Photo Credit: Casamigos
It’s 11 a.m. on a Thursday in May, and Rande Gerber may or may not have a glass of tequila in his hand. Although we can’t swear to it — due to quarantine restrictions, our interview is over the phone — if he did, we wholeheartedly believe that he has fully earned the right to declare, “It’s five o’clock somewhere!”
Despite the current desolate economic climate, Gerber has much to be proud of. This month marks his third anniversary as one of the richest men in America: the result of selling Casamigos, the premium tequila company he created with good friend George Clooney in 2013, to distribution juggernaut Diageo for a cool $1 billion just four years later. His more recent victories are seemingly smaller successes. Note the use of the word “seemingly”: that Casamigos — which he still fully controls — is thriving, not just surviving, in the time of corona is a massive win.
Part of his success as an entrepreneur has been his ability to roll with the punches, and needless to say, he’s been twisting and turning with the best of them right now. “There are definitely challenges, especially now, where there are no restaurants, bars, hotels or casinos open,” he maintains, noting that the company has fully pivoted in response to the current climate. “The focus is now on retail, liquor stores, grocery stores and online ordering. We’re still the biggest growth brand in the market, even during this time.”
This is no mean feat, but Gerber says it’s par for the course. “We’re always up for a challenge,” he declares. “This one was obviously unexpected to the world, but because we can still operate as a small company, we can adapt and move pretty fast. Our philosophy hasn’t really changed [since we launched]. We’re not marketing to stay-at-home, we’re sticking to our plan, making some adjustments, trying to think of what we can do when restaurants, bars and hotels start reopening.”
He and his fully-internal team operate like a small family, strategizing and bouncing ideas off each other virtually between the company’s Malibu and New York offices, currently utilizing daily Zoom calls as their conference space of choice. “We’re getting creative,” he declares. “We put together a Shark Tank type of deal, where we talked to all the employees and said, ‘Come up with some interesting ideas on how you see either the brand improving or things that are missing from the marketplace.’ We gave everyone [this] opportunity as a way of keeping them interested and excited about the brand. Whether you were a salesperson working in a control state or working in the media department, everyone had the same chance. It was great to see what came from just giving people an opportunity to go beyond what their job description is.”
“As owners — George and myself and [Discovery Land Company CEO] Mike Meldman — we know we didn’t get here alone; it was due to the hard work and dedication of our team. When I do our employee reviews twice a year, I ask them, ‘Are you happy with your position? Give me the pros and cons. Is there another position you would like? Do you see yourself going from sales to marketing?’ It’s important to take care of your employees. I want to give everyone an opportunity to love what they do; I want everybody to be happy in their jobs. If someone is interested in moving to a different division, I’m happy to give that a shot. You really need to be passionate about what you do. Our team is young, passionate, creative, dedicated and loyal. They truly understand and love our brand, and appreciate it’s not only the best tequila, it’s also a lifestyle that we all live. Treat team members the way you would want to be treated, then you hopefully have a success, as we did and continue to do today.”
This kind of mentality is one of the many reasons that employees are clamoring to work at Casamigos (their legendary, week-long, off-site, team-building company retreats in hot spots like Las Vegas are another); Gerber is the kind of boss who’s part mentor, part friend. He really listens to what his staff has to say, and it doesn’t go in one ear and out the other, either. He’s a role model who leads by example.
Photo Credit: Casamigos
“I know what I know, but I also know what I don’t know, so I try to surround myself with smart, talented, creative and dedicated people. Most of my staff is younger than I am, and because of this, they see things differently than I do at times. Even when I make a decision, I run everything by my team. ‘What do you think of this design? What do you think of this idea?’ I’m never one to say, ‘This is the way it’s going to be; I don’t respect your opinion.’ I don’t necessarily always agree with it, but I’m always open to hearing it. It can never hurt to listen to others. For me, it’s really important that I listen to everyone on our team no matter what their job title is. As the world changes, you have to, at times, rethink the way you do business, and I’m always open for discussion.”
Success, to Gerber, is not a solo achievement. He owes as much, if not more, to the people around him as he does his own business acumen. And so he gives back to them in the best way he knows how — in our opinion, an innovation that more companies should be employing today.
