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The Homemade Gin Kit: Building a business on booze

Thursday - 1/9/2014, 9:42am  ET

GinKit.JPG
The Homemade Gin Kit includes two bottles, a tin of juniper berries and a blend of herbs and spices. (WTOP/Rachel Nania)
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Turning your kitchen into a distillery

WTOP's Rachel Nania reports

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Taking a gamble on a boozy business

WTOP's Rachel Nania reports

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WASHINGTON - Jack Hubbard and Joe Maiellano became fast friends after a night of gambling in Las Vegas.

"Jack thought I looked lucky for some reason and offered to split the pot with me if I picked a winning number on roulette," says Maiellano, an Arlington, Va., resident, who was in Vegas at the time with his wife, Sarah, who worked with Hubbard.

"I picked number nine, he put 100 bucks down and won four grand … So that was kind of the start of a beautiful friendship."

Since Hubbard and Maiellano were so good at roulette, the two newfound friends decided to take a risk on something else: starting a gin business.

Building a Business on Booze

After the fun in Vegas ended, Hubbard and Maiellano, who both work as nonprofit fundraisers, stayed in touch when they came back to the D.C. area.

Roughly two years ago, one particular night the two began to discuss their shared interest in the business of booze -- gin, in particular.

"That night we got to talking about how great it would be to open a distillery," says Maiellano, 29. "The next morning, after a couple of Advil, we talked and said, ‘Hey, how serious were you about that?'"

It turns out they were both very serious.

Hubbard, also 29, and Maiellano contacted everybody they knew who might be able to research the process and possibility of opening a distillery in the District.

"You don't realize how helpful your friends can be until you start getting into something new," Maiellano says.

However, the number that surfaced for the estimated cost of starting their business was much more than the two planned. It was $1 million. So the idea of opening a distillery got shelved -- at least for a few weeks.

Sell the Shovel, Not the Gold

Hubbard, a self-proclaimed lover of business books, says the recollection of a recently read story gave them just what they needed in their recipe for starting a business.

He tells the story of a guy who goes out to California during the Gold Rush. He's out there for two to three weeks and gets frustrated that he can't find any gold.

"He looks around and sees hundreds of people digging for gold. And he sort of has this moment where he goes, ‘I shouldn't be looking for gold, I need to be selling shovels,'" Hubbard says.

That's when Hubbard and Maiellano decided they didn't need to be selling gin. Similar to popular homebrew kits, they could capitalize on the craft cocktail movement and sell kits for people to make their own gin.

The investment in this business plan was much smaller, and the response from customers has been bigger than they imagined.

In November 2012, Hubbard and Maiellano established their business: The Homemade Gin Kit.

They built the first 250 kits in Maiellano's Arlington apartment with the help of their wives. When the first 250 kits were finished, Maiellano says he would slowly, one by one, take them down to the FedEx near his apartment building to fulfill orders.

As word spread about the kits, the business saw more interest from consumers -- especially when the holiday season launched into full swing.

"Then it hit big and we were sold out," Maiellano says.

The operation got too big for the living room and had to be moved to an assembly facility out by Dulles, where the kits are now produced.

The Recipe for Gin

The Homemade Gin Kit, which sells for $49.95, includes two bottles, a tin of juniper berries and a blend of herbs and spices.

Maiellano says the recipe was developed by lots of trial and error. His interest in craft cocktails -- and trying several different varieties of gin -- also played a part in the recipe process.

"It's a tough job, but somebody has to sample the very small differences between 12 types of gin and how they stand up in a martini vs. gin and tonic vs. other cocktails," says Maiellano, who adds the recipe in The Homemade Gin Kit makes a gin ideal for a gin and tonic.

Those using the kit steep the juniper berries for 24 hours in a neutral-grain alcohol, such as vodka, which is not included in the kit.

"The alcohol starts to strip away the essential oils out of the juniper berries," Maiellano says. "That is the backbone of any gin."

After 24 hours, the spices and botanicals are added to the mix to steep for another 12 hours. The liquid is strained from the rest of the recipe, and funneled into two swing-top glass bottles.

"We found, as Jack and I were making batch after batch of gin, friends would come over and we'd tell them what we're doing and our friends would always wind up leaving with our finished product," says Maiellano, explaining the point of the second bottle in the kit.

After making the kits, Hubbard and Maiellano, who thought their gin tasted great, hoped others felt the same.

"We were nervous at first because we liked the gin, but you're always looking for that validation. And honestly, a lot of people were skeptical saying, ‘Who are these guys running this website saying you can make gin at home,' because nobody was really doing this commercially," Hubbard says.

That outside validation came from a New York Times cocktail reporter who contacted Maiellano in December 2012 after hearing about The Homemade Gin Kit.

Maiellano sent her a kit to try and anxiously waited for her response.

"We had never been more nervous … and it was amazing. She wrote an amazing review," Hubbard says.

Plans for the Future

Since launching the business in November 2012, Hubbard and Maiellano have sold about 16,000 kits, generating more than $500,000 in revenue.

The business has really become a family operation. Maiellano handles the cocktail side of things, and his wife, Sarah, who formerly worked in public relations, handles the company's press and social media.

Hubbard handles the business aspect of the company, and his wife, Molly, does the accounting.

Their success has allowed them to consider branching into other products and has not let them completely dismiss the idea of one day opening a distillery.

But for now, they hope to turn homemade gin skeptics into fans.

"Think about it, how many times does someone bring wine to a house party? Bring your own gin. It's cooler," Hubbard says.

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