IkaVina Wine and Spirits, LLC: The Investment

The Goal: $300,000

We are looking to start this by raising 300K in the form of investments of $1000 from 300 individuals; this is not to say that you couldn't invest more than that because we'd love that too. We're not crowdsourcing; we're an LLC and we're actual selling ownership/membership units with the stipulation that we can purchase them back from you in no more than fifteen months at a interest rate of 22%.

Can you start a wine label for 300K?

The answer my friends is yes; you can actually start a label for much less than that but that doesn't mean that the wine itself will be good. You could start a vanity label and only produce so many cases, but what good is that if people like and want more? And on the flip side if you raise millions, and then produce so many bottles and can't get it sold, then you're losing additional money on warehousing and the voluminous staff that you hired for your grand idea.

Wouldn't it be easier to just raise the money from a smaller group of investors?

The answer is both yes and no. If I lived someplace where we had more seasoned as well as wildcat investors the answer might be yes, but one of the biggest problems in the wine game is that people with a lot of money get into it for the prestige and really don't know what they're doing, thus the statement "the way to make a small fortune in the wine game is to start with a big fortune." Of course, that normally is from the stance of being a grower and producer, versus just being a label owner. Additionally, investors that usually put up a larger amount are more interested in the returns on their money, whether it means selling the company to another entity or taking over and replacing the staff, the focus and even the products.

However, like anything sometimes it's easier to obtain financing after you have already raised so much or you have already started to show progress. At other times, it's like the conundrum in an interview in which they tell you that you need to have experience to get the job, but you can only gain experience by doing the job. Life is tragically comical like that sometimes.

The Amount

I find it more plausible that I can get 300 people each willing to invest $1000 dollars towards seeing this done. One person tasted just a little bit of one of my dessert wines and immediately said that she was interested in investing 2K! I just sent her the paperwork the other day.

The amount calculated comes from two figures, the first is that which is the cost of the wine, including labeling and transport. This figure totals just under 150K and covers two forty foot containers; one consisting on wine from Italy, and the other of wines from Portugal. All told, that would come to around 24,000 bottles of wine. This price also reflects a rate of 1.16 dollars to the Euro. The remainder of the amount are the costs associated with initial marketing and sales costs, including printing, promotional tastings (you actually have to purchase the product from the establishment), warehousing, travel and lodging.

I figure that I am not asking too much and I am not asking too little either. $1000 means a lot of things to a lot of different people, and in the end I find it a respectable number. Would having 300 additional owners in the company be a bother? Well, you can easily have 5,000 Facebook friends so it doesn't seem to be an issue, and I can probably gain more from those people in suggestions, tips for where to sell, and who knows what else. Maybe we can also trade drink and food recipes; I make a mean ceviche!

What percentage stake of the company does the total investment represent?

This total amount raised will represent a 10% ownership of/in the company.

How Can I Invest?

You can email me at invest@ikavina.com and I can send you the basic overview and investment agreement. I didn't go with the crowdfunding way because I really don't see it working as a viable solution for African American entrepreneurs, plus the nature of what I am doing is different. If I were a winery, brewery or distillery, it would be easier, and the thing is that I can't send wine through the mail without a lot of paperwork, permits and costs.

The Return: What You Get Back

Besides the basic return of 22% within fifteen months, you will always have first dibs and rights of refusal to get involved with anything that we are doing. You will always be able to reach out, call or email and talk to me. You will also receive a total of wine equaling three cases within the first six months of operation (but realize that you will have to pick it up from the office). Lastly, you will receive annual admission to a Founder's Day event featuring our wines and free food.

Insurance: What if Something Happens to Zach?

Well, there are two things that I need to find, the first is a Chief Financial Officer and the second is a Number Two. I could probably use someone like Denzel Washington's character in Crimson Tide

The company will have a life insurance policy on me at least to the tune of one million dollars so in the event that something happens to me, the company gets paid and you get your money back plus your return on investment.