If You Sell ‘Oaxaca in a Bottle,’ What Happens to Oaxaca?

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New York Times

Read the full article here.

“Nobody dare order a margarita with any of these, or I will be really upset.”

Fausto Zapata, the chief executive and co-founder of El Silencio mezcal, hovered over a 45-foot-long table at his company’s plush resort outside of Oaxaca City, in the agave fields of southwestern Mexico. Below him: seven bottles of limited-edition mezcals, each with tasting notes embossed on thick, black card stock. He poured a thimble’s worth of $150-per-bottle tobala into five silver jicaras, tiny bowls that are traditional vessels for sipping mezcal.

“Take a sip, leave it in your mouth for 10 to 12 seconds, let your taste buds get exposed,” he said. The second sip was to be consumed in silence — save for the moody guitar piped in through surround-sound speakers — to “get lost in the flavors.”

“Now move on to your next bite,” he said, gesturing at a row of monochrome, glitter-dusted gummies, the confections that might have resulted if Willy Wonka had ventured into triple-digit tasting menus. He explained that some of the treats were made from molé, offered a tangent about the history of mole (“It’s a beautiful story”) and grabbed another bottle by the neck: “Before I forget — you have to try black magic.”

A deep purple liquid poured out, prompting gasps. “All natural,” Mr. Zapata said, “all plant-based.”

“What gives it its color?” the woman next to me asked.

“Trade secret,” said Vicente Cisneros, El Silencio’s co-founder. He sat across from Mr. Zapata in dark sunglasses and a company-branded hat. “Everything we do gets copied in two seconds,” Mr. Cisneros added, shrugging, “but that’s why we’re innovating all the time.”

A legend says that several hundred years ago, in pre-Columbian Mexico, a lightning bolt struck an agave plant and released the juice we now call mezcal. But to the credit of health-conscious consumers, valuation-seeking start-up founders, George Clooney or all of the above: Mezcal’s international moment is now.

El Silencio mezcal at Casa Silencio, a resort outside Oaxaca City. Americans are consuming more of the spirit.

According to Mexico’s mezcal regulatory commission, more than $413 million worth of mezcal was produced last year, up from $350 million in 2019. Americans are consuming more of it than ever: Drizly, the app for alcohol on demand, saw a 600 percent year-over-year increase in mezcal sales in the United States. Large alcohol conglomerates are clamoring to back brands — El Silencio is partially funded by Constellation Brands, whose portfolio includes Corona and Robert Mondavi. Direct-to-consumer start-ups are multiplying like so many spiky agaves under the sun — including one backed by LeBron James, called Lobos 1707.

Smoky and earthy, mezcal has become a mainstay on the menus of trendy restaurants and cocktail bars. But for many people, the drink’s appeal is its authenticity — which means that some of its longtime proponents have mixed feelings about its sudden popularity and interest from businesspeople far from Mexico.

“I never expected this sort of Columbus crusade,” said Bricia Lopez, a Oaxaca native whose Los Angeles restaurant, Guelaguetza, stocks more than 100 mezcals.

Ms. Lopez cringes at hobbyists or investors who talk about “discovering” the spirit. She said she liked the way El Silencio, owned by two Mexican citizens, was growing: sustainably and in a way that aimed to create wealth for the region.

“You cannot buy tradition, and that’s what people who are getting into the mezcal business today are trying to do,” she said. “They’re trying to position themselves next to someone who looks like an Indigenous person, take a picture and be like, ‘I’m authentic, too.’”

Ms. Lopez added, “They start these brands, and they think they’re coming up with a story that’s unique to them, but it’s the same freaking story: ‘I’m a white guy who went to Oaxaca and, like, I fell in love with the people.’”

You can see why they would try, given the case of Mr. Clooney. In 2017, Casamigos, the tequila brand he co-founded, was acquired by the beverage company Diageo for an estimated $1 billion. That sale “prompted this whole rush of people to get into the industry,” said Susan Coss, the co-founder of the website Mezcalistas. “Like, ‘Look, there’s so much money to be made.’ But it’s difficult to build a mezcal brand.”

The most common species of agave takes seven years to mature. Mezcal is traditionally produced in small batches, the smoked agave mashed to a pulp by a donkey and distilled in copper stills. According to one report, tequila had global revenues of $9.4 billion in 2020. Mezcal’s revenues: about 4 percent of that. While tequila is technically a type of mezcal, Jalisco, the state that produces the majority of the world’s tequila, has infrastructure that Oaxaca can’t yet match.