This is, no doubt, why, all before the age of 55 (he’s now 58), Gerber founded two major nightlife companies — Midnight Oil and the Gerber Group; pioneered the ‘hotel bar’ concept across America with his The Whiskey Bars; kickstarted the nightlife scene in South Beach, Miami, as we know it today with the 1991 opening of his The Whiskey on Ocean Drive; launched his first liquor brand, Caliche Rum, in 2012; and sold his second to the tune of $1 billion in 2017.
His own passion for the brand is clearly infectious (in the good kind of way). He eats, breathes, sleeps and drinks Casamigos, the latter multiple times a week, if not a day. “[I’m drinking Casamigos] pretty often, quarantine or not, depending on what my schedule is for the day,” he laughs.
His tequila brand has almost become a member of the family at this point. He and Clooney hand-crafted a Reposado for personal use only—as a literal “house tequila”—while building their matching Mexican dream homes in Los Cabos (which they’ve since sold). Incidentally, this is where the brand’s name comes from: Literally translated, “Casamigos” means “house of friends.”
“George and I decided to make tequila just for ourselves and to drink with our friends. We wanted something that was perfect for us. We weren’t thinking about starting a company or ever selling any of it. It was strictly for us to drink,” he explains. “We wanted something we could sip all night and not have to mix, something that was smooth and didn’t burn and was pure. Ours is one hundred percent pure Blue Weber agave, and we thought, ‘Why cover up such a great product if you don’t have to?’ By being able to drink it clean as we do, we realized that you’re not going to get hungover, because you don’t need all those sugary mixers.” [Although he and Clooney drink theirs neat or on the rocks, he does note that it mixes well, too: his wife of 22 years, supermodel Cindy Crawford, frequently muddles hers with jalapeno and cucumbers.]
These tequila-fueled nights became legend, both in Mexico and at home in Malibu. After trying the tequila, friends would clamor for bottles. Gerber knew he had a hit on his hands, though it was some time before he and Clooney decided to officially start the ball rolling on retailing their drink of choice.
“This was something that took us two years to develop, and it had to be perfect. We knew that we had a very unique product that was the best, at least for us. And we knew that once we got the end result exactly as we wanted, two years and 700 bottles of samples later, that it was perfect. We’d serve it to friends when they came over, and they’d ask for a bottle.”
Photo Credit: Casamigos
Gerber had absolutely no doubts that Casamigos would be successful. How could it not? “We were definitely confident that it would succeed. We thought that we loved it so much and all of our friends loved it, that the word would catch on when we made the decision to launch. And it did.”
Since its launch, the brand has gone from strength to strength, and Gerber insists again that much of the credit should go to the people who support him. “Like I said before, I know what I know and I know what I don’t know. When I sold my bar and restaurant business and got into this business, people were like, ‘Oh [Casamigos] is a natural progression.’ Actually, it’s not at all. Yeah, I used to buy liquor, but that was the only thing I knew about the liquor business. I knew what I liked to drink and what I didn’t. But when it came to starting a company, I did know to go to the best.” So he hired Lee Einsidler, the former CEO of power player Sidney Frank Importing Company, who was responsible for creating the buzz around Jagermeister and Grey Goose; Einsidler is now the CEO of Casamigos.
“[Lee] fell in love with Casamigos. He pitched us on the brand, which he had never done before. He said, ‘For the first time in my thirty-something years of being in the business, I’m going to pitch you guys. I’m the right guy for you,’” Gerber recalls. “It was the greatest thing that we’ve done. We couldn’t have taken the company to where it is today without Lee on board. He’s just one of the boys. We had a handshake deal, and to this day I don’t think we have anything in writing.”
Trust is clearly big in Gerber’s playbook. When starting the company with Clooney and Meldman, a handshake wasn’t even necessary: a cheers alone sufficed. Though this did make us wonder: how has mixing friendship and business, a notoriously oily combination, worked for the three amigos?
“[In general, going into business with friends] can be tough, but in all honesty, because we weren’t thinking of going into business together and it happened organically, it’s not. For me, I run the company. We started the company, I do the day-to-day. I have my job, which is really overseeing the entire company. George has a day job: he’s an actor, producer and director. He comes to meetings; he loves the business and its easy since its all he drinks. My friend and partner, Mike, is the same. He’s in the real estate business, but he loves Casamigos and takes every opportunity to share it with friends and is a great partner. We all play a somewhat different role.”
