When Business Kills Passion: Florencia Palmaz Questions the Soul of America’s Wine Country

0:00 The connection begins with us being incredibly connected to land, and then it's one of those few beverages that we actually get to transfer that love and connection into a bottle. And then what you're talking about, that next challenge is how do we then confer that connection that's instilled in this bottle onto ultimately the guests who get to enjoy it? Sit back and grab a glass. It's Wine Talks with Paul Kaye. Hey, welcome to Wine Talks with Paul Kaye. And we are, we are in studio today, beautiful Southern California, actually 102 today, about to have a conversation with Florence. Do you say Palmas?

0:44 Uh, Florencia, yes. Or Flo if it's a, if it's a mouthful. I was thinking about the Madame Cathiard. Florencia Palmas of Palmas Vineyards. Welcome to the show. Thanks. Great to be here. It's already started as an incredible conversation, so I didn't really want to interrupt that thought, but just get the introduction on the books here. I'm going to read what ChatGPT wrote about you in 75 words. Can I do that? Sure. Are you sure? Yeah. Now I'm interested to know. Ooh, 75 words. It says, today on Wine Talks, we welcome Florencia Palmaz, whose journey from Argentina to Napa Valley connects family, food, and the willingness to challenge convention. After building a gourmet food business with her mother, Florencia brought her culinary instincts to Palma's vineyard, helping shape wines designed for the table. Her story explores what happens when specific innovation meets hospitality and why even the most sophisticated winery ultimately comes back to the people.

1:48 Florencia, welcome to Wine Talks. You know, it's kind of, I don't know. I use it to write stuff because it is faster and easier, but then it doesn't sound like you. It doesn't feel like me. I gotta be honest with you. It sounds so much more sophisticated than how I feel. Well, that's interesting. Well, let's talk about that for a second. You are an immigrant from Argentina, and wine was not the trade in Argentina. But let's talk about the immigration. I mean, Napa, we were just talking about Napa and the history of Napa. so much about immigration. All of the great houses early on in Napa were from immigrants. Why do you think that happened? Why do you think we landed there? My father was an immigrant to America. What does that history tell us about Napa Valley? Oh, gosh, that's interesting. I think so many people, dating back to the 1800s to today, the people who come to Napa are passionate and risk-takers, right? Because this isn't a guaranteed success. It's farming.

2:56 And my gut tells me that immigrants in general are extraordinarily energetic dreamers and risk-takers, right? Because they leave something that they know to go do something new and adventurous. So maybe there's a connection there. No, I think that's right on. And I just had this There was a post yesterday on LinkedIn from Monica Elling, whose father escaped Hungary, and she tells briefly the story of that. And my father ran from Cairo, Egypt. My grandparents ran from the genocide in Armenia. And I always, I'm almost a little jealous of that. I've been a little jealous of you, a little jealous of this jumping off point where you just decide, look, we've got to do something else. And we We have no idea what we're getting into. We're just going to do it and rely on our wits, I guess.

3:50 And the risk tolerance is there. And I want that sort of part of the credo of somebody that comes to Napa Valley looking for a better life. I mean, look, I'm going to be totally honest. I came as a baby in arms, right? So to say that I'm an immigrant is a little bit like I don't have that extraordinary risk, right? I was 18 months old when I came to America. And so I was essentially the baby coming along with, I think, what was my parents' extraordinary adventure that they embarked on. But, you know, I have a lot of respect for what building a new business and even, you know, working in farming, whether you're the second generation or the third generation or the first, you're still dealing with risk. every single day, right? Where our farms are, you know, under risk of falling apart because Mother Nature takes a turn. And, you know, that becomes increasingly more adventurous every year as the weather becomes more erratic. And, you know, market conditions don't always align with what our farming conditions offer us. So, you know, we're taking the risk of needing to reinvent ourselves every generation.

5:03 Well, I certainly, certainly, I don't think the general public understands that with wine and that A, it's really farming and B, if you do it right and make an honest glass of wine, you're completely at the whim of what nature gives you. But I wonder, let's go back to the immigration thing for a second. Yeah. When the Nazis came to Bordeaux and all the resistance started there, all these amazing stories. You might have read Wine and War. Yeah. And it seems to me that not unlike your parents coming from Argentina, that that sort of risk and background and experience shows up in the philosophy of what you put in the bottle. In other words, you don't taste this tannic structure because, you know, the Nazis came into Bordeaux, but It would seem to me that the history and the knowledge base and the experience and all the things that affected the psyche of that person making the wine would end up in that glass.

