August Sebastiani on Gen Z, Wine Innovation & 100 Years of Sonoma Legacy

If you have spent any time at all in the wine trade...even if you have just visited the wine section of your favorite market; you know, have seen and recognize the name Sebastiani. They are one of the original Sonoma county wine families and August is the 4th generation. He makes an interesting point that traditionally in the Italian culture, the firstborn son that gets the name of the founding family member, in this case, it was the 4th generation son.

But don't let the family history fool you into thinking this is old school, archaic thinking wine approach; nothing could be further from the truth.

Few winery names are as steeped in Sonoma lore as Sebastiani, but August Sebastiani himself is as approachable as a bottle of his family’s famed Zinfandel. Tune into this episode and you’ll discover why. You’ll be privy to a firsthand account of American winemaking’s intersection with immigration, family legacy, and relentless innovation, as August peels back the layers of his family’s journey from Tuscan stone mason beginnings to California wine empire. You’ll hear how his great-grandfather started with nothing but a trowel and a dream, made his fortune in rocks after San Francisco’s great earthquake, and how the generations that followed grew that spirit into an industry force—pivoting from stones to grapes, from bulk to premium, and always with a nod to their roots. August shares candid stories of sibling rivalry among winemaking families, the hard lessons learned from Prohibition, and the offbeat path that nearly led him away from wine. Whether wrangling city council duties in between harvests or tending to the next generation of wine drinkers, August reveals how both tradition and restless creativity fuel Three Badge Beverage Corporation’s quest for relevance in a marketplace that’s constantly shifting underfoot. You’ll learn why packaging matters as much as what’s in the bottle, what innovation actually looks like for a multigenerational wine business, and why sometimes, the key to success is simply listening—whether it’s to a bartender’s take on what’s trending or a customer’s unvarnished truth. Walk away from this episode with intimate knowledge of how the Sebastiani family has continually reinvented itself, how legacy and bold experimentation coexist, and why August believes you sometimes have to run to the front of the parade and pretend you’ve been leading it all along.

 

1. Three Badge Beverage Corporation (Three Badge)

   • Website: https://threebadge.com

2. Sebastiani Vineyards

   • Website: https://www.sebastiani.com

3. Don Sebastiani & Sons

   • Website: https://donsebastianiandsons.com

4. Wine of the Month Club

   • Website: https://www.wineofthemonthclub.com

5. B.R. Cohn Winery

   • Website: https://www.brcohn.com

6. Constellation Brands

   • Website: https://www.cbrands.com

7. Gallo (E. & J. Gallo Winery)

   • Website: https://www.gallo.com

Episode Transcript

(00:00):
We've had such a great run the last five or six years of
pushing towards premium, pushing towards premium. And now you go out
to, go out to a bar. It's not uncommon to spend $25 on a cocktail.
If you're a starving student, you can't spend $25 on a margarita. That just
doesn't work. Sit back and grab a glass. It's
Wine Talks with Paul K.

(00:22):
Hey, welcome to Wine Talks with Paul Kay. And we are at an away game
today up in the Sonoma Valley about to have a conversation with August
Sebastiani. Hey, this is Paul K. The guy who tasted 100,000
wines in his career and sold 17 million bottles. And you're going to hear that
all the time now because that's how we set the stage for what we're about
to do. But not while we're here. We're here to talk to August. You go

(00:43):
back August or August? August just like the month. August just like the month. But
yeah, your. Wait a minute, that was your, your, your grand great, great, great
grandfather. My grandfather. My grandfather was born August 1st
and that's where he ended up with the name. Oh, that's true. I was born
in April. So yeah, that's a. God bless him.
He actually pre deceased me. He passed away in February of

(01:03):
1980 and I was born the following April. Oh, wow.
Never met him. And what's funny is the old Italian thing, the, the first
born male grandchild is named after. Nono is named after
the grandfather. Right. And for whatever reason they saved it until I think I was
the ninth born of the grandchildren. Wow, that's interesting. And
it was a very Italian thing to do. Right. And I think the timing was

(01:26):
just right. And I tell you what, he's left awful big shoes for me to
fill. But God bless him. Walk into this place and you seems like you're
doing a pretty good job, but we're trying. Is he, was he the, was he
the immigrant that came to America? It was his dad, my great grandfather, Samuel.
Samuel Sebastian. Yes. And so he came from a town in southern
Tuscany called Farnetta. And of all things, I mean it was,

(01:48):
it's the American dream. He came here with nothing. He was a stone mason when
he got here and he was farming rocks out of
the shocking hill, rather just north of Sonoma
Plaza. And the story goes, in 1906,
after the earthquake in San Francisco, a lot of people talk about, you know,
shaking and damage that came from the shaking. It was actually the fires that

(02:09):
ensued in the wake of the 1910 oh, six earthquake
that really decimated San Francisco. And he did very well
for himself, selling stones, repaving San Francisco. But as a fireman
maybe, right? No, no, no, no. But then he bought a little piece of dirt
and a bigger piece of dirt and a bigger piece of dirt. And my grandfather
passed away in the 40s. My great grandfather passed away in the 40s. He had

(02:31):
a very diverse enterprise. I mean, there was, you know, the theater
here in town. There was the winery, obviously, and
a number of other, you know, a lot of real estate and other endeavors.
And it was my. My grandfather, namesake, August, who was really the green
thumb who really focused everything on wine, grape production.
It's interesting, though, because, you know, the immigration here. And I actually started a new

(02:53):
podcast I haven't launched yet, but I've got some in the can, which is called
Song of America. Cool. So we're going to have this conversation again, maybe a different
angle. I love it. Which is about success in America, coming here for
that dream. And now that immigration is such an important topic, we need
to tell some of these great stories. But, you know, you wonder, his
generation. My grandfather came in 20 something from Turkey,

(03:16):
where that drive comes from. Is it because we're leaving
someplace that was difficult and strifeful, or is it because we got to a
place that was free and we could express ourselves? Right. And I'll bet
that answering that is painting with a very broad brush. I think
everybody has a different story. And I think the answer, as with so many other
things, is just a little bit of everything. Yeah, it was bad at home. Right.

