The Grapes of Risk with David Duncan
David Duncan, CEO of Silver Oak Cellars, joins Sandra and Sandy on the podcast today to discuss the art, science, and risks of winemaking. Their conversation covers topics such as the difficulties associated with winemaking, the risks involved, and the sustainable practices and technological advancements that are shaping the industry. David shares his family's entrepreneurial background, recounts how he was drawn to the farming aspect of winemaking, and describes the process of making wine, from planting vines to releasing a new vintage.
The episode also explores the attraction of risk-taking and adrenaline, as David, a successful winemaker, stage musician, and philanthropist, shares his thoughts on how he manages risk-taking in both his personal and professional life. He and our hosts then touch on the duality of risk-takers - their ability to focus on risk-taking while also being able to detach themselves from it - as well as the importance of building resilience and adapting to change. In addition to providing a fascinating exploration into the world of winemaking, today’s episode offers a unique perspective on risk-taking, making it a must-listen for anyone interested in thriving, as David does, at the intersection of tradition and innovation.
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Transcript:
Dr. Sandra Magnus: It lies somewhere between the pit of your stomach, your racing heart, and your brain somehow trying to keep it all together. It's an area we call The Adrenaline Zone.
I'm retired astronaut Dr. Sandra Magnus.
Sandy Winnefeld: And I'm retired Navy fighter pilot Admiral Sandy Winnefeld. We're two adrenaline junkies who love spending time with people who are really passionate about pushing their boundaries as far as possible.
Dr. Sandra Magnus: When people think about owning a vineyard, what often comes to mind is romantic scenery with beautiful buildings, vineyards on rolling hills as far as the eye can see, and wines paired with delicious culinary delights.
Sandy Winnefeld: Well, there's plenty of that. But in reality, making high-quality wine is a difficult business that combines both art and science. A lot can go wrong due to Mother Nature or human error.
Dr. Sandra Magnus: We wanted to learn more about the risks associated with winemaking.
Sandy Winnefeld: We also wanted to have a little bit of fun.
Dr. Sandra Magnus: So we invited David Duncan to join us. David is the proprietor, chairman, and CEO of the famed family-owned Silver Oak Winery in Napa Valley.
Sandy Winnefeld: It turns out that David's more than just a winemaker also. He's a Colorado boy who's been a cowboy, a skier, hunter, fisherman. And he's a member of the band Silverado Pickups, which has warmed up for our previous guest, Tim McGraw, several times at charity concerts.
Dr. Sandra Magnus: So we caught up with David at his winery in Oakville, California.
Sandy Winnefeld: So, David Duncan from Silver Oak Winery, welcome to the Adrenaline Zone. Thanks for being with us today.
David Duncan: Thanks, Sandy, I'm pleased to be here, coming to you from the middle of Napa Valley. And Sandra, a pleasure to meet you and be on your show. Thank you.
Dr. Sandra Magnus: Yeah, we're really delighted you're here and we can't wait to talk to you about the art, science, and risk of winemaking. But before we get into that, let's start a little bit with the history of how you got into it, where you grew up, what attracted you to winemaking in the first place.
David Duncan: So my father was a serial entrepreneur, and I like to say that he always invested in Mother Nature-based businesses. So he actually started a ski area in Colorado in 1965. We co-founded Silver Oak in 1972, and dad was also in the oil and gas business and got more serious about that in the late seventies and early eighties. And so I would like to say we started Silver Oak before the oil business helped out things a little bit. So we're a family business, and my path here actually led through my education. I got my master's at the University of Denver and got an MBA there back in the ‘90s.
Sandy Winnefeld: At the Daniels School. Right?
David Duncan: The Daniels School. Now, I was there before it was the Daniel School, and so, yeah, dialed into the internet for the first time while I was in business school. If you think about that.
Sandy Winnefeld: Wow, that really ages you and times you out.