6:08 That's an interesting thought. And for some reason, and I don't know why, but right as you were sort of talking about that, right, this is the idea of the Nazis coming and threatening a vintner in Bordeaux, right? I immediately felt and remembered the threat and the invasion of the fires of 2017, where something from the outside was coming in and was coming for me and for my family and what we did. I think that they probably— my immediate response was, nothing's going to take us out. This is our land and we're going to stay here and we're going to survive this. You immediately take on this this protection of my family, protection of my land, and protection of the ability to continue to do what we love. I'm sure that that same thing happened then. The stories that you mentioned were so well written about are the hiding of bottles behind false walls and the somewhat messy navigation of being able to continue to operate even though they were under an occupation. You know, we, you know, in a very different way, very simpler way, right? Just 10 days. Right. It's a great analogy, really. Fighting, you know, we were— so we were just, you know, trying to protect our land and try to continue making wines while we're, you know, fighting fires. But, you know, that very much was my immediate response when that happened was,

7:40 you know, how do I, A, protect my family, B, protect this land, and continue to be able to make wine, right? It was very simple. Because I didn't want to be interrupted because I love what I'm doing. I think that's always in the back of your mind, no matter what happens, that it could happen again. And so that changes the honesty and the humility that's in that glass of wine, even though it's harder to define structurally. I believe it's there and I believe it's felt. I have this romantic view of wine. We're going to get into your parents coming here. But the romantic view is, of course, that it is the only beverage that connects the human soul to the earth, and properly made and honest wine does that, and why it's completely different than any other beverage in the world. But then we have to sell it. So that's the irony of it all. It's not all about the romance. You've got to put something in the bottle people want to buy. I'll add to that. I do completely agree with you that there is something there in that connection, but the connection begins with us being incredibly connected to land. And then it's one of those few beverages that we actually get to transfer that love and connection into a bottle.

8:52 And then what you're talking about, that next challenge is how do we then confer that connection that's instilled in this bottle onto ultimately the guests who get to enjoy it, right? And that's the communicating of our passions. That's the, you know, in the sharing of our stories. I mean, it's why sommeliers are such an important part of our industry. industry, you know, they are the person that connects oftentimes what we do to the person who ultimately gets to enjoy the bottle, right? They are our storytellers tableside. So let's talk about that. We're going to bounce around a little bit, but that's an important piece. The story is— I mean, it's all about the story. Everything in life's about the story.

9:38 But yeah, there's a, there's a falseness about storytelling out there that I think the human people— I mean, people can, not the human, but the people can differentiate. And like, I was listening to this podcast, like I said, about Château Montelena. I mean, Jim Barrett's purpose of buying Château Montelena wasn't about winemaking, care less. It was an incentive put out by the Nixon administration to incent investment in America's agricultural infrastructure. I didn't know that. That's fascinating. However, you know, it quickly turned into a passion now, didn't it? Yeah. And all of a sudden, it took me 15 years of selling wine for it to hit me as to what I was providing people.

10:28 And you said, you said it perfectly, the guest. if we looked at it as guests and it was hospitality, which it really is, maybe that story's a little more earnest. Maybe it's a little more humble. Maybe it's a little more honestly told rather than, we have a story too, kind of thing. It just shows up, right? Well, and there's so much, you know, as the wine industry becomes an industry and it has marketing gurus and it has, you know, PE firms running it and investment bankers, it stopped being about heartfelt stories that are personal and that are emotional, and it started becoming marketing strategies. Yes. And that's a real tragedy, right? Because this is really still very simple. I mean, I love what you say about Beaujolais.

11:13 The truth of the matter is, you know, when we came to this valley, we didn't actually come with the intention of making wine. We didn't get it yet. Our real intention, my parents' intention, was to build a place to keep their family together. Right? To find a piece of land for all of us to work together. That was the intention. Wow. You know, wine was the vehicle for us to stay connected to each other. And it was a simple desire because my father spent so many years as he was, of course, traveling the world and trying to, you know, teach all the doctors around the world how to use the stent since he invented the stent. We never saw him as kids. Right? I mean, it was many years when, you know, when I was 6, 8, 10, 12, where people would ask him, where's your father? He'd be like, uh, Shanghai? No. India?

12:03 No. Egypt? I don't know. It's been a couple weeks since I've seen him. Right? Because he was literally traveling the world trying to, you know, teach people how to use the stent in every single hospital in the world. We never saw him. So he had this strong desire to come back home and be home and building a business that was something that felt really grounded, like farming on a vineyard, was just this passion for him. And, you know, we all kind of followed along. Yeah, sounds great. Sounds like a lot of fun. But that's an interesting story. I mean, obviously inventing the stent is an incredible thing. I find it fascinating that an Argentinian, I guess, cardiologist at this point, invented this product that obviously was very successful and very important part of medical history.

12:53 But, and traveled the world, was away from the family. But you still, you come to Napa, you weren't gonna make wines. And a lot of people that are successful in business that go to Napa do it because they want to buy this lifestyle. Yes. They build these magnanimous châteaux, some of them extraordinarily ugly. I heard that comment on another one of your podcasts and I couldn't stop laughing. I was like, wow, that is some real honesty. It's so true. But then, but then some catch on to this incredible product and some just continue to market this business and they realize it's really expensive to make.