(03:38):
And there was opportunity here, and it was just kind of the perfect storm. And.
And I tell you what's unique about our story is I've got
all four. Well, maybe not grandparents, but
both of my parents are children of immigrants. And my. My. We get a lot
of street cred for the story on my dad's side of the family, but we're
much closer to the old world on mom's side of the family. Really? Wow. And

(04:00):
where was she? Where was her family? So my mom's parents actually met in San
Francisco, but spoke very broken English as immigrants
themselves and both Italian. My. My
mom's mom, Nona Albina, actually came from just.
Just outside of Genoa, a little bit north of Genoa. Okay. And my
mom's dad, Guido. Nono Guido, he

(04:22):
actually trouble got in Guido, he came from just
outside of Florence, actually. Luca. Specifically Luca. Yeah,
suburb of Luca. So the stone. But stone work was a
pretty important trade that the Italians brought to
America. For Sure it was. I don't know if it was Italians at large or
just happened to be my great grandfather and. And what. What he found

(04:44):
when he got here. But you'll notice if you work your way around Sonoma, there's
quite a bit of it. If you go over to the old family ranch, Sebastiani
Viney, there's a lot of stonework there. We did a little homage to him in
front of our office here at 3 Badge. We've got a few stone walls, just
kind of tip the cap to the history and the story. That's great. But, yeah,
it's certainly a big part of my family story and. And what we're all about.
Well, they had quite an enclave of Italians that came from, I think, the

(05:08):
Lombardi district or the north side. Sure.
What's the name? I have a piece of furniture at home. It's a beautiful coffee
bar from the north, Gambaro. Gambaro.
Anyway, so you already said
that the Green Thumb came from your grandfather. Yeah. Was this something that
he was interested in prior to, or. I mean, this is. You're talking about what

(05:31):
year? The forties. This was the. So when my great grandfather passed away, I
believe it was 44, he passed away. My grandfather
and grandmother, his wife, Sylvia August and Sylvia purchased the
winery and a number of other assets from his estate. And I think
it ended up just kind of being the perfect storm. I mean, again, a little
bit of everything in terms of timing and. What do they say luck is the

(05:52):
intersection of timing and opportunity. That's right. And
when. When things were clipping, when he was getting started, he would harvest a
bunch of wine grapes. The train tracks came all the way into Sonoma. We've got
bike paths that go from, you know, east to west through town
that used to connect to the train that would go to St. Louis or Chicago
or Boston. Right. And he would ship wine grapes, and sometimes they would say

(06:15):
it was from Sebastiani, sometime they would say it was from California, or sometimes it
wouldn't say anything because you didn't have the oversight. Right. Certainly, that we do now
in terms of TTB and ABC regulation. So
it was really a big trade, actually. I think selling grapes to the east coast
was a huge trade. For sure. Yeah, for sure. And you go back far enough.
I mean, my. My great grandfather was able to get one of,

(06:36):
I think, seven wine production licenses from the state of
California through Prohibition. And that was, you know, obviously a very big deal
to be able to. To keep on. On humming. Through Prohibition. Yeah.
For, you know, sacramental Clerical and medicinal use, as they would
say. So, but like I said, my grandfather, you
know, it was. It was at the time and, you know, 15,

(06:59):
20 years hence, that was when,
you know, Chateau Montelena and all the, you know, the world was discovering
Napa and Sonoma and with Gallows and Mondavis and
Krugs and Sebastianis and many, many others
kind of rode the wave. You know, we like to talk about here at Three
Badge a lot. We talk about a rising tide lifting all

(07:21):
boats. You know, that sounds kind of like. That, though, because
when my dad sold me the company in 1988, which is the Wine
of the Month Club, the original Wine of the Month Club, we. He had done
some research as to what was going on in the direct consumer world, and
we could only find, like, four or five wineries at the time. And I don't
remember if Sebastian was on the list or not, but it was those groups. It

(07:41):
was, you know, it was. It wasn't even Monte. It was
Mondavi and Inglenook and those original
group of people that had started sort of doing this at the same time.
But so was there. Was there a rising tide? Was there that
camaraderie amongst immigrants at this point? Absolutely.
That we're just going to help each other and support each other a little bit.

(08:02):
There was, you know, friendly rivalry, almost like a sibling rivalry situation where,
you know, I. I wouldn't consider him a friend, but I knew him a little
bit. And that was Bruce cone over at BR Cone. That's
right. The general man or the manager of the Doobie Brothers. Yeah, he used to
tell stories about my grandfather and the Gallo brothers getting into
bidding wars for, you know, whatever fruit he had.

(08:24):
And, you know, he used to really enjoy kind of playing them off each other
and obviously doing what he could to drive the price up as they're trying to
drive it down. But there's. There's a lot of that. So that's
amazing stories, right? Are those documented somewhere? That's a good point. I
think mostly anecdotal at this, really. Like your history, for
instance, was. Did anybody sit down with your grandfather, your great grandfather, and say, hey,

(08:45):
let's talk about this? There's no. Nothing formally. You know, there's.
There's stories and there's documents. You can. You can unearth them. And frankly, my.
My aunt. My aunt Marianne Cunio, she's. She's a little bit kind of the
family docent in that regard. She's got a couple of barns,
slash warehouses that have some old documents and Some old.
Some old paperwork, but mostly old, you know, the bar from the old

(09:07):
tasting room, stuff like that. That's. That's really cool. I love that. Great
to know that it's still around. And were you. Were you de
facto gonna be in this trade, or did you think
maybe. Oh, are you kidding me? I was going to play second base for the
San Francisco Giants. Really? That was what took up my spot.
My inability to hit a curveball ended my career. That was probably around, you

(09:28):
know, 12, 13 years old. I. I hung ultimately. But, you
know, when I was a kid, I did a bunch of stuff. I did a
lot of theater as a kid. I was quite the thespian through high school.
I went to college at Santa Clara University and studied political science,
of all things. I. I would say that probably at, you know, my daughter's
age, my oldest is in college now, and we're starting to have conversations about where

