705 Jeff Mahony: CEO of NEFT Vodka
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I am unwilling to give up, that I will start over from scratch as many times as it takes to get where I want to be. You just want to make sure you will get knocked down, but just make sure you don't get knocked out. So your only choice should be, go focus on what you can control. Hi everyone and welcome to the Kara Golden Show. Join me each week for inspiring conversations with some of the world's greatest leaders,

We'll talk with founders, entrepreneurs, CEOs, and really some of the most interesting people of our time. Can't wait to get started. Let's go. Let's go. Hi, everyone, and welcome back to The Kara Golden Show. Super excited for my next guest today. Today's guest is someone who is shaking up one of the most

saturated and traditional categories out there, vodka, but he's doing it with innovation, bold design, especially when you see this packaging, it's quite good, and a serious commitment to quality in the actual liquid itself. So I'm joined by Jeff Mahoney, who is the CEO of Neft Vodka.

a premium vodka brand you've probably seen in an iconic black barrel, wondering what in the heck is this? Neft is redefining what modern vodka can look like, taste like, and stand for. And with just two ingredients, rye and sprinkles,

So under Jeff's leadership, the brand is gaining global recognition. But the brand is also gaining global recognition.

Proving that even in a crowded space, authenticity and execution still win. And I cannot wait to dive in to hear more about how Jeff is building out this incredible brand.

disrupting expectations and why sustainability and purity matter in the world of spirits and what it takes to stand out. So Jeff, welcome to The Kara Golden Show. Oh my gosh, thank you for having me, Kara. Absolutely. So for those who aren't familiar with the product Neft Vodka, what makes it stand out in such a competitive category?

Well, that's a good one. Well, we're disrupting the space. We're bringing back the sipping versions of the spirit. So most spirits were originally defined to be sipping versions. You see that with tequila and a variety of other spirits, but you don't see it in the vodka space. So we're bringing that back. Now, in order to be that, you have to have an interesting taste profile. You have something that doesn't bite.

Made from good ingredients, something that's high quality, that tastes good with every sip, right? So it has to be something that has longevity. And that's where we've been. So we think that the vodka space has grown a little complacent. You talked about a lot of competitors. We're cutting through that noise by creating an actual high quality product, but we're delivering it with a little bit of luxury and elegance and grace. This message is a paid partnership with Apple Card.

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I love it. So you're not the founder of Neft. You joined the founder. What made you want to take on this opportunity and focus on the growth? A really interesting moment that I had. Many years ago, November of 2018, I was served a warm version of this program.

which in the vodka space as a vodka drinker for many decades, you would never drink a warm vodka. I did. I enjoyed it thoroughly. There was a chilled version waiting for me, which was even better. It was at that moment that I started my process of getting involved in the company. Ultimately, I bought U.S. Operations and turned that into something significant. And now we own Worldwide Operations Inc.

And we're in 22 countries as a result. But it all started with that warm shot of Nafaka.

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So how did the idea for a barrel, the black barrel that you were so known for, how did that come about? Naft is actually oil in about 50 Cyrillic languages. I think often there's going to be folks who see it right away and understand that.

Because it means oil, we wanted to bring a little bit of homage, if you will, to those folks that are in the field that are living and sometimes living not so well in those fields and give them a respite. That respite had to be a high-quality product, had to be something worthy of the work that they've been doing. To pay homage to them, the Black Barrel was designed specifically

It's got some interesting utility. It's unbreakable, so it works in that kind of environment. It stays cold for four to six hours, so there's a bit of feature set to it that make it very utilitous in that space, right? Lakeside, riverside, by the boat, also at the hotel and near the pools. We wanted it to be something that you could use everywhere, but in homage directly to those folks, it had to be recyclability.

Had to be an eco-friendly version of this. There had to be something where we could authentically say that we are doing something not just for you, but for the environment that you live in. So that was the born, where it was born.

So the turning point when you joined the team, how big were you guys at that point, either in dollars or volume or years is fine too. It had been around for probably eight years. We had a small footprint in Austria, which is where we were born. Austria is our home. We are a product of Austria, our waters from there. But it had a small footprint in the U.S. as well. That's where I was introduced to it.

Now we're in 22 countries, as I mentioned, and we are growing fast. But it's all related to the barrel itself and then the juice. You look at that barrel and you see distinctiveness. You see character. You see something that might be relatable to you. And of course, you see the utility. But if the juice inside isn't premium, you won't buy a second one. So we were able to actually produce a high quality product

inside of that barrel. And that has really taken a foothold in those countries. We're limiting our own growth. We don't want to do a poor job in many places. We want to do a great job in a few places. So for now, 22 countries is about the right footprint for us.