13:35 There's a lot of risk involved. The margins suck. And, you know, you need to be extraordinarily passionate to survive all that. particularly when I talk to our winemakers that are in different countries that are not so well established. But that wasn't the case here. I mean, you left Argentina for a better life. Yeah, we left for Argentina so my father could be a medical student all over again. He was already, you know, completed all of his training, was ready to go and be a doctor in La Plata. And it's It was actually my grandfather, my mother's father's death on the table of a triple dot bypass that my father was as a doctor viewing in the surgery room that really made an impact on him. Hmm. So he was very driven at the time to really find solutions to what was a very personal family problem, which was heart disease. My— both my— both my grandfathers, my father's father, and of course my mother's father died in their 40s of heart disease. And so for my father, it was a personal, personal drive to try and find solutions to that. Wow. How interesting.

14:59 So he started a relationship with one of the first one of the first interventional radiologists here in the United States that was at UC Davis, actually was at Ann Arbor, Michigan when they started their conversations and basically a pen pal relationship with Dr. Stuart Reuter, who was bringing in some of the first angioplasty innovation. And then, you know, and there's just like, I'm repeating things that you can imagine are very well covered in— you can Google this and you can find amazing stories by my father himself telling how he came here and how his research went about.

15:45 But it was actually Dr. Stuart Reuter who went from Ann Arbor, Michigan to UC Davis before we came to the US, but then had my father land here in California. It could have been Michigan. Just think of that. We could have been making wine in Michigan, but no, we're making wine in Napa Valley because we first came here. I came in a Wolverine and, uh, you know, actually there's a winery in, um, Kansas called Terra Vox. He's trying to bring back, um, indigenous Cal-American, though they're not Vitis vinifera, but they were grapes used, you know, pre— Sure. To make wine. And I don't know, man, talk about— Napa seems to be much more suited for this job. So So that was one of the questions, I guess you just answered it, which is your father's path in the stent is a well-known, documented, obviously documented story amongst the medical profession.

16:48 Absolutely. Yeah. And it's kind of an amazing and unique one because it's a rare example of a true academic working in the university hospital at the VA hospital. having a thought, a crystalline innovative thought, and then having an entire career in academia to develop it and bring it to fruition. It's very strange. I had Dr. Jan Krupp on the show recently who started Stagecoach Vineyards and what a revelation for him. And the question I asked him was, you know, what did your wife think when you started this scatterbrained idea to get into the wine business? He said, you mean my first wife? So that kind of answered that question. And then— But then the inventor of the Coravan, Mr. Lambrecht, Greg Lambrecht, was, you know, his— the technology used for the Coravan was a delivery system he created for cancer drugs. And got out of the medical profession. And as opposed to— I suppose there's this passion that must have been swelling up in your father to become a farmer. I mean, or besides just buying land to unite the family that you'd be— Well, I'm going to burst your bubble right there. It was actually my mother. Oh, well, I'm glad. We came to Napa

18:21 mainly because Well, I'll take you back. So we come to the US in '78— sorry, '76. We come to the US in '76, and my parents are in the Bay Area, and on the weekends would drive around. And of course, we were just customers of, like we were talking about, the wine clubs of several wineries. We loved coming up to the Valley. I was a baby. My parents would come up to the valley and I was this tortured toddler kicking rocks in parking lots of Heitz Vineyard and whatnot.

19:01 But so my mother used to always whine. She'd say, oh, I can't believe I married a doctor when I have to look at all these beautiful vineyards and all these wineries. Someday, if we ever do really well in life, I would love to come back to Napa Valley. So it was my mother's lifelong dream. to retire on a vineyard. You know, her family raised cattle in Argentina. She knew and always was very connected to sort of that idea of that a family farm can really unify a family for many generations. So that's where that— that's where the seed was literally planted via mom. And she's the one who found the estate many years later. as my father was really dealing with, I would say, sort of a dark period in his career when there was a lot of patent lawsuits going on and there was a huge sort of series of years where he was really just defending his work rather than working on his work. Wow. That's when she actually found the property and said, time for us to make a change, time for us to build something beautiful. And she's the one who really pitched it to the family and saying, hey, let's rebuild an abandoned winery. And that's what we started to do. I know of La Plata Vineyards or La Plata as a brand, but where's La Plata in the geography of Argentina? La Plata

20:34 is just outside of Buenos Aires. Buenos Aires obviously is the capital right there, and then La Plata is just south, East of Buenos Aires on the river. And it's actually the capital of the— it's sort of the academic capital of the country. So it's where the big university is located. It's the capital of the province of Buenos Aires. So it's sort of the small town next to the big town. And is it a wine district by itself? No, it's really just a— it's a college town, really, more than anything. a town. It's a pretty big city, but it was always considered the little sister to Buenos Aires. And then just outside of that is already quite a bit of great Pampas rangelands. So it's really much more cattle being raised just outside of La Plata. That's really the beginning of the high grass and really great cattle ranging. The wine, the real wine country of Argentina is much more up in the hills around Mendoza. Mendoza.

