Ep. 96 Monty Waldin interviews Paul Howard (Wine Alchemy) | Monty Waldin's Let's Talk Wine Biz

Italian wine podcast. Chinching with Italian wine people. Hello. This is the Italian wine podcast. My name is Monte Gordon. Today's guest is Paul Howard. Paul is a wine writer and educator and an expert on blockchain. Now his company's called Wine Alchemy Limited, and he's based in the north of England. Paul, welcome to the show. Thank you very much for having me at Monty. Right. The first question is, how did you get into wine? I got into wine quite late, actually. In my late twenties, I was an accidental tourist in Burgundy. I went on holiday with some friends, and suddenly my good friend at the time said that he wanted to go and buy wine direct from vineyards. I, at that time, thought he was completely insane, and, lagged back, when we walked up to the to the first vineyard. And from the moment, we walked in and walked into the cellar and tried the wines and the hospitality I was hooked, and I've been doing that ever since. So you're buying wine direct from producers, are you? I do. Yeah. So do you buy from Italy? Most of my wine now is bought from Italy, migrate Pashions are Champagne, burgundy, and and most areas of Italy. Okay. We got a special area that you you work with, in particular? In Italy, probably around the Veneter is is is my most favored and and and most visited area. Why is that? It's partly originally back to ease of access into into Verona itself, but I just fell in love with the styles of of the Reds in Bell Pollachella and then Swave. I've then found some of the other smaller appalachians if I can call them that Bartelina or the Coli Bariki just found endless pleasure in in finding new wines and new styles. To who your who who are your customers in the UK? Are you selling to restaurants? Have you got a private wine list? I don't actually sell wine. I sell the concept of wine, and I do and I do tastings for consumers, but I don't actually sell wine personally. Okay. So you you you have wine for educational purposes. Yes. Yeah. So what you're you're a teacher as well then? Yes. Absolutely. So so you're teaching who members of the public? Members of the public sometimes I will do my favorite ones, these days, corporate groups, partly because corporate groups always turn up. Sure. She was there. But members of the public that want to know about wine from absolute beginning us to to to more expert people, and I'll and I'll pitch different courses or or different wine seminars, to those featuring great wines, which often serve blinds, so people can have no preconceptions beforehand. What is the perception of the people that come to your tasting classes about Italian wine in particular? Sorry. And and the Veneto wines that you've talked about in in particular. The the perception changes a lot afterwards. So the the one of the pleasures I get. I mean, it's the fact that people in the UK still don't know as much about Italy as they might do say about France or indeed about Spain. And one of the things that impresses people a lot is is just the sheer diversity both of grapes and and of wine styles. Isn't that the challenge it's bewildering, isn't it? Absolutely bewildering. So how do you make it simple for people so that they can really grasp what what the difference is between, say, a Swave and a Val Pollo. I know one is a white and one is a river. How do you do that? What's your approach? I think what I like to do is try try to tell stories and and base it around something that has some resonance. So one of the great things about Italy is the beauty of the countryside. So you can you can kind of start with an introduction to what the area is about, what the arts about, and then you can move people very gently into, and they grow wild here, and these are the kind of grapes that they grow, and you may not be familiar with those. Please don't worry too much about DOC, DOCG, IGG, VP, all of those things, and don't worry about the fact that sometimes grapes have lump, unpronounceable names. Let's just concentrate on what on what's indiglass. I'm not gonna tell you what they are until afterwards, and we'll do a reveal. And then you tell me you like it, and you tell me if you don't. And all I ask is if you don't like it, you tell me why. When people don't like something, do they do they say all Italian wine tastes very acid or very alcoholic or There is a perception again that Italian whites are highly acidic and and quite neutral, which I think at one time was was possibly a trip. There is a perception as well that Italian wines are always very powerful red the red certainly are always very powerful and can be very tannic And so they're taking the the kind of the Barolo model, if you like. What I'm trying to do is say yes, those kind of ones exist, but there's an awful lot more besides. So have you tried this white one? It's actually much broader. It might be chardonnay, for example. Up in your letter, or have you tried a lighter red, like like La Gryne? Do you think one of the problems with with English or sorry British, people is is nobody really wants to admit they actually like wines of the tiny little bit of sweetness even if, it's not written on the label. Absolutely. Yep. So there's that classic, I like sweet, but I'll only admit to being too dry. So one of the great things about prossecco is that it says dry on the label, which has actually been sweet. And and that kind of is is actually quite a good introduction to that kind of thing. And it's it's one of the things that I like to explore with people and and to actually say, there are no right and wrong answers. There are there are no observations that are necessarily wrong. Let's explore what what those are and let's see if we can develop some of those things. And it know, if there are things that you don't like, I'm sure I can find something