[00:00:00] Dirty Sue: More SKUs, more data, more complexity. The beverage industry is changing fast. VIP helps suppliers, distributors, and retailers stay ahead, turning purpose-built beverage data and technology into smarter decisions and better results. For more than 50 years, VIP has helped power the beverage industry. Now, they're building what's next. VIP, empowering smart decisions. Visit VIPinsights.com for more information.
[00:00:37] Ray Latif: Hello friends, I'm Ray Latif and you're tuned in to Taste Radio, the leading podcast for entrepreneurs, makers, and innovators in the food and beverage industry. What if the biggest opportunity in your industry is something no one else even sees? In this episode, Eric Tecosky, the founder of pioneering cocktail ingredient brand Dirty Sue, unpacks how a simple gap behind the bar became a first-to-market product, a profitable niche, and a lesson in discipline focus. From navigating skeptical buyers to scaling a single SKU for 20 years, ET breaks down the strategy, timing, and execution behind building a sustainable category-creating brand. Hey folks, it's Ray with Taste Radio. Right now, I am honored to be sitting down with ET, the founder of Dirty Sue. ET, it's great to see you. Great to see you. Thanks for having me on. And before we go any further, ET stands for? Eric Tecosky. Yes, but nobody calls you that. Maybe my mother. Maybe your mom. Yeah. It's been a name, a nickname that stuck with you for how many years at this point? Let's just say many, many, many. Fair enough. You're a young man, E.T. I wouldn't worry about it. That's right. That's right. Yes. Yes. Your Instagram handle though is superhype1. Where'd that come from?
[00:02:02] Eric Tecosky: Yes. My favorite band of all time, Led Zeppelin, their publishing company was called Superhype and It's funny, when I called it Super Hype, my dad took issue with it because he felt like hype is bullshit. And then when I qualified it by saying, you can believe the hype in this situation, like, I like that, I like that. So we kept it. I think for them, Super Hype was because they, before they ever released a song, they signed the biggest advance of any band at that time. And people were just saying they must be a bunch of hype. And then obviously Zeppelin came out and that was not the case.
[00:02:36] Ray Latif: Superhype is a great name. I like the name ET as well for a lot of different reasons. I really liked the name Dirty Sue. Thank you. Dirty Sue to me, I'm trying to find a point of reference and it feels like there's a lot of different places where you might've pulled from to create this name, but where did the name Dirty Sue come from?
[00:02:54] Eric Tecosky: Yeah, when I came up with the idea to bottle olive juice, which wasn't a thing when I started the brand, I really wanted dirty in the title of whatever name I came up with, just because I wanted people to immediately associate with a dirty martini. And I don't know how many days, weeks, dirty something, something dirty. And I was sitting in my apartment And I spied behind the sofa, my beach cruiser bicycle. So hashtag not married yet. My bike was in the living room and the bike, it's got like a wide frame and on the frame, whoever, you know, the company had painted a pinup girl, like a world war two nose of a plane. And it said the flying Sue. And I was like, oh, Dirty Sue, that's catchy. And at the time, I thought the pinup girl would have been cool, too. So I had a friend draw a pinup girl on an olive instead of the wing of a plane. And she was sitting on the olive saluting. And it just felt like a throwback, a little bit of Americana and nostalgia. And the name was catchy. And my original thought was I wanted to change how people order at a bar. So instead of saying, I want a vodka dirty martini or gin dirty martini. You would just name your brand and say I want to X 32 and just kind of like Kleenex. So I wanted something catchy and when I saw that it kind of stuck.
[00:04:15] Ray Latif: I love that. You wanted to create a brand name that could become generic, is what I'm hearing? Yes. Correct. Interesting. Interesting. And your background is actually in whiskey, or at least you spent a number of years as the U S ambassador for Jack Daniel. Whenever I think about dirty martinis, I don't think about whiskey. I think about vodka or gin. So just Let's talk a bit about your background in the industry and when you realized it was time to strike out on your own and get into entrepreneurship.
