out how it’s been able to gain such great market traction in just a few years.

What was the initial genesis of SheerID?
Living in a college town, everywhere we went, we kept noticing how hard it was for students to verify their eligibility and redeem discounts they deserved. We saw that at the airport, in the University library, and even at the college bookstore. As the pattern started to emerge and the pain point became obvious to us, David and I conducted extensive research to uncover what solutions existed. We were stunned that there weren’t companies already verifying eligibility for exclusive student discounts.

Once you had that initial idea, how did you go about developing, testing, evolving, and growing the concept?
I tapped Alex Boone, our EVP of Technology, and sold him on the idea. After hours of testing, Alex confirmed that it was possible to build an API that could perform a binary verification against data sources. From there we spent a lot of time researching data options until we found the right partner for authoritative student data. Upon starting to do TAM research for students, we uncovered there might be an even bigger opportunity around military discounts, so we began developing those two products in parallel.

What were some of the initial hurdles that you encountered as you were entering the market and lining up new clients?
When looking at the classic product life cycle, we realized that we were at the extreme end of the introduction and education phase. So while it was great to not have competition, there was a lot of education to do in the marketplace before we could sell our product.

What were the key pain points that SheerID looked to solve in the market when you launched and how have those evolved as you’ve scaled up?
At our core, we have always been a verification company. We set out to streamline the eligibility verification process for our clients and their customers. Along the way, we have been surprised at how our clients integrate our solutions. For example, we knew from the beginning that we had the capability to host our clients’ verification, but we thought they would be more interested in our API and hosting it themselves. However, because we frequently work with decision makers on the operations and marketing side of the house, the fact that we can get a SheerID-hosted verification solution up and running in six business days with minimal IT support has been a big advantage.

SheerID started with Students and Military, which seems like a great group based on retailer promotions/deals – was there a focus on lining up these two groups first?
There are 34 million members of the military community and 21 million college students. That made them the biggest opportunity for our target prospects.Hurry_bg_img

Was there a measured approach to growth after Students and Military, or more of a database/records access reason for how SheerID has entered the market?
We’ve always gotten a positive response from data partners we’ve approached because our API is designed to ask for a binary response and doesn’t see or transmit PII (personally identifiable information).

As we gained traction and on-boarded new clients, we uncovered two new pain points. Many software companies and other business that offered student discounts wanted to offer academic discounts so adding teacher and faculty satisfied their criteria. We also discovered that several of our clients who offered military discounts to show their appreciation also wanted to extend their offers to first responders. Both new products were client-driven.

Talk a bit about founding and growing the company in Eugene from a community standpoint.
Eugene has been a terrific place to start our company. The cost of living is affordable and the quality of life can’t be beat. Founding our business in Eugene has allowed me to maintain a healthy work/life balance and spend time with my family.

jake_david_2How important is it to maintain a great company culture as you scale up?
Maintaining our company culture is super important to us. We’re a family-friendly, environmentally conscious company. Once a month, we host a family movie night at our office. We encourage our employees to bike to work and stay active by organizing hikes and other outdoor activities. When we opened our new office in Portland, there was definitely a look and feel we wanted to replicate. For example, our desks in both offices are made from recycled doors, and we made it a priority to create comfortable seating areas where our employees can relax and brainstorm. We want our remote employees to feel like they’re a part of the SheerID family. We supply our offices with healthy snacks and high quality coffee, and we’ve signed our remote employees up for Graze subscriptions and coffee subscriptions so that they can enjoy those perks too. We try to create an environment that is very inclusive.

What do you think the biggest opportunities and challenges are on the horizon?
Our core business will always be verification, but our API is so flexible that there are many products we can create and different directions we can take. We’re very aware that in order to meet our goal of doubling revenue this year, we need to scale with focus and choose our next products and opportunities in a calculated fashion.

If your present day self could go back in time and tell your former self some advice, what would it be?
Don’t waste time worrying about the fact that every business planning professional out there says you should never start a business that doesn’t have competition. This idea has legs, so relax, dig in, and enjoy the ride.

