GAN EDEN Wines- Proposal

I am seeking a financial commitment to the project of resurrecting GAN EDEN as a viable California winery brand, and a viable kosher wine brand.  My projections in terms of cash flow indicate that over the course of 5 years, it will probably require a maximum of $3 million, a minimum of $1.5 million, and a likelihood of something closer to the average of the two.  This should see production and profitable sales of 20,000 cases of GAN EDEN wine within a phased growth over the course of 3 years.  I would require initial starting capital of at least $1 million. In consideration for supplying the capital to see this project through, the investors would receive a cumulative 75% equity in the company, and their investment stakes would be reimbursed prior to my participation in monetary distributions.  I would receive 10% equity when the winery breaks even, with the possibility of another 10% under negotiable conditions, and the balance would be available for employee rewards.  Whether this were structured as an S- Corp, C- Corp or LLC would be left to the desires of the investors.  The process of acquiring the investors, as well as the initial $1 million for acquisitions and operational expenses must begin at once.  

I would like to lease the Lolonis Winery facility, located in the Redwood Valley of Mendocino County, kasher the facility, and use it as a dedicated kosher facility. This is probably the only reasonable way to embark on this project this harvest.

In truth, I would be pleased to establish the wine under any brand name, but there are advantages to using GAN EDEN:                                                          

1. I already own the GAN EDEN brand
2. I am already associated with the GAN EDEN brand by both consumers and the industry.
   
3. The GAN EDEN Brand is already associated with  premium and super-premium wine.  GAN EDEN is the only kosher wine brand until recently which made significant headway into the general marketplace in the United States, owing to the early success of several wine types.
   
4. I have already had a new label designed for GAN EDEN wines, so there is no need to do that
5. I already own ganeden.com, which is considered now to be a premium domain which others desire, and is a valuable name to the kosher consumer because it is a name that can easily be remembered
6. It is a domain name coveted by other businesses, so that it is a saleable commodity which will be offered to supplement this proposal only if GAN EDEN is chosen to be the brand name

The Lolonis winery facility is located out-of-the-way, it is older, it hasn't been utilized to its fullest extent in several years, and some of its equipment is broken and will need to be fixed or supplemented with our own.  However, it is:

1. Available at a very advantageous price
2. Equipped with much of the equipment which will be required for making wine
3. Able to be utilized with its permits and bonding until such time as this consortium is able to generate its own permits, licenses and bonding, allowing the GAN EDEN consortium to commence operations with crush of 2018.  In fact, this may well be the only means at this point to do so.
4. A 50,000 case facility, as the Lolonis Winery facility is, is far larger than GAN EDEN will require at start-up.  However, it does allow scale-up in a familiar facility, without constantly moving from location to location.  It is priced as if it is a far smaller facility, which is initially attractive.

My proposal includes rapid but phased growth.  In my opinion, the winery requires a certain size before it becomes a reasonable investment.  There is definitely an economy of scale in the wine industry.  Like all wineries, tiny wineries survive or fail with the perceived quality of their wine.  Perceived quality in a tiny winery can be high when actual quality is far lower, due to the "boutique" factor.  This perceived quality translates to wine price, and high wine prices can provide a tiny winery with high enough income to provide for several families.  A 1000 case winery can provide all of the profit of a 20,000 case winery, but a $2 million profit requires a per case profit far higher when dealing with 1000 cases (unreasonably so at $2000/case)  than a 20,000 case winery ($100/case).  My plan provides for rapid scale-up, from 5000 cases initially to 10,000 cases the second year and 20,000 cases the third year.  I am committed to providing pricing likely to allow all of the wine to be released and to be sold at its appropriate time, and to be sold in the appropriate time frame. I definitely believe that within a few years, 20,000 cases of sales per year can certainly be achieved at some price which will be profitable,  Obviously, a higher achieved price directly translates to a higher achieved profit and a better investment, one which can support further growth.

Craig Winchell, Tel:  (707) 494-7095  Email:  ganedenwines@gmail.com