. . . . . . .
Darn! Well that means a dram or two of Pussers, and some good quiet time to cogitate. When I predicted that Tate would encounter investor conflict I really thought we wouldn't know for some time. On the pro/con continuum, Bear and I sat respectfully on opposite sides, both of us feeling safe in knowing the real outcome was year(s) away. A no lose situation.
Then - magically - all hell broke loose last week and it was the Shootout at Balcone Corral, and I was proved amazingly prescient. Part of me wanted to gloat, but out of respect for both the Bear and young Tate, this didn't feel right. Even after Tate's alleged wild threats, I felt really, really bad for a guy that had it all going, but became his own worst enemy. Sadly I have had friends whose businesses ended the same way. We are truly big supporters of honest and pure craft distillers,
Not only was this a big fail for Tate, but also for the new and now well-funded Balcones and even worse for all the budding micro's out there. It's hard enough to get distribution and a little piece of shelf without this huge fail reflecting on them. Bacardi reliably produces and delivers their product, with machine like, drama-free precision.
But I'm gonna make a prediction anyway...
First the observations:
- 1. Both parties have LOTS to lose. Tate's career is rapidly going up in enough smoke, enough to use his secret process to smoke all remaining batches of his Brimstone Whisky. His reputation, credibility and trustworthiness have been greatly damaged, maybe permanently.
As for the new Balcones, the investors have $10M at stake. Yes, they don't have to build the facility but this event may take years to sort out. Even if they withdraw, their own judgment and reputations have been damaged insofar as future acquisitions.
Who's gonna hire Tate? Is the company ready to walk? These are grave concerns. Both had a huge stake in Balcones, but it's Tate who will suffer the more.
2. Making nice will be hard, particularly for Tate. His alleged threats to hold his breath, to shoot board members, to destroy his ball and go home may gain him some concessions, but will they be enough for him? This is questionable. The board has to decide whether they can trust a guy who has taken such extreme alleged actions. After all, they just went through negotiations, reached an understanding and cut a deal - to fall apart in months? And so dramatically? Are they willing to double down and roll these dice again?
Even in the beginning and under the best of conditions, the rapid scaling of Balcones was questionable, particularly as I believe these novel products and their market were not yet fully understood in terms of scalability. A reconciliation now adds even more levels of risk as mentioned above.
- 3. Still one has to consider that the company so far has only enforced a 90-day suspension, and has obtained a very serious restraining order to keep Tate on the shortest of leashes. If they were walking, this would not have happened. I believe they are open to reconciliation.
4. Tate is harder perhaps impossible to read. The Court has ordered him into complete silence (which he bordered on violating with Chuck Cowdery). So we feel obligated to rely on his past. This grandiose gentleman seems to be an ego driven, hype believing, and thin-skinned micro-manager who seems to need to be in complete control, and to get all the accolades. If these impressions are true, he will have a LOT to dial back. Add to that the alleged threats and his road to recovery becomes ever harder.
This is a helluva Mofo!
But I'm not the Compleat Idiot for nothing.
In a spirit of compleat idiocy I'm willing to exit the Eight Ball Saloon and place a bet on the Shootout!
Contrary to popular opinion the company can continue without Tate, despite Cowdery's exclamation to the contrary. They can choose to withdraw and move their money to another investment. Tate's options are much more limited - he can either find God and bite the bullet, or find a new profession. He could also attempt to establish and build another micro, but I'm not sure starting from scratch again is in his DNA or within his personal financial capabilities. The chance of finding new investors now are somewhere between slim and none.
He's also tasted the wine, the glamour, and what appeared like the huge success he dreamed of, with the brass ring just beyond his grasp, but now snatched away. The company knows this. Tate thinks he's indispensable, but I believe the company holds the cards and will play them. They may offer him a role that keeps him aboard, but on a very, very short leash.
The position may well be one that gives him a corner of the new facility to play with a small still and to keep experimenting. Leave him with title enough for his ego – this might be the time for “Master Distiller” - , and put him on the road to do what he does best, gladhanding, speaking soaking up just enough spotlight to assuage his ego, but not enough to be perceived as the company and only as he refrains from undermining the company. Unfortunately Tate has demonstrated what appears to be an explosive unpredictability so the reconcilation must include an honest, strict, gradual and failsafe return.
Their position: " Chip, you're important but no man is indispensable, especially under these circumstances. You were the head distiller, but not the only distiller. We have a lot of money at stake, and you have made it very, very difficult for us to trust you. Your actions have damaged all of us, and unless we can somehow resolve our differences very quickly, it might be better for us to simply part friends and go our separate ways. With that in mind we're willing to give it another chance, but you must convince us that we can truly work together. Chip, it's up to you..."
Step up to the window...
My Odds are 3-5 (pays $3.20 on a $2 bet) he submits and tries to come back. He's tasted the wine. Hey, not so fast! Even if he does the odds are 2-5 ($2.80) the company will have him. For you Europeans that'd be 1.60 and 1.40. Altogether the total odds are 2.24 Euro, 6-5 US, payout $4.48. For you non-betting folk (me) that's just short of a 50% chance..
Any takers?