For more information, visit www.sheerid.com, like them on facebook and follow them on twitter.

The proof is in the pork: The Elkhorn Farm and Forge Story

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Matt Alford quit eating meat in 1997 after reading Diet for a New America, which details the plight of animals raised in factory farm conditions.

It was the beginnings of a  journey that eventually led to the founding of Elkhorn Farm and Forge in Gaston, OR. It was not a predetermined journey or one that has been easy, but it certainly was rewarding.

The beginnings of a pig farmer

Matt’s vow to not eat meat took a bit of a turn after two years of soul searching.

“ I started hunting and gathering my own food so I could know exactly where my food came from, field to table. It was a  journey that led me to start raising my own goats as pack animals, and eventually I raised a few heritage breed pigs for my own consumption. “

He started with goats as the primary livestock on the farm, but the focus started to go towards pigs. The land and infrastructure requirements are similar for both animals, but pigs are easier to contain than goats, and they don’t need as much land or fence as cattle.  20150909_104307

“ I was able to start raising pigs using the farm assets I already owned (truck, trailer, shelter, waterers, fence, etc.) and that allowed me to get started without spending much additional money.  Along the way, I discovered that I really love being around pigs.”

His approach is based on pre-industrial methods where the pigs live outdoors on the pasture and forestland; free to roam, root, and run – in other words, be happy pigs. But starting a farm is anything but an easy task, and not for the unpassionate. But it’s a life that Matt had glimpses of in his youth.

“ As a kid I picked pole beans, strawberries, and raspberries for money.  In high school, I worked four years on a local farm growing and harvesting row crops, grass seed, and tending a small herd of cattle. However, I started my farm from scratch.”

Matt’s home and farm is situated on 1.8 acres and he leases and manages several properties nearby, which brings the total acreage up to 40.  In his perfect world, all the farmland would be contiguous, but as a startup, he is working with what is available.

“ It’s less efficient having multiple parcels of land, but I’ve been able to pick up under-utilized plots of ground and that has helped keep the costs down.”

But as with any startup, the costs to get going can add up quickly.

“ My biggest challenge was and continues to be time vs. money.  I scaled up the herd and grew the business by doing everything myself, working long hours 7 days a week to conserve cash.  I’m past the point where I can continue to grow the business simply by applying more of my time, so I need to invest in people and more infrastructure in order to keep up with the growth.”

1-20140531_165506Being out by yourself on 40 acres with nobody to talk to but the pigs can be refreshing, but Matt has also had the benefit of connecting to a community of resources as Elkhorn has grown.

“My friend, Will Woolley, is a co-founder of Templeton Hills Beef in California, where they raise grass-fed beef exclusively.  There’s a lot of overlap between our operations, and his willingness to share his experience has repeatedly helped me think through road blocks.  Locally, the non-profit Friends of Family Farmers has been a tremendous resource in terms of networking. The one thing that really gave me the confidence to buy a few pigs initially was the fact that my friend Brandon was already raising a few pigs each year for his own family.  We call each other when we have goat problems, and knowing that I could do the same with pigs was really important to me.”

With the farm and support network more established, Matt set out to source the pigs for Elkhorn. He searched and found a professional local hog breeder whom he could trust, one that could sell him top-quality stock and be another source of advice.

“I already had a great relationship with a local large animal veterinarian so I felt like I had a good support system in place.”

Bringing quality pork to the market

The taste of Elkhorn Farm and Forge’s pork is amazing, and it didn’t take long before the demand expanded beyond his family and friends. One of the most important aspects of being able to deliver quality pork on a consistent basis rest in the skilled hands of the butcher, so Matt set out to locate one by reaching out to the community for references.

“ I started calling and visiting slaughter facilities and butchers, while talking to everyone I knew who raised their own livestock.  As a livestock producer, your business is only as good as your last delivery from the butcher.  They can make or break your business, so I choose them carefully and make sure I’m a great customer to do business with on an ongoing basis.”1-LO4M0993

Elkhorn’s marketing started out as word of mouth and continues to be the best sales channel.  Matt sells directly to consumers and a few chefs over the phone and on his website. He’s purposely avoided selling to wholesalers and retail stores, primarily because he hasn’t needed to up to this point, and it doesn’t make sense from a margins standpoint. The farm is looking to potentially sell via farmer’s markets in the future.  