21:40 The Pyrenees. Calafate. But it is, it is a— I just brought it up here on the map. It is across the way from Uruguay, which in the same sort of terroir and, um, and weather growing, uh, Tannat and things. It's interesting that it didn't take. But of course, was wine when you grew up— well, you were 18 months, but when your parents were there, you know, Mount— uh, Argentinian wines, at least here at the Wine of the Month Club, my dad did a Chilean wine like in 1979 or something. mean, it wasn't really a worldwide stage for Argentinian wine in those days. Certainly beef, you know, Argentinian beef is well known worldwide.

22:25 So there was no affinity for wine when they were there? You know, no, not really. Honestly, my parents, they drank wine casually at the table. My grandparents were not necessarily wine collectors in the classic sense. And in my mind, the region around— the reason why the agriculture surrounding Buenos Aires and La Plata in that part of Argentina is not necessarily wine-centric is it also has a lot of summer rain. So, you know, Napa, Bordeaux, we're talking about areas that are actually fairly arid during the summer. That really gives the grapes a chance to grow in the right conditions for winemaking. I would definitely struggle to imagine making great wine in an area that has that much summer rain.

23:20 But it wasn't part of the family dinner table. Yeah, you were actually asking more about the family dinner table dynamic. In Argentina, it's You know, of course it's all about the beef. I would say that, you know, asados, and when I say that, I mean that in the asado is almost a cultural event, not a meal. That there are these long, multi-course lingering tables where you, you know, you're grilling several different pieces of cuts of meat and you have sort of these waves of dinner and it's sort of series of salads and, you know, grilled sausage.

24:01 And then another salad. Okay. I just, it's already like lunch. Sorry. Well, and, and, and that's the cultural piece that I think that we really like. That's, that's actually one of the sort of identifiers to us is this idea that these long meandering meals are, are so central to our relationship in the family. It's really what binds us. It's what binds us to each other. It's what binds us to our guests. You know, we're always trying to recreate those table experiences. And for me, wine is actually one of those wonderful mechanisms to extend a meal, right? A wonderful way to really sort of make the experience around a table feel more connected. It's clearly, and it's really interesting to me, particularly with my circle of friends, obviously I'm in the wine trade. They like wine. They have little cellars. They don't know what they're buying, but I try to help them.

25:04 But I find this ironic in that so much of the culture of wine people, the average American anyway, would say, I don't understand wine. I don't know what I'm talking about. I don't like the wine list. And that's true. It's intimidating. Some somms make it intimidating on purpose. But at the same time, Those dinners that you have with friends and family, and you open a bottle of wine, so much of the conversation goes back to that. And it's not intimidating. Yeah. Just a conversation. And you could spout off all the knowledge you know about that wine. But in that environment, it doesn't come off as this intimidating subject, and people are interested. I just find that fascinating. But in an open public environment, they get intimidated by the glass of wine. But it always— I think about Downton Abbey. You ever watch that show? Yeah, of course. When it was time to find the wine for dinner, it was such a ceremony. And not the intimidating ceremony that you sometimes get pretentious about, but just this reverence to make sure that the wine was poured properly and it was there proper and it was the right wine for what they're doing. And that speaks— To so much more. Let's get to that. You know what it's speaking to is this exactly what we were talking about earlier. It speaks to— so that collection of wines that that estate had, or that anyone's home will have, is the collection of

26:34 future moments to honor your guests with. That's a good way to put it. And those bottles reflect their values and what they're wanting to honor guests. Like, what's that value that you want to confer onto your guests? Is it a strong message of sustainability, then they're going to collect wines that reflect that ideal. Or is it a value of tradition or tradition to a certain place? They're going to collect those wines. So that then when that special guest comes to their table, you're telling in your 30 seconds or 2 minutes the story of why you're going to open this bottle and you're going to have all this ceremony around it. So that you can really Have your guests understand how much you're honoring them. That's what the— that's how I feel like it's— that's what the whole purpose of a collection is.

27:28 That was well articulated. I've never thought of it that way. And I just finished, you know, when I sold the Wine of the Month Club in 2023, and it wasn't because I was making too much money, the buyers who only bought my inventory that dealt with my daily sales, which is retailed at $15 to $25. But during COVID I'd collected this amazing stuff, classified growths and burgundies and things, because I was selling everything people— anything I told people to buy during COVID they bought. And so all of a sudden, I had 2,500 bottles or so of some really nice stuff, and they wanted nothing of it. Yeah. So my wife's— my wife's an accountant. She had just as soon preferred the cash.