[00:04:47] Eric Tecosky: To be honest, entrepreneurship was kind of in my blood. My dad was a CPA, but he had a very entrepreneurial mind and always had some type of either idea going or side business going. And even when I was a kid, My dad during tax season would come home late because, you know, that's when you work the most. And if it wasn't a grill, he wasn't cooking. So during tax season, my mom would keep a lot of frozen pizza from the local pizza place on hand. And my dad would come home and make himself a couple slices of pizza. And as a kid, you watch your parents do anything and somehow it annoys you. So my dad would sit there with garlic, oregano, crushed red pepper, and scientifically put as many perfectly placed kernels of each spice. And I was like, why don't you just put them in the same jar and shake it on? It's like, that's genius. So as an entire family, we came up with a product called Pizza Put On. And his client at the time had done the FedEx logo. So he did the logo for the brand. And my mom was basically in charge of the company. And my dad built this device where you could pour all the spices in these columns and then pull a lever and it filled a bottle perfectly with the right proportions. And then for a penny a piece, my sister got to put the labels on the bottles, which maybe nowadays we could get out of doing that. But yeah, so we had that business for a while. There's no internet back then. And Pizza Place is where my dad thought would be Our wheelhouse all loved it, but they said, look, when we put crushed red pepper and oregano and garlic on our table, you can just tweak your pizza how you like it. If I put your product on my table, now my pizza is not good enough without your brand. So that was the pushback. And without Internet and specialty stores like we have today, it just kind of went away until I was a senior in college and I was in my last marketing class for my major and the teacher said like day one, you know, why do you guys think brands fail or make it? And like I raised my hand like I tell you how our brand failed and then for the rest of that class she called me every class and said E.T. what do you think about and everyone hated me like yeah it was the easiest day I ever got but I did not make any friends by being a teacher's pet.
[00:07:08] Ray Latif: Were you in business school?
[00:07:09] Eric Tecosky: Yeah, well, undergrad, but I was a marketing major at Syracuse. I had an opportunity right after college to move out to L.A., and that opportunity lasted about six months, and I found myself looking for work, and I was at a friend's birthday party at a, like, lounge, and I was leaving. I kind of knew the bartender just from going in there a little bit, and I said, hey, you guys looking for any help? And he's like, doing what? I'm like, you know, the assistant to the bartender. He's like, a barback? And I was like, sure, if that's what you're calling it. And he's like, yeah, we're pretty full, but come back with a resume. So I made a resume with all the bars I drank at in college and just said I worked there. And the next day I went in and as luck would have it, their barback, I don't know, got drunk the night before, messed something up and got fired. And I started work that night. You are a true entrepreneur.
[00:08:02] Ray Latif: You see an opportunity and you take that opportunity and you take it with full gusto. If it doesn't make any sense, as in, I have no experience, you know, as a bar back, well, how much experience do you really need? If you've been sitting at a bar, you see what bar backs do.
[00:08:17] Eric Tecosky: Yeah. I mean, bar backing, it's grueling, but you know, you have a few tasks and if you're just doing well, you get the attention of the bartenders and then they kind of take you under the wing and start training you. And that's what happened. And these guys. At the time, I thought they were ancient. They were probably in their mid-30s. And they trained me, and it was great. And then I went and got my first bartending job at this nightclub on Sunset. And it just kind of went from there. And the whole time, I always had something. I was writing screenplays for a long time or trying to do this or that. But bartending was always like the anchor of my life. As the cocktail scene shifted from just drinks, right? Neon sugar filled drinks of the 90s and we started getting into 2000s. I landed my favorite bar and I was able to get a job as bar manager and. I was on a brand trip with some bartenders from San Francisco and realized they really know a lot more about, even though I've been doing it over a decade now, they just seem to be way more in tune with where this movement was headed. They're already making their own bitters, using egg whites in cocktails. you know, fatwashing and I'm like, just listening and just kind of keep my mouth shut. So I didn't, you know, sound like I didn't know what I was doing. I got back to LA and I said to my boss, I'm like, look, this is happening in San Francisco right now. You know, it might be a six and a half hour drive, but it's a 45 minute flight and there is the internet. So it's not going to be long before it hits LA. So immediately we just went to Fresh Juices and then I think I bought Dale DeGrasse's first book and read up on that and just changed our first menu. I wasn't trying to change the bar into, you know, like a twisty mustache cocktail bar, but I figured at very least whatever drinks we made should be the best version of that drink. If we're making a margarita on the menu, it should be the best margarita. If we're making an old-fashioned, it should be the best. And it just worked for our space because it was a very regular driven bar, but also a lot of bartenders came there so they could come there and get a great cocktail. We weren't promoting ourselves as a cocktail bar per se, but we did make great drinks. And that's when Dirty Sue came about. dirty martinis ever popular, right? So at the time, we kept the olive juice in a squeeze bottle. And I was working by myself one night. So I only have myself to blame for this. But I set the bar up, put the squeeze bottle out, you know, filled the olive tray and garnishes and all this different stuff. And mid shift, we just got hit a little abnormally for the night it was with like 40 people at once came from, I think a movie screening. And all of a sudden I'm three deep and someone says dirty martini. So, you know, pour everything and I grabbed the olive juice bottle and it was empty. And then I went to the jar to refill it and the jar had probably half full of olives and also empty of juice. So then I had to go to the liquor room, get another jar of olives and fight that thing open with my wet hands. Took me like 10 minutes to make a 45 second cocktail. And that's when I was like, no one bottles olive juice. How is that possible? And as soon as I got a break, I went online and Googled bottled olive juice and it didn't exist. And that's what started me on creating Dirty Sue. What year was that? 2003 is when the light bulb went off and I launched summer of 2004.