So when you joined, what was the first thing that you did to, I guess, set the stage for growing into what you thought it had the possibility of being? Needed to figure out what the emotional connection was going to be. Why would a consumer want to be part of what we're creating? What kind of lifestyle do we represent?

And for us, we represent that bold and elegant and graceful lifestyle, something that you can aspire to, something where you are looking to trade up. So many of us, depending on where we are in our spending cycles as we grow into adulthood and retirement, we'll pick a time in our life when we begin to upscale. What is it that we're going to do in this category? What is our brand that we want to be with? So we chose...

to create a brand that would fit into that moment in your life. When you have decided that you're tired of the inexpensive vodkas or other spirits and you're looking to level up, but you want to do it in a way that is something you can share with your friends and family because it's at a price point that works and that you'll be proud of it as you let them experience it while you're standing there for that moment.

So we needed to create that emotional connection and an ability to tell a story, a story around the unique barrel and around the unique flavoring and around the fact that it is designed to be a sipping product. So you really need to create that emotional connection. That's the first thing we did was what was that emotional connection going to be? Was it going to be price point? No. Was it going to be priced right? Yes. Was it going to be an authentic brand? Absolutely.

People aren't going to relate to you very long if you're not authentic, if you're not transparent, if you're not high quality. So we had to choose which of the features, if you will, were going to be beneficial to our story. That's what we did first. So was the barrel part of the company since day one or did that come later?

Now, it was part of the company and it's in other forms. What we did is to enhance that, to create the recyclability portion of it. We're working on a version that you can throw into your garden, right? Something along those lines where you can actually be truly eco-friendly in all the senses. So what we did is we had to take what was originally Homage,

and build into the eco-friendly portion of this. That means that our distilleries are near 100% renewable fuels, right? They're not quite there. We can't quite get there yet, but we're working our way towards that. But that authentic story and that transparency had to be something we evolved. We had to actually decide this is where we're going to go and then in a meaningful and directed way, get ourselves there.

So it was a part of the history, but it evolved into something that's more aligned with who we are today. So Next is known for its commitment to clean ingredients, just two, rye and spring water. First of all, is it truly unique in the vodka space? I mean, can you give people an idea of what are others doing and why was simplicity so important to you?

Well, it's a misnomer in the space that the more distillations you do, the better your product is. What that really means is that your product started out dirty and you had to clean it. The power and usage, if you will, of distillation is to clean products. It's to actually get the purest essence of it out and leave the remnants behind. The more you have to do that, the dirtier the product. So we do it twice.

as opposed to some of the vodkas that might do seven or eight times. Because we start with high quality water. So we're in Austria. Our water, you can go to our waterfall. We actually have our own waterfall. You can go out there and you can drink straight from the waterfall.

It's an immaculate tasting water. It's healthy for you. It's highly oxygenated. A lot of mineral content because it's been about 50 years in granite as it seeped through from snow in through the aquifers and then back up through our spring, which results in a fairly large waterfall, as I mentioned. But then you need the rye. So we have four ancient ryes, and they need to be high quality.

Austria and Germany and the surrounding areas are the perfect place. They've been non-GMO since their inception. This isn't something new for them. This isn't a fad. So growing something high quality, non-GMO has been something as a staple for them. Think Sound of Music and the movies that we might have seen. This is where they were in those pristine fields.

So we brought those two ingredients together and we said, well, what would be the best way to eliminate what is the negative of most vodkas? And that's the bite at the end. Well, it turns out with the proper wash, which is part of our cycle and using that high quality water again, you can remove that bite. And so you can either remove that bite by doing something unique like that, which is more expensive, more time consuming.

Or you can add glycerins and fructoses into it. And what you find is most Vakas will add fructose, glycerin, and other additives in order to remove that bite. Now, in most countries, jurisdictionally, 50 milliliters can be virtually anything you want. So you don't have to report it. And so most Vakas are using that method. That's the hangover, actually. Vaka is a gluten-free product by nature.

just through the distillation process it is designed in its cleanest form to actually work in concert with the body now forgive me it's still a spirit this isn't going to be some health additive to your life right but vodka was originally known as the water of life that was the actual meaning vodka is the short version of the ukrainian word and polish word for this

So the water of life is what they used to call this when properly created. So that's what we wanted to get back to. And that is unique in the school. So Neff's Taste has won multiple awards. How do you keep a high quality luxury product consistent at scale? That is a very good question. So we run our own distilleries. We're constantly standing up new distilleries. They do take time.

So we have to stay ahead of our capacity requirements. Those distilleries are run our way with our quality control folks, leveraging that best water tactic as we talked about. It's all a product of Austria. So we do make all of our product in Austria. And you create an opportunity then for that constant testing. So we actually have chemists on site

to make sure that the water quality is proper. We have filtering systems, obviously, like most distilleries do. But we have our master distillers who are sommeliers in their own right and are constantly tasting the product.