David Duncan: I know, but I did my final thesis project on Silver Oak and built the business model, and then that led us to acquiring full ownership of the winery. And then I moved here full-time about 20 years ago. So I have been here now for many years, raised our kids here in Napa. It's just a great, great experience.
Dr. Sandra Magnus: So if you don't mind me asking, doing that business project for your degree, you had to learn about wine from scratch, or did you have some experience in the industry before that you could leverage for your business plan?
David Duncan: Well, I had the good fortune of growing up in Colorado, so I didn't grow up here as sort of what we would call a ’cellar brat’ in the business. And I mean that in the most wonderful way. I actually spent my youth farming in Colorado, and so the farming part of the wine business is what attracted me, and so I was around it and knew it. But I am not the winemaker, thank God, and not a scientist, really, by background. I'm more of a business person and I've gotten a lot of experience now, so I definitely have my opinions about things. But I've been very fortunate to have a wonderful team around me and be able to make these wines that people drink and buy every year and love.
Sandy Winnefeld: So you said you're not the winemaker. So we're going to tread on a little dangerous ground here. We're going to talk about wine. Most of our listeners have been through some kind of winery tour somewhere on the planet, but can you walk us through the process from putting a vine in the ground and the challenges associated with that to releasing a new vintage? There's a lot that goes on in between.
David Duncan: Yeah. So the biggest factor that people don't often understand in winemaking, especially fine winemaking, and it's really particular to Silver Oak because we have about the longest process that you can imagine. So from the time you plant a vine to the time the grapes are ready to make into wine, it's about five years. It takes a vine five years before it produces bottle-quality grapes. And for us, we pick, let's say, the 2022 vintage. We ferment it, we put it in a barrel for two years, and then we bottle it for two years. So the day after tomorrow, we're going to be releasing our 2018 vintage. So if you're listening to this in the future, it's February of 2023. We are releasing a wine that we made five years ago. And so that part of it is a big part of it, but it's pick the grapes, crush them, ferment, barrel, bottle, and then enjoy in a nutshell.
Dr. Sandra Magnus: So clearly there's not only a huge capital investment, then we have to talk about the rest of the risk involved in making wine. And Mother Nature is one of those pieces of risk that you have to deal with. I heard that you had a horrible fire at Silver Oak in 2006. That's an unexpected twist of Mother Nature, but that was probably very challenging to deal with.
David Duncan: Yes. And now I call it my personal fire because so many people in our community have been affected by fires. But I actually was at the gym working out in the morning and my wife called me and said, the winery is on fire. And I ran down here and sometime when you visit, Sandra, I'll show you the picture of me in my gym clothes. But, yes, we had a terribly devastating fire here in 2006. Actually, tomorrow is the anniversary of the fire. It was on February 2nd.
Dr. Sandra Magnus: Oh, wow.
David Duncan: And so the dumpster caught on fire. It was an accident. Happened to be a windy February morning, and it burned down the original building that we founded Silver Oak in, which was an old dairy barn that was built in, we think, about 1920, and destroyed 117 barrels of wine and did enough damage to the winery that we decided to rebuild. So one of the things that you have, being a lifelong farmer and person of the land is a lot of resiliency. So literally, the afternoon of the fire, we went down and our CFO at the time, who's now retired, she was crying and people were upset and she said, “What are we going to do?” And really, without missing a beat, I was like, “We're going to rebuild the winery.” And we opened a bottle of wine and everybody started laughing. And almost at that moment, we bounced back and we started the plan. And now, Sandy, you've been here, we built a beautiful new modern facility with 35 years of experience. And really, it was the best thing that ever happened to us. It gave us a chance to refresh the brand, think about things in a different way, and build a great winery.
Dr. Sandra Magnus: So none of the vines were damaged? It was just the building?
David Duncan: No, it was just the building.
Dr. Sandra Magnus: Oh, that's fortunate.
David Duncan: Yes.
