Leaving the powerhouse of Diageo for a small start-up took courage, but Jeff Kozak, CEO of whiskey brand Whistlepig, has made a real success of things.
For rye whiskey aficionados, Whistlepig is one of the leading names in the business. Though the brand is still relatively small in the grand scheme of things – shifting more than 100,000 cases in 2020 – it is making big waves in the industry.
At the helm is CEO Jeff Kozak, who has held an eclectic mix of roles in the beverage sector. “I actually got into the whiskey business backwards,” he explains. Having grown up in Canada, Kozak started his professional career as a commodities trader selling wheat, rye and corn to millers and bakers, as well as various food companies. One of the firms on his roster was the world’s leading spirits producer, Diageo.
“I would sell their grain for Crown Royal because they had their distillery up in Canada, then eventually I started selling rye to other distilleries throughout the US. So I’d go see Jack [Daniel’s], and go see Jim Beam, and I kind of just fell in love with that because it was so much more exciting to go visit a distillery than to go visit a miller that was making bread or Cheerios or oats.”
LUCKIEST KID IN THE WORLD
Kozak successfully convinced Beam (now Beam Suntory) to hire him in‐house and save the brand money, “so that’s how my first job [in the industry] basically came about, working for Beam and securing all their grain requirements for their distillery up in Canada. I thought I was the luckiest kid in the world; I moved from the relatively dusty world of trading grain to working at a distillery.”
Kozak was shown the complete inner workings of the company, he says, from distilling to sales. “Eventually I got to manage all of their inventory – all their whisky, Tequila and rum inventory – like it was a commodity. Anything we couldn’t use for our own bottling requirements, I would end up selling to third parties all around the world.”
His work took him to South Africa, France and South America to sell producers their Canadian whisky requirements. “At that time, there was a lot of Tequila that was going to Germany, so I got to meet all these independent players, and that gave me exposure to a lot of smaller companies and a lot of entrepreneurs. At the same time craft whisky was starting to happen,” he recalls. Those without distilleries were turning to the likes of Beam and Diageo for their whiskey supplies, one of which ended up being Whistlepig.
“I would sell them rye whiskey every year, and they kept on buying more, and I realised that they were basically assembling this huge stockpile of rye whiskey,” Kozak says. “Eventually one of the founders convinced me that I should leave this big, large company, Diageo – I was working for them in Chicago – and move to this little town called Shoreham, Vermont, and start working at Whistlepig.”
So seven years ago, Kozak made the switch from the world’s biggest spirits firm to “probably one of the smallest”. “It was empowering, but it was also scary,” he remembers.
Whistlepig’s home is a 500‐acre farm, a world away from the powerhouse of Diageo Kozak had grown accustomed to. “I went from Diageo, which was running the largest bottling factory in America, to bottling on old wooden picnic tables. We had employed a lot of senior citizens or people who had been retired who were running this bottling line, which really meant you had six people sitting on a picnic table filling bottles of whiskey.”
The company employed around 15 people when Kozak joined – “a couple of people on the farm, four or five bottlers, then five sales people just in the major metropolitan markets”. Today, that workforce has grown to more than 100 people and the facilities have, of course, also been upgraded.
In 2015, Whistlepig moved into production for the first time after converting a 150‐year‐old dairy barn on its farm into a single‐estate distillery. The distillery grows and harvests its own crops, distils them in a copper pot still designed by the revered late master distiller Dave Pickerell, matures them in barrels made from trees grown on the site, and bottles them there – but no longer on picnic benches.
“We grow as much grain as we possibly can,” explains Kozak. “It could be rye, corn, wheat or barley – we rotate through that, then that allows us to produce a number of barrels a year.”
Generally, Whistlepig is able to produce between 1,500 to 2,000 barrels a year exclusively from grain that was grown on the farm. “We have this term that we call ‘triple terroir’ – our water, our wood and our grain,” he continues. “We also source within 100km of our farm any Vermont oak that we can find, and then we have that Vermont oak made into barrels by an independent stave company, so that’s how we put as much possible terroir into the whiskey we produce on the farm.”
Terroir is of huge importance to the company, and Kozak and his team are passionate about highlighting it in whiskey. “In the past it was always just viewed as a term that was obviously more synonymous with wine,” he says.
“But now, with people like us and other craft producers that are producing in smaller batches, and actually using local ingredients, terroir becomes something that is much more accessible. It’s also more evident, and we see it ourselves when we produce something from one year to the next, as growing conditions – even on the same farm – change.”
As the conversation turns to how a small‐scale distiller such as Whistlepig can weather the effects of climate change, which are becoming increasingly intrusive year on year, Kozak believes its size could be an advantage, allowing the company to swiftly adjust when needed. Rye is planted in autumn, he explains, becomes dormant then emerges in spring.
