Element seeks to be world’s first open innovation whiskey company
Co-founder says spirits will be inspired and developed based on consumers’ feedback and ideas
Element strives to be the world's first open innovation whiskey company, Fionn Cox, co-founder, Element Irish Whiskey, said.
“We wanted to create an alternative experience of Irish whiskey for the new era of whiskey drinkers who want to explore beyond the standard,” he said.
On a mission to democratise whiskey, he said: “Besides whiskey, my business partner and I have a background and an interest in technology, and we asked ourselves what would happen if we did things differently compared to other whiskey companies.
“Instead of telling our customers what to like, what if our whiskey could be inspired and developed based on consumers’ feedback and ideas? The idea for an open innovation whiskey company was born.”
Poised to capitalise on the exceptional growth within the Irish whiskey category, Element targets the new generation of younger, adventurous and increasingly experimental consumers.
Element Irish whiskey is to launch its first product, Fusion Series R/1.0, in the last week of November and will be initially available via the website. Fusion Series R/1.0 is a small-batch blended whiskey composed of both single malt and single grain spirits which are matured in a combination of former bourbon, virgin American oak, oloroso sherry and seasoned stout casks.
They are already working on the next release, a single malt Irish whiskey, which will be on the market in spring 2023.
The promoters, in conjunction with Wexford LEO and Bord Bia, have self-funded the entire development; 3,000 bottles of whiskey have been produced this November.
“Our open innovation product development model will facilitate the creation of the next best whiskey. Open innovation is based on the concept that leveraging the ideas and feedback from the crowd (consumers) and using this input to create the next best is more powerful than looking inwards alone,” Cox said.
A concept born in the tech sector, open innovation is seen in many industries today and is fundamental to a variety of organisations from Lego and Nasa to Ben & Jerry’s.
Element Irish Whiskey seeks to challenge the status quo and empower its consumers to shape the direction of the next release, said Cox, adding that the aim is to explore the possible, where whiskey meets tech.
Cox has a background in food marketing and product development and has worked across three continents in sales, marketing and operations roles – most notably with a large multinational whiskey company focusing on brand development and marketing in West Africa.
Non-executive director Alf Smiddy is a chartered accountant by trade who has worked at senior levels in the Irish and international beverage sector for 25 years. Non-executive director Cormac O’Neill is a serial entrepreneur with a retail, travel and technology background. “Cormac is an experienced CEO/CFO who brings an extensive execution track record to the team,” said Cox.
The Element Irish Whiskey proposition is based on delivering premium, innovative and adventurous alternatives to a younger, more affluent target market who are more likely to try new and differentiated offerings.
“Our primary focus is within the premium and high-end premium segments,” said Cox. “Irish whiskey sales ($4.2 billion) are outpacing global whiskey growth by almost 50 per cent (9.2 per cent compound annual growth rate, CAGR vs 6.5 per cent CAGR). This is mainly driven by the bigger players, but smaller premium brands are also growing on the back of this success.
“Sales are forecast to double to $7.7 billion by 2027.”
Cox said that the US represents the largest single territory (42 per cent of sales today), but non-traditional territories such as Africa and the Far East present greater opportunities to premium brands due to their emerging middle-class demands.
“Our target demographic (Gen X/Y) are the largest single group of consumers (29.5 per cent), they have the highest percentage of female consumers (35 per cent) and exhibit the fastest growth for new entrants of any demographic. These consumers’ desires are not fulfilled by the current market offering.”
Cox added: “Firstly, we want to build credentials in Ireland and Europe before seeking to expand into the non-traditional territories in Africa and the Far East.”
The company has received a first order from Nigeria – the fastest growing market in the world for Irish whiskey with 390 per cent growth (2016-2021) – which will be shipped in early 2023.
The business is raising a further €600k investment under EIIS. Cox said the funds raised will be used to accelerate sales and marketing across retail, drive new export business in Africa and the Far East, and expand e-commerce sales in the EU.
This investment offers investors the opportunity to participate in a business venture with a company operating in a fast-growing market and to avail of income tax relief for their investment under the EIIS. The business is also offering an additional 20 per cent return on investment after four years.
Example for a €25,000 investment
(i) Cost of investment, €25,000 + application fee (3 per cent), €750 = Total cost €25,750
(ii) Tax relief/return EII relief 2022, €10,000 = Return €5,000
Tax benefit and return €15,000
Initial capital €25,000 less placement costs (€750) = Total gross return €39,250
For more information, contact: fionn@neweraspirits.com; see elementirishwhiskey.com