Sandy Winnefeld: But I really admire people who can take a negative and turn it into a positive. And you all have really done that. It's a gorgeous facility. And I know that when we were kind of snorkeling around the valley looking to see where we were going to do the charity event that Guy and Tim did, it was like, this is the place. So can you tell us a little bit about the thinking that went into putting that? Because it's a whole new facility that has a really nice arrangement for events.
David Duncan: Yeah. Back when we were designing this course, we were responding to the fire, so there was some time pressure on us. But first and foremost, we built the winery. That was our primary purpose here, is to make and age, and produce our wines. But as part of that, especially in the modern era, hospitality is a big factor, so to have the new tasting room, we built a commercial kitchen. And then we really thought about guests coming and enjoying wine and being able to do events like we did for Tim and Guy's foundation here, as well as more smaller, more intimate events. We've done dinner for four at the winery, too. And the event that Sandy and I are referring to was dinner for 400, so it can go both ways. And so we did really think a lot about how to have the flexibility and the space, and we're in a beautiful place because it's Napa Valley, and so I appreciate your enjoyment. And there was a lot of thought that went into it.
Dr. Sandra Magnus: So giving back to Mother Nature. The fire, of course, is something that's not really expected. But dealing with water, whether you have too much or you don't have enough, especially with some of the challenges that California has had over the years, how do you deal with those risks as a farmer?
David Duncan: It's very interesting from an industry standpoint what's been happening with the application of science and technology to wine growing. I'll just stick to that. We think today that we use about 30% of the water that we did 10 or 15 years ago.
Dr. Sandra Magnus: Wow.
David Duncan: So in the old days, we would go kick on a valve at 7:00 at night and come out at 7:00 in the morning and turn it off. So you might do a twelve-hour set, kind of when the vines looked like they needed a drink during the summer when it’s hot. Today we measure with neutron probes, we use leaf water potential. Just in the old days if you wanted to fly, take an infrared picture, an NDVI of a vineyard, to see where vineyard health is. You would need to fly an airplane to do that. Today you can do it with a drone, and you could literally do it every day. It used to cost $6,000 to get a vineyard block done. So all of that application, I think, has really helped us manage water use. And we also know that deficit, what we call deficit irrigation, produces better wines. And so keeping the vine just with enough water instead of satiated all the time produces better wines, and so we're using a lot less water. And some of this has to do with our whole sustainability approach, but we've also taken our experience in the vineyards and applied it to the winery because we use a great deal of water in the wineries.
And we actually built another winery in the Alexander Valley, which we finished in 2017, and took what we learned here in Oakville from the fire experience and applied it. That building is actually designated as a living building. And so our water use statistics, just to answer that question, the wine industry uses about six to seven gallons of water per gallon of wine. That's kind of the rule of thumb. We know for a fact that our Alexander Valley facility uses one gallon of potable water per gallon of wine, so we beat it by a factor of seven. It was an amazing application of good thinking and taking some risks and figuring out how to make sure it works. And now this is going to be our 7th vintage in the winery. I can't believe that much time has already passed. And it works great and it makes wonderful, wonderful wines, which people enjoy.
Sandy Winnefeld: So you're well down the road on the E part of ESG, I guess, as far as the water goes.
David Duncan: Oh, and been committed to that for a long time. Yeah.
Sandy Winnefeld: Usually, it's not enough water around Napa Valley. This year, I'm sure you were affected by the rains. Was that a problem, having too much water in your vineyards this year?
David Duncan: It's funny because I've had a lot of friends reach out and say, “Are you okay?” Texts and emails and calls. And I keep telling everybody it's been wonderful. Having the reservoirs full, and having the water table get regenerated has been wonderful. And people forget that in the winter of 2016 and 2017 and the winter of 2019 and 2020, we had 60 inches of rain in Napa. Normal here is about 33 inches of rain. And so for Napa Valley, we're not even to normal levels yet. It was very rainy for a month. And of course, the snow pack up in the Sierra is tremendous. And so we're always fighting what Mother Nature has thrown at us and adjusting to it. But to answer your question, it's really not too much water. I know there are communities affected and people died, and I'm not trying to belittle that at all. But from a farming standpoint, we welcome rain all the time.