(09:49):
she sees herself down the road and in that time of life.
I. I think a political. Political career was. Was something
that I was. I wouldn't say pursuing, but. But loosely
interested in. Yeah. Enough to go to college and study it and figure it out.
And it wasn't like you were going to be part of the wine trade, which
is very interesting because there's a lot of siblings, a lot of

(10:12):
offspring of the founders of these places that
didn't think that that was going to happen, that we were even from Europe a
lot. Many, many. Like Clovis Tanger, you know, the French champagne guy. He
was. I'm not doing this right. I'm going to be a businessman. There were more
than a few conversations I can remember, actually quite vividly in my early
20s, in which I take my dad out to lunch or dinner,

(10:35):
and I told him, like, I feel like I'm being pigeonholed into this thing. And
I'm not sure that that's what I want to do. He was always great about
it, and I think some of it is just. He's just a good dad then
after the batting cage. Right, Right. But, you know, just
parenting. And I've come to. Come to learn. I mean, you can't really tell them
where to go. Right. You give them the scaffolding and let them kind of build
their own future. Right. So he was smart enough

(10:58):
to kind of let me spread my wings. And I dabbled in politics. When I
got out of school, really, it was never a career choice. It
was never paying the bills, because, frankly, I got out of school, I came
right into the wine business.
Exactly right. Trying to find a job. So that's when it happened. Yeah, after
college. That's exactly right out of it. I got out of school in

(11:20):
22,002. I took the summer off
and then August 15, August 20, I got right into
it and haven't really looked back. When did,
and what was the organization then? Just Sebastiani Vineyards? No, we
were actually, my dad's branch of the family tree was out of
Sebastiani. So let's back up. My, my

(11:41):
grandfather, he passed away in 1980 as I mentioned, just
before I was born. That was when my Uncle Sam was, was
kind of running Sebastiani Vineyards at the time. And he ran it for
another half decade, maybe half dozen years. And my dad
took over in 85. My dad ran
Sebastiani from 85 till roughly 2001.

(12:03):
And during that time they built a winery down in
Loi and, and built a number of really
impressive volume everyday low
retail brands. Grocery store, 1.5 liters was really the
driver. And then sold those brands and the Lodi facility
to Constellation. Well, there you go. Now we're trying to start big business

(12:26):
now. Right, exactly right. And so my dad took his
proceeds from that and you know, started the Don Sebastiani and
Sons program, which was my dad, my brother, myself, my
sister, it's you know, Don and Sons and Daughter. My sister was,
was a kid, she was in her early teens at that time, but she was
still, you know, an equity part that point. And he had to put it in

(12:48):
a trust in order to make sure that everything was above board with the, you
know, the underage and the whole thing. But obviously now we've all come of
age and, and we're all involved in a number of different entities.
But to answer your question, when I got, when I got out of school I
went to Don Sebastiani and Sons and, and I wouldn't say I cut my teeth
there, but kind of got situated there. So Sebastian.

(13:09):
So if your dad was running Sebastiani property. Yeah.
You must, you must have known Richard Zeller. Richard
Zeller is the chief executive officer of Three Badge
Beverage Corporation. Come on. I speak daily. He's a very
much water bottle, that guy. I can probably guess.
I can. He's a, you know, came up the sales world. He was a southern

(13:31):
wines and spirit. He's been with my family now, gosh, 40 years.
Forever. 40 years, yeah. Because I started in 88 and I think I bought from
like in 91 or something. Right. He is a very, very dear friend
and colleague. You're around by today by chance? No, he's he lives
in la, so he commutes up here maybe two
weeks a month he's up here in Sonoma. Another week he's traveling elsewhere,

(13:52):
and then another week he's in la. I knew when he showed up I was
going to be buying something. Right? That's exactly right. He's fantastic.
I bought three slugs that I remember. And
I'm talking four or five hundred cases each. One was. Maybe
it was your daughter or maybe it was your. Maybe it was
your sister. But somebody had drawn on a Mac, like an old

(14:14):
Mac, some characters, and then they made a label out of it.
Yes. And it was a Cabernet Franck and I think a Merlot. That was my
sister Amelia. Oh, yes. And it was. She actually drew on the whiteboard
in my Dad's office in 1980. She was born
in 87, so it might have been 91 or 2, something like that. Exactly right.
And they made a wine, called it Amelia. They took the scribbling of the

(14:35):
whiteboard and put it on a label and. There were two or three
varietals and I bought them both. They're great wines.
Sure. But I don't, I think final analysis was.
He said, we found it in the warehouse and we weren't sure what to do
with it. And it came to me. And then I bought a sparkler from you
guys. Okay, sure. I don't remember which. Who made a bunch of different
wines. I mean, there was a, you know, they did my, my, my Uncle Richard

(14:58):
Cuneo. They did a Richard A. Cuneo sparkling wine, Sebastian.
And they did a bunch of stuff. I mean, they were importing, they were, you
know, my dad was importing white Armagnac back in the early years.
Yep. And he was, dude, he was importing. I think they
imported Chinese beer at one point. I mean, it was, you know, hey, let's go
sell some stuff. Let's figure out what's going on, you know, and so I, I

(15:20):
think a little bit of that is a creative spirit that we really pride ourselves
on here. Sure. Well, you know, let's turn over some rocks and see what, what
opportunities like. Yeah, right, right. That's just. Well, that's what we need in this
industry probably today. So being in this industry for so
long and, and, and what's interesting for me is that this was an
established thing. Your father ran this very well known group. It's a

(15:42):
very well known family. Don Sebastian as well. That whole brand is very
well known. We're going through some interesting times.
I'm guessing that you've seen a lot of different
market issues with the wine business over the years. Sure.
I mean, we know that there's some people that are drinking the Gen Z. I'm
not going to get all those details. But you know, there are issues today. Right.

