The spirits company is building a $25m distillery on a 36ha site above Lake Dunstan, between Cromwell and Tarras, which will be the largest in New Zealand.
Yesterday, co-founder Daniel Mclaughlin said it had been a good year for Scapegrace which will celebrate a decade in business in February next year.
It marked a milestone of selling more than 100,000 cases of product — gin, vodka, single malt whisky and RTDs — in the 2023 financial year to more than 42 countries while revenue of $12.7m was a jump of 30% on the previous year. A similar increase was expected next year.
To help fund its expansion, Scapegrace secured $13.9m of new capital this year, including $2.9m of government funding from the Kanoa Regional Economic Development and Investment Unit.
Scapegrace was co-founded by Mr Mclaughlin and his brother-in-law Mark Neal, both previously involved in the liquor industry, and Richard Bourke.
They noticed how New Zealand was under-represented on the world stage for spirits, despite boasting a massive wine industry, and they saw a significant opportunity.
Mr Mclaughlin said phase two of the development, which included the distillery, was tracking well and was on track for commissioning to start in February and handover in March.
Scapegrace’s whisky sales were still "fairly modest" and, once operational, the new distillery would provide a 25-fold increase in whisky capability. Single malt whisky was projected to generate an annual wholesale value of $33m.
Mr Mclaughlin was in discussions with potential investors and he was confident of reaching the $8m when the capital raise closed on October 31.
Of the $5m raised, there were between 25 and 30 investors ranging from the minimum investment of $50,000 to the largest of $1m "and everywhere in between".
It was also a fun industry to be involved with.
Scapegrace had gained "really strong support" from Otago investors. About 65%-70% of its shareholder base, including himself and Mr Neal, were from the region.
Scapegrace comprised a small, agile team, both in New Zealand and globally, who were "really passionate and committed to the cause". It had a "really big win" recently in the United Kingdom with a listing across all Waitrose supermarkets.
It had been trying for about eight years to get into Waitrose. It was the result of tenacity and perseverance, helped by getting "runs on the board" and awards and accolades, he said.
Scapegrace Gin was voted World’s Best London Dry Gin at the International Wine and Spirits Competition in London in 2018 and, in August, received the highest accolade at the Global Spirits Masters for its single whisky. Scapegrace was also voted best looking gin bottle in the world at the San Francisco Spirits Competition.
New Zealand was getting a name for its spirits internationally, the wine industry having helped carve the path for the spirit industry, Mr Mclaughlin said.
Asked about trends in the spirit industry, Mr Mclaughlin said new world whisky was huge internationally and Scapegrace saw growth opportunities in that sector. It was a challenging space and barriers to entry were a lot harder than white spirits.
In July, Scapegrace brought back Rogue Society to the domestic market; Rogue Society was the original name of the brand between 2014 and 2018 before a name change was required to enter international markets.
Rogue Society’s gin and vodka was retailing in the premium segment of the market which was dominated by mass-produced international spirit. That segment where it was positioned was a big opportunity, giving consumers an ability to purchase something more affordable while still supporting a New Zealand-made product, he said.
