New Zealand wine's newest fine wine player
"I know what people are going to say. They'll say, 'Smith has found some money and he's doing the same thing all over.' All I can say is that this is going to be very different."
We're at a smart Auckland restaurant. Steve Smith MW is giving us the lowdown on his new wine venture, a partnership between himself and American Brian Sheth, who is also present. Sheth is 41 years old, with a 200-watt smile. And yes, he is very wealthy. Just a few moments before he received a text he shared with the table – "It looks like I've just bought a new software company". He said this in a matter-of-fact, business-as-usual way. Vista Equity Partners, the private equity company he founded, makes around 30 such multi-million dollar acquisitions annually. A year ago Forbes magazine put Sheth's net worth at US$1.1 billion.
Smith is all too aware of the déjà vu at play here. It is 18 years since he co-founded Craggy Range, a venture that married his vision (and subsequent sweat) to the financial backing of the Peabody family. The relationship ended when Smith extricated himself completely from the business in 2015.
The original idea for Craggy Range was "single vineyard, single minded". The goal was to showcase terroir-driven wines that were expressions of great sites around New Zealand.
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"After a time it got too big to be able to do that in the way I had conceived it," says Smith. "I found myself getting further away from the reality of 'single vineyard, single-minded'. Craggy's decision to move away from producing single-vineyard wines was a signal that it was time I returned to the things that meant most to me." He pauses, then adds: "Craggy Range was one of the great wine projects in the world at the time. I feel privileged to have been a part of it."
Several years ago Brian Sheth began making regular forays to New Zealand, having become smitten by the place and its wine. In 2012 he introduced himself to John Buck, co-founder of Te Mata Estate. He asked Buck if he would consider selling Te Mata. Buck, never one to mince words, responded by telling the American he exemplified everything that was going wrong with the New Zealand wine industry. "After that he was very polite and showed me round," says Sheth.
On the same trip, Sheth met Steve Smith. They enjoyed each other's company, and got together again at Smith's beach house the next time Sheth made landfall in Aotearoa. Sheth suggested they do something together in New Zealand wine. Smith, by then post-Craggy, was up for a new adventure.
The new project's arrival has been sotto voce, with the first wines having quietly entered the market at the beginning of August. It has already evolved from its founding concept. "The original idea was for me to find great parcels from exceptional vineyards, curate them, and we'd create a brand around that. We've done that by collecting an initial group of wines under the Smith & Sheth 'CRU' banner. In that way, we're like an old-fashioned Burgundian negociant – owning vineyards is not what it's about, but provenance is still championed," says Smith.
"Then the opportunity came to buy existing brands that were proven and which we admired. That's when we expanded to create Aotearoa New Zealand Fine Wine Estates. This will be a collection of wine estates under one umbrella. Each estate retains its individuality and brand identity, but by bringing them together with our resources, we can raise their profiles in a way they couldn't individually."
Straddling those two concepts is something Smith feels strongly about. He's convinced the time has come for the high end of New Zealand wine to go forth and conquer. "We want to tell the New Zealand fine wine story – if we don't, all the world will hear about is Marlborough sauvignon blanc. I don't think you could have told this story any earlier. We needed to go through 25 years of finding out what we're like and we needed to achieve some vine age. Now… we're ready."
Two estates have so far been purchased – Pyramid Valley Vineyards in North Canterbury and Lowburn Ferry in Central Otago. Roger and Jean Gibson have spent the last 20 years planting and nurturing their Lowburn Ferry vineyard and the pinot noir that has flowed from the site has been much-acclaimed. "It's a remarkable vineyard," says Steve Smith. "Deciding to sell wasn't easy for them. It was as much about who they were handing it over to as it was about money."
It was a similar situation with Pyramid Valley Vineyards, which has been a labour of deep devotion for Mike and Claudia Weersing from the moment they bought the limestone-rich site near Waikari in 2000. But things had come to a head – the Weersings wanted to grow the business and needed new investment to do that. They were also "not getting any younger", in Claudia's words, and were open to the idea of someone else taking over. It just had to be the right someone.
"Brian and Steve came here and one of Brian's first questions was "are you organic or biodynamic?", says Claudia Weersing. "He's so conservation-minded and he loved it that we were certified biodynamic. That philosophy is important to us and he wants to keep it and step it up. People need to know this… that our vision will be maintained. It's what Pyramid Valley deserves and what New Zealand deserves."
Sheth's green streak does run deep. A self-confessed "big believer in climate change", he and his wife Adria are involved with a number of environmental initiatives through their philanthropic entities Sangreal Foundation and Global Wildlife Conservation. Our own Department of Conservation recently received financial assistance from Sangreal to help save the kakĪ (black stilt) from extinction. Expect more, says Steve Smith.
"He has a love affair with this country. On his first trip he drove around the country and had the time of his life. He found that many Kiwis shared his values, so he feels an investment here can make a positive difference.
Sheth loves sport, another passion he and Smith share. He grew up outside Boston in a hard-knock neighbourhood and when he and his old mates from those days get together, "we just start hitting each other and talking about the New England Patriots", he says. After being a key sponsor of the All Blacks on their northern tour last year, he is on first-name terms with Richie McCaw and Dan Carter. He wears an ABs replica jersey to tests. Rumour has it he's also learning every verse of Ten Guitars.