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Wine and spirits could become a common asset class thanks to Fintech Vint

You may be interested in investing in wine and liquor. Vint is a fintech firm that shares this view and aspires to make it more accessible to the general public. But don’t count on receiving bottles through mail: Investing via Vint is a fractional process. This may or may not be ideal depending on your financial situation. Recently, a $130,000 bottle of Macallan 78-Year-Old Collection whisky was offered on Vint and quickly sold out.

Traditional investing advice, which recommended a 60/40 split between stocks and bonds, is being replaced by the more modern recommendation of a more diversified portfolio. Wine and spirits aren’t always the most easily available “alts,” but companies like Vint are striving to change that.

Vint now has additional resources to realise its ambitions: As of late, it has secured a $5 million seed investment round sponsored by Montage Ventures, after an earlier $1.7 million round in October 2021.

The fact that fine wine and spirits have outperformed other major asset classes like equities and appear impervious to some of the public markets’ recent difficulties certainly helps Vint’s appeal.

This year, the value of “fine and rare” single malts increased by more than a fifth, with volumes increasing by23%, according to statistics from Scottish investment firm Noble & Co, which was recently cited by the Financial Times. Conversely, it said that the FTSE 100, the UK’s primary stock market index, “had traded flat this year.”

Vint CEO Nick King, on the other hand, emphasised the need of diversity and cautioned against over-optimism. This is a financial commitment. “I’m dubious if someone tells me ‘it’s just going to move up into the right,'” he said.

Still, King takes great pride in the fact that Vint has produced net annualised returns of 28.3 percent on asset withdrawals since its start. The collections of wine and spirits in question have completed the whole “Source, Securitize, Store, Then Sell” cycle by Vint.

King and his co-founder Patrick Sanders launched Vint 1.5 years ago, and in that time it has made 50 “offerings,” which are similar to crowdfunding campaigns. Furthermore, the firm spent eight months becoming SEC-compliant so that it could begin selling collections to the general public; this is a perfect comparison for the aforementioned process.

The establishment of the regulated category known as Reg A+ paved the way for Vint’s offers to be approved by the SEC. Part of the JOBS Act, which has boosted alternative investment, it has positive effects on the industry.

For such a new company, the procedure took a lot of time, but King is certain it was well worth it. This is a lengthy game for us. Creating a new asset class takes time, so doing things properly and collaborating with regulators to establish a framework that instils confidence in this asset class is essential.

Even though they frame their business around “a new asset class,” Vint already faces competition from companies like Cavissima, Cult Wine Investment, iDealWine, Vinovest, and U’Wine. However, the firm also faces competition from do-it-yourself methods and wine swapping services, both of which are industry mainstays.

King, who doesn’t have a background in the wine industry, sees Vint as more of a financial technology firm than a traditional winery. However, locating rare bottles remains a significant part of Vint’s business, which is why it just recruited Adam Lapierre, a certified master of wine, to serve as its head of wine.

The most recent funding round has allowed Vint to add business development and general counsel roles to its current team of 12. In terms of the remainder of the plan, King has a few ideas in mind, including:

We are exploring potential new products. Now that we’ve covered wine, whisky, scotch barrels, and futures, we’re thinking about expanding into bourbon and maybe even other beverage categories. Next, we want to enrich the system with more information. To further inform our purchase and sell choices, we regularly research market data from the United States, the United Kingdom, and auction markets, and we want to keep providing this information to our consumers. Also crucial is the ongoing process of divesting from assets.

It’s too soon to know whether the market will be as good for sales of Vint’s collections as it has been previously, but seeing the value of wine and spirits increase as an investment will be interesting nonetheless. It’s not out of the question that more people may start include alternative assets in their portfolios as inflation and uncertainty grow.