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[00:12:00] Ray Latif: Artificial intelligence is reshaping every corner of the beverage industry. But where is it creating real value today? Stay tuned till the end of this episode for a bonus interview when I sit down with Andrew Krizis and Lucinda Aquat of VIP to explore how AI is moving beyond analytics to automate decisions, improve efficiency, and transform the three-tier system. So you've been at this for a while and clearly cocktail trends have evolved in the past 20 years, but I think premium has been the through line for the industry.
[00:12:38] Eric Tecosky: That actually hurt me in the beginning because when I created Dirty Sue, premium was not the vocabulary of bars. You know, people still had actual rail vodka, you know, and gin and rum. They weren't using today, like the worst vodka in a speed rack. might have been premium when I was starting out. So that has evolved. But when I started Dirty Sue, first of all, it took me forever to find anywhere that could bottle olive juice because most of it is imported. And all these farms I contacted weren't really farms. They were just private labeling from other farms. And it took me about six months And my very last phone call was a family-owned farm in California, and they grew California green queen olives, which aren't typically what we see in martinis in the U.S., but they were also the largest importer of Mediterranean Spanish olives on the West Coast. So I drove up there. and tasted their brine, and it tasted just like what was in an olive jar, which was totally fine, but I didn't think it was good enough to put in a bottle and say this is something you should buy. And I talked to them for a long time about how we could premiumize olive brine, and they explained how olive brine comes to be and different paths we could take to try to make it a better martini. You still want the salt, obviously. That's why people love a dirty martini, but I wanted more of that olive umami forward flavor to really give it something special. So we tinkered and tinkered and tinkered and finally landed on what Dirty Sue became. And it was great. People loved it, except bar managers, because bar managers looked at the bottom line. And they said, why would I buy something I get for free? And me being a marketing guy and sales guy, I'm like, hey, if you're getting it for free, there's a reason that you're not getting charged for it. How good could it possibly be? But they didn't care. That wasn't the world. This was the world of Cosmos and Lemon Drops and Jager bombs and stuff like that. Not that there's anything wrong with any of that, but we weren't into cocktails yet. So a lot of bar managers put back, especially bar managers that never bartended. So what I started doing, I would hire friends of mine, other bartenders on like some Monday or Tuesday, and I would call it dirty day. And I would give them all a roll of quarters and a list of bars and a couple of cases of dirty too. And I'm like, just go to all these bars and say, hey, this is from the bar manager over here at Jones. This is his product. He wants you to try it, no charge. See what your bartenders think. And once I got bartenders to get their hands on this bottle, convenience alone, they were sold because all they had to do was put a pour spout on it and not drain olive jars and not waste olives and not clean squeeze bottles. Then there's the bartenders that still, and some do it today, put the hand over the olive tray and The juice goes through your fingers. That is disgusting.
[00:15:39] Ray Latif: It's the worst.
[00:15:40] Eric Tecosky: That's a dirty martini. Yeah. So it just kind of grew like that. And then I got my first distributor. And I would say of all that early stuff, my biggest mistake I made when I created my website, which is still relatively a new thing, an e-commerce site, It was written in 100% flash, and I know nothing about technology like that, but it looked cool. And the guy that designed it was in my friend's band, so it just had a cool vibe. And we had our launch party, and Christina Aguilera showed up to the launch party. She got in front of the step and repeat, took pictures, hung out, had a couple drinks, and it was amazing. And then that picture ended up everywhere. and we were not set up to sell. I had one distributor in Southern California. My e-commerce was caveman-esque, and it took me a long time to catch up. It was really a wasted opportunity that could have given me a lot more of a boost than it did.