“The biggest brand of mezcal is not even at 100,000 cases,” said Harry Kohlmann, the chief executive of Park Street Companies, which helps fledgling spirits brands expand. “But you have to think about 10 years from now,” he said. “There are going to be several brands who are over 100,000 cases. One will be over one million cases.”

What if mezcal is a sleeping giant, the next natural wine, the next hard seltzer? (Once, there was Zima. Now, there’s a $4.5 billion market.)

Ray Lombard, the executive vice president of Southern Glazer’s Wine & Spirits, the largest wine and spirits distributor in the United States, sees this moment as a tipping point. “The only mezcal you used to be able to buy was the one with the worm in the bottle,” he said. “Now we’re seeing triple-digit growth. The race is on.”

One of the early entrants into the mezcal rush was John Rexer, a New Yorker who created his brand, Ilegal, in 2006. He had developed a taste for mezcal in the 1990s while importing furniture from Mexico. (He had also been bootlegging unmarked mezcal across borders, hence the name.)

Ten years later, enough converts and tastemakers in the U.S. and elsewhere had acquired an affinity for Ilegal that it became a sought-after investment, and in 2016, Bacardi acquired a minority stake in Mr. Rexer’s brand. In 2017, the French company Pernod Ricard bought a majority stake in Del Maguey (known for its green bottles and painterly labels), and in 2019, Constellation Brands acquired a minority stake in El Silencio.

“I think we can be a several-hundred-thousand-case brand,” Mr. Rexer said. “I hate to throw demographics out of there, but mezcal is something that Gen Z and millennials have fallen in love with.”

Its prevalence at much-hyped cocktail bars has a lot to do with that.

“Let’s say you’re from Kansas and you go to Miami for a weekend,” Mr. Kohlmann, who is based in Miami, said. “You go to a bar, you have a cool bartender mixing your drink and through social media, you try to amplify your experience. You want likes, you want to take a picture of yourself with a drink. That drink can’t be rum and coke. It has to be something special. That’s how a lot of fancy brands are being built.”

Also aiding mezcal’s rise: the notion that agave-based spirits are “clean,” i.e., devoid of additives that can trigger a hangover and also act as stimulants, unlike other alcohols.

“No,” said Serena Poon, a certified nutritionist and Reiki practitioner whose clients include Jerry Bruckheimer and Kerry Washington. “All alcohols are depressants.” (She repeated this two more times.) “Straight agave spirits may be ‘cleaner’ because your body isn’t processing as many ingredients as it would with a hard seltzer or sugary cocktail. It’s no different than if you were to have whole foods as opposed to something that’s packaged.”

The same could be said about any additive-free spirit — vodka, say. What makes mezcal especially appealing to certain consumers are the variations in flavor and provenance, whereas premium vodkas pride themselves on tasting like nothing at all. For instance: Clase Azul’s Guerrero mezcal, from the Mexican state of the same name, tastes markedly more woody and sharp than its mezcal from Durango.

“One day, people will be going to Oaxaca the way they go to Napa,” Ms. Lopez, the Los Angeles restaurant owner, said. “It’s already starting to happen.”

Specifically, it is happening at Casa Silencio, El Silencio’s luxury getaway in an agave field. A first-of-its-kind enterprise, the resort might have seemed unrealistic a few years ago; now, it feels prescient.

“We don’t just sell mezcal,” Mr. Zapata said, “we sell Oaxaca in a bottle.”

There is nothing in sight around the compound save for agave spikes; Mr. Zapata and Mr. Cisneros, Silencio’s chief marketing officer, funded the construction of a mile-long road to the outskirts of the nearest town, Xaaga, to make their hotel accessible to guests. They came up with the concept after visiting the Glenmorangie and Macallan distilleries in Scotland.

Mexico City natives and childhood friends, the founders reconnected in Santa Monica, Calif. a decade ago when their children were in the same kindergarten class. In 2013, Mr. Zapata, then a real estate developer between projects, met the founder of Chase Foundation, which provides quality-of-life services to terminally ill children.

Mr. Zapata offered to create a fund-raising event, which quickly became a scheme to turn a Beverly Hills hotel bar into a mezcaleria for a night.

Mr. Zapata asked Mr. Cisneros, a designer, to help with the event. They made four trips to Oaxaca and “fell in love with everything about the process,” Mr. Zapata said. Except one part: transporting unlicensed, unregulated cases of mezcal to the United States.

They cajoled their friends who lived in San Diego to drive to a warehouse in Tijuana; one was detained and forced to pour out his stash. The event sold out. The morning after, Mr. Zapata and Mr. Cisneros woke up to screenfuls of texts, all with some version of the same message: “How do I get your mezcal?” Mr. Zapata said, “I called Vicente and said, ‘Dude, I think we have a company.’”

