CaskX is a company that provides a platform that makes it easy for investors to purchase portfolios of Bourbon Barrels and Scotch Whiskey casks from leading distilleries. Pulse 2.0 interviewed CaskX CEO Jeremy Kasler to learn more about the company.
Jeremy Kasler’s Background
Kasler was born in London and started his entrepreneurial journey when he was a young man. And Kasler said:
“I sold everything from Christmas wrapping paper to hotdogs, which later altered into selling fine China art pieces and now whiskey casks. My grandfather had always played a pivotal role in my life as he was the one to show me how to always work hard. This inspired me to stay motivated and look for more business opportunities to bring to life.
“My personal journey began with a profound admiration for whiskey, and it didn’t take long for me to recognize the potential for investing in whiskey casks as a truly rewarding endeavor. This realization led me to assemble a team of experts, which includes master distillers, sommeliers, and financial specialists, culminating in the creation of CaskX. Our diverse backgrounds harmoniously blend craftsmanship and financial expertise. In today’s economic climate, characterized by uncertainty and inflationary pressures, whiskey casks offer a safeguard against instability commonly associated with paper-based financial instruments.”
Favorite Memory
What has been Kasler’s favorite memory working for CaskX so far? Kasler shared:
“One of the most notable memories was starting the company amid the unprecedented challenges of the COVID-19 pandemic. It was a dark time as the world faced widespread challenges from the direct health impacts to the attempts to mitigate the spread with mass closures. There was uncertainty and unknown all around. A natural reaction would have been to press the pause button, but our entire team was driven to press forward. Forging connections through phone calls and Zoom meetings while hunkered down in homes while doors to the outside world were closed is something I will always remember. It brought a small slice of positivity during a time when it was difficult to find hope for what was ahead.”
Core Products
What are CaskX’s core products and features? Kasler explained:
“CaskX is the leading platform for whiskey investment. We help private individuals diversify their investment holdings by purchasing portfolios of whiskey barrels from distilleries in the United States and Scotland. Investors benefit from a spirit that appreciates over time, and the distilleries benefit from immediate cash flow. Whiskey casks are a tangible asset that requires time to reach peak flavor profile and maximum value. Investors provide value to the whiskey production process by purchasing assets immediately from distilleries and then holding the spirit until it reaches maturity. The business is a win-win for both investors and distilleries.”
Challenges Faced
What challenges has Kasler faced in building the company
“One of the biggest challenges has been acquiring sufficient whiskey to meet investor demands. The whiskey boom has created a dynamic where we’re acquiring as many barrels as we can, but the distilleries simply can’t produce enough. We’ve worked hard to navigate this by fostering relationships with distilleries and building a reputation for being true partners with each distillery whom we work with. When distillery partners see the effort we put forth to build up their brand and promote their products it aids in getting access to more barrels which can then be offered to investors. It goes back to our commitment to helping distilleries, from helping with cash flow through the sale of barrels to building up distillery brands.”
“The second major challenge for CaskX in the early stages was navigating regulatory and compliance requirements. Whiskey casks are a challenging asset in that they are both alcohol and investments – two areas with highly complex rules. The alcohol aspect alone is challenging, but casks are also considered investment securities based on legal precedence, putting them under a stringent set of rules. This has impacted how we sell, manage and maintain whiskey investments. It has required a greater level of control than most tangible assets. While this took a large investment of capital and time to get right, it has resulted in increased security for investors.”
Evolution Of CaskX’s Technology
How has CaskX’s technology evolved since launching? Kasler noted:
“From day one, CaskX has believed in technology playing a pivotal role in all aspects of the business. The most revolutionary use of technology has come from more closely connecting investors with their assets, giving them the ability to oversee and manage holdings in a manner that parallels the accessibility that is provided for traditional financial products. Investors can leverage an app to monitor their holdings, download certificates and view inspection reports. All of this with the goal of being transparent in all aspects so that investors can rest easy in knowing the details of their whiskey investment portfolio. We continue to seek ways to use technology to even more closely integrate with distillery partners to make information available in an even more timely manner.”