that you do. You never dreamt of becoming a sommelier, did you? I did at one time. Yeah. Well, in in in my younger days, I've always been interested in in in actually selling and storytelling. But I think these days, I I like to confirm my stories to the written word rather than or or to one events where I can talk one to one or one one to a few people. Just tell me about blockchain. How does that relate to your wine activity? It's an interesting thing because for many years, I was part time. It was always my dream to go full time, which I am now. But I spent most of my life in financial services, which you can imagine is completely different, and often perhaps quite boring in in in comparison. So why was a real get out for me? It was but one of the things I discovered later in my financial services career was a new technology called blockchain. Blockchain is actually the the technology that makes Bitcoin work. And of course, Bitcoin's big whatever you think of Bitcoin, it's it's become hyped and full of full of money. And of course, from there, banks the kind of people that I work for were very interested in using the underlying blockchain to see what else they could do. Why would they want to use it rather than just paper dollars and and physical money coins? Yeah. The one thing that blockchain gives you is, if you like, a version of the truth that is incorruptible. So the the way the tech technology works is that once you've put a a trade or a transaction or an asset onto the blockchain that self, it becomes unchangeable, and there are various complicated mathematical formula to to maintain that. That means that whenever you transact on whatever it is that's on there, in this case, wine or it could be, you know, legal service or it could be a currency. Every transaction is linked to the previous transaction indelibly. So you've got a perfect history from and in this case, in wine, from from growing the grape all the way through to the consumer open the wine and and drinking it in the glass, you have a a perfect history that cannot be changed of where that wine came from, who made it, how they made it, and through whose hands it's been passed, by the time it gets to you. And how much it costs to each stage? And, yeah, you could record that very easily. Do people record it easily because surely that is, in for some cases, quite sensitive information, isn't it? So one one of the things about blockchain, there are things called smart contracts. The idea of a smart contract is to automate all the paperwork and the and the legalities behind a transaction. One of the things that you can do with any item of information in including things like price and terms of conditions is that you do what's called permissioning. And permissioning means that it's that that information is there as an indelible record, but it's turned off to those who shouldn't have any interest in it. So if I was saying buying wine from you, we could come to a commercial transaction, and we could record that that transaction's happened, which is the important thing. But the actual amount of money or or when I need to pay you, or when you're gonna ship the one to me can stay in private demo. Between us. Yeah. Right. So if I study my three euro bottle of wine and whatever you're paying four euros fifty for it. Yep. And you are clever enough to sell it for for six hundred euros a bottle. Yep. That the person that buying it by for six hundred euros a bottle does not know that actually he's or she is paying way over the odds. Correct. Okay. So that's that's kind of one advantage of it. That's your secret. If if I was a dodgy producer or dodgy saying selling a wine from denomination or Apylacian or X Yes. And, actually, I was blending in wine from Appalachian. Why? Yes. Would the blockchain be able to find out that I was I was being dodgy or not? Yes. It was. But what if I if if if if I was buying wine from a dealer who wasn't on blockchain. So I bought Sis, I bought some Merlo Yeah. And I was sending you a Sanjay, and I said, right, here's my Sanjay, and you saw that takes quite a nice, and you're gonna buy it. You would not know that I've actually put Stapmolo in it, which is that's correct. Whereas on blockchain, you would. And one one of the, things that I want to bring it out is about how you can use Blockchain to stop fraud in all its ways. We've we've seen a number of instances this year and and in previous years of people doing exactly what you said, buying cheap wine from some appalachia, you know, Van de France or some repackaging as something very much more expensive and pocketing the the the change, which is different, you know, disenfranchising both the the retailer, but obviously the consumer as well, and and disrupting the whole category. With blockchain, if that wine had been made, and was on blockchain, when it was bought, it would be registered as as a merlot. You couldn't then sell it as a Sanjuvaser. If you try to sell it as a Sanjuvaser, you don't it it would still be caveat emptor, but the person buying could look back at the blockchain records and say, that isn't what you're what you're selling me. But, I mean, if I was really dodgy, you know, having made one, I know in my one, I've got two tanks. I've got one of Sanjay, and one of Merlo, and I'm sending you a tank of Sanjay, but actually I empty the tank of Merlo and send that to you. But if I declared that Sanjuvozie and you taste it. Oh, that's that taste. Alright. It tastes a bit like Sanjuvozie because you're not a regular taster. In that case, on the record, it would say that Monty Sanjuvozie was actually Sanjuvozie, and it would then be up to you outside of Blockchain to get a chemical analysis done. It's actually the DNA of this wine. It was it was grown in Germany, and it doesn't come from from Italy. So one of the things that codify the wine producers like