WEEKLY BRIEFING:
Large Wine Collection Finds Cool Reception
George Fansmith, 39, was born in Pittsburgh and went to school in Washington, D.C., before starting a career in banking. The dot-com boom lured him to Los Angeles, where he helped run several start-ups before the crash. Tech was in the cellar, so Fansmith decided to make it his home. His father, who had also been on the West Coast, returned East and left a cellar full of Duckhorn Merlot (3-liter bottle, 1999 vintage: $224) in Glendale. Fansmith tried it, liked it and came up with his next venture: wine storage. He now has facilities in Playa del Rey and Marina del Rey.
“Wine storage sounds very straightforward and boring, but trying to figure out the construction, the weight you’re storing liquid in glass and figure out the cooling requirements, was challenging. We started our legwork in spring 2001 and we were ready for our first customers by winter of 2002.
“We offer 24-hour access. That’s what really took us the longest time to figure out how to safely provide that kind of access. My wife, Carla, who’s a partner, spent 12 years in the electronics security industry. Her expertise allowed us to design a system that would do this. But that’s what took us a year.
“I started the first facility with a friend, but I bought him out. It was self-financed. It cost about $50,000 for the refrigeration, shelves and everything else. We have 220 lockers, and each holds 12 cases, or 144 bottles of wine for a total capacity of 31,680 bottles.
“For the second facility, I brought in a partner, a customer at the first facility. He’s a venture capitalist. We have 300 lockers, and 11 rooms, and the rooms can hold 200 cases each. So the total capacity there is 350,000 bottles.
“We have between 100 and 200 clients. Our average customer stores 36 cases about 400 bottles. The charge depends on the amount of storage. It’s $19 for a single case for a year, up to $3,500 for a room. I would say right now that we have about 75,000 bottles.
“We got our first customers by word of mouth through fellow collectors. To this day, that’s how the majority of our marketing works.
“We have zero employees. The facilities run on their own. We figured, worst-case scenario, I’d have really expensive space for my collection. It took off. Now we’re looking for space in Washington, D.C., we’re looking at Boston, San Diego and San Francisco. We haven’t decided whether we’re going to franchise or wholly own.
“The location is extremely important to us. We’re very different from your standard wine storage. We’re not in your typical light industrial area. We’ve chosen locations where people will have a reason to be other than making a special trip to their wine locker.
“For wine storage, there was nothing around here. I store about 60 cases. That’s the benefit of ownership: I don’t charge myself.”
Steve Silkin
