Crushpad Napa has warned it is likely to close its operation if it fails to find funding, and has sent an email to clients warning that a 'wind-down process' is imminent.
Despite assurances that the Napa-based custom crush outfit is still ‘open for business’, it seems increasingly likely the company is in financial difficulty, having missed out on a recent US$500,000 round of funding.
On 13 June Crushpad CEO Peter Ekman emailed the company’s investors, detailing that its recent attempts to complete new financing were not successful.
‘Therefore we are now in a position where we lack sufficient funding to continue operations beyond the end of the month,’ the email said.
The company reportedly hopes to make up the shortfall through a new investor. Ekman told clients, ‘If we do not receive sufficient interest, we will be forced to initiate a wind-down process in the very short term.’
The email was published on 19 June on US website WineIndustryInsight.
Crushpad founder Michael Brill told Decanter.com via email, ‘I hope we’ll have some good news shortly.’
However, several industry insiders in the US confirm that Crushpad’s business model – where high-net worth individuals each make their own barrels of wine – has been hard hit by the recession.
‘They have a lot of affluent customers,’ one observer said today, ‘but many have not survived the recent financial crisis, and now don’t have the US$10,000 needed to pay for the wine they have made.’
The Bordeaux outpost of Crushpad, as reported on Decanter.com a few weeks ago, is now part of the Cazes family business in the wine tourism village of Bages, and is not affected by the finances of its Californian parent. The two companies maintain a cross-marketing relationship, but have no financial links.
Crushpad Bordeaux director Stephen Bolger confirmed, ‘The whole of Crushpad Bordeaux’s operating activities have been taken over by an entirely separate entity owned by the Cazes family. This entity is well-funded and ensures the completion of all client wines and, more importantly, the continued development of our Bordeaux operation. Just last week we signed the contracts for our new winery building and submitted all the necessary building permits.‘
An (already planned) rebranding of Crushpad Bordeaux is going ahead in the near future.
Written by Jane Anson in Bordeaux