Significant Milestones
What have been some of the CaskX’s most significant milestones?
“Our journey at CaskX has been marked by significant milestones, each contributing to our evolution and growth as the leading whiskey platform. Our transition to California marked a pivotal moment in our company’s history. The move opened up new horizons, providing us with access to a dynamic market and a vibrant network of investors and distilleries and the establishment of our initial offices located in Sydney, Hong Kong, Louisville, and Los Angeles. Achieving our first $100,000 deal represented a substantial milestone in building trust and credibility in the industry. It demonstrated that our unique approach to whiskey investment resonated with investors seeking opportunities beyond traditional markets. Securing our first client with a million-dollar investment which underlined our ability to cater to a diverse range of clients with varying investment preferences. Building partnerships with esteemed distilleries in Kentucky and Tennessee was a crucial step in enhancing the depth and diversity of our whiskey cask offerings. These partnerships allowed us to present investors with a broader spectrum of investment options, each carrying the distinct character and heritage of these renowned regions.”
Revenue
After asking Kasler about revenue information, he revealed:
“To date, CaskX has helped over 400 clients around the world invest in more than 15,000 whiskey investments – enough to produce more than 6 million bottles of whiskey. As whiskey demand has grown, so has CaskX – their year-over-year sales more than doubled last year, rising 106%.”
Total Addressable Market
What total addressable market (TAM) size is the company pursuing? Kasler assessed:
“The whiskey investment market resides intriguingly at the intersection of the surging global whiskey market and the established global investment market, intertwining the realms of spirit maturation and asset management. According to Polaris Market Research, the global whiskey market was valued at a striking $80.5 billion in 2021, with an optimistic projection to burgeon to $146.15 billion by 2031, representing a 7.3% annual compound growth from 2022 to 2030. On the other side of the equation, the alternative investment assets worldwide amounted to a hefty $13 trillion in 2021 and are anticipated to escalate to an astonishing $23 trillion by 2026.”
“A large part of the estimated growth in the whiskey market will come at the hands of investors who will facilitate the expansion to meet rising demand among consumers. The expansion will come from new and innovative distilleries who lack the capital to produce sufficient quantities to meet demand without outside capital. This is where the CaskX platform comes into play as it helps these distilleries produce more barrels without selling equity by connecting individual investors with an investment in barrels of whiskey. The distilleries can thereby generate immediate cashflow while investors profit from the steady appreciation of the liquid.”
“In light of these dynamics and considering the positive trajectory of both the whiskey and the alternative investment markets, CaskX estimates the total addressable market (TAM) size of the whiskey investment market to be approximately $40 billion.”
Differentiation From The Competition
What differentiates the company from its competition? Kasler affirmed:
“CaskX distinguishes itself through three pivotal factors: direct distillery relationships, unwavering transparency, and a resolute financial focus. We engage directly with distilleries to curate a diverse selection of whiskey casks, subsequently offering these opportunities to investors. Our unwavering commitment to transparency ensures that investors maintain an unobstructed view of their investments throughout the investment period. To uphold this commitment, we conduct annual physical stock inspections carried out by independent accounting firms, with the results promptly reported to our clients. CaskX strives to put investors in complete control of their investment. Our team of specialists offer exceptional expertise in tailoring each client’s portfolios to overcome all economic cycles with a specific end-goal objective solidifying our commitment to delivering an investment experience that is both unique and rewarding.”
Future Company Goals
What are some of CaskX’s future company goals? Kasler concluded:
“We can’t giveaway too much, but there are some exciting developments that are currently underway. Some of these innovations pertain to leveraging technology to advance the industry, while others are centered around enhancing the whiskey itself. One such step forward will be the introduction of bottles of our own whiskey. Each cask of whiskey is completely unique and our goal will be to showcase the characteristics of our distillery partners in a unique way.”
