• 2 months ago
BAXUS is a global marketplace for the world’s most collectible spirits, providing pricing data, vaulting solutions, and access for everyone.

The last several years have seen an explosion of individuals and funds diving headlong into the world of spirits investing. Driven by the hyper explosion of the whiskey market, where bottles of Scotch, Bourbon, and Japanese Whisky continually set new sales records, investors are actively searching out the next hot bottle. This has led to numerous stories of individuals uncovering hidden gems or getting burned by counterfeits and fake investment platforms. It's an exciting world many connoisseurs want into but don't know how to enter safely.

BAXUS seeks to bring order to a chaotic environment as the first peer-to-peer Marketplace for buying, selling, trading, and storing valuable spirits and wine. Providing pricing data, vaulting solutions, and access for everyone, BAXUS is the brainchild of Tzvi Wiesel, a seasoned whisky investor and trader who launched his own whisky fund while studying computer and database learning at Columbia University. He teamed up with Carrie Carrington Kellar, a former New York Times machine learning team member.

Incorporating blockchain technology, AI learning, and data analysis, BAXUS provides its users with the most up-to-date pricing analysis. It all starts when a bottle arrives at their warehouse in New Jersey, where every bottle they deal with is stored in a climate-controlled environment. Each bottle is authenticated, 360-degree scanned, tagged with its own RFID label, and has its own unique non-fungible token (NFT) created. Then, that NFT is entered into the seller's digital portfolio, with each bottle having its own page detailing a wraparound view of the bottle along with its history and pricing data. It’s up to each owner to decide when they want to list a bottle as active on the market side of the platform.

Read the full story on Forbes: https://www.forbes.com/sites/hudsonlindenberger/2023/10/25/baxus-is-seeking-to-revolutionize-online-whisky-and-wine-trading/