(16:04):
That we're trying to solve or trying to understand now that we've solved them. I
think they're generational. Sure. But I land on the idea
that it really is just a generational thing. It's just going
to ebb and flow as it always has. It's been around forever. That's, that's what
it is. And I think at our core competency at Three Badge,
we consider ourselves innovators. And the fact that we

(16:25):
do everything that we do, including wine and spirits
and we've dabbled in beer a little bit and we've looked at other things
and continue to. That is the fact that we're
able to do that as, as nimbly as we are without having to appeal to
Wall street, without having to kind of run it up the corporate flagpole. We do
a lot of things on horseback and we make mistakes.

(16:49):
But every once in a while you reel in a big fish and, and that,
that comes with intimate conversations. You sit down and my dad
excels at this, really. He grabs a New York Times and he takes it to
a restaurant and he sits at the bar for lunch, strikes up a conversation with
the bartender. What are people buying? What price points are working? What's the
hot cocktail? What's the hot by the glass? And that becomes

(17:11):
our kind of field work and you know, our focus group,
as it were. And we say, hey, let's throw some spaghetti against the wall and
see if it's going to stick. I think that's kind of where it has to
be. And that's brilliant. That's just getting your ear to the
ground and figuring out what's going on. Because I don't think here's what, here's what
I see all the time. And I read all this stuff I was

(17:32):
reading last week a bunch of Les Avi devant magazines from the 70s
to see what the conversations were like then. Sure. And what they were
talking about. And they're not usually industry related. Usually it's about wine.
But it seems to me that as we go through
these things, you've, you've got to have your ear with the
people. The metrics and the social metrics and the

(17:54):
roas and all the things that they throw at you for marketing
are really just sort of temperature gauges. They don't really tell you what to
do. Sure. Right. And the thing, the thing that's tricky about wine and spirits in
particular is the game of telephone. That comes from the three tier
system. As you sit down with your distributor partners and they're doing a great
job, but by the time even the message gets from

(18:16):
the retailer to the wholesaler to the supplier, the
moment maybe it's come and gone. That was a great analysis or a
great analogy. Well, thank you. The. The game of telephone
through the three tier system. Yes, because that's what it is. And as marketers it,
we find some challenges there going both ways, whether
it's our message to our ultimate consumer or their message to us.

(18:38):
You know, I subscribe firmly to the marketing school of thought
that your brand isn't always what you say it is, it's what
your consumer says it is. Right. You may not even know what it is.
We used to talk a lot about. I forgot what the heck car it was
and I'm going to mess this up. There was a car that was marketed
when I was first getting into the industry and it was a, it was a

(19:01):
Honda, like a crossover. It was a small,
like, I remember it wasn't a minivan because it was smaller than that.
But it was marketed towards like ex
athletes and surfers and you know,
skateboarders and snowboarders. You can hose the thing down if you get sand in the
car or snow in the car, whatever it is. And the people who ended up

(19:23):
buying it were soccer moms for the same reason, because it was small, it had
great gas mileage, blah, blah, blah, blah. And even, you know, these so funny,
these brilliant marketers had, you know, a wonderful plan.
And when the rubber meets the road, you really don't know what's going to happen.
And sometimes you just got to lean into it and own it like you were
there. We talk about a lot, you know, sometimes it's the art

(19:43):
of running to the front of the parade and pretending like you've been there the
whole damn time. Right. Exactly. Right.
That's interesting thought too, because Internet and Facebook and
Instagram and LinkedIn have created all these marketeers
and brand people and we're going to make a brand that's going to work. And
it's like, you know, if you knew the answer to that question, like, how do

(20:04):
you build a brand? If there was a formula, right. You know, we'd all be
brilliant. But we know we never know what's going to. After all the
analysis and all the metrics and all the Things you never still.
I mean, I won't say half, but you know, a handful of our brands come
from a production opportunity that landed in our lap. A number.
Another piece of our portfolio comes from marketing opportunities

(20:27):
that arise. And another one is just like, hey, these are fun projects. I want
to do that. Let's go see if there's an opportunity. Right. So it's
a recurring theme sometimes you just go to. It's a
factor of a little bit of everything that seems to work. Three Badge started
a when and why. So three Badge hasn't always been called
Three Badge. Three Badge started in

(20:50):
gosh. I guess if you go back, it's probably kind of the idea of 3
badge was 0506. So start to the young. I decided I
wanted to be a wholesaler. Oh, that was brilliant. And so we actually had
a portfolio of dawn and Sons brands that we
developed for kind of a direct to consumer tier group, direct to
retail tier. We actually brought in some third party brands as

(21:12):
well. And what we found through that experience was the brands had
traction, but we didn't have full trucks. We didn't have Jack
Daniels or Corona. And so it wasn't as
profitable as an entity. And frankly, what a lifelong lesson for me to
learn, you know, the, to walk a mile in our wholesaler's shoes and
appreciate all they do for us. And so we. But the brands

(21:34):
had traction and we were getting reorders. And so we took the brands that
worked and we pivoted to a 50 state model. We
were just in Northern California. We have. The truck is still here. We were driving
to Tahoe and Monterey and you know, up to the Oregon
border. And when we pivoted,
we started rolling out to 50 states. And we were actually, at the time we

(21:57):
were called the Other Guys. That was the name brand. The Other Guy.
That wasn't the name of the brand. That was the name of the umbrella company.
The Other Guys. I like that. Right. It was call the Other Guys. It was
painfully generic though. It was such, you know, we called it tog and the
whole thing. And we became three Badge when we bought the building
in which we are presently seated, which is cool. We bought an old firehouse from

(22:18):
the Phidias and Elma. So, you know, we're kind of getting ahead of ourselves a
little bit. In 05, when we started the Other Guys, I also
chose to throw my hat in the ring for a seat on the Sonoma City
Council. Oh, right. Very well said. And
I loved it. I was a kid. I was, you know, 25, 26 years
old and I won and I got elected to the Sonoma City Council. I served

(22:39):
a four year term. It was terrific. I wouldn't,
I wouldn't trade that experience for the world. I'm not in a hurry to go
back there. Riding the coattails of the great grandfather into the Sebastian
A. Into city council. Well, even more specifically, my old man was a
politician. My dad was. Oh, he was. So everybody knew that he served, he. Served
maybe three terms in the California State Assembly. So when I was a kid, as