Then, there’s the fact that the brand was intended to be a labor of love as opposed to their main sources of income. “None of us got into this to start a company, none of us needed more money. It’s easier to start a business with friends when you’re all in it for the same reasons, and it’s not something that has the stress of, ‘We have so much money sunk into this that if it doesn’t work we’re going to go broke’. I put money in, George put his money in, Mike put his money in. We didn’t raise money from friends or bring in outside investors. If it worked, it worked, and if it didn’t, it was our money and our decisions. Either way, we had the perfect tequila made by us for us.”
Photo Credit: Casamigos
On that note, he maintains, “You do want everyone to give what they can. I might put in more hours, but my partners contribute just as much as I do, just in different ways. A lot of people are like, ‘You’re in the office every day, you put in all the time,’ but I don’t expect them to do things that they can’t do or don’t want to do, and they don’t expect me to do things that I can’t do or don’t want to do. But we do expect each other, as a team, to do the best we can to have the best possible outcome.”
No one could have expected a better outcome than the sale to Diageo, a $700 million initial payout with potential of a further $300 million linked to positive performance over the following decade — another challenge that Gerber & co. are rising to. And although selling to the British spirits company, which also owns Johnnie Walker and Guinness, as well as a minority of LVMH, among others, might have caused internal struggle given that the company is so near and dear to his heart, Gerber says there was virtually no indecision on his end.
“The only hesitation I had was that I had just sold my other company and I wasn’t expecting to get back into business; I wanted to take a break for maybe a year. But, I also love starting companies. If I’m going to put my time and effort into it, I have to be passionate about it, and it’s going to be one hundred percent and 24/7. Although we sold Casamigos to Diageo, our involvement remains as it did from day one. I still run the company, George and Mike are still as involved as much as they have always been, and we’ve kept our employees together. The great thing about working with Diageo is that we got to keep our team together and run it as we always have — those were some of our conditions. They are a great partner and fully support our vision. We would never have sold [it otherwise]. This is truly a lifestyle for us.”
Though Casamigos is fully integrated into his daily routine, for now, Gerber’s reality is more of the casa de familia variety: he’s quarantining at home in the ‘Bu with his wife and children, models Kaia, 18, and Presley, 20. For a man that’s made a living drinking and doing what he loves, COVID-19 hasn’t changed his perspective on life, but made him more appreciative of the one he already has.
“For me, family always came first. It’s really nice having my kids around. We’re all in this together at our house in Malibu. It’s been interesting to see how well they’ve adjusted [to life in quarantine].They say, ‘We actually don’t miss going out.’ They miss their friends, but they don’t miss the hustle and bustle of [life in L.A.] or have a fear of missing out on things. They’re taking advantage of the time: My daughter has a book club and is taking guitar classes and acting classes online. My son is working on a clothing line, surfs and is working at our restaurant, Café Habana. It’s nice to see them adjusting, and not just desperate to get out of the house and back into the world. I think that’s really nice, just to have the family together, because this would typically be the time that some kids are off to college. I do feel that on one hand, it’s kind of been a blessing that we’ve been able to be together.”
Even during this uncertain time, Gerber has managed to find the silver lining. His business is not only on track, but even growing (since its acquisition by Diageo, Casamigos has expanded its existing range of an Anejo, Reposado and Blanco to include a Mezcal); he and Cindy, as well as Irving and Shelli Azoff, Mike Meldman, Jeff Shell and Jay Sures can look forward to reopening Beverly Hills institution Nate ‘n Al’s deli in the near post-COVID-19 future; he can pop into Café Habana, his family’s buzzy Mexican eatery at the Malibu Lumber Yard down the street; and he’s spending precious time with his family. What more can a man ask for?
RANDE GERBER’S GUIDE TO MALIBU
Photo Credit: Henry Hargreaves
I’ve lived in Malibu for twenty years. Even though Malibu has changed [over that time period], there are still great local spots that you can go to. It still has a very small community vibe, although in the summer it gets a bit busier with tourists and people wanting to go to the beach. The other eight, nine months of the year, it’s still a small community.
1. Café Habana. That’s our family’s restaurant, and it’s the local spot where everyone goes. That’s the favorite.
2. Nobu Malibu. It’s beautiful and on the beach.
3. SunLife Organics. [It’s] great for healthy smoothies.
4. Tra di Noi. A great Italian.