[00:16:41] Ray Latif: It's interesting, you know, as an early stage entrepreneur, you got to be prepared for failure, but really also be prepared for success. You never know when that opportunity is going to come and you know, it's best to be prepared for it. And people always talk about luck as the intersection of timing and preparedness. And I think in your case, timing was there as preparedness, not so much. Not so much. But I also talked to a lot of early stage folks about being ahead of the curve. And even though a few things fell into place, you were still, I would say, probably ahead of the trend. And while there was some buy-in from, say, bartenders in Southern California, you still had the rest of the country to consider and where to go from there. How did you map out your growth strategy once you realized that there was some demand for this, that where there was some interest for this? How did you think about the next year and potentially years after that?
[00:17:35] Eric Tecosky: Once I had that first hurdle, I said, I need to be ready for growth. So the first thing I did, because I realized the internet was a real thing at that point, people were using the internet and buying on the internet. The first liquor store that ever carried Dirty Sue was out in the Inland Empire, about an hour east of LA. And I knew they sold wine online, because wine was legal to ship. So I called the manager, and I was like, hey, how do you do it? He's like, oh, we have a company, we have custom boxes that have wine shippers, and it doesn't break in transit, and it's light, and you can brand your name on it, whatever you want to do. So they had moved on, they're a giant liquor store, like what? you know, a Total Wine or BevMo looks like today. And he's like, I'll give you the first guy we use, which will sell you more your quantity size and talk to them. And it was amazing, right? Because now I had custom packaging for Jersey Sioux, nothing broke in the mail. I knew how to do it. I got a UPS account, which I didn't know you can do to get better rates. You know what I mean? I just thought he just went on ups.com, who knew you can negotiate. And Once I got that in place and knew I could ship anywhere in the US and still make money, that was step one. As I was growing Southern California, I was strategically looking at where I wanted to go. And the West Coast made the most sense because manufacturing in California, and I didn't yet have West Coast warehousing and to make that, you know, not cost prohibitive for an West Coast distributor. We were in Southern California to Northern California, went to Nevada, Arizona, and we just started building that area. And then it started catching on. We started getting some press. bartender creates product because that wasn't a thing back then and those pieces started falling into place and you know just got a few really good hits that put me on the map and I had the support of bartenders. As I mentioned to learn how to modern bartend I bought Dale DeGroff's book and then I met Dale and he really liked Dirty Sue And when his second book came out on the Dirty Martini page, he calls out Dirty Sue is the best you could buy, which if you're an actor, you know, Robert De Niro saying, did a good job. You know what I mean? So it was pretty amazing. And it really let other people like, oh, well, if Dale DeGroff says it's good, I'll try it, you know, and other peers of Dale also kind of got on. So in that bar community, I really had a good reputation amongst that crowd as a quality product, different from what's in the jar, that you could trust, that's consistent, that's cost effective and easy. And then conquering the home market was next.
[00:20:28] Speaker 1: Taste Radio meetups are continuing in Chicago, San Diego, San Francisco, and London. Come hang out with the food, beverage, and beer community for live podcast recordings, CPG networking, and sample sharing. Want to attend or partner with us? Head to Taste Radio.com slash meetups. Quick pause to let you know that the leading event for the beverage industry is headed back to Los Angeles this December 6th through 8th. BevNET Live brings founders, investors, retailers, suppliers, and operators together for product discovery, high-value conversations, and partnerships that can shape what comes next. Early registration pricing is available now. Head to bevnetlive.com to register. Mark your calendar. Nosh Live is back December 3rd and 4th in Los Angeles. Join packaged food founders, buyers, investors, and operators for two days of product discovery and conversations focused on what's next. Early registration pricing is available now. Head to noshlive.com to register.
[00:21:23] Ray Latif: It sounds like you got buy-in from the trade, but even in the mid 2000s, I certainly wasn't considering cocktails as something I would ever make at home. I think that actually came many, many years later. I mean, when it came to retail consumers, people buying from your website, who were those people and how did you cultivate a marketing strategy that spoke to not just those people, but the people that would come after them or the people that were like-minded?