yourself would, I think, appreciate about blockchain is that the quicker you get more wines on the block chain, the quicker it will have a situation where a non blockchain wine will be the one where you go. Hold on a minute. I need to check. Because if you're putting the wine on your blockchain, the most important transaction is is what's for the Genesis transaction. And that's when you as a producer put the wine on because we have to believe the truth of of that first wine. Now you can verify that, for instance, in the vineyard, you could have weather station drone technology. You could have a record of when you you've used biodynamic sprays, for example, you could put on your organic or biodynamic certification. In winery, you could have testing of various stages in in winemaking, but you could also put that isotopic analysis. Yeah. Exactly. So that would guarantee a non blockchain wine wouldn't have that guarantee. So I think that's one of the advantages for people moving situation to that. So what about what about cost? If I if I'm a producer, I'm gonna sell I'm normally, I sell mine for five euros a bottle. Yeah. A new company, it's a month you may really nice mine. Can you pay me or get on the blockchain system? How much extra am I gonna am I gonna have to charge you to cover any costs I may incur. Versioning nothing because the the actual transactions themselves get getting onto the blockchain is a matter of almost public record. The code was actually in when it was invented, was invented as an open source code, and it was it was left by the inventor to the world. Open source code means anybody can use it. Yes. And so you've got various company startups using blockchain. And the cost of adding that wine onto onto the blockchain is no more than it would cost you to fill a ledger in through Excel. Right? It's it's virtually nothing. And it's actually using the same process. You can even use your browser to do it. So it's it's the amount of time that it would take you to upload that data. So there's virtually no costing that what's server. There are some costs downstream because the important thing is also how you track your wine as it moves through the distribution chain to the customer. But there are some very cheap examples like QR codes and RFID tags that are either their cents, even even their RFID tag is is only a few cents in price. Right. And what does RFID stand for? Radio frequency identifier. Okay. And suits And in English, what does that mean? In basic basically, it's like a QR code in that it will broadcast to a to a device like a smartphone, the thing that says, hello, I'm here. Right. If you're in a warehouse or on a ship or however you're transporting the wine, you know that that palette is broadcasting to you. Hello, I'm Montez Merlo, or Hello, I'm Montez Sanchez basic. Where does your interest in this technology stem form? Were you once ripped off as a as a wine merchant or something and you think hang on? I don't I don't wanna be taken for a ride again by a supplier, or is it the technology that fascinated you? It's it's partly the technology, but I think, oddly, it's because in financial services, I became fascinated by fraudsters. One of the reasons was purely intellectual because I've often thought if only you put that incredible skill to good use, we could all be actually quite a lot better off. When I started in wine, I've I've seen a lot of wine frauds and wine scandals over the years. Me too. And I'm always amazed by how easy it is for the wine market to be the victim of frauds at every stage? If you're selling eggs, it's very hard to pretend it's an ostrich egg as an ostrich egg and a chicken egg as egg. It's very hard to pull the whatever somebody's eyes, but in wine, it's very, very easy to do. Yeah. That's right. You've you've you've got a liquid in a bottle and that liquid can be substituted and it can be adulterated. And we've we've seen every kind of fraud from the obvious kind of that's fake labels for the investment fine wine market, but my real interest is actually in, if you like, the the volume market for everyday drinkers where they can be ripped off. And we've seen a large incidence of of fate wine or adulterated wine over the last few years. I remember these consumers getting ripped off, and I'm a consumer. And I don't, you know, that that doesn't sit well, wouldn't it? Paul, it's great to talk to you. You're tired of your company, wine Alchemy Limited just talking about fraudwind. Now why Alchemy Alcony. Because Alconists, we kind of think, oh, you know, I've seen some Alcony in the wine industry where I've blended wine that shouldn't have to, you know, maybe I shouldn't say that. No. I I think sorry. I I think that the the actually that you're making a connection which actually kind of interesting when I'd never thought of that. When I when I named the company Alchemy, I was I was actually following some of your ideas for from some of the things that you'd written in in Harper's about Biodynamics. Articles of which I've still part, by the way. It's a long time ago. It's a long time ago. That's we've both been around a while. And, speak of yourself, mate. One of the, one of the interesting things I've I've found is, in in chemistry, the alchemists were the first chemists. And they were trying to turn Basement into gold. And in a sense, and in a very loose sense, that's what I'm trying to do. Cool. Paul, it's been great to talk to you fascinating conversation. We've never had anybody on the show talking about the things that you've been talking about, a fascinating interview. And, we hope get you back in the future. Yeah. I'd love to come back. See how the see how the blockchain, thing develops in the wine industry. Yeah. Really interesting. Thank you very much indeed. No worries. Thanks, Paul. Thank you. Follow Italian wine podcast on Facebook and Instagram.