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Transcript
00:00I was in New York City, but I lived in Jersey, and when I went home to Jersey and I popped
00:05into a local liquor store, I realized that that same bottle that I was seeing on a liquor
00:09store shelf in Manhattan for $300 was $150 in Jersey.
00:13And I was like, wait a second, there's a real disconnect here if I can drive over a bridge
00:16and pay half the price.
00:18Whiskey and alcohol distribution in general is really, really siloed, state by state,
00:23country by country, and there's no transparency in the market to figure out what you should
00:27be paying, what the real market price is, and what other people are willing to pay for
00:31bottles that they can't get their hands on.
00:33So Baxis really came to be as a way to bridge that gap, to create transparency in the market
00:38and access so people anywhere in the world could buy and trade bottles that they might
00:41not have readily available to them.
00:45Baxis is a secure vaulting platform and marketplace, and so what that means is people send us their
00:51personal collections, and these are bottles that could be new releases, and these are
00:54bottles that in some cases are from the 1800s and early 1900s.
00:59We provide temperature controlled insured storage and vaulting solutions, and then those
01:03bottles go into their account.
01:05So users access a dashboard where they can see the bottles that they have in their account,
01:09interesting information about the bottles, historical information, and then the most
01:13important part for a lot of them is that they can actually track the prices.
01:17And so we provide all of the auction data, secondary pricing data that we can gather
01:22in a chart for them to track the values and then allow them to list their bottles for
01:26sale directly.
01:27What we found, and kind of our little joke, but our real growth hack is not going to the
01:31whiskey collectors, but we go to their significant others and we're like, hey, so what if you
01:34could get free storage and insurance for all of the stuff taking up your house?
01:38And two days later we get a call, yeah, my wife would like these 300 bottles out of my
01:42house by tomorrow.
01:43For anyone looking for, you know, a growth hack in the collectible space, let me tell
01:46you, go to the spouses, not the collectors.
01:52One of the issues with auction houses, which I've used in the past, is you'll send in your
01:57bottles, it'll take a couple of weeks, then they run the auction for a couple of weeks,
02:01then it takes them a couple of weeks to collect the funds.
02:03And by the time they're done with everything, it's, you know, two, three months between
02:06when you send in your bottle and when you get paid.
02:09And that drives a lot of people to gray markets that exist, you know, private groups where
02:12there's a lot of fraud because you don't have that layer of security.
02:15And so what we wanted to do was create that instantaneity of it, allow you to buy more
02:20things, allow you to sell more things.
02:23We do a 360-degree scan of every bottle epaxis, and the reason for this is multifold.
02:27One is the authentication process and being able to run computer vision models to double-check
02:32on the authenticity.
02:34But the other one is that when you're buying something rare and collectible, the condition
02:38matters.
02:39You know, trading cards get sent to PSA or CGC for grading.
02:42That doesn't exist for whiskey.
02:44So I want to make sure, is the label in pristine condition?
02:46Is it ripped?
02:47Is the tack strip torn?
02:48How does the liquid look inside?
02:50So all of that is really important to the buyer.
02:52And even when you're using websites or liquor store websites, they're usually using stock
02:56images.
02:57And so you don't know if you're getting the exact bottle that they're telling you about.
03:01Sometimes they may even get the edition or something wrong because, you know, the store
03:04owner doesn't know.
03:05And most brands actually reuse UPC codes.
03:08So you'll actually scan a barcode and it'll come up as the exact same as last year's edition.
03:11They don't change it for year to year, so the guy who works in the store doesn't even
03:14know.
03:15When we first launched, NFTs were at their absolute height.
03:19So people are talking board apes and JPEGs and all that.
03:22And we're like, guys, this is great technology, but you're missing what it can be used for.
03:26What was really important for us with Baxos was building both for the future, as well
03:31as the interoperability that blockchain provided and the security.
03:34So when you trade someone a token, they own that bottle now and they can redeem and ship
03:38that bottle.
03:39And if you're a blockchain user, if you're in Web3, if you understand it, there are so
03:42many things you can do.
03:43The other day, somebody traded a bottle of whiskey that was stored in Baxos' vault because
03:47they're all tokenized for a Magic the Gathering card that was tokenized in somebody else's
03:52vault.
03:53That's what this unlocks, is that in the future, all of these different blockchain protocols
03:56can now fit in with your whiskey collection.
03:58No one cares about what web services platform Netflix is hosted on.
04:02They care that they can click a button and watch a movie.
04:05Our users are not going to care how we build it.
04:06They just care that it works.
04:08Our core user, the people that we really wanted to appeal to, was whiskey lovers, was collectors,
04:12and not just whiskey, but spirits and wine in general.
04:15And so we need to bring it to where they were at.
04:17And for most of them, it's, they're familiar and they're comfortable with the website,
04:21they can log in with an email, they can pay with a credit card.
04:23And so all of those are things that we put really at the forefront of Baxos.
04:27You can use crypto if you want to, but you don't have to know anything about it.
04:34I had built and run small businesses that I had built up, but it's very different than
04:37trying to build a venture-grade enterprise.
04:40So it was tough at the beginning to get that interest, I would say, even from VCs, where
04:45they understood the idea of like real, what they're calling real world assets or RWAs,
04:49but they didn't know much about the whiskey markets, or the spirits markets, or the wine
04:53markets and understand how large they were.
04:55We kind of had this opportunity to try and fail a lot, you know, at a small scale, leading
05:00into the end of 2022 when FTX collapsed, and we were like, no, no, we're focused, we're
05:05like heads down focused on building for the whiskey community, building for the spirits
05:08community.
05:09And so that bear market didn't really affect us.
05:12If anything, it made us stronger because when it started to ease up, people are like, wait,
05:17these guys are still around.
05:182023, when we launched the marketplace, we started to get that momentum.
05:22We expected people would send them a couple of bottles here and there, but we started
05:25to get real, real collections.
05:27We had a substantial amount of trading going on.
05:30Whiskey collectors were raving about the platform because they're like, wait, these are bottles
05:33I've been looking for.
05:34It's an ability for me to sell.
05:35And that really took off and caught some VC attention.
05:37And so we ended up raising our seed round and really just been scaling ever since.
05:41The nice thing about SaaS companies is as long as you have a computer and an internet
05:45connection, you can run your company.
05:47For us, it's we need physical space to store the bottles.
05:49So we are opening actually our second vault now in Jersey.
05:53We're going to be opening a couple more in the US at the end of this year, and then one
05:55overseas, our first overseas vault, and scaling both the physical infrastructure globally
06:00to add more users, as well as the engineering support on the back end to be able to really,
06:03really deliver features and products to those users.
06:07There's this disconnect between brands and consumers.
06:09A distillery will sell their bottles to a distributor who sells their bottles to a liquor
06:13store, who sells their bottles to you, who sells the bottles to me, who sells the bottles
06:16to someone else.
06:17And so by the time it gets to the end consumer, the brand has no idea who their biggest fans
06:21actually are.
06:22We can say there is an account that has 50 of your bottles.
06:25And so being able to connect and show brands, first of all, here's how you can really connect
06:29with your consumers, which we've already done with a couple of brands, and they've loved
06:32And so we went into the database and we found the two largest collectors of single barrel
06:37Russell's Reserves, like Wild Turkey's product, and we brought two users down who have, each
06:42of them, over 50 or 60 bottles of single barrel Russell's Reserve, and they had never met
06:47anyone from the brand.
06:48They loved the product, they loved the brand, and they got to pick that barrel with us themselves
06:52with Bruce Russell.
06:53And they were huge fans before, but now they're lifelong fans.
06:55And that's really special.
06:56And I think that's what makes it so special.
06:58And so building those real connections and not just making people think of them as large
07:01companies is really cool and really special, because the people who work in the distilleries
07:05and in the brands really care.
07:06They're really passionate.
07:07What's cool about the blockchain element is because each of the brands has their own
07:11blockchain, they have their own token, they have their own token, they have their own
07:15token, they have their own token, they have their own token, they have their own token,
07:17they have their own token, they have their own token, they have their own token, they
07:19have their own token, they have their own token, they have their own token, they have their
07:21own token, they have their own token, they have their own token, they have their own
07:23token, they have their own token, they have their own token, they have their own token,
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07:28their own token, they have their own token, they have their own token, they have their
07:30own token, they have their own token, they have their own token, they have their own
07:32token, they have their own token, they have their own token, they have their own token,
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07:38their own token, they have their own token, they have their own token, they have their
07:40own token, they have their own token, they have their own token, they have their own
07:42token, they have their own token, they have their own token, they have their own token,
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