Startups

Bright Cellars lands more funding to personalize its subscription-based wines

Comment

Image Credits: Bright Cellars /

Bright Cellars, a six-year-old subscription-based wine seller has, like many upstarts, evolved over time. While it once sent its club members third-party wines that fit their particular profiles, Milwaukee, Wisconsin-based Bright Cellars says it’s now amassing enough data about its customers that it no longer sells wines made by other brands. Instead, while some of its “original” offerings are admittedly sold by other labels under different names, it is increasingly finding success by directing its winemaker partners to tweak the recipe, so to speak.

“We’re optimizing wine like you might optimize a more digital product,” says co-founder and CEO, Richard Yau, a San Francisco native whose startup entered into a regional accelerator program early on and stayed, though the company is now largely decentralized.

We talked earlier today with Yau about that shift, which investors are supporting with $11.2 million in Series B funding, led by Cleveland Avenue, with participation from earlier backers Revolution Ventures and Northwestern Mutual. (The company has now raised roughly $20 million altogether).

Yau also talked about industry trends that he’s seeing because of all that data collection.

3 issues to resolve before switching to a subscription business model

TC: You’re building a portfolio of wines. What does that mean?

RY: We don’t own any land. We’re working primarily with suppliers [as do big companies like Gallo and Constellation], but at a larger scale than before, so we now get to shape what wines taste like and look like, and we can optimize across variables like how sweet should this wine be? How acidic? What do we want its color and brand and label to look like and which segment of our customers will really enjoy this wine the most?

TC: What’s one of your concoctions?

RY: We have a sparkling wine that’s produced in the Champagne method — not a Champagne wine; it’s a domestic wine — using grape varietals that no one uses for sparkling wine, and it’s one of the top-rated wines on our platform. Sparkling wine has been really good for us.

TC: How many subscribers do you have?

RY: We can’t share that, but we saw an acceleration in not just new subscribers throughout the pandemic but also in terms of seeing a larger share of [customers’] wallets going to D2C, and that impacted us pretty positively. Even as things eased up over the summer, we saw that people were cooking and eating at home more [and drinking wine].

TC: What’s the average price of a bottle of wine on the platform?

RY: $20 to $25.

TC: Where are your grape suppliers?

RY: A lot are on the West Coast, in Washington and California, but we also have grape suppliers internationally, including in South America and Europe.

TC: How many wines do you offer, and how long do you trial a wine?

RY: We’ve tested around 600, and at any given time, we’ll have 40 to 50 wines on the platform. We don’t stock everything forever; those that don’t do as well, we basically eliminate.

TC: A lot of D2C brands eventually branch into real-world locations. You aren’t doing that. Why not?

RY: It’s possible that we might at some point, but we like being D2C and it makes a lot of sense in a world where our members now work from home and are home to receive packages. It lines up with e-commerce trends in general. If you’re not buying your groceries at the store anymore, you aren’t buying wines at the store, either.

TC: From where are these bottles shipped?

RY: From a variety of places, but primarily from Santa Rosa [in the Bay Area].

TC: Have you seen the impact the weather is having on California winemakers, some of whom are now spraying sunscreen on their grapes to protect them?

RY: [Climate change] has certainly affected the wine industry. One of the fortunate things about us is we have flexibility in the suppliers we’re working with, so from a business-health perspective, we haven’t been as affected by that. Because a lot of our operations are in California, we did a couple of years ago have some interruptions with distribution where we weren’t able to ship some days; we were also impacted by warm temperatures. But fortunately, so far for this year, we haven’t had any operational or supply-chain disruptions.

TC: Have you been approached by one of legacy firms about a partnership or acquisition?

RY: We’ve had conversations, more in terms of partnerships because we have lots of data and can help them. For example, we can launch a new wine and get feedback almost like a focus group to figure out who likes what. We can split test two different blends for a wine and figure out which does better. That’s where conversations with legacy wine companies have happened.

TC: So they’d pay you for your data.

RY: We’re not opposed to selling data in the future, but we’ve approached it more like, here’s an opportunity to learn about how innovation works at a larger wine company. We don’t expect to be able to do what Constellation does well — with its large salesforce and distributors in every state — but what we can do in a complementary way is understand the consumer.

TC: What have you learned that might surprise outsiders?

RY: Petite sirah [offerings] do as well, if not better than, cabernet and pinot noir on the platform. Cab and pinot are fully 50 times the market size of petite sirah, but we see that our members really like it.

People also like merlot a lot more than they think — pretty much across all demographics. People like to hate merlot, but when we look at red blends that do well . . .

TC: What do people have against merlot?

RY: [Laughs.] Have you ever seen “Sideways?” That has something to do with it, still. Meanwhile, pinot noir remains popular, but people don’t like it as much as [other wine sellers] think.

More TechCrunch

Snowflake is the latest company in a string of high-profile security incidents and sizable data breaches caused by the lack of MFA.

Hundreds of Snowflake customer passwords found online are linked to info-stealing malware

The buy will benefit ChromeOS, Google’s lightweight Linux-based operating system, by giving ChromeOS users greater access to Windows apps “without the hassle of complex installations or updates.”

Google acquires Cameyo to bring Windows apps to ChromeOS

Mistral is no doubt looking to grow revenue as it faces considerable — and growing — competition in the generative AI space.

Mistral launches new services and SDK to let customers fine-tune its models

The warning for the Ai Pin was issued “out of an abundance of caution,” according to Humane.