[00:21:50] Eric Tecosky: Yeah, again, a little bit of an opportunity I kind of seized on. When I first started getting some press, and most of it was in bar trade magazines, but then every once in a while I'd get a blurb in a consumer publication, and someone emailed me through the website and said, hey, I'm a home dirty martini lover, and I have five jars of olives in my fridge. All the juice is gone. My olives are going bad. I feel bad about throwing them away, but I don't know what to do. do you sell retail? And I never even thought of that as a viable market. Coming from the bar world, you know, it's a mixer also. In essence, you're mixing it with vodka or gin. And it was a $7.50. I'm like, wow, that's a lot of olive juice for someone at home. So I made a 375 and launched that as the retail bottle. And I was amazed at how many people had that same issue that woman had, where they were buying all these little supermarket-sized jars of olives. and making two or three martinis and then having a jar of olives that were going bad.
[00:22:59] Ray Latif: And probably making really terrible martinis at that. I mean, if you're not buying high quality olives, you're getting really bad olive juice.
[00:23:07] Eric Tecosky: Yeah, that really helped. And then I just realized that was a market. So I started putting a focus as much as I was on the on-premise in the liquor stores and that kind of world as well. And then obviously as Amazon grew, That only helped me because now people in states or cities where I wasn't distributed could get Dirty Sue. It's just crazy how the world has changed since I started. I literally, the first couple orders I got online for a case of Dirty Sue, I was buying a box from a UPS type store, not even a UPS store, like a mom and pop, so full retail. wrapping it in bubble wrap, stuffing them in a box with the old school peanuts. And if someone paid at the time, maybe $70 to get a case of olive juice delivered, I was spending about $110 to get it to them. Not a model I could sustain. Yeah.
[00:24:02] Ray Latif: Sounds like your fulfillment has changed, has evolved since those days.
[00:24:06] Eric Tecosky: Yes, quite a bit, quite a bit.
[00:24:07] Ray Latif: One thing that hasn't really evolved too much, and I think in a good way, is your focus, right? You are focused on olives and olive juice in particular. You sell onions and you sell whiskey cherries as well, but the primary focus of your brand is olives and olive juice. There are a lot of different ways you can go. I'm sure investors would say, hey, Dirty Sue has built up this great brand name. You know, why don't you do this or do that? You could make a Tom Collins mix or you could make a margarita mix or all these different things. But it seems like you've been pretty intentional about staying in your lane. Am I right in thinking that?
[00:24:43] Eric Tecosky: Yeah, I mean, I still think as good as Dirty Sue is doing, I have so much runway left. You know, there's so much room left, even just in the US, where Dirty Sue isn't. So to just dilute the brand, to just throw something out with my name on it, seems like a sure way of failure, right? If you listen to anyone that's a business mentor, they say focus, focus, focus, stick to what you're good at, do what you're good at, crush what you're good at. Tito is a prime example of that. I've met Tito in passing. We're not buddies, but I have a lot of friends that work at Tito's and have been there since day one. So I hear the magic of what he did. And basically, he took one item in a time in our taste evolution where flavors are everything, and he just stuck to one thing and said, I'm gonna do this as well as I can do it. And he did it to the point where you can't walk into a bar or a liquor store or home, basically, and not find a bottle of Tito's. That's the point, which just happened this month when he said, what's next? And he bought a bottle of tequila, right? So if you could learn anything from a guy who's super successful, focus on what you do. I didn't do olives at first. It was just the olive juice. And to be honest, I could have just stuck with that. But every single martini made with my olive juice has an olive. So it seemed crazy not to at least offer that as a brand extension because it made sense.
[00:26:23] Ray Latif: ET, there's one word that I haven't brought up and then you haven't brought up throughout this conversation. It's niche. What you are selling is relatively niche. There's only a handful of people that really buy all of juice and buy all of juice specifically for cocktails. But you can build a business with niche. You can scale niche. This is not going to be a business where all of a sudden, you know, you're sold as much as Jack or Tito's, but there's a real opportunity here and you've proved that opportunity out. I guess the question for me is how do you sell that vision to investors so that you can hire more people, so that you can expand production, so that you can be in more places, so that you can consider an innovation pipeline down the line. What has been the pitch when you start talking to investors? I assume you already have.
[00:27:06] Eric Tecosky: To be honest, my pitch was 21 and a half years ago when I got my first three investors and my only investors. I've never gone out for more money since. And my pitch back then was, I'm not sure this is going to work, but I think it will.
[00:27:22] Ray Latif: By the way, that's a great pitch. I think a lot of people that I've spoken to who ask for money from friends and family, the line should always be, you're probably going to lose your money, but there's a chance that you could do well.