28:11 But they didn't want to buy it. So now I have this amazing collection. I had to build a small cellar at home to accommodate it. But you're right, that's exactly how it feels. Like, I have dinner, even if it's my son-in-law's or my daughter's, I'll go into that cellar and I'll look around and I'll sort of come up with a decision. And that decision is based on a lot of variables. What we're having for dinner, who's invited, you know, what statements I want to make. It's a pretty interesting thought. Really interesting. Go back to the last one. Sometimes it's so simple. You don't have to know anything about the wine, and maybe you're just trying to honor a date and time, right? These bottles are the pin cushion, are the pushpins of our memories in our lives, right? Whether it's the year of a child's birth, or the year of a graduation, or the year of a marriage, right? Those vintages oftentimes, just on the very surface level, right?

29:07 the year on the bottle can commemorate a year that is special to someone. There is, to me, one of my biggest joys in this industry that I never anticipated was getting text messages from customers saying, with a picture of a bottle in a special place, saying, celebrating my 5th anniversary. Thank you so much for remembering when we came to visit you. That is like instant joy for me. It's like, oh, I get to be part of that. that couple's celebration. You did it. Exactly. That's— and that's the whole purpose. Like, for me, that's why we do this. Um, what the sommeliers aren't getting when, when it, when it's coming off in, in a pretentious way, right, like you're saying, in that restaurant setting, it's because they're forgetting what they're trying to do is give context to that couple or those guests, what they're trying to commemorate.

30:03 Make the bottle the pin cushion into that meal so that that moment, that dinner, can be extra special. That's all we're trying to do. The way you do that, which is lost in a lot of senses— a lot of talk of this on LinkedIn about salesmanship, and the old methods don't work anymore. And it's not true, because true salesmanship back in the day— and I sold a lot of stuff in my career— was understanding who the client was and what their needs were. And you only get that by asking open-ended questions to understand what their thoughts are. And that'll help guide any SOM to, you know, a proper selection. Not only make the selection right, 'cause any selection they make at that point, if they've done this right, will be right for them. Yeah. It's making that client feel like they care. Absolutely. Not saying this is our special wine of the day, or this is what we have on tap, so to speak. But what do you do? What do you usually drink? What are we having tonight? What can we do? What do you— are you interested in experimenting? All the different open-ended questions that could lead to a decision that makes the client feel like somebody cared about what I'm doing. It was listening to me, right? Why I'm here. Yeah. My most, you know, as you can imagine, in the career of wine, I've sold, I've presented a lot of vintage wines. Which isn't a lot of bottles, to a lot of sommeliers and a lot of wine buyers. And I've listened and heard their responses and critiques on my wine or, you know,

31:34 are there— and the most sophisticated buyers I know, right? Whether it be a wine shop buyer or a sommelier, is the one who tastes the wine. And rather than saying, I like it, right? The really sophisticated ones are the ones who say, I have a regular who comes in every month. and always drinks these wines. Your wine would be a perfect thing for me to present to them. You've got their— your palate, this style is right in line with such and such particular customer's palate. So that's sophisticated, right? To not know whether you like it, but to know whether your customers will like it. Which means they've been paying attention.

32:17 Yeah, exactly. Exactly. That they're not just standing around saying, this is delicious. I like this, I like that. You know, just throwing out their opinions. Now, you know, there was— I don't know if I— if you— the podcast you listen to, I talked about the Palermo sommelier who— we were at a seaside restaurant in Palermo, and the guy, I think the guy was Croatian, but that part of the country, that part of the world. And I was— I wish I got a video. I just got one photograph. This guy was so passionate about making sure that you— Now, he made a recommendation And I had already— I already knew what my crowd was, what my group likes. And so I ordered a Super Tuscan. It didn't matter to him. He made me feel like I had ordered the King's Ransom. It was amazing. And I watched this guy. I even went to him afterwards and I gave him a €60 tip besides the table tip and said, watching you relish in presenting wine was one of the greatest experiences I've had in this industry, and I've been doing it for 35 years. And, and I thought— and then I went to a steakhouse in Beverly Hills 2 weeks later and had the most annoying conversation with the somm because it was all about what he's drank and what he's been and what tastings he went to. And, you know, everything— About him. It was, it was about him instead of about the guests.

33:39 So tell me where— let's, let's talk business a little bit. Where are your wines at? Are you using the 3 tiers? Are you all DTC? What's your typical You know, gosh, it's— okay, let me see. Let me start by saying my intention all along was to try and be as balanced as possible and have as many, as much of the wine distributed in equal parts, both, you know, whether it be direct-to-consumer or via the 3-tier system. And then even within the 3-tier system, try and have a balanced selection between on-premise and off-premise. and even export. And that was actually taught to me by sort of the previous generation who had told me, watch out, this industry has channel swings. And if you don't have a very balanced portfolio of customers, you'll get hurt when tourism is down in Napa, or you'll get hurt when— there's a war in another country and they don't want to buy American wines anymore. That was incredibly great advice that I sort of live by even more so today than ever.