(23:01):
I mentioned, my Uncle Sam ran Sebastiani Vineyards for the first half of the
1980s. My dad was commuting up to Sacramento as a state Assemblyman for
the 8th district, which was a weird one. It extended from
Sonoma kind of through Napa and up to Lake County.
Really, it was a very, very weird shaped district. I think they've, you know,
redrawn it more than a few times since. But, you know, the

(23:23):
apple doesn't fall too far from the tree. So I wrote, you know,
ran for city council, was elected, loved it. And then in 2010,
I thought, you know what, that's enough. My kids family was growing and
charity starts at home, right. So I had to make sure my kids were in
bed and that I was around and available for soccer games and
baseball games and volleyball games, whatever else. And

(23:45):
so, so I turned the page. Now fast forwarding five years from that
to 2015, or 14 rather, that's when the city
decided to sell the firehouse. The state of California was way
underwater at the time. And Jerry Brown
wanted his money back. He wanted his money and he told all of the cities

(24:05):
of California, and I'm sorry if I'm getting granular, they closed up
an agency called Redevelopment. I did well with those guys. There you go.
Successor agencies. Yes. And so the successor agency to the
Redevelopment Agency of Sonoma owned this building.
Fascinating process. They put it up for auction. It was
on, you know, June 1, I think, of 2014. They

(24:28):
wanted your highest and best final offer to buy the place.
I've subsequently learned I don't think our offer was the highest, but we
were the only offer that wanted to preserve the building and celebrate
its history. Everybody else wanted to scrape the lot, do three stories
with, you know, yeah, coffee shop and a, you know, Chase bank,
retail and whatever else. But we wanted to own the

(24:50):
history and we wanted to use the garage and use the office space
and. And through that process we came to learn that
my grandfather was a volunteer in the very building. Wow.
When he was a. How Cool. Is that kid really cool.
And. And so Sonoma's local newspaper, the Index Tribune,
has a very robust online archive. And you can search by

(25:12):
keyword, literally back to the 1850s,
and you can find articles and all sorts of stuff. We found an ad. Wow.
From 1945 that was
advocating for the passage of props one and two, that would have
raised $50,000, if you can believe it, to buy an
unspecified piece of dirt and build a state of the art

(25:36):
combo police and fire station. And also
eight grand baked into that for a fire engine as well. And the
ad says, this is a great business deal for the city of Sonoma. Our insurance
premiums are all going to come down. And at the bottom is a roll call
of Sonoma's volunteer firefighters. And it has all the city's
father's names there, including my grandfather. Wow. That's true. And so

(25:57):
I sent it out to my aunt, my uncle, my dad. I said, check this
out. You know, Nono Gus, we call him Nono Gus, was very involved in this
building. And. And my Aunt Marianne says, I've got his service badges.
Blew my mind. I called her right away. She said, you know, I'm not going
to give them to you. I said, I wouldn't dream of asking you for them,
but can I maybe borrow them for an afternoon and see if there's some branding

(26:17):
opportunity or we can have a look at it and take some pictures.
And, you know, sure. Sure enough, there were
three badges. One was an active badge that lived in his wallet
for 25 or 30 years. And his gnarly and petite
and gross and a retired badge, and then an honorary
badge they gave my grandmother when he passed away. Wow. And so those three

(26:39):
badges are kind of the tangible intersection of my family story,
our building story, and too good of a marketing
opportunity to pass up on. You know, I have to say this back of just
a second. My. I respect what you've done because my mother was a city
councilwoman, my hometown, and it took a couple of terms to figure it out.
And I just. I know how much time it takes. I also know how much

(27:01):
slack they cut me whenever I got pulled over. Which is kind of cool.
And I spent eight years on a planning commission in my hometown in Acadia now
and learned. And I did it because I wanted to learn that side of the
fence. How did they think? Sure. And that could have a lot to do with
how you won the successor agency property, because I had this
exact same story. I was the only guy that was preserving.

(27:22):
It was a grain mill I was a lumber mill I was going to turn
into a wine event. It was my warehouse. I packed the ship wine there, the
wine shop in there. It was right by the new train station, but it was
exactly the same. Everybody else wanted to knock it down, build apartments. Wow. And they
wanted to preserve this. You know, I think it was built in 58 or something.
Sure. And it came out really cool. That's great. Good for you. It was
really funny, though, because there was a big facade that faces the

(27:45):
210 freeway. Huge. They let me put Wine of the Month club on there.
But the painter had said, look, I'm going to paint the. I'm going to put
the primer on Friday afternoon, I'll come back, money and paint it.
And I'm going to mix the white primer with the
color that's coming on, which is this deep burgundy. Okay, well, that
came out, like hot pink. This is a true story.

(28:07):
And so he paints this big, giant stucco facade beacon. Makes it
easy to find completely. Two people came from the gas
station next door, and one person actually pull off the freeway and came into the
building and asked if the place was going to be a strip joint. Okay, how
about that? How about that? And I'm like, my friend, make more money
in the wine shop there. Right? No, but that's truly commendable

(28:29):
to serve your community like that. I appreciate that name. It was a lot of
work. And you know what? I tell you, to your point,
everyone who comes to show their appreciation has a caveat
about, oh, it's thankless work. I actually found it quite the contrary.
And I found everyone was very much appreciative of it. I was a fish out
of water. And I liken it to. As a, you know, a father of kids

(28:50):
who are learning how to drive a car, my first city council meeting felt
like my first time driving on the freeway. I'm sure, you know, it was holy,
goodness gracious, this is really something. And, you know, maybe
18 months into it, I finally got my footing because I didn't have
to do the deep dive on the staff report because I had lived it. Right.
That's right. When you were getting started, you really had to do a lot of

(29:11):
the research and go back to why they did this and why they did that.
And once you start. Start to be a part of the process, it becomes
a lot easier because you. You own it and you understand it. You're, you know,
breaking down your own precedent or the decisions you've already made. And it was. It
was a fun process. And like I said, I wouldn't trade it for the world.
If I was counseling a 25 year old a, I would say