[00:27:35] Eric Tecosky: I explained why they might lose their money, which was no one's ever done this before, and there could be a reason I'm not seeing. But for my money, from a guy standing behind a bar, we're throwing away, I don't know what they cost back then, but a gallon of olives maybe was back then 20, 22 bucks. And I would say we threw away a third of every jar of olives. And probably 10% that we used, we probably shouldn't have. And that's not nothing for under $10 or $7.50. So if you're looking at half ounce of olive juice per drink for a typical dirty martini, That's 50 drinks in one bottle. If you're talking about extra dirty, three quarters of an ounce. Now, you know, 30 some drinks in a bottle. Somebody wants to triple X dirty. Now you maybe have 25 drinks in a bottle. There's no reason not to have it. And the value of Dirty Sue pays for itself. And this isn't a sales pitch. This is just math and science. A typical martini, right, let's say you're going to have a nice premium martini at a great steakhouse you love going to, it's a three ounce pour of vodka, okay? Maybe you're a gin drinker and maybe they put in a quarter ounce vermouth, but some vermouths cost as much as the vodka, right? Dirty Sue does not cost anywhere near a premium vodka. So the best olive juice on the planet costs way less than one of the great vodkas or gins on the planet. So if you, I love my Dirty Martini super, super dirty. Now the bartender's pouring two ounces of premium vodka or gin in the tin, or glass, you know, if that's how you're having it, and then an ounce of Dirty Sue. You just lowered the liquor cost of that drink tremendously. So the value of having a great olive juice for your, you're gonna make dirty martinis anyway, so either you're gonna throw away olives, or you're going to use the best olive juices on the planet, and it's gonna make your drink a lot less expensive. So there's really no argument at this point with everyone wanting the best you can have, it makes sense. And then if you're a bartender who's just lazy like I was, poor spout and done, that's such a better, easier setup than messing with the olive jar. So, you know, for me, if I was going to tagline it, right, the dirtier your martini, the cleaner your bottom line, you know what I mean?
[00:30:08] Ray Latif: ET, I've really loved speaking with you. Thank you so much for taking the time to sit down with me today. I'd love to meet up in person and share a Dirty Sue martini with you sometime in the near future. So hopefully we can meet up and make that happen.
[00:30:22] Eric Tecosky: That would be great. Thank you very much for having me. I appreciate it. It's super fun. For sure.
[00:30:26] Ray Latif: Thank you again. That brings us to the end of this episode of Taste Radio. Thank you so much for listening. Taste Radio is a production of BevNET.com, Incorporated. Our audio engineer for Taste Radio is Joe Cracci. Our technical director is Joshua Pratt, and our video editor is Ryan Galang. Our social marketing manager is Amanda Smerlinski, and our designer is Amanda Huang. Just a reminder, if you like what you hear on Taste Radio, please share the podcast with friends and colleagues. And of course, we would love it if you could review us on the Apple Podcasts app or your listening platform of choice. Check us out on Instagram. Our handle is bevnettasteradio. As always, for questions, comments, ideas for future podcasts, please send us an email to ask at Taste Radio.com. On behalf of the entire Taste Radio team, thank you for listening. And we'll talk to you next time.
[00:31:20] Speaker 2: you
[00:31:32] Ray Latif: VIP has quietly powered the beverage industry for more than 50 years, trusted by more than 2,800 distributors and 1,400 suppliers. They have defined this industry time and again, and in this era of AI, they're leading the way. Today, we're joined by VIP CEO Andrew Krizis and Head of Sales Lucinda Awkwot to discuss where the industry is headed and what customers can expect next. Andrew, it's great to see you. How are you? Good. Thanks for having me, Ray. Lucinda, how are you?
[00:32:02] Speaker 1: So great. Excited to be here.
[00:32:04] Ray Latif: Yes. And our audience is excited to hear about VIP's capabilities with AI because it is a topic that is top of mind for so many founders at this point. Andrew, as I mentioned, VIP has been around for over 50 years. Your background is pretty interesting because you bring so much to the table as CEO. How did you come to VIP?
[00:32:25] Speaker 3: Yeah, great question, Ray. And I think it does go back to the legacy of VIP. So I'm incredibly passionate about the beverage and alcohol industry, the broader CPG industry as a whole. So I spent the last 12 years plus working at Nielsen IQ, working with many of the suppliers that could be listening to this, distributors and retailers. It was about five years ago that I first interacted with VIP and it's actually a partner to Nielsen IQ. And so a complimentary partnership was created and I got to know the company a little bit. I got to see the value of what VIP creates in the industry and how it helps support the three-tier system. And I was just blown away also by the people. by just the caliber of the talent, how respected they were in the industry, how much knowledge they had across the three-tier system. And so once I started to get to know the company a bit more, I saw just the opportunity for the technology to do so much more across the industry. And with AI, as we were talking about becoming really important and accelerating every day, every week, I started to realize it's a huge moment for AI and technology and more investment to come into VIP, really help our clients, help the suppliers, help the distributors and retailers, and transform how operations and the day-to-day work is getting done. So I just saw that as a great opportunity, both in the technology and AI side, leveraging all of my data background and knowledge in the industry, but then joining a group that has an amazing culture, an amazing team, and a ton of passion behind it.
[00:33:44] Ray Latif: Lucinda, when you came to VIP, you also came with a ton of experience. Just talk a bit about your background in this industry.
[00:33:51] Speaker 1: Yeah, thanks, Ray. So I like to say I was born and raised in the beer business, but I got here as soon as I could. Started when I was 21 with Boston Beer Company. I've worked in all three tiers of the three-tier supply chain over the last 20 years. And I showed up to the first day to the VIP office here in Burlington, and I felt like I should be asking for autographs because VIP is the only set of data and the only set of tools that I've ever used on any of the three tiers. So it was really remarkable to see the team of people that has built such an incredible organization and really built from the ground up over the past 50 plus years that VIPs existed. So I'm honored to be here, a part of the team now to help carry the sales team into the future with all this new, authentic work that we're going to talk about.
[00:34:37] Ray Latif: Andrew, let's just start off by talking about where the beverage industry is headed right now in broad terms and why AI is such a critical strategic investment for founders and businesses.
[00:34:47] Speaker 3: You know, I think about whether you're a small supplier or distributor or a large supplier, you know, the beverage alcohol space. You could be only have a few people at your company or hundreds. At the end of the day, everyone's looking for efficiency. Whether you're three people within your company, you're stretching yourself to try to do five jobs. Or again, you're a larger company with maybe 10 people in the finance department. You're all trying to find better ways to do what you're doing so you can drive more product to consumers. So AI is just coming at this perfect moment over the last six to 12 months where everyone needs it. Everyone needs it for similar reasons, for inefficiencies, whether it's helping you run some reporting, it's helping you with pricing, it's helping you optimize something. At the end of the day, there's never enough hands and arms within a company when you're building a brand. And I've experienced that, you know, working with hundreds and hundreds of founders over the last 12 years in my past role with Nielsen IQ. And I see that with VIP. So I think all of the industry, both suppliers, distributors, retailers are looking at AI to try to understand how can I drive more efficiency? How can I drive a better delivery of my service or product to the end customer? And how can I do it in a way that's going to set me up for success? But now many people are taking it in different ways. You know, AI isn't something that's just intuitive and you throw on a chat bot and all of a sudden you're up and running. So it's really interesting to see how suppliers are leveraging AI, how distributors are leveraging AI, retailers, et cetera. And there's some fun nuances between those three.
[00:36:09] Ray Latif: When it comes to spending money on AI or otherwise, founders want to see a return on investment. And I'm curious about how you measure return on investment when it comes to AI. And also, there's so much hype about AI at this point. Where does hype meet reality? Lucinda, can you tackle both questions for me?
[00:36:28] Speaker 1: Yeah, great questions. So I think I'll tackle the ROI question first, because I think it will address the buzzword as well. But I think when you think about AI, I was thinking back to all these different technological advances and how they've impacted the industry all the way back to when we used to have rolls of quarters to get on the payphone. And then all of a sudden, cell phones helped to make us more efficient. Same thing with printers and then the internet. I think of AI in the same way. It will give us the ability to enable all of our teams to be that much faster, that much smarter, smarter by way of better insights from the data. So if we're able to take a sales report, a sales ranker, and extract out the insights that much faster and distill down to the actual accounts we should be spending our time in, that to me is an instant ROI. There's also back of house applications. We think we talked with our distributors about some of the features that are most important to them as we're building out our new agentic platform. And it's things like avoiding the fat finger on the order. We don't want 10, we want one. We don't want 100, we want 10. And so giving the teams the ability to capture those things in advance, I think is where we see the ROI. It also empowers our retailers to make better orders. So think of predictive ordering in an e-commerce platform like Connect. There is so many great things that we can do to empower across all three of the tiers using all of our gigantic features that we have in place now. So if I'm a retailer, if I'm a distributor, if I'm a supplier, that's how I think about the ROI. And it really enables the humans to be better at their jobs. So that in itself, I think is the buzz. I encourage people to think about AI as more of a tool and a way to do their business, a way to go about seeking the outcomes they're looking for versus this buzzword of a tool. And I think when we all begin to embrace it much more, we'll see that firsthand as well.
[00:38:22] Ray Latif: Obviously, technology is moving faster than it ever has before. And it's incumbent upon VIP to provide technology that is keeping up with the times or in this case, keeping up by the day.
[00:38:33] Speaker 3: Yeah, I think you're spot on with it's evolving every day, every week, new models come out, Fable 5 came out for the second time. So it's a constant. It's been great. I've had a few conversations just recently with some distributors and suppliers. And when we talk about the investments, one of the things that came out clearly from our clients was they are interested, they are getting pressure to use AI. And so initially, you know, whether you're a founder on this call, a supplier or distributor, the thought process was, let's just take Jet, GPT, let's take Claude, let's just turn it on for everyone. And like, let's go get some insights. And you can get some gains and insights there. But ultimately, those clients came to us and said, hey, for us really to take advantage of this new technology and capability, we need VIP. We need VIP to do this within all the business processes, because VIP is so foundational to the core operations, whether you're a distributor, whether you're on the supplier side, looking at your inventory and depletions. And so that's where we took it upon ourselves to say, let's look at the marketplace. Let's look at all the different providers out there and take a hard look at ourselves. And we made the decision to make a really sizable, significant investment into a new architecture with AI and an agentic first decision. And what that allows us to do is actually create not just agents and AI on top of legacy products, which again, that still adds some value, but it doesn't change the game. And so we said, let's go down the path of actually building for the next several years, not for the next two months or three months, because a new model is to proceed something, but we need to have a new foundation. So VIPs made the biggest investment or one of the biggest investments we've ever made as a company. And that's gonna allow us to have an agentic first platform, bring in many different types of data and create agents on top that again, aren't just giving you some insights, but I like to say are doing work. They're doing work for you as a supplier. They're actually making decisions on your behalf within certain guardrails. And then they're able to communicate for you. If you're a supplier, actually having these agents do work for you, communicate to your distributors, to your trading partners on your behalf. Again, I go back to my first point. Everyone needs more arms and hands, right? You never have enough people when you're a small player or a large player. And so actually being able to do some of that work, communicate digitally to distributors, whether it's pricing, whether it's something related to inventory, whether it's shipments. And likewise, distributors having agents that can interpret and engage and make decisions on their behalf and then communicate to their trading partners. That's where we're going as VIP with AI. We think we play a really central role into that core operational element of how the three tier system works. But we were also cognizant that that takes real investment. It's not just lipstick on an existing product and putting in a chat bot and saying, oh, everything's AI. It's really looking at the foundation of what's needed So much has changed just in the last six months, where whether you're a software or data company, what you had built maybe two years ago, even 12 months ago, almost becomes irrelevant from an architectural standpoint, just because the last six months. So that level of investment is something we're fully driving towards and working with a lot of clients on both the distributor and supplier side of how we bring this new platform to life. And at the same time, though, we're still investing in our existing products. That is not stopping. So I think of it from a VIP standpoint, as we're going down both paths, we're investing in existing products, putting AI on top, kind of what I was mentioning with many others in the industry. But we're also going after this whole new architecture and whole new platform. And that's what's really required long term of the three tier system.
[00:41:57] Ray Latif: Whenever I talk to founders, operators about who are they choose their partners, it really comes down to trust. And I think when you're talking about AI and the evolution of this technology, it's really important to trust your partner. And it seems like the level of expertise that you guys can provide to companies is just unmatched at this point. So I highly encourage folks to get in touch with the team at VIP. Lucinda, what's the best way to do so?
[00:42:25] Speaker 1: Yeah, thanks, Ray. We are so excited to hear from all our customers. We're getting questions every day, and I do think the best way to reach out to us is vipinsights.com. And go and submit a form, request a demo, send in a question, and we will be able to get back to you. But our sales team is talking with all of our customers all day, every day about this, and we're really excited to bring everyone more.
[00:42:46] Ray Latif: Outstanding. Well, Andrew, Lucinda, thank you so much for taking the time. I'm really excited for the future of AI and VIP's ability to help companies address this technology in a really effective way. So thanks again, and let's definitely stay in touch. Great. Thanks for having us, Ray.
[00:43:01] Speaker 1: Thank you, Ray.
