In the world of whisky, Scotland’s rich heritage of crafting the world’s most revered spirits stands alone. Graeme Macaloney, a visionary who hails from the land of scotch and centuries-old whisky distilleries, brought with him more than just a passion for distilling when he ventured to Canada. He brought a dream. A dream that would eventually become a reality thanks to some innovative ideas and the help of hundreds of enthusiasts through crowdfunding.
After moving to Canada and being blown away by British Columbia’s craft beer industry, he decided to combine his love of whisky and beer by opening Macaloney’s Island Distillery & Twa Dogs Brewery in Saanich on Vancouver Island. Today, its concoctions have found global acclaim, winning multiple awards, including World’s Best Pot Still at the 2023 World Whiskies.
Macaloney’s story is not just about creating award-winning spirits but also about how community capital through Brewfundr transformed his vision into a global success. Macaloney’s Island Distillery & Twa Dogs Brewery stands as a beacon of how traditional craftsmanship can merge with modern crowdfunding to create something truly exceptional.
In the competitive and dynamic world of craft brewing and distilling, standing out requires more than just creating excellent products; it demands ingenuity in business and innovative marketing strategies.
I told them, ‘how would you like to be a part of this rollercoaster ride?’
Graeme Macaloney
The Challenge
Graeme Macaloney faced a common dilemma in the industry: high start-up costs and the need for a distinctive approach to attract customers and investors. Fortunately, he had a background in venture capital (VC), having built an angel investor network in Alberta as well as raising capital and setting up some venture capital funds in biotechnology.
“Before crowdfunding was a thing in Canada, I had come into this from a background where I’d helped build an angel investor network,” Graeme shares “And so with that experience, both sides of the VC creation, and having worked with Angel investors, I felt the perfect way to finance this apart from mortgaging my house, which is nowhere near enough money to pay for all of this was to really develop the concept of a distillery and brewery built by Canadians for Canadians.”
Without any real platform or followers early on, Graeme did his own version of crowdfunding, travelling coast to coast pouring whisky from a nonexistent distillery at whisky clubs, selling them on his dream. He said: “I told them, ‘how would you like to be a part of this rollercoaster ride?’”
Those initial investors are still part of Macaloney’s regular founder-owners program and today, the distillery and brewery has 700 common-shared investors as its co-owners.
Culture of Innovation
As his business started to grow, Graeme wanted to create more than spirits and beers. He wanted to create experiences, a sense of ownership.
With the help of some innovative crowdfunding initiatives, he has been able to realise his dream while taking his most loyal customers along for the ride.
Whisky for Life!
At the heart of Macaloney’s Island Distillery lies an innovative program that encapsulates its bond with investors: the Whisky for Life program.
Whisky for Life, as Macaloney explains, is a recent initiative that offers participants the chance to buy preferred shares, which in turn offer an annual dividend. However, the real allure lies in the option to convert this cash dividend into a store credit, with an added 15% bonus. This credit can then be used to purchase Macaloney’s whiskies or beers. Investors are not just putting their money into the distillery; they’re getting a piece of its heart and soul in return.
The program doesn’t stop at dividends turned into delightful drams. Macaloney emphasized the additional benefits, noting that investors enjoy perks like “access to our whiskey Academy, and free tours, unlimited tastings for friends, family colleagues.” This innovative program bridges the gap between consumer and investor, creating a community deeply invested in both the financial success and the craft of the distillery.
In a market where traditional investment and customer loyalty programs are the norm, Macaloney’s Whisky for Life stands out as a creative fusion of investment, education, and indulgence. It is not just an investment in a distillery; it’s a lifelong journey into the world of fine spirits, a testament to the power of community capital in shaping the future of craft distilling.
The Cask Program: A Personal Legacy in Every Barrel
Macaloney’s Island Distillery & Twa Dogs Brewery has introduced another creative initiative it calls the Cask Program that allows aficionados to to design their own whiskey and leave a personal imprint on their very own barrel. This program, as Graeme describes, is not just about owning a part of the distillery’s output; it’s about crafting a personal legacy.
Participants are given the opportunity to choose from different styles of whiskey – classic single malt, peaty, or an Irish style. The customization extends to the selection of the cask as well. Enthusiasts can opt for classic bourbon wood, Oloroso sherry casks, or even a unique Sherry whiskey, among others. And devotees will not have to wait a decade to taste their hard work. Thanks to some reduced aging techniques, Graeme says that the whisky “will be ready in three years three, three and a half years at most.”
Once matured, the patrons are invited to partake in the bottling process, further personalizing the experience by designing their own labels. The immersive experience allows patient patrons to not only save about half price per bottle, but also turn their passion into a tangible and tasteable reality.
The Whiskey Academy: Sampling the Art of Distilling
The Whiskey Academy offers fans of Macaloney the chance to learn about the art of distilling. As described by Macaloney, the Academy offers a comprehensive two-day journey through the distillation process, including lectures and the chance to experience the evolving flavours. “You get taken into the warehouse to sample cask samples, taste the unique flavors coming off the pot stills, and I put you through a blending class, where you create your own unique blend of whisky” Macaloney elaborates.
People can pay to attend the academy, for less than $2,000, but investors get access for free, providing another incentive to become a shareholder.
The Whiskey Academy is a testament to Macaloney’s commitment to transparency and community involvement. As an opportunity for enthusiasts to actively participate in the whiskey-making process, thereby fostering a deeper appreciation and connection to the spirit.
Maximizing Community Capital
Graeme speaks passionately how Macaloney’s Island Distillery & Twa Dogs Brewery’s investor network has opened unforeseen doors. “The networking is phenomenal,” he says, revealing how a founder-owner’s chance meeting with a whiskey importation company owner on holiday led to an international distribution deal. “He says: ‘Hey, I part-own a Canadian distillery title, do you have any good whiskies that you sell in Switzerland?’ And the guy said: ‘We’re always looking for world class whiskies.’” As a result of the encounter, Macaloney’s is now preparing an entire pallet of its finest spirits to send to Switzerland.
Graeme also recounts how he was able to locate some local peat thanks to the investor network after being told by The Canadian Sphagnum Peat Moss Association there were no producers in BC. An owner-investor was able to tell Graeme about a BC interior-based harvester of a different kind of carpet moss not registered by the association. Graeme notes: “We are the only distillery outside of Scotland – and there’s only seven left in Scotland – who peat smoke our own barley at the distillery.” Evidence that just as it takes a village to raise a child, it takes a network to grow a distillery.
Going Global
The global footprint of Macaloney’s Island Distillery & Twa Dogs Brewery is expanding, with their whiskies making a mark in the European market and beyond. Graeme proudly outlines the distillery’s international reach, “Now we’re in Germany, Netherlands, Switzerland, Austria, Italy, etcetera,” showcasing their growing presence in some of Europe’s most discerning markets. International expansion is high on Graeme’s agenda, “Right now we’re in 10 countries,” he says. “I want to be in 30 or 40 in very short order.” For owner-investors it is hard not to get excited about a Canadian creation you helped bring to life being enjoyed by enthusiasts in far off lands. What started as a dream on an island on Canada’s west coast can unite people across oceans.
Macaloney’s Island Distillery & Twa Dogs Brewery demonstrates that combining quality craftsmanship with innovative community-focused strategies can lead to significant success. Their journey serves as an example of how aspiring producers can harvest the potential of community capital to turn their customers into long-term partners.