Sandy Winnefeld: Are you seeing any detectable sort of long-range, long-term impacts of climate change or is it just all over the place and you can't see anything discernible?
David Duncan: My canned answer is that if we can't grow Cabernet Sauvignon in Napa Valley, the Earth's problems are going to be much more complicated than that.
Sandy Winnefeld: There you go. I can relate to that. I love it.
David Duncan: Because Manhattan will be 12 ft underwater and nobody will be out there to buy wine. But of course, there are people in the industry that are trying to plant different varietals and think about those things. I have spent time working in the oil and gas business and I know quite a bit about geology and time. We've already talked about that a little bit is a huge risk for us. But I think on the global scale of time, 100 years is not a big deal. And I'm not belittling climate change at all, I think man has definitely affected and done less than good things to the Earth. But it is very complicated and there are events that could happen. A volcano comes out, we have a two or three-degree Celsius cooling event. We might be having the opposite problem of global warming. And so there's a lot of different thinking about that, and I just don't think we know. My personal response is just keep my head down, keep doing what we do, enjoy every day and enjoy every moment.
Sandy Winnefeld: Yeah. And like you said earlier, when the bad thing happens, suck it up and move on.
David Duncan: Yeah. And we've made an impact to try and impact our carbon footprint at the winery and everything that we do. So we're doing our part as well.
Dr. Sandra Magnus: So back to the nature issue, pests. How do you deal with pests and how do they engage or want to munch on your vines?
Sandy Winnefeld: Yeah, they like grapes, too, huh?
David Duncan: Yeah. So that’s a great question. Essentially, we don’t have a lot of issues. When we got the fire in 2006, we’d had a flood a month before. So we had a flood on January 1st and a fire on February 2nd. On March 3rd, I was joking we’re going to have the locust come in and take out the vine, but we don’t really have that. So the thing that we do today is we promote beneficial predators. If you came out of Napa 15 or 20 years ago, there were no weeds and no grass under any vine in any vineyard anywhere. It was like the Dust Bowl in the ‘30s because everybody used Roundup and we were crushing the weeds, trying to protect them from competing for water with the vines and we’ve learned that that’s not okay. So now, we are really into soil health, promoting what we call beneficial pests in the vineyard to go get the ones that are not good. We don’t spray any pesticides, we're not out there trying to wipe out every little thing in the vineyard. It’s a little bit like using bird netting. I remember an old vendor one time and I was like, “Why don’t you use bird netting?” And he said, “Because birds don’t eat that much.” They can’t eat all the grapes.
We do have some issues with pests from time to time, but it’s not a wide-ranging thing. There are threats like there are two critters that are both in the sharpshooter family. They could create huge problems and so the industry is on that, and we’re doing a lot of things to try and prevent some sort of dramatic change in different bugs that can cause problems.
Dr. Sandra Magnus: It sounds like you have to keep a delicate balance there.
David Duncan: You definitely need to.
Sandy Winnefeld: So digging deeply into the Mother Nature piece, earthquakes, I imagine an earthquake probably doesn't bother a vineyard too much, but it could bother your facility there. I mean, do you think much about that? Or is this like, “Okay, we're in Northern California. We have earthquakes all the time. No big deal.
David Duncan: So when we built this winery, I remember having a discussion with the engineer. And being from Colorado, I was very aware of earthquakes and kind of nervous about them. So I kept asking the engineers and the architects that we were working with. I was like, “What about earthquakes? What are we going to do about wine storage? How is this going to work?” Finally, the engineer got tired of me asking questions, and he said, “David, let me put it this way to you. If there's an earthquake, you want to run into this building. And you've been here saying, do you know, we built a very portable stone building?
And so in 2014, we had a 6.0, a very big test of that, and the earthquake happened at 3:20. I was in the winery at about 4:15 in the morning after I cleaned up my house a little bit. And people always are like, “Did that earthquake wake you up? Everybody says, “Yes, the earthquake woke you up.” And this winery did really well. And so, I think earthquakes and rain might be in the same category that there's not a lot you can do about it. And we don't love them around here. They're not a lot of fun.