Matt’s foray into the farming business has opened his eyes to both the needs and opportunities in agriculture.

“ Farmers need technology that reduces labor and increases efficiency without abusing animals or the genetic integrity of plants.  In some places, technology is overused, while in others, technology and automation are sorely lacking.  As one example, a critical indicator of animal health is their internal body temperature, yet the market has yet to produce an affordable, reliable body temperature monitor for swine.  I should be able to get a proactive text message telling me when a pig’s body temperature is out of range or their daily exercise level is below normal.”

As it turns out, the local food culture really wants to know their farmer, and buy humanely-raised great tasting meat, which has resulted in the explosive demand for organic food in the United States. In Matt’s mind this creates great opportunities.

“ Forward-looking investors are forming real estate investment trusts (REITs), with the express purpose of buying conventional farmland and converting it to organic.  They hire consultants to manage the transition and lease the land back to farmers.  It’s a smart solution that solves critical financial hurdles for farmers while meeting a market need. Longer term, a big opportunity lies in urban agriculture.  There’s so much more that can be done to grow food within urban boundaries rather than trucking food in and trucking waste out.  People who live in cities yearn for the connection to the land and the taste of real food.  Urban planners, architects, and real estate developers who integrate the ability to grow food into their buildings and living spaces will capitalize on the deep seated emotional need of people to return to the land.”

Returning to the land is what he has done and it’s been a challenging, but hugely rewarding journey. It’s one that has taught him both entrepreneurial lessons and insights.

“ When things aren’t going as planned, be more flexible and take a step back rather than pushing forward.  I’ve made some bad situations worse by not wanting to deviate from my plan, when things would have turned out better if I’d just decided to give it some space and find another way.  You can get a long way applying steady pressure, but there are limits too.”

These are words that anyone who has started a business can relate to. But there are more intrinsic feelings and beliefs that truly sum up what Matt is doing at Elkhorn Farm and Forge. “ I really love being around pigs.  Being able to give them a great life on the farm and provide premium quality pork to local families is a win for everyone. “1-DSC02760

For more information visit, www.elkhornfarmandforge.com. You can also support them by liking them on facebook and following them on twitter.

Creating a community around feed and pet supplies

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Dani Wright was on the path to become a veterinarian. But with two boys in school and college tuition looming, she knew that those plans had to be put on hold.

However, when one door closes, another one opens.

dani2Dani was born and raised in Springfield, Oregon. Her parents still live in the area and it’s where she went to school. It’s where she has raised her kids, and been involved as a Boy Scouts and 4H leader. In other words, Springfield is home, and that’s where she saw an opportunity to create a business in the community she loves.

“ I started my retail experience as a tire salesman at Montgomery Ward, where I was saving money for veterinary school. But then I got married and life changed a bit.” She adds, “ I then worked at Safeway as a floral designer before moving on to the local feed store.”

It’s at the feed store where she saw an opportunity to combine her community roots and retail experience with her interest in animals.

“ I was experienced in the the feed and pet industry and always wanted to be a veterinarian. However, the Feed and Pet store I had been working at for 14 years, and had planned on buying, was not going to be for sale. I had met a potential silent partner with matching funds that believed in me, and McKenzie Feed was born.”

Opportunity knocks

After working in the local feed industry for 14 years, Dani had some insights into the opportunity of opening her own feed store around Springfield.

“ Of two area feed stores, one had sold and one had closed due to family and management issues, respectively. I was able to locate approximately halfway between each of those locations.” So with a desired location in mind and the local need for a new feed and pet store evident, Dani started the process of building what would become McKenzie Feed.

“ I went to the downtown center and chamber and met with an SBDC counselor about the practical aspects of opening a feed store.”

While her industry knowledge and work ethic would have given her the drive to open and succeed, the SBDC provided invaluable help in navigating all of the intricacies – from financing to marketing.