(29:33):
absolutely, do this for sure 100 times out of 100 as a
45 year old guy, you never say never. But I'm not in a hurry to
go back because it was, it was a lot of work. It's a lot of
work if you do it right. And no control over your time.
Yes. Because you got to do a mayors and council members thing, you know, in
Sebastopol, or you got to go to Sacramento for a thing. And I

(29:53):
like being able to have a little bit more father schedule. It's probably different. But
you did, you did the right thing. I get it when the kids are out
of the house. And that's why there's a lot of, you know, 50 something, 60
somethings who do that because they got the time right. You know, they're not shuttling
to and from practice as I find myself doing quite a bit.
In fact, literally before you got here, I was on the phone with my wife
figuring out who's bringing my son to water polo practice in Napa. So that's,

(30:15):
that's more about my Friday afternoons. I get it again because I have
millennials daughters. They're 30, the oldest is 32 and the youngest is
29. So we're well advanced in that and I literally
ignore that. But my daughter did not lose her house in the
altitude of fire. She was displaced. She's living with us. So I have three grandkids
with us now. Seven, five and three. I was the little league coach

(30:38):
again. Good for you. And I loved it. That's fantastic. Except the beauty was
I didn't have to be there every time. Sure. I could go. Well, we went
to Bordeaux. I don't have to do that. Right. But when I was on the
field, I really loved it. Right. I really love it. So I get
it. So three badge now. Yeah. What, what is it
exactly? Now it's spirits. Wine. Spirits and wine.

(31:00):
Spirits and wine. We've talked about maybe getting back into beer. And we were,
you know, at the beginning of the craft. Not the beginning, but when craft beer
was really swelling. That's about 10, 15 years ago. We, we
had kind of messed around in that space. But I think that
moment kind of came and went. I think White Claw came in and, you know,
sucked up all that business with an eye roll. I get it. But it's got

(31:22):
a place. Obviously it's made some considerable headway. And if you look at
you know, kind of what ails the wine and spirits industry, that, that might not
be a small part of it. No, it's one of them. And it's, it's the
approachability and the ease of just cracking a can and you know,
whether it's that or ready to drink cocktail, we see some
traction there. And I don't want

(31:43):
to be silly. My 19 year old daughter is not yet of age, but she
is a college student and she has friends who are of age and the stories
that they bring back from school about what kids of that generation are
doing with their spare time as responsibly as I insist
that they do it. We're learning a
little bit about what kids are doing about raising kids. Yeah, right. Also that.

(32:05):
But as it pertains to our, you
know, innovative, you know, tendencies here at Three Badge, the lessons
we're learning there is that we have spent such
a, we've had such a great run the last, you know, five or six years
of pushing towards premium, pushing towards premium. And now
you go out to, go out to a bar, it's not uncommon to spend 25

(32:27):
on a cocktail. If you're a starving student, you can't spend 25
on a margarita. That just doesn't work. I think that's a big part of the
issue. That's a really good point. You know, actually I even thought that because it
is $25 for a freaking. Cocktail, especially in Malibu. Yeah,
yeah, exactly. Gotta drive all the way up to Pepperdine.
Right, but that's the Colony right there. Yep.

(32:49):
That's an interesting thought though because it is certainly the, the problems of the industry
and I don't want to harp on the problems but sales are
not great and the premium market. But then you talk to the
Bordelaise and you know, they're, they're dropping their
prices. Classified growth. I just got an email yesterday from a European importer. She's
like, yeah, all the second labels of Margaux, Lafitte,

(33:11):
Latour, they're all being, the prices are coming down. I think that's a problem.
Sure. The world's drowning in wine. That's it. That's too much wine.
So what, what wine brands then does three Badge carry now? So our,
our flagship brand is called Garricky and we have two
tiers of a Guerrike brand. We've got a wholesale tier that's a,
you know, dusty rose label that you'll find at, you know, your local retailer

(33:33):
that we, we sell on our website, but that goes through wholesalers to
retail through 50 states and beyond. And then we have
a tasting room only single vineyard offering
with a, you know, a handful of wines there that include actually a pet
nat, which is a lot of fun. A very popular offering for us. It's kind
of my go to. Sorry, tapping the microphone. It's.

(33:55):
It's kind of my go to a cocktail wine for. You're looking for a glass.
People get really excited when they see something new. Is that still, like, happening Pet
nats and natural? It's not a huge volume driver for us,
but it definitely raises eyebrows and gets people excited when they come to the
tasting room on a Friday afternoon. So is that. Is that where you
place innovation for three badges? In other words, the idea of

(34:17):
innovation in the wine trade would be to roll with the marketplace and
come up with things it has or change the experience of your
wine or change the packaging. Like today, I saw it in the little
market in Yonville. It's really kind of cool. It was a little.
Almost looked like a prescription bottle, you know, like the liquid bottle.
It was a crown cap, but it was a sparkler. And it was a different.

(34:39):
Different package altogether that I've seen. I don't think crown caps are great, but it
was probably 250ml kind of thing. Right. You know, it was. It was.
I thought it was professional. But is that what innovation feels like to you, or.
A little bit. A little bit. I mean, you know, in terms of sparklers specifically,
we had another. We have another brand called Guinigi, which is
named for a landmark in northern Italy that

(35:01):
is in the city of Luca. And so we actually
have a Prosecco, actually two Prosecco under the Guinigi
label. And so we found that some success there. And the conversation of, you
don't have to wait for a celebration to have bubbles, you
know, maybe Friday. Getting home from work on a Friday afternoon spent
$65. Right, exactly. Right. And so.

(35:24):
So some of it is the messaging. And, you know, sparkling is.
Is part of a little bit of, you know, off. Off of the beaten path.
It's a little bit of a different approach in terms of innovation. We look to,
you know, varietal expressions, we look to Appalachians, we look to
price points, we look to packaging opportunities
that. That look and feel a little bit different or

(35:47):
frankly that. That don't look and feel any different, but are
right where the consumer. Right where the fish are. We like to fish where the
fish are. Yeah. So one of our new innovative brands ain't
all that innovative, but as I've mentioned, Sometimes the push to premium
hurts. When you're looking at, you know, gen whomever, you're looking at
20 somethings who aren't as avid consumers

(36:10):
as we were at that age, and you say, let's find something that's approachable
and easy to pronounce and easy to drink and easy to find
that's not, you know, some style of wine
making that's, you know, bizarre or, you know, that's really
varietally correct. California, Ava.
And so that, that brand for us is called Subterra.