34:59 But, you know, the reality is the trend in the last, let's say, 15 years has been so much growth, almost uncontrollable growth in the tourism here and locally in Napa, that DTC, direct-to-consumer, ended up being a big channel for us. I've enjoyed it. I'm not going to lie. It's been great because we all know that that's where wineries get to keep their margin. Where the margins are. It's where the margin is, but it's unsustainable because here we are, we're looking at a moment in which the tourism and the visitorship is down in Napa. And so the pendulum is swinging. And so now everyone is scared for the future. And we've seen a lot of wineries hurt when they got to too concentrated in direct-to-consumer.

35:49 So my intention is always to try and be as balanced as possible. It doesn't always happen. And, you know, and we, you know, we want to keep, we want to, we want to keep all 3 channels as open and as available as possible. So, you know, that's my intention at least. Well, it's a, you know, I used to say here it was a 3-legged stool. In fact, if you— this painting is my father in 1975. Oh, how cool. In fact, when you talked about, you know, you got dragged around as a young person in Napa, I'll never forget 1974, uh, he went up and he borrowed a station wagon when the windows didn't work and it was 100 degrees, and we collected all these, uh, wine antiques of fruit presses and All kinds of stuff. They're out in the front of this building right now because I'm never going to move them again. I've been moving them for 40 years. And so, and so, but I thank him for putting me in this industry.

36:50 So I have to, I had to kind of remember the, the camaraderie that we had doing it. But, um, yes, the industry's suffering right now, and I just— there's no answer to this, and you get a lot of pontification about what's going on. And so much of it takes me back to what you already said, which is this experiential part of wine is so important that you— that your cellar's full of memories that you can present to friends and family when you pour a glass of wine, and there's meaning behind each bottle. That's not necessarily the case when you walk into the supermarket and you see rows and rows of shelf talkers and Josh and Apothic Red and all the rest of these things that taste like sugar water, you know. So I guess that's the business side of things, but your side is really important. Our 3-legged stool here was bottle sales, membership sales, and gift sales. And in your case, it's on-premise, off-premise, and DTC.

37:47 And you tried to balance that. Now, had you predicted COVID, you know, you would have put more time in the DTC before it, you know, before it started, and you would have, you know, maximized that value, and you would have realized that on-premise plummeted. And so how do you protect yourself from that? I don't know. You just— it's prognostication, I guess, as to what you want. But— Yeah, I think, look, it's impossible to reflect back on what I should— what we should have done, right? All I can say is that the day that the announcement came that we had to shut down our tasting room, right? Which was for us a significant piece of our business.

38:27 I remember reading the notice that was brought to us, right? You must close your doors and the whole thing. What really struck me as brutal was, but you're allowed to keep your farming operation. So I was like, oh great, so half my company can still come to work, but the other half is immediately fired? And the half that wants to work here? How totally unfair! The first thing I did was I popped up out of this chair, I went straight back to the tasting room, and I said, Okay guys, this to the, to the tasting room team, right? Which is an entire culinary team. You can imagine it's everyone who takes care of the tasting, the hospitality area, the serving, the kitchen, the— and then of course the ambassadors themselves and the concierge team. And I said, all of you, we're going to work really hard to keep you employed. It's like, I don't know what happens next, but we're going to, we're going to do this. It can't be that I can keep the vineyard team here and I can keep the winery team, but I can't keep you here. So we're going to come up with a way right now to keep you all going. And that's what we did. I mean, we actually, we were lucky that, it sounds sort of archaic today. Here we are doing an interview on a Zoom call. We happened to be early adopters of, at the time, this video conferencing system because we have several other businesses. And so we were video conferencing with our other companies. And so we happened to have video conferencing systems in our offices. And immediately I said, all right, everybody, go home with the IP-based telephone and go home with a video conferencing camera.

39:57 We're going to start doing virtual tastings. Wow. And we immediately did that. You know, we turned on overnight really enthusiastically and passionately. We did a WineStream, which we called it the WineStream, which was our little weekly wine show where we were, you know, sort of inviting our customers to come and join us and, you know, literally just put on a silly little talk show. and talk about and interview sommeliers who were suddenly closed down and like, hey, tell me about your experiences. We talked to climatologists to talk about weather. We just like, whatever strange subject we wanted to come up with, we would talk about it for an hour once a week. But then what we were also doing on the back end, which was what was very, for us, very meaningful, was to say, how can I keep my sales team running? And that was with, you know, intense virtual connections with our customers.

40:50 It's like, you all have come to visit us previously in the past, you're stuck in your houses, hey, we can ship you wine. And so that's what we did. I mean, and I feel really lucky that while so many people were really suffering during COVID I was at least able to keep my hospitality team employed. That's great. And with something to do. Right? And, you know, to this day I still have customers come to me and say, thank you so much for what you did during COVID You were a bright spot. And it's like, okay, well, you know, seems a little tight to say that. That was pretty— A winery is a bright spot. But it turned out, you know— It was very resourceful. I mean, we did it too, but we were only DTC. So, I mean, that was, that was fun. We had a lot of fun doing it. And sales were up by, you know, 30%.