Dr. Sandra Magnus: I imagine it's kind of scary to live through an earthquake. I haven't been in one. Been in a hurricane, but not an earthquake.
David Duncan: That was the biggest one I had been in. And it was pretty scary because you don't know how long it's going to go. And 6.0 is pretty big.
Dr. Sandra Magnus: So moving off of the Mother Nature piece, Sandy and I have had to deal with throughout our careers is the risk of human error. And so I suppose you have to have certain procedures or training to keep employees from making mistakes or contaminating or ruining a batch. What sort of things do you have to watch out for there?
David Duncan: Yeah, that's a great question. I don't get asked that frequently. I really like that. It's a big deal. So we have a lot of protocols, a lot of checks. We have things that happen from time to time. Years ago, when we even used to use Roundup, and I'm talking 25 years ago, we had an employee spray Roundup over a vineyard and killed the whole vineyard as an accident, and so he didn't stay with us.
Sandy Winnefeld: Yeah, that's one of those big mistakes.
David Duncan: During the fermentation process, we add yeast, and those need to be done in particular quantities, and there's a lot of math and figuring out what's going to go into the tank. And so just all of those different kinds of things, I think, around the winemaking side of things. And then the interesting thing about human error is we also want to promote ingenuity and trial and thinking about our different ways to do things and taking some risks, frankly. And so one of the things that we benefit by is– We're not a big winery. We make about 150,000 cases a year, so the big giant wineries make millions and millions of cases a year, but we're big enough that we can do trials and try things in meaningful, experimental ways. So, we'll do ten tons three different ways, and then we can taste those wines as opposed to, in a research environment, you might do 20 lbs, and that's not a commercial quantity of grapes. And so, on the one hand, we want to be careful, and on the other hand, we want to test and try and experiment with different things.
Sandy Winnefeld: But at the end of it all, David, you end up with these beautiful Cabernets. Is there anything that we left off that is a risk you deal with on a daily basis to make those things?
David Duncan: Well, let's talk for a second about the wine consumer and our listeners as customers. What are their risks? So a bad bottle of wine corked, how it's preserved, how you feel the day you're drinking the wine. So I just wanted to share that from that side of the bottle, if you will, or the glass. Enjoy what you like, and don't let wine snobbery get in your way because it can happen. And at Silver Oak, we promote enjoyment, conviviality, creating a moment. We own the trademark on life as a Cabernet.
And so listening to the Adrenaline Zone, I think people that are in these crazy different areas of their lives, they take it very seriously, but they're also so good at what they do that they have a casualness about them. I mean, I think that's been a thread that I've found through listening to your program, and I've found that to be fascinating. And so I think that's something to explore as you guys go forward with this.
Sandy Winnefeld: The common things of risk takers, and we've found a number of these. This is our 32nd episode, and you're right in there with them. I can tell you that. By the way, from the consumer side, I have two rules about drinking wine. One is, life is too short for a crappy bottle of wine. So if you open it and it's not good, pour it out.
David Duncan: Totally agree.
Sandy Winnefeld: Which, by the way, has never happened with a bottle of Silver Oak. And the other is, I will not open an expensive bottle of wine with somebody that I don't think appreciates it. And I have friends who appreciate it. It's not snobbery. It's friends who know what it is and friends who don't. And I want to preserve those moments for people who actually get it.
David Duncan: Those are great rules. I fully support them.
Dr. Sandra Magnus: But, David, to reiterate on something Sandy said, it seems like from what you've done, you're one of those people between cowboying, skiing, I guess Sandy told me you had some time as a stage musician, so you have a little bit of an attraction to adrenaline and risk-taking in general as well.
David Duncan: Yeah, I think growing up a skier, it got instilled in me. And the music thing is really fun. I have band practice tonight with the boys, and we have a band called The Silverado Pickups. Sandy, I don't know if you saw us perform where you were backstage.