(36:33):
And we're, we've, we've actually launched some other offerings in the Subterra brand.
We're kind of repositioning it to celebrate as, as an everyday
California offering that might retail for 12 to 15 bucks. Yeah,
that's a tough market spot. It certainly is. You are congested.
And I took a picture of the day at Ralph's Market in South Cal. There
was a shelf talker on every single bottle in the damn shelf. And you're like,

(36:55):
how do you choose? Right? And, you know, we like to think that it's that
packaging, that really. Packaging, you know, that's the first impression. And obviously
the fruit and the juice has to deliver, but it's the packaging that
sells the first bottle and then what's in the bottle will sell the second and
the third and beyond. Right. You know, the founder of Barefoot, Mike
Houlihan, had come into my office in 1989

(37:17):
with this idea. And you probably don't know the whole story, I won't tell you,
but I called my dad. I go, dad, this guy thinks he's going to sell
wine. He's calling it the Lafitte F E T of California.
And I go, what a hyper. He's very hyper guy. He's really nice guy. And
I thought, what a stupid idea. And of course, one of the biggest brands in
America. That's how smart I am. But he

(37:37):
did say something. You remember Thrifty? The Thrifty drugstore line?
He was trying to sell them the wine and he took them the package and
the guy goes, look, I want to be able to see that label from
like 20ft away. If somebody's walking down the aisle
pushing the stroller, I want her to be able to see your label stand
out that far away. And that was sort of a Gallo, you

(37:59):
know, guerrilla marketing kind of concept, right? Sure. So you're, you're in
the trenches with this. Well, I tell you, that was a lesson that we learned
in some of it is again, timing and the timing now is very different than
the timing was then. But when I was first getting into the business, Don and
Son's big brand was Smoking Loon. And that was another brand
that you would, you know, you walked into Safeway on the right day and you

(38:20):
trip over 150, 200 case display. Yeah.
And obviously the magnitude of the display is going to get your attention. But
if you got even one facing that package, the contrast of
the red and the yellow. I remember hitting you in the head, you know, you
couldn't miss it. Was that Chef Pop, as we call it. Right. But
Don Sebastiani was more than that. Those things. Right. It was Smoking Loon was the

(38:43):
real driver. Well, because of the fighting varietal price range, but. Right.
But the. There are other brands that were. Oh, yeah. Pepperwood Grove was another.
I bought a ton of that. So good. Right? Yeah. I think it was your
first bottle. It was so good. The Pinot Noir. Pepperwood Grove. Actually, funny story. You
know, we talked about my mom' family a little bit. My mom's brother, my uncle
Roy Chetti and my dad partnered at Chetti

(39:05):
Sebastiani seller. Yes. Early
90s. There you go. And Pepperwood Grove was kind of their. Their anchor brand. They
also had a Chetti Sebastiani seller brand called CSC Ceccetti
Sebastiani Seller that was a lot more upmarket, kind of Napa
offering all negotian style
and led. By pimple with grill from Richard Zeller.

(39:27):
At some point you certainly. Depending on what year I was
Richard, I tell you to. To his credit, he's one of the few guys who
worked for Sebastiani Vineyards. He worked for Cecchetti Sebastiani Seller. He worked for Don
Sebastian. Wow. And the other guys. And now three badges. You're gonna have to
say item for me. That's even. I absolutely will. And that's. That's even more than
I can say. I was never an employee at Cecchetti Sebastiani Sellers. So he's. He's

(39:48):
checked more than his boxes than have I. I still have a 3. Liter sparkler
that I use for display. This is pretty great. So is there. Is there a
low out and we're running out of time now, so wrap this up. But is
there a low out non alk in your portfolio? There is not. But that is
innovative. That's a category that we are targeting right now. Actually. We're looking
at our gin brand, Uncle Val's Botanical

(40:09):
and. And others. I love the Cal.
Uncle Val is actually Zio Valerio is my
mom's dad's baby. Brother. Wow. And
he, he lived in a suburb of Luca. He passed away a few years back.
And we thought we would pay an homage to Zio polarity when we
came out with Uncle Val's Gin. Yeah. And we've got three different offerings of gin

(40:33):
and we're, we're dabbling in maybe an Uncle Val's non Alk.
Because distilled or not non alk distilled,
it would be something that might compete with seed lip or, you know, you make
a cocktail with it or a mocktail with it. So you think it's got staying
power. I mean, it sounds like you're looking at maybe. I tell you, I don't
know if it's got staying power, but it's. It's more than a blip on the

(40:54):
radar. It's. It's a thing for sure. We were at the fancy food show in
Vegas and it was the. The primary theme of any beverage there was
not out. Sure. Prosecco, distilled spirits, brown liquor. Right.
And we think, and whether this is maybe another factor of the 20
somethings lack of interest, there might be this
California sober craze that has been really, of course, taken

(41:16):
off. Whether it's cannabis or whether it's, you know, some other, you know,
lion's mane or whatever it is. People go out, they want to have something to
drink, right. So they, they'll have a. They'll have a mocktail that, you know,
it's a. Which is also running 25. Yeah. Right. Which I don't understand
at all point. But it's something that I think it's too big to
ignore. Yeah, I think you're right. I've got a. I've got a friend who was

(41:38):
a big beer. This is actually the buddy who introduced me to craft beer. As
we dabbled in craft beer, he had a. For. I forget what
year it was. Maybe his 40th birthday. He decided, I'm gonna not drink for a
year just to do it. And he started drinking non
alk IPAs. And he's like, I gotta tell you, they're pretty damn good.
They're getting. And that might be part of the issue too, is that the non
elk stuff, pardon my language, it doesn't suck anymore. Well, the, the

(42:01):
beers don't. And I had one the other day. This cracked me up though. It
was. There was Whole Foods and they were pouring Corona. Not out, but it
still had the stanchions. And it still said, you must be 21. Right.
I didn't understand and I thought was very good
and I don't know why my stomach was tweaked about an hour later. I don't
know if it's from that or not, but it was something. Well, so what,

(42:24):
what is next? We got a down out thing. Right. I mentioned
subterranean repositioning the Subterra brand. That's, that's, that's coming.
We've been looking at ready to drinks as well. The other thing too,
and this is a little bit of a Hail Mary pass and this is a,
you know, it's a fledgling conversation that we're
having internally. Yeah, I love sake.