41:40 You know, actually, I saw this, this in my— at least in my sales graph, the slippage from about 2016 and heading into '19 was not— '19 was not a great year. And then COVID hit and it's like, wow, we could do no wrong. And then it started to tail off immediately. Literally the day after the lockdown was lifted, you know, we just— sales went back down to 2019 and before. So That part of the industry was suffering from different problems. But so you, I don't remember that they locked down the tasting rooms. And I remember somehow Newsom, once he started lockdown, that he released or relieved, I guess maybe that's what you're talking about, was the winery operations because of Plumpjack and all these other investments. And I thought, oh, 'cause I was getting ready to turn my retail store into like an Italian deli. And I called some purveyors I know here and I put pastas and stuff so I could keep the doors open, make it a market. And then I didn't need to because I thought they relieved some of those sanctions against the wineries.

42:52 Months later. It felt like every single week of COVID we had a whole new existential shift because for good or bad, the California government was changing their mind on how to manage COVID every week, it felt like. So from one day we were shut down. So then, you know, so then the next, the next week it was, okay, you can have these people here, but you can't have these people here, and they must be this many feet apart. And then later on it was, okay, fine, we'll let you do tastings, but you have to do the tastings outdoors. Well, they tell us that in the middle of winter when it's freezing cold outside. But yeah, well, thanks for nothing. Really super. So, you know, we were every single week having to reinvent how are we going to operate. But for me, the guiding force was, how do I keep my team employed? How do I keep them occupied and keep their lives as normal as possible in the midst of this crisis? Actually, yesterday I was playing with the in-house forehead thermometer that we used. Every employee walked into the building, we took their— Yes. Everybody was panicking, but it was fine.

44:03 What is your then position today? I had this conversation with a large, not a large one, but a winery in the Stag's Leap District. And they're almost all entirely DTC and they are sort of a club and it's working right now. Yeah. Which is fascinating in the world of wine that something's working. But their tasting room manager was telling us her opinion of what was happening in the Valley. And that was, The rest, the hotels are running at 30% occupancy and they prefer, and they're leaving the prices high. I mean, staying at the Yonfield Estate is like $1,000 a night, you know, for something because they were getting, their costs were lower having a skeleton crew at 30%, still getting full margin on the rooms. But you know, the pull-through impact of that is, you know, Violet Gurgich was telling me that, you know, their tasting room traffic is off 30%.

45:01 So has that moved the needle? Has the movement— now, easy for me to say. Has the needle moved on that in the last, let's say, 12 months where tourism is swinging the other way, or is it still pretty depressed? You know, so I get— what I'm amazed to hear is that from all my colleagues in the industry, every single one has a very unique and very dramatic response to this question, which is making it— it's like feeding the narrative. Yeah. It's like the favorite question to be asked right now in the industry is, you know, how are you surviving? It makes it so much more dramatic. So I agree with you that there's a lot of people that are reporting huge slipping of their traffic, right? You also have a lot of reports of, you know, sort of these hospital, you know, are the hotels hurting us or helping us by not lowering their rates? Or are they— I don't wanna hold a big opinion on it. Like, I can't, I'm not informed enough on the Valley's issues, right, to be able to hold a big opinion on that. But I can tell you here, I've been really fortunate in which my net traffic isn't that different. So, yeah, we've been very fortunate that the net traffic hasn't slipped that much. Primarily, I think the main reason is that we've always been a very special place for people to come to. So, you know, While there's fewer people coming to the Valley, they're still coming to see us.

46:31 We've taken tremendous lengths to make sure that the hospitality here has always been very special, very unique, very connected to individuals. You know, we don't do advertising or we don't do big marketing campaigns. What we make sure to do is personally, one-on-one, connect to each and every customer we have. So when they come to visit, it's almost like they, oh, we've got to go visit our friends down at Paul Masson. And we've been successful that way. It's an interesting thought. And we haven't even talked about your hospitality experience with your mother, but we're going back to that idea of the cellar and the story behind every bottle. And I can't tell you how many times I would buy wine for client of mine who went to Italy and sat at the— in front of the Colosseum and had a glass of wine and wanted me to get that wine and would tell me that didn't taste the same once I got it, even though it was the same vintage in the same vineyard.

47:31 And that's because the experience of it all changes, changes. It's just part of— Yeah. It's part of the wine thing. And so doing it that way is the right way to do it, to, to prolong the, the value of, of an honest glass of wine. And I think that, I think the consumers, and the point I'm getting to is there's so much chatter about AI and automatic buying and that this romantic side of wine isn't going to change. It hasn't changed in 6,000 years plus. Yeah. It's always going to be that way because that's what it means. And we can apply all the marketing techniques and we have Gen Zers creating their brands with the crown cap and special label. It's irrelevant when it comes down to the things that you're making. Well, and you know what? You have to remember there's, there's basic biology behind it, too. Your ability to smell and taste first and foremost goes to your emotion center. Then it is logically interpreted. So we feel what we taste before we think about it logically. It's not like color, where, you know, your eyes and even your sense of touch and your sense of hearing, for the most part, goes straight to logic. You can describe what you see and feel very well, but you can't necessarily describe what you smell and taste verbally. Interesting