“ The SBDC is a great and continual help. Gary Smith provides insights and practical knowledge for balancing your business, socially networking, marketing and economics.” Dani adds, “ I had tried to buy 10 different locations and with each foray into a new location I worked with everyone from local and city government to finance people. The SBDC provided the resources that allowed me to navigate the various balance sheets, business plans and P&L statements needed to keep the process moving forwards – it was basically spreadsheets galore.”

With all of the paperwork done, and financing provided by Continental Bank and the SBA, Dani dialed in on the location and bought the old Grays Garden Center at 4441 Main St in 2004, and McKenzie Feed and Saddlery was born.storefront2

But as any entrepreneur knows, how things ultimately work out is never as you planned.

“ Funny story – I had rented a smaller space and was in the process of opening when a much bigger space one block away opened up, so I moved before I opened and then ten years later I bought and moved back a block and a half. Crazy. Location, location ,location.”

In 2009 they changed the name to McKenzie Feed and Pet Supplies, which was based largely on the economic downturn that occurred in 2008/09. As a commodity store, Dani was able to see the downturn coming about 6 months ahead of when it hit the area hard. The slight change in the name and focus allowed them to lower the risk around horses and livestock, which people tend to get out of in rough economic times, and increase dog and cat products as those owners tend to have discretionary money for their pets.

A focus on customer service

Given the choices around where the consumer can purchase their pet food, McKenzie Feed has found not only a niche that needed filling in the area, but a customer centered philosophy that has allowed them to retain and grow their business.

‘We can help’ is not only a motto, but the way each and every employee engages customers and the community.

“Customer service and caring is what keeps our people buying with us. Every customer is greeted and all food is carried out. Our computer system keeps track of your purchases and we’ve even had customers call from their vet to find out what food they should feed their pet.” she adds “ We get thanks from people who have tried all kinds of treatments to treat symptoms pets have, like itching, smelling, and scratching.We can solve many issues with simple nutrition.”

The McKenzie Feed team, which has grown from 3 to 11, know that what they sell in their store directly affects the well being of the animals they care so much about. Therefore, there is a constant focus to only stock the best supplies for their customer’s pets.

11707_1009025795781769_9182961654834213890_n“With so many recalls on pet foods in recent years, we are proud to say none of our food has ever been recalled. We make educated choices and will not carry anything that I will not personally feed and guarantee.”

Part of this focus centers around personally knowing the suppliers of their products.

“ I have very good relationships with all my vendors.The vendors established great credit terms with me as I was ramping up business, but more importantly, provide great products. The feed company CHS is in Harrisburg, Oregon and Valley Feed is in McMinnville, Oregon. We also sell our customers local eggs, fresh goat milk, honey, vinegar and local bones from Knee Deep Cattle Co., and Hawley Ranch. Our number one Oregon product is Mink Sheen Shampoo from Salem, OR. It’s an amazing shampoo for dogs, cats, and horses.”

In recent years there has been an uptick and interest in raising small livestock like chickens and dairy goats, and while the interest has been good for business, Dani and her staff also realize that educating and answering all of their customer’s questions is critical, since many of these folks are first-time livestock owners.

“ Chickens are very mainstream now, along with a few dairy goats. We offer advice on natural feeding and organic offerings. In addition to the one on one advice, McKenzie Feed also has a series of educational classes for dogs, chickens, flea and worm prevention, feed, and feeding.” Dani adds, “ We also have vendors who give samples and pet food education classes around raw, freeze-dried and specialty food use.”11900091_1082837715067243_1829485255193033665_o

The passion around helping the people and animals they serve emanates from their location, and much of this can be traced back to Dani and her reasons for doing what she does on a daily basis.

“ I live my love. I have my own dogs, a horse, chickens, cows and cats. I want to make every person’s dream of owning their own pet as good as possible through offering affordable practical help and sharing of knowledge. With God and SBDC ‘s help I run my business with good practices , a healthy bottom line and time for me. My business does not run me. “

For more information, visit www.mckenziefeed.com or like them on facebook.

For more information on the SBDC, visit www.bizcenter.org.