“We didn’t have snow until we were into January here; it was really interesting to see that the rye that had emerged was so strong,” he notes. “I don’t know what the effect will be in the spring, I’m assuming the harvest will be even earlier because it’s further along. You just have to be nimble because rye has never been a genetically modified crop, so there’s not much you could do; it really is dependent on what Mother Nature gives you.”
When it comes to maturation, Kozak says it will be interesting to see how global warming could affect the maturation of Whistlepig’s whiskey. However, there are no plans to control the temperature of the warehouses, Kozak plans to leave that to nature and the watchful eye of his team.
Because of the limitations that come with operating a small farm distillery, the majority of Whistlepig’s inventory comes from third‐party producers – and Kozak expects that will always be the case. “I think we’ll always have to have some percentage that’s sourced from other parties just because we’re distilling in a remote location, we’re not in a commercial environment, and that’s OK because there is a lot to be said about the art of blending. It is always a dance of what you do with your own production and what you do with other whiskey that you have to source, and I guess we’re OK with that.”
Whistlepig has one bottling facility in Vermont and another in New York that looks after some of the SKUs that are “a little bigger in volume”. In terms of annual production capacity, besides the barrels produced at the distillery itself, the rest is dependent on sales and demand. Kozak draws parallels between Whistlepig and Scotch whisky, as some of the brand’s bottlings are 18 years old.
“We’re looking at what the demand is for that, and trying to match up what we can produce in‐house and what else we can source from other parties,” he says.
In the American whiskey world, Whistlepig has been a leader in cask‐finishing experimentation, and has released a swathe of cask‐finished bottles over the years. In 2020, Whistlepig brought out a 17‐year‐old rye whiskey finished in Spanish oak and South American teak wood casks as the seventh expression in its Boss Hog series, the brand’s most premium offering. The previous year, Whistlepig released a 16‐year‐old rye finished in umeshu‐seasoned barrels, called The Boss Hog: The Samurai Scientist.
Other cask experimentations include Whistlepig Old World Rye, a 12‐year‐old rye whiskey finished in a mix of wine casks: Madeira, Sauternes and Port.
“American whiskey had never really used finishing casks, Whistlepig was definitely one of the first in the rye category to start pushing that envelope,” Kozak notes.
“The Old World in a sense is our playground. We can use casks that have never ever been conceived to be used in American whiskey, then there might be that one special cask that ends up being used in Boss Hog. I don’t see cask‐finishing slowing down, but I know there are a lot more people using and creating finishing whiskeys, so I’m also wondering what will be the next big trend? Again, you still have to stay ahead of what the consumer wants and still make whiskey that tastes great.”
Kozak believes American single malt whiskey is due its time in the spotlight as more American producers prove they can make single malt as well as the Scots. But dynamic ageing is piquing his interest. “I see a lot more people experimenting with temperature, pressure, and even just location, and seeing if that can impart different flavours. I think dynamic ageing might supplement finishing, or it could be something completely different.”
Cask experimentation will remain important for Whistlepig as the company grows – and international expansion plans will soon be put into motion. In December 2020, Moët Hennessy acquired a minority stake in Whistlepig for an undisclosed sum, specifically to help the rye whiskey brand grow internationally.
The US is currently Whistlepig’s biggest market, with the UK following as the brand’s largest international audience. For Kozak, Moët Hennessy will be able to provide the distribution muscle Whistlepig needs to break into new territories.
“With Moët Hennessy we’ll look to probably about five countries this year to start with,” Kozak explains. “We’ve always done relatively well in the UK, so we’re hopeful that they can extend their distribution to the UK, and then we’ll look to a couple of other test markets like Japan, and a couple of other European markets just to go slowly with them, build everything carefully in the best restaurants, best bars and cocktail accounts, over this next year.”
As the Covid‐19 pandemic continues to play out, shutting large portions of the on‐trade worldwide, Kozak knows there will still be considerable challenges ahead. Whistlepig has mostly been an on‐trade brand, as Kozak explains: “Up until the pandemic of 2020, we really hadn’t concentrated on retail. It was viewed as something we would get to in future years, so when the pandemic hit, it was a shock.
“Then we had to figure out how do we still get to those consumers that want a premium rye. So the shift to retail reaffirmed that there’s awareness and demand for the brand because we really didn’t lose step – that just showed the brand’s strength was there.”
Retailers “gladly” took Whistlepig on board – a significant feat for a brand that retails at around US$80 per bottle. Kozak estimates that this year “we’ll probably end up only doing 10% of our business” in the on‐trade. Like so many others, e‐commerce will play a defining role in the brand’s success in the coming 12 months.
“I hope we continue to not be complacent, and push ourselves to continue to interact with the consumer, whether they’re still stuck at home, or if they’re out in public and going back to bars and restaurants,” Kozak says.
“We have to see what happens in the back half of the year and make sure we’re nimble. What we’re doing internationally is part of building this into a global brand, and in some years it’ll be more profitable and in other years it’ll be less profitable, but we’re in this for the long haul and that’s the view we have to take.” If all goes to plan, world domination awaits.