49:02 point. But you feel it first, right? Because it's first going to your— it first goes to your amygdala. You know, but my— you can imagine my father being a scientist, like, we love to look at things in the basic science, like, distill it all down. Let's find the source of why, and then let's innovate from there. So with that understanding of saying that our sense of taste and connection is emotional first and foremost, you can see that history of the traditions of hospitality are rooted in framing that emotional connection, right? And this isn't dishonest. You still have to make a great bottle of wine. You still have to deliver something that is, you know, as flawless as it gets, or as, you know, as authentic a blend as possible. But making sure that it is then delivered in a way that connects someone in a positive light, that's what we're doing, right? Mm-hmm. And it starts with everything we do, from making sure that the flowers don't have strange smells that are coming up out of the tasting room, Making sure that our ambassadors are speaking to the wine without conferring a lot of bias. You don't want someone standing in front of you swirling a glass saying apricots and melons or nectarines as they're sipping a glass of white wine in front of a customer, because that's the first thing that's like, oops, bias. Right? Bias kicks right in. You don't smell that. I didn't taste that. And they go, there must be something wrong with me. Yeah, exactly.

50:35 It's really, that's really a bad strategy, right? But talking about, you know, what the context of how the wines are made or where they're made, or, you know, what's the philosophy around the occasion that this wine is blended for, that's, those are the discussions you want to have. Since you can really frame a customer's mind around a wine. It's, uh, it's hard to define the, that ethereal feeling. And it's funny, my wife smells much more than I do. I mean, I, my, my, my palate is really good at structure and the, you know, the balance and acid and fruit and things. It's lousy at fruit impressions.

51:23 And even with the size of my nose, my wife still detects stuff that I don't detect. I'm the exact same way. I'm the first to confess I'm not a supertaster. You know, what I am is a very emotionally intuitive person though. So when I see someone coming up the stairs and they look, you know, haggard, dehydrated, you know, they just, they haven't been having a good day. I want to stop everything to make sure that we get them to a place where they can then be relaxed and really hear and enjoy themselves for an afternoon. Where is the winery? Our winery is down in Napa, in the Coombsville region. We're actually just about 10 minutes away from downtown, just up against the Vaca Range, which is that hillside as you're driving up and down the valley.

52:16 Yep. The southeast side of Napa. Our winery is literally dug into the mountain of the Vaca Range. So we're just on the base of Mount George, and it's an underground wine cave system developed first. The big intention was so that we could be a gravity flow winery. My father had a deep passion for when we decided it's build a winery, he wanted to understand the basic science around wine structure and wine ageability. You know, what can we do as we're building a winery to really make sure that we're ensuring that we're not compromising, you know, we're maximizing the quality and not compromising the fruit that's coming in the door by making, you know, gross mistakes in how we make the wine. And at the time, there was a lot of understanding of how tannins were getting beaten up and bruised and air, you know, wines being inadvertently aerated early in their development because they would be pumped from location to location in a vertical above-ground winery.

53:22 So, you know, he sort of took the stance that, well, we've got an entire mountainside that we've got up against, let's use it to our advantage and let's place the entire operation inside the cave. Wow, how interesting. Honestly, hospitality was the last thing we thought about. We didn't even, you know, DTC wasn't a big deal in the 1990s. Yeah, there were some customers coming to visit wineries, but it was an afterthought. And for us, the wine, the tasting room, and all of that was an afterthought that we sort of said, oh, maybe someone's gonna wanna come and visit us. Okay, we'll put one, we'll put like one little dining room. tasting room set aside that someone could come and taste in. And, you know, that of course, that it became this activity that is really central to our experience. And a lot of our customers, of course, want to come because we never realized it was going to become such an oddity that everyone was going to want to come and see this crazy thing. So— Well, you know, they found that 6,000-year-old winery in Armenia. It's gravity flow. How about that? Confirmation.

54:31 Yes. Fly out there and take a look. It's been an honor having you on the show. We're already at an hour and that's 15 minutes longer than we were supposed to go. And I hope we have a chance to tilt a glass together next time we're up. Absolutely. Please. It would be an honor. Come and visit. We'd love to. Love to sit and I want to, I'd love to hear all your stories. Thank you. We're going to be— Learn all about it. We're supposed to be up in September, but that wasn't going to work. But I'm trying to— my daughter was displaced by the fires here in Southern California. She didn't lose her house, but it's uninhabitable still. And so they've been living with us with the 3 grandkids. Nice. Yes, it has been very nice. Once I put my head in the right spot.

55:17 Hey, we all live on the farm together. So I say nice because it can be an incredible experience. So I'm A silver lining. We'll bring them all up. Would love to have them, have you all come, and, and, uh, we would, you know, be— you'd be lovely. We'll look forward to it. Awesome. Cheers. Cheers.