Humane urges customers to stop using charging case, citing battery fire concerns

The keynote will be focused on Apple’s software offerings and the developers that power them, including the latest versions of iOS, iPadOS, macOS, tvOS, visionOS and watchOS.

Watch Apple kick off WWDC 2024 right here

As WWDC 2024 nears, all sorts of rumors and leaks have emerged about what iOS 18 and its AI-powered apps and features have in store.

What to expect from Apple’s AI-powered iOS 18 at WWDC 2024

Welcome to Elon Musk’s X. The social network formerly known as Twitter where the rules are made up and the check marks don’t matter. Or do they? The Tesla and…

Elon Musk’s X: A complete timeline of what Twitter has become

TechCrunch has kept readers informed regarding Fearless Fund’s courtroom battle to provide business grants to Black women. Today, we are happy to announce that Fearless Fund CEO and co-founder Arian…

Fearless Fund’s Arian Simone coming to Disrupt 2024

Bridgy Fed is one of the efforts aimed at connecting the fediverse with the web, Bluesky and, perhaps later, other networks like Nostr.

Bluesky and Mastodon users can now talk to each other with Bridgy Fed

Zoox, Amazon’s self-driving unit, is bringing its autonomous vehicles to more cities.  The self-driving technology company announced Wednesday plans to begin testing in Austin and Miami this summer. The two…

Zoox to test self-driving cars in Austin and Miami 

Called Stable Audio Open, the generative model takes a text description and outputs a recording up to 47 seconds in length.

Stability AI releases a sound generator

It’s not just instant-delivery startups that are struggling. Oda, the Norway-based online supermarket delivery startup, has confirmed layoffs of 150 jobs as it drastically scales back its expansion ambitions to…

SoftBank-backed grocery startup Oda lays off 150, resets focus on Norway and Sweden

Newsletter platform Substack is introducing the ability for writers to send videos to their subscribers via Chat, its private community feature, the company announced on Wednesday. The rollout of video…

Substack brings video to its Chat feature

Hiya, folks, and welcome to TechCrunch’s inaugural AI newsletter. It’s truly a thrill to type those words — this one’s been long in the making, and we’re excited to finally…

This Week in AI: Ex-OpenAI staff call for safety and transparency

Ms. Rachel isn’t a household name, but if you spend a lot of time with toddlers, she might as well be a rockstar. She’s like Steve from Blues Clues for…

Cameo fumbles on Ms. Rachel fundraiser as fans receive credits instead of videos  

Cartwheel helps animators go from zero to basic movement, so creating a scene or character with elementary motions like taking a step, swatting a fly or sitting down is easier.

Cartwheel generates 3D animations from scratch to power up creators

The new tool, which is set to arrive in Wix’s app builder tool this week, guides users through a chatbot-like interface to understand the goals, intent and aesthetic of their…

Wix’s new tool taps AI to generate smartphone apps

ClickUp Knowledge Management combines a new wiki-like editor and with a new AI system that can also bring in data from Google Drive, Dropbox, Confluence, Figma and other sources.

ClickUp wants to take on Notion and Confluence with its new AI-based Knowledge Base

New York City, home to over 60,000 gig delivery workers, has been cracking down on cheap, uncertified e-bikes that have resulted in battery fires across the city.  Some e-bike providers…

Whizz wants to own the delivery e-bike subscription space, starting with NYC

This is the last major step before Starliner can be certified as an operational crew system, and the first Starliner mission is expected to launch in 2025. 

Boeing’s Starliner astronaut capsule is en route to the ISS 

TechCrunch Disrupt 2024 in San Francisco is the must-attend event for startup founders aiming to make their mark in the tech world. This year, founders have three exciting ways to…

Three ways founders can shine at TechCrunch Disrupt 2024

Google’s newest startup program, announced on Wednesday, aims to bring AI technology to the public sector. The newly launched “Google for Startups AI Academy: American Infrastructure” will offer participants hands-on…

Google’s new startup program focuses on bringing AI to public infrastructure

eBay’s newest AI feature allows sellers to replace image backgrounds with AI-generated backdrops. The tool is now available for iOS users in the U.S., U.K., and Germany. It’ll gradually roll…

eBay debuts AI-powered background tool to enhance product images

If you’re anything like me, you’ve tried every to-do list app and productivity system, only to find yourself giving up sooner rather than later because managing your productivity system becomes…

Hoop uses AI to automatically manage your to-do list

Asana is using its work graph to train LLMs with the goal of creating AI assistants that work alongside human employees in company workflows.

Asana introduces ‘AI teammates’ designed to work alongside human employees

Taloflow, an early stage startup changing the way companies evaluate and select software, has raised $1.3M in a seed round.

Taloflow puts AI to work on software vendor selection to reduce costs and save time

The startup is hoping its durable filters can make metals refining and battery recycling more efficient, too.

SiTration uses silicon wafers to reclaim critical minerals from mining waste

Spun out of Bosch, Dive wants to change how manufacturers use computer simulations by both using modern mathematical approaches and cloud computing.

Dive goes cloud-native for its computational fluid dynamics simulation service

The tension between incumbents and fintechs has existed for decades. But every once in a while, the two groups decide to put their competition aside and work together. In an…

When foes become friends: Capital One partners with fintech giants Stripe, Adyen to prevent fraud

After growing 500% year-over-year in the past year, Understory is now launching a product focused on the renewable energy sector.

Insurance provider Understory gets into renewable energy following $15M Series A