Joney Talks!

Wine is a Living Thing

In today’s episode, we will speak to my friend Anthony Zhang, the co-founder and CEO of Vinovest.

Vinovest is an online platform that allows investors to invest in an interesting asset class, namely fine wines 🍷!

Once your investment portfolio has grown a certain size, it may be interesting to protect it even further with uncorrelated assets (e.g., assets that do not follow the same trend as the traditional stock market) such as wine. Anthony will share why he believes investing in wine makes sense, how we can access this particular investment, what the expected returns can be, some market trends, and we will of course discuss the risks and if this investment could be right to you.

So make yourself comfortable, pour yourself a nice glass of vino 😉 , and listen here:

…or listen on Apple Podcasts

This episode is for you if you are interested in diversifying your investment portfolio with alternative assets and/or if you are curious about how investing in wine works in general.

Key Takeaways:

• Investing in wine:
  • Investing in wine has returned 10-12% annually (you can look at the Liv-ex index)
  • There is a decreasing supply and an increasing demand
  • It is uncorrelated to the markets so, from a fundamental standpoint, this investment makes sense.
  • It can for you if your time horizon is 5-15 years and you are looking for stable long-term growth. This is not for you yet if you are just starting out with investing.
• Investing in wine can be intimidating: But like with stocks start by looking at the big names (the equivalent of blue chips) like burgundy. Stick with the famous regions with strong track records first. And in a second phase, you can start looking at the equivalent of emerging markets: Chile, New Zealand,… 
• What makes wine increase in value:
  • Demand drives the market dynamics.
  • Depending on the wine, it can reach a peak in 20-30 years, at that point will sell or drink it. This could also become a collectible.
  • The ageability of a wine is important.
  • Brand equity: prestige, story, etc.
• Important factors:
  • Wine storage and insurance: The condition is important when reselling.
  • Private residence storage will devalue the value of your assets, so you are better off keeping them in a professional storage facility.
  • Tax: Always consult with a professional but here is what I could find
    • For France, look here
    • The UK look here and go to point 9.
    • For Belgium and Luxembourg it looks as if your capital gains will be tax-free as long as you manage your wine as a “good father” (in good faith), i.e. if you buy for 5000 EUR, keep the wines for 20 years and then resell these, you should not be taxed on your gains. If you constantly buy and sell, this will be seen as a taxable commercial activity.
• The best reason for me to invest in fine wines? The possibility to drink some of it too, investing is a way to drink exclusive wines for cheaper. It makes for the perfect combination of passion and profits.

Who is Anthony?

Anthony is co-founder and CEO of Vinovest, a platform that is democratizing access to fine wine investing. A repeat entrepreneur and Thiel Fellow, he successfully built and sold two companies— EnvoyNow and KnowYourVC—by the age of 22. He has also held leadership positions at cryptocurrency platform Blockfolio and is a board member at RateMyInvestor. You can learn more about Vinovest at www.vinovest.co.

RESOURCES 

• Website: Vinovest
• Twitter: @anthony_j_zhang
• Book recommendation: Zero to One
• Best purchase under 100 dollars: A Coravin system, so you do not have to pull the cork off the bottle and you can keep your vino longer.

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