If the product is subpar, it gets yanked out of the lot and a new set is created. So it's a batch product. We do do it in batch. We don't do it in a continuous column sort of methodology like you'll see some of the major vodka producers doing. And so we can actually control our quality because we do it a batch at a time.

So your background in finance, how do you feel like it's helped you operate in the spirits industry? I should back up and say that you didn't come from the spirits industry, but you had invested in this company. So, but...

I think so often people think that you can't go start a company in a different industry if you don't have experience or you can't join a company if you don't have experience. I tend to think that that is completely wrong. And I think you're proving that theory. But talk to me about how a background, the background that you have really has helped you to kind of scale this company.

Well, it's fresh eyes. So I share your belief. There has to be a set of industry specialists who can help you from falling off cliffs. But you need some fresh eyes to create some new and innovative approaches to a market space. There are no real new problems. There's always just lessons that somebody's already solved and you just have to have the tenure to improve.

implement those solutions that you found. Operating out of the verticals like the financial services space is essentially the same. We work with large banking enterprises. Those banking enterprises sell to consumers. It's the same thing here. We work with large distributor relationships. Those distributors sell to retailers and to on-premise locations like bars and restaurants who sell to consumers.

So like financial services, rarely do the large financial services firms actually touch the consumer. They're usually dealing through broker dealers or other operators. In our case, it's banking operations. It's the same thing here. So the rules and lessons do apply. Having said that, there are some basic rules of thumb here.

not growing too quick, making sure that you can do a great job in the space that you're in, right? Looking at beachheads, how can I actually produce value in a very centralized point where there's centers of influence and see the halo effects of that as others look in and watch? So those become your influencers of the old days. Now we have people that are influencers.

But in the old world, if you will, before influencers and social media, the influencers were your banks, they were your retail locations, they were your bars and restaurants. Those are the ones that are influencing people. So it's the same model. There's nothing fundamentally different about it. And you just have to recognize where there's overlap in what you were previously doing and then apply those lessons.

But the statements that I hear often are, we never do it this way. We always do it this way. And trust me, usually everything that comes after those statements is probably erroneous. Come up with something on your own and figure out how to actually do it. There's always some kind of problem solving, as I like to call it, just work the problem.

How do you actually achieve the result that you're looking for? What's the output and what are my inputs and how do I migrate between those inputs to outputs? It's the same in every vertical. Emotional connection, everything, same. Scaling any product takes resilience. It takes a great product, first and foremost. It takes a story.

All of these things that I think you've absolutely nailed. But what's been the biggest challenge that you've had in growing the brand? We all run into challenges, hiccups, roadblocks, failures, whatever you want to call them. And you push through.

But I'd love to hear maybe something that was super challenging, surprising even to you that it was challenging. It's the spirit space is a highly regulated space and it should be. We are selling a product that should not be mixed with driving and a variety of other portions of your life.

Having said that, many of those regulations stem back to the 30s, for example, in the United States. We have a three-tier system here. In some states, we have a four-tier system. But if you look really closely at those regulations, they were designed to stop illegal transport of alcohol. And they are a hindrance today in many, many ways because that illegal framework doesn't exist like it used to exist.

And so what was surprising to me was how difficult it is to just get your product into a market space and how many gatekeepers there are that can prevent you from getting your product in. And I mean, logistically, not from a marketing standpoint, just making it available was surprisingly difficult here.

And most countries follow suit with the U.S. Typically, they're 5, 10, 15 years behind, but their regulations always catch up. The U.S. is the most heavily regulated market on the planet, regardless of what vertical you're talking about. And so what we find is that the other jurisdictions are doing exactly the same things and creating the same roadblocks to getting your product logistically into market.

I understand some of those rules. Some are not so big. So the other that was surprising was counterfeiting. There's a tremendous amount of fake neft on the markets, particularly in the Eastern European bloc, the CIS, as we call it. Massive amounts, right down to the exact barrel. And we have found now subpar in nature, but the same printing, right? Unfortunately, it rots, it rusts.

It leaks. So it's creating some real challenges for us because it has our branding on it. So we know where those barrels come from. They come from China and they work their way into Eastern Europe through the Middle East. And it's surprisingly difficult to stop that. And there is no legal or regulatory environment to help with that.

So we use that as a marketing opportunity. We say, okay, if you're going to counterfeit and you're going to counterfeit in this area, we're going to let you counterfeit for a little while. Then we're going to come in on your heels with the proper product, with the right marketing and differentiate with the localities there to say, remember the old product? That wasn't the real product. If you thought that was good, wait till you taste this. And we're having some great success there, but it required some very innovative thinking and

And it required us to do something that was the opposite of what we wanted to do. What we really wanted to do initially was shut it all down. But it turns out these folks are spending a lot of money marketing our product. We just need to come in with the proper version of this and then take over the market, which we are doing. So that was an interesting twist that I did not expect.