(42:46):
And so we were thinking that it might be kind of fun to get a
sake and to market it to non
conventional outlets and sit down with an Italian
restaurant and say, listen, this conjozo sake, it's
a, it's a dry junmai, but it's got
stuffing and it pairs beautifully with your, you

(43:07):
know, chicken parmesan or whatever it happens to be. Because that is,
was an eye opening experience. My wife and I, about a decade ago, we went
to a dinner in Napa and there's a gentleman who used to be. His name
is Eddie. Eduardo Dingler's his name. He used to be the Saki
Samoye Morimoto. He went around last thing. I'm Arnold Dingler.
Right. But now he's, he's a great

(43:28):
dude. And he is a traveling sake ambassador and he hosts these
dinners where he pairs unconventional
foods, not very conventional foods, but foods that are
not commonly paired with sake. With sake, including
tri tip, including pizza, including all sorts
of things. And has a very accurate

(43:51):
description of why this flavor profile works with this particular
food and doesn't compete with it, but pairs with it.
And it was just an eye opener for me. So when I'm at home, my
poison of choice is dry
filtered sake. That's my. And cold. I'm going to send you
two things when we're done with this when I get back. One is there's an

(44:12):
article in the Les Amid event magazine from 1978 about sake.
Okay. It's really interesting. I'll bet it's like. And the title is
99% of Americans won't know what you're talking about. And it talks about
it. And then I just did a podcast with a guy who's a. What do
they call a master brewer in Arkansas,
In Arkansas being the number one rice producing state in the country.

(44:36):
Right. So he went to Japan, got trained, which is a great story, and
came back and makes domestic chocolate. Wouldn't have thought about Arkansas. I know,
good for him. Like, figure that out. Figure that one out. There's a. So we
dabbled also in Mezcal and we actually had a Mezcal
brand that was pretty successful when we sold it back in November, in fact.
And, and so we spent some time down in Oaxaca. And one of my favorite

(44:58):
restaurants on the planet is a sushi place in Oaxaca. Now this is
a little bit more traditional. Obviously it's sushi, but in Oaxaca it's called
crudo. Right. Which is raw in Spanish. And it's
six seats at a bar and the chef is right there
making one bite of nigori. Every course
is one bite. You sit there for a couple hours, you have a 25 course

(45:21):
dinner. And they pair it with locally sourced
sake. Wow. From Oaxaca of all places. It's
pretty wild. So it's, it's a fun odyssey. And, and the sky's the limit. And
I tell you, in terms of back to innovation and three Badge, it's the
spirits piece that really excites me because you can kind of get outside the
40 yard lines, whereas wine's a lot more traditional. Remember how

(45:43):
outrageous screw caps were 15 years ago? Yes. Right.
With spirits, the sky's the limit in terms of, you know, flavor
profile and packaging and bottle shape and
everything. So that's really where we exercise our, our creative
muscles. Think about that for a second. You're right.
Mezcal, when I was growing up in my dad's shop was the worm, you know,

(46:05):
rojo, whatever it was called. Right. And then it became this premium,
very much drink. And a great parallel from wine where you talk about varietal
agave. Yeah. Just like you talk about varietal wine grapes.
And it was a, it was a fun experience. And I don't want to spend
all of our time talking about that, but seems like an example there of the
creativity you're allowed that the, that the market will allow

(46:26):
in spirits that they will not allow in wine. That's right. Our bottle was a
ceramic bottle. You couldn't put wine in a ceramic bottle without
people flipping the tables over, you know, so it was, it's fun that you're,
like I said, allowed to kind of spread your wings creatively on the spirit side.
And so we really enjoy it for. That reason on the RTD side. And this
is going to be it. I did have somebody on the show. The

(46:48):
product's called Knox and Dobson. I put their
Manhattan and their gin martini up against my homemade ones with my brother,
my son in law's. And I consider Myself an expert at both of these cocktails,
and I barely won. How about that? And because they're going
after that premium. Not the High Noon stuff, but the
premium market, and they're out there pouring it off. You know, what

(47:10):
do you get, a quarter ounce? So we just pour off distilled spirits. Right. You
know, at Whole Foods and Ghosts, wherever they're going. And you know, that
it's really hard work for them because that's all they. That's just them. Sure.
But I can see that it gets. Back to the point I made
earlier. Sometimes you just need something that's easy. Yeah. You know, I could go make
a thing. I don't want to spend 20 minutes making a drink for my buddy.

(47:31):
Let me open it up and. And maybe add some produce. I'll add a,
you know, a piece of fruit or, you know, a zest or something that. That
makes it a little bit more. But it's a lot easier just to pull the
bottle open and give it a pour, and you're off and running, as opposed to
getting the shaker and muddling and going through whatever. You know, I
love it. I don't get me wrong, if I'm up for a cocktail, I want

(47:51):
to sit down. I want it done right. But if I'm at home with some
buddies, sometimes it's easier to just kind of throw it out there. Oh, for sure.
If you. I'm telling you, if you had poured these behind the
bar, turned your back and poured it in the martini glass. You might
know the difference. Yeah. You would not. We're out of time, which was
unbelievable. It was really a lot. That was a lot of fun as well. I
hope we can do it again. I'd love to see what happens next here at

(48:14):
3 badge so I can come up and we can talk about that success. I
can get Richard up here next time. In fact, he probably will be. But
this has been great. Thank you very much for having me. Really appreciate it. Cheers.
Cheers.