What makes an aspiring entrepreneur enter an established industry with no prior experience, do something totally different and succeed?
It's a question the founders of Desert Door Texas Sotol, a distillery that recently opened its doors in Driftwood, Texas, are striving to answer. Although they'd never met prior to 2014, co-founders Brent Looby, Judson Kauffman, and Ryan Campbell came together to build a brand in a hotly competitive industry.
Desert Door claims the distinction of being the only U.S. distiller of sotol, a plant-based liquor that's popular south of the border. Recently, Kauffman told Forbes Magazine that one of Desert Door's aspirations is to make sotol into "what boubon is to Kentucky."
It's certainly a good time to be in the market for distilled spirits, which grew by 4.5 percent last year to over $25 billion, according to the Distilled Spirits Council of the United States. Premium brands — like the one Desert Door is trying to break into — are flying off the shelves, and accounted for more than 30 percent of all spirit sales in 2016.
In 2016, Desert Door's founders drafted a charter, and quickly identified key components of the brand personality, even down to the bottle's design. Its deep azure blue and golden logo are meant to evoke the sunset of the Texas desert.
The name "Desert Door" came to them when they tasted their initial batch of homemade sotol, which is often confused with tequila. Sotol is unfamiliar to most Americans, and that's something Looby, Kauffman, and Campbell aim to change. The spirit is a distilled from Dasylirion texanum, a flowering plant often called a "desert spoon" because of the distinctive shape of its leaves.
"When you drink Desert Door Texas Sotol, you're stepping through a doorway into a place with a rich and rugged history, and we thought it was important to express that in the name," Looby told CNBC in a recent interview. "We were struck by how much it actually tasted like the Texas desert. … It was a transportive experience."
Looby, Kauffman, and Campbell are all military veterans. Looby recently retired from 20 years in the Marines, where he was a pilot, Kauffman was in the Navy for eight years and Campbell served in the Army.
Kauffman and Looby have deep Texan roots, while native Floridian Campbell married a Texan and has sworn to "never leave the Lone Star State." Their common backgrounds helped them become fast friends after they met at an executive MBA program at the University of Texas in 2014. There, they developed the concept for Desert Door Texas Sotol as part of a class project.
"Based on the positive feedback we received, we entered the Texas Venture Labs competition, and were selected as the second runner up," Kauffman said. The concept attracted immediate investors — even some from the attending audience — which helped propel the Desert Door Texas Sotol concept toward actualization as a full-fledged distilling business.
"We initially set-out to raise $200,000, and did that in less than two weeks," Looby said. "Over the next four months, we continued to fundraise, and well exceeded our expectations. At present, we're well prepared for future growth, including strategic hires."
Although Kauffman's great-grandfather was a brewer in Cincinnati, the trio had no real brewing or distilling experience. While looking for space to start experimenting with the distillation process, they settled on a barn in Williamson County, Texas, owned by Kauffman's grandfather.
The elder Kauffman repeatedly asked the founders: "When can I taste it? Is it ready yet?" Kauffman, Looby and Campbell were cautiously optimistic when they finally presented him with a sample from their initial batch. Their hopes, however, were dashed by Grandpa's honest assessment.
"He looked me in the eye and said 'BLECH! That's not worth a damn, Jud. Tastes like hell!!" Kauffman said. "My grandfather didn't mince words, but that's OK. It motivated us to keep going until we got it right."
Fast forward to Nov. 11, when Desert Door held its grand opening — and customers have apparently given the liquor a better appraisal than Grandpa Kauffman. According to Campbell, Desert Door has had requests from restaurants, bars, and liquor stores in Colorado, Illinois, Florida and Tennessee. Still, the team's immediate goal is a tight focused on Texas.
"We aren't really targeting anything outside of our backyards for now, said Campbell. "We want to achieve success locally before expanding regionally, then throughout the state and beyond. Because of our backgrounds, we believe in the military adage: 'Plan your work and work your plan'. So, whatever demand may be, we're sticking to our mission for steady, controlled growth."
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