The investment from Constellation Brands — an amount both parties declined to disclose — helped El Silencio increase distribution and build the resort, which also functions as a distillery and office for some of the company’s 79 employees. Visitors can hack at agaves, hurl them into a smoking pit and nod as guides promote the distillery’s one-ton, solar-powered, stone-grinding wheel as a more humane and sustainable method of mashing the roasted agave than the traditional donkey stomping.

“Those animals defecate while they’re working,” Mr. Zapata said. “We double-distill, but still.”

A subterranean lounge houses mezcals infused with cannabis (not for sale). By the guest rooms sit an onyx infinity pool and lounge chairs draped with fur throws. An amphitheater features a schedule of guests: D.J.s, chefs and, eventually, shamans, who will conduct “ritual healing ceremonies,” per the company’s publicist. Too much?

Not to their investors, Jennifer Evans, a vice president of Constellation Brands, said.

“Their unique approach,” she added, “really resonates with new-age consumers.”

This smoldering industry has enticed newcomers, like the year-old Rosaluna, a brand with a dusty-rose label and icons seemingly inspired by Indigenous art (or at least a quick image search). It’s the brainchild of “best friends who traveled together, drank together and partied together,” said co-founder Nate Brown.

Mr. Brown, a former creative director for Kanye West, and his co-founder, Terry Lee, previously the chief operating officer of MeUndies, did not know how make mezcal when they started Rosaluna. But they were consumers. “We were always really conscious of what we were putting in our bodies. We were agave drinkers,” Mr. Brown said.

On a Utah ski trip a few years ago, a few mezcals deep, they talked about creating a mezcal brand. “We’re not from Mexico, we didn’t know who we’d talk to, but then I was like, ‘Wait a minute, I met this guy named Pepe at a Miami Heat game. What if I WhatsApp-ed him right now?’” Mr. Brown recalled. “I sent him this kind of drunk, novel-length text.”

Pepe Mireles Verástegui became the third co-founder of Rosaluna, which is now the house mezcal of the Soho House club in the United States.

The Rosaluna founders have given equity to J.J. Méndez León Jiménez and Frida Méndez León Jiménezthe Oaxacan brother and sister who oversee the production of their mezcal. David Mayer de Rothschild, the banking family’s youngest heir and the founder of the year-old lifestyle brand Lost Explorer, did the same with his Oaxaca-based producers, Don Fortino Ramos and his family. “There’s a gold rush,” he said, adding that he was aware of the backlash from those who want the spirit to remain local and artisanal.

He sees his brand as about something bigger than returns. “We are all lost explorers,” he said. (His Zoom name is David de Explorer.) “When you’re younger, everything is awe and wonder. You get older and that sense of magic disappears. I want to go back to that place. I think our product does that. It suddenly allows you that feeling of warmth.”

He added, “We endeavor to be a brand that transcends commercial transaction. Maybe it sounds a bit pretentious and worthy, but whatever.”

Critics have bemoaned imperialism in the mezcal industry: the coastal elites flying in, scraping up their juice and selling it for 10 times as much back home. “Maybe they just want to grab some juice, put in a nice bottle and they’re great marketers,” Ms. Lopez said. “Awesome. Good for them. People like that could go to the jungle and sell plants. It’s just a skill.”

When Ms. Lopez buys for her restaurant, she pays attention to who is selling it: “Now, any mezcal that I carry has to be woman-owned, Mexican-owned or has to have the producer in some sort of ownership structure.”

In the case of El Silencio, increased demand for mezcal allowed the company to hire Luis Hernandez, a chemist at the University of Oaxaca, who is working to develop a standardized training program for budding mezcaleros, or distillers — a craft that has traditionally been passed down through generations. El Silencio has hired several of Mr. Hernandez’s students.

Finding economic opportunity without destroying what made mezcal popular in the first place remains an ever-present tension.

“I think the reason why people are going for mezcal is because tequila has become boring,” Ms. Lopez said. But the new kid on the block — or behind the bar — can only stay novel for so long. “It’s the same thing that happened when people stopped drinking vodka and started drinking tequila. ”

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This content is strictly the opinion of Chef Serena Poon and is for informational and educational purposes only. It is not intended to provide medical advice or to take the place of medical advice or treatment from a personal physician. All readers/viewers of this content are advised to consult their doctors or qualified health professionals regarding specific health questions. Neither Serena nor the publisher of this content takes responsibility for possible health consequences of any person or persons reading or following the information in this educational content. All viewers of this content, especially those taking prescription or over-the-counter medications, should consult their physicians before beginning any nutrition, supplement or lifestyle program.

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