Sandy Winnefeld: I did. You've warmed up Tim McGraw three times.
David Duncan: We’ve warmed up for Tim McGraw three times.
Dr. Sandra Magnus: Very nice.
David Duncan: I joke that the first time we warmed up for Tim McGraw was the 20 minutes of my life that I lost because I barely remembered at all. I was so nervous. And I'm not a natural performer, but I love being in the band, and we have a great time. But it is very adrenaline-producing to be up on stage. It's harder to play in front of four people than it is in front of 400, to be honest.
Sandy Winnefeld: Because you might actually hear back from the four.
David Duncan: Yeah.
Sandy Winnefeld: And some of your bandmates, your teammates, there are competitors, right? They're people who also make wine.
Sandy Winnefeld: I like to think of it like Paris in the ‘20s where it's more like we're all artists that are hanging out together. Napa Valley is a wonderful place, and people really get along, and people share so many ideas. And so we do have other vendors in the band, and we all have a great time, and we enjoy some wine together and play music, and it makes for a very good time.
Dr. Sandra Magnus: Well, risk comes in many forms, and getting up in front of a huge crowd of people as a musician is certainly one of them.
David Duncan: We did record an album, and we're just about to get it out. It's called Bacon, Butter & Salt, The album, The Silverado Pickups. So I might do a little plug for my album, and hopefully, by the time you all are listening to this, you can Google that up and listen to it on your favorite streaming service.
Sandy Winnefeld: What every good chef puts on almost every meal.
David Duncan: Yes.There's a story behind that, but we'll have to save that for another time.
Sandy Winnefeld: Okay. So on the personal side of handling the risk, one of the things that Sandra and I think she would agree, we've discovered, is that there's kind of this duality of how people have an intense focus on it and they are able to calculate the risk extremely, extremely well. The people who are really good at what they do. But there's also this sort of almost callous relaxed, like, "Hey, as long as I don't die, if this thing doesn't work out, there's something else I can do in my life." So they've got this sort of juxtaposition of intense focus on the risk, but at the same time detaching from it. Does that resonate with you? Do you have a sense of the same way?
David Duncan: Yeah, I think that's what I was trying to express a minute ago with so many of your episodes. I think that's absolutely true. I guess you get to a point in any business, industry, life, pursuit, sport, hobby, or kind of you've seen it all. And I think I'm not a trained pilot like you both are, but I have been around a lot of that. And I think that's why you go through every single scenario you can imagine so that when it actually happens to you, you've already done it. And so from a wine standpoint, we grow wine every year. It's either too much rain or too much or not enough rain. That's only common. There's never a perfect amount of rain. And whether you have a pest problem or a personnel problem or something goes wrong or you pick too early or whatever, you just got to roll with the punches. And I think people who deal with risk on a basis all the time, their ability to roll with the punches and not let it take you down gets refined, and they get to be experts at that, whether you're a bull rider or a mountain skier or mountain climber.
Dr. Sandra Magnus: Building resilience.
Sandy Winnefeld: So you're not only a successful winemaker and a musician, I see your guitar in the corner behind you. But one of the great things, David, I like about you is that you believe in philanthropy and you do a lot of philanthropic work, and not just the concert we talked about earlier. And it's not uncommon for some of our risk-takers to be philanthropic. There's so much that you do in the Valley, I can't even begin to list it. But tell our listeners about that. What do you do and why do you do it?
David Duncan: Oh, boy. Well, I have been involved in a lot of things. I think part of it is that I do have a platform to do good and people love, whether it's a wine bottle and a silent auction for a kid's school or a book club or something, all the way to having– Last year, I auctioned off an event with Kelsea Ballerini as a private concert. Kelsea, she's not rising. She's a star now. And she was incredible. And we did an amazing event and we raised almost $500 million for a charity. Or the thing that we did for Tim and Guy. So I think just having the ability to give back and participate in that is very gratifying. I don't do it from an ego standpoint. You don't see my name all over that stuff at all. But we live in a place where people like to come and they'll be very generous.
We are hosting this year for our local community. We are bringing back a live auction, which hasn't happened since COVID in the Napa Valley used to be known as Auction Napa Valley. And we're actually going to host the main events and the live auction at Silver Oak on June 3rd this year. So very exciting. And if you want to support all the things that make great wine, please support that. And you can find out about it at collectivenapavalley.com. But we're fortunate to be able to do that. And we support hundreds and hundreds and hundreds of different charities around the country every year, often with just a bottle of wine or a tour and tasting. But very fortunate to get to do that.
Sandy Winnefeld: I do want to ask you, how do you feel about the 2018 vintage? You've probably had a sneak peek at that a couple of times.
David Duncan: Yes, oh, absolutely. As a matter of fact, we just tasted the 2018, 2019, 2020, 2021, and 2022. So that's how I get a sneak peek because we always taste the back vintages when we do the blends, which we just completed the 2022 blends. 2018 is beautiful. We knew it was a good vintage at the time, but it was kind of a large vintage. And now we sort of know that large quantity vintages tend to be very high quality, which seems a little bit counterintuitive, but it's not, so we're just thrilled with the wine. The other exciting thing, talking about taking a risk, is that after almost 20 years, we changed the Napa Valley package from a silk screen label to a paper label. And so that's something that our customers– Well, now emails are out, but most people have not seen this brand new label that we designed three years ago, and part of that was for a sustainability purpose. So both what's in the bottle and what's on the bottle is very important to us and I think people are really going to enjoy it. So, yeah, 2018 Napa is the next one coming out.
Dr. Sandra Magnus: If you still have a moment, I'd want to go backward to the science and technology used in the vineyard. I was a little fascinated with that. So do you have little experimental areas of the vineyard that you try out new technologies before you deploy them?
David Duncan: In a larger sense, yes. Back to that scale thing, you can do stuff with bunches of grapes or you can do stuff with tons of grapes. And so if we're doing a control experiment like this, last year we did an experiment with leafing, so when you go through the vineyard, you want the canopy, the leaves on the grapevine to provide sort of dappled light to the fruit while it's ripening. So this is over weeks period we go through and we'll do an experiment where we'll pick off a specific number of leaves, let's say six leaves on each shoot on each vine. So you're talking about a lot of leaves through an area and then we'll do another area where we'll leave the canopy as it was to see how that activity affects ripening and then affects flavor development. And so we have veneer blocks that we like to do that in, but you don't want to use every block every year because then you'll create different things and there's carbohydrate uptake in the roots, and we can go down a deep rabbit hole here.
And so typically if we're doing an experiment like that, we'll do like four rows, and then we'll do four rows of experiment, four rows of control, four rows of experiment, four rows of control. And then you have to flag all those because then you have to pick them. You have to make sure they get into the fermenter correctly. You have to pick the right amount of tons. But we do a lot of experimentation like that, and you make the wine and then we'll taste those over several years to see how that experiment, from a sensory standpoint if we can assess what the experiment did. And of course, we do a lot of chemistry, and we're also trying to control that environment in the moment. So there's a lot of data around that, but those are the kinds of experiments that we could do in the vineyard.
Dr. Sandra Magnus: So do all the vineyards share their experiments, or are some of that are proprietary to get to your particular vintage of wine?
David Duncan: That's a great question. So there are industry groups and many, many vendors will talk about what they're doing. So I'd say the default is to share. There are certain vendors who don't like to share. You can imagine from talking to me for the last few minutes that we're on the 100% share. Let's learn. I think Robert Mondavi was the champion in Napa Valley of the rising tide floats all boats. And so I think that is very true. And so there's not enough proprietary data about something I would do in the vineyard that I wouldn't share with you. As to I tried this, it didn't work, or it did work, or you should try this. A lot of talk like that, that we all share collectively as farmers here in the valley.
Dr. Sandra Magnus: The little peek into that science and behind the art of winemaking is fascinating. Not a lot of people, I think, understand that there's a strong base of experimentation and technology there.
David Duncan: There's so much that goes into a bottle of wine.
Dr. Sandra Magnus: That's cool.
Sandy Winnefeld: Well, David, let's talk for just a second business risk in the sense of– I'm on the board of Molson Coors, so the Bev Alc industry is sort of segmented into spirits, wine and beer, and other crazy things that are coming along the line. How do you see that evolving? Is the wine business on an upcycle or flat-down cycle? How do you see that playing out?
David Duncan: There's a couple of factors to that. One is that there's a lot of discussion about what younger people are drinking. But for fine wine, which is what I do, which is a category, I think that the future is very, very bright. I believe that people have been drinking great wine for years and years and years. People are not drinking our wine to get a buzz or for this, I do tailgate with it. I've got two kids at Notre Dame, and so I do tailgate with it. But in general, I think one of the things that happened post-COVID with restaurants– I was joking during COVID that you go out to dinner and it would be half the food for twice the price. And so now, either you're paying $70 for a steak at places, and so people are willing to spend $200 or $300 on a bottle of wine if you're paying $70 for a steak. So I think that's been very interesting how that's changed.
I also believe, you actually mentioned it earlier in the broadcast, that you won't drink a bottle of wine unless you're going to enjoy it with the person that you're enjoying it with. And life's too short to drink cheap wine. I think people really understand that. I actually was in New York and had a glass of wine on the plane on the way back and it was terrible. It's hard to drink. You don't want to do that. From clothing to food to people that enjoy fine things and that's important to them are going to continue to drink excellent wines and we're going to continue to make them. So I don't see it as a giant risk.
Sandy Winnefeld: So at your end of the business, it's in good shape.
David Duncan: Yeah. And I think from a generational standpoint, we, at Silver Oak, in particular, have become a family tradition. So it's not like, “I don't drink wine. I'd rather have a $40 tequila than drink wine.” It's like, “Oh, no, we have wine on Thanksgiving because this is our family tradition that I grew up with.” And that's been really gratifying to see.
Dr. Sandra Magnus: So I have to ask, if you're tailgating with fine wine, what is the food that is accompanying to complement?
David Duncan: We did a big tailgater for the Clemson game last year, and so we had beans and ribs and there were six bottles of Silver Oak sitting on a table. And we had more than 100 people at this tailgater. And I said to the parents, I'm like, “Why don't you guys open those bottles? I brought them. They're like, “Oh, no, that's too fancy. We're not going to have that.” And I said, “I brought the bottles of wine.” And I went and opened all six of them. They were gone in ten minutes.
Dr. Sandra Magnus: I believe you.
David Duncan: So once they were gone, they were gone in ten minutes.
Sandy Winnefeld: Good wine will go good on cornflakes, too, right?
David Duncan: Yeah. Especially the Alexander Valley. I have to say, the Alexander Valley will pair with anything.
Dr. Sandra Magnus: Oh, yeah. Those are wonderful.
Sandy Winnefeld: Well, David, as Sandra said, this has been a lot of fun. I can't wait to get back out there and connect with you. So much to talk about, so much to do, and maybe a couple of glasses of wine to go along with it. But we hope you'll keep taking risks in that business because it sure is a lot of fun to spend time with you and with your wines.
David Duncan: Well, I'm very passionate about what I do and I invite you all to come and visit anytime. It's a beautiful spot. And I'm looking out at Napa Valley right now on my window, and it’s a good spot.
Sandy Winnefeld: I've got a few bottles. I'll get maybe a bottle to Sandy so she can enjoy it.
David Duncan: Sounds great.
Dr. Sandra Magnus: Yeah. It was really a fascinating chat, and I really enjoyed poking on the science and technology piece, being the geek that I am. There’s a lot that's going on there.
David Duncan: I can introduce you to our viticultural geeks, and you'll have a blast. So yeