Wine Business School Releases First Wine

Sonoma State Cellars brand started as student project

by Andrew Adams
sonoma state university wine business institute
Students and staff from the Sonoma State University Wine Business Institute affix labels to bottles of the 2010 Sonoma State Cellars Cuvée.
Rohnert Park, Calif.—Students well schooled in analyzing profit and loss spreadsheets and the minutiae of accounting recently had to tackle the challenge of hand-labeling a single barrel-bottling run.

The bottling exercise was one of many small yet daunting tasks that Sonoma State University Wine Business Institute students have overcome in their pursuit to release the inaugural vintage of Sonoma State Cellars wine.

“There were several things from this venture that I will take away and inevitably use in my future endeavors,” said Dylan Karahalios, who with Jacob Avery, Stephanie Gremban, Sean Headden, Kendall Hoxsey, Marin McElhany, Brian Perkins, Andrew Pimentel and Nick Rood created a business plan for the wine brand, which they presented to school faculty, administrators and professionals in the wine business. “One of the most important skills was how to coordinate a large team.…I also learned that there are going to be road blocks and hurdles along the way, but it’s how you overcome them that define the success of the business,” Karahalios said.

Most of the wine—a 2010 Dry Creek Valley “Cuvée”—already has been sold for $28 per bottle to alumni and industry supporters of the institute.

Erik Miller, owner and winemaker at Kokomo Winery in Healdsburg, Calif., oversaw the winemaking after sitting in on the students’ business plan presentation.

Winemaker steps in to help
Miller said that he kept in touch with the students and offered his assistance to keep the project going after another winery that had pledged to cooperate pulled its support. Miller made wine with fruit donated from Timber Crest Farms and ended up donating a barrel to the student project. He said the students helped bottle and label the wine, and it was fun to see how excited they were to be producing an actual product using their business plan. “The day they labeled the bottle and they had that tangible bottle in their hands, I saw it in their eyes,” he said.

Plans already call for the program to expand to two barrels of a Claret-like Bordeaux blend that will be bottled next March. For this coming vintage, Miller said the wine would either be another Bordeaux blend or possibly Zinfandel. Miller said that students would work with mock contracts for the donated fruit to get a better understanding of grower negotiations.

He said there’s a possibility for students to help with the actual winemaking but added he has a pretty small cellar, and it could get a little stressful working with students who are studying to sell wine rather than make it.

“The most surprising part was the support we received from all the parties involved,” Karahalios said. “Kokomo was extremely generous sharing not only their wine but their facility, their experience and a lot of their time to help us succeed.”

Karahalios is now working with the parks department in the city of Santa Rosa, Calif., and doesn’t have plans to go into the wine business, but he said the program was an invaluable experience. “The project definitely gave me a much deeper understanding of the business side of the wine industry. It was a great enhancement to the classroom component of my education.”

Miller said he wants to stay involved with the project indefinitely, adding that he enjoyed working with the students because of their enthusiasm. He said he was impressed with the patience and tenacity of the first groups of students who envisioned the project and jumped through the many hoops of university bureaucracy to make it a reality. “They pushed forward and pushed forward and got the thing out,” he said. “This first group of students definitely had it a little tougher than future students.”

Ray Johnson, director of the Wine Business Institute, said it was a challenge to ensure everything conformed with university regulations, which required work from “all the way up the entire system” to the chancellor’s office. “It’s awesome to see the power of collaboration,” he said.

Building the program
He said the wine project will be a two-semester class for four to six students in the wine MBA program. During the fall term, students will see vineyard operations and crush; then they’ll work on marketing and a release party in the spring. “We want to build it prudently, step by step,” he said. “I want to build toward what is executable at each stage.”

Currently that means lining up pre-orders to ensure each vintage is a commercial success. All the money generated by the wine label will go back into the institute. In the future, Johnson said the idea is to possibly expand the business model to make labels for other universities.

Sonoma State could contract with a school in another part of the country to craft a private-label wine that they could then sell to alumni. “We see that done in the wine industry today, so is there a way we could replicate it ourselves?”

Abigail Smyth, Kendal Georgeson, Liza Goldstein and Leah McNally conceived the idea of a Sonoma State wine brand. Smyth said the group saw an opportunity to build more awareness and support for the wine business program as well as keep alumni connected to the school. “As very early students in the wine business MBA program we witnessed the generosity of involved, far-sighted, local donors,” Smyth said. “The potential for greater support from the wine industry and alumni who have benefited from the opportunities it provides is vast.”

Smyth is now the international sales and marketing manager for Kenwood Vineyards and Korbel Brandy and said she uses the “project management, teamwork, patience and flexibility” skills she learned from helping start Sonoma State Cellars every day.

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