Very interesting. So how big is your team at this point? The team is relatively small. We're about 200 people. So we are running in 22 jurisdictions. The preponderance of those folks run out of the United States. The rest are floating between the UK, Asia, Latin America, and obviously Europe. We have a dependence on our relationships with our distributors.

Distributors in the United States and distributors outside the United States work differently. Distributors in the United States can help in many different ways that are different than the ways that distributors outside the U.S. work. So we have to have a bigger team in the U.S. and smaller teams in other jurisdictions in order to accomplish the same case goals.

Yeah, I feel like, especially when you are dealing with distributors, whether you have to or not, you need your own people, right, to go in and actually speak about your product. Because otherwise, it just doesn't make it. Yep, we have an old saying, the doorway is small, and the backpack that you can wear is small. So there's only a couple of things in that backpack.

And when you've got a distributor with 400, 500 brands that they're selling, you need to get attention on your own. When you think about the next frontier for Neft, maybe new products, partnerships, markets, where do you think it's headed?

I think we're going to more heavily embrace the motorsports space. We're already a sponsor of the racing teams, right? We're Vesha Kashyap. We're part of the Red Bull second team. We are embracing MotoGP and Indy. We've been previous sponsors of the Indy racing circuit here, which is obviously U.S.-based.

Formula One is a very, very large market. It's larger than the NFL. It's larger than any other sport except for the world soccer every four years. So we are embracing the motorsports space. They are embracing us. So I think we can create a real emotional attachment with

The folks there who are chasing innovation, who are chasing precision, who are chasing creativity, who are definitely competitive in nature, I think we're going to fit in really, really well there. We are also embracing a bit lighter music, art, and fashion. So we have a lot of foyer into the music world. We've started our own festival series there.

We have Fashion, Boo Berry, and a variety of other English brands have embraced us. We're throwing events with them. When it comes to art, we've started our own worldwide art contest where we're embracing filmmakers still in moving imagery, et cetera, to help, if you will, equalize opportunities. So if I might just take just one moment here.

We as a brand are helping women and children. That's our cause. We take that charitable approach very seriously. But in that, we have to pick sort of a genre. What we've chosen is that...

Opportunity needs to be balanced. Talent is already balanced. Talent is equally distributed around the world, around the socioeconomic, gender. Nothing gets in the way of talent's distribution, but opportunity does. So we are embracing the opportunity to create that for the communities that we serve.

So motorsports, music, art, and fashion, and somehow manifesting opportunity in a more equal share across the world landscape.

So your superpower, you have to have one, especially if you're insane enough to take on this role and wanting to grow it as you have. What would you say to somebody who is maybe doing something similar to what you have chosen to take on? I think if I can be so bold...

Perfection costs too much. There's some form that's just shy of perfection that will get a high quality deliverable service or product into the hands of the consumers that need it. There's an authentic approach in that. And there's a transparent approach that you need to embody, all of which require courage,

If I can be so bold, my superpower is that I may not always know what to do, but I don't lack the courage to try. And I have the confidence to know that I'll figure it out when I arrive there. So for me, I don't need a 5, 10, 20 year range plan. I need a goal and I'll figure out how to get there along the way because I'll be courageous as I go.

I love it. So last question, what's the one thing you want people to remember about Neft after hearing our conversation today? I think the one thing is it is a high quality, bold, elegant, and graceful taste that you will enjoy. And it's my hope that you'll spread the word that this is a sipping Varka

and that it will change the direction of Varkas on this planet and redirect that course along the lines of the high-quality scotches and bourbons and tequilas and all those that are already being embraced. And if I get my hope, you'll see this product in the hands of all the major mixologists and all the consumers around

who want to try something new, but maybe have found themselves shying away from vodka, this will be your product.

Jeff, thanks so much for joining us today. Your story and Neff's story is such a great example of what happens when vision meets execution. And from your clean ingredients to the bold branding, mission-driven approach, you're showing that even in a legacy category like spirits and vodka in particular, there's always room to do it better. And I'm so happy to be here with you today.

and to do it differently. So for everyone listening, go check out Neft Vodka at neftvodka.com or on Instagram and all over social as well. You'll love, as I said, not only the product inside the can, but the packaging is really something.

And if you've enjoyed this episode, send it to a friend, leave us a quick review, and don't forget to subscribe so you never miss an amazing, another amazing episode of The Kara Golden Show. And thank you again, Jeff. I really appreciate it. Kara, this has been an immense pleasure for me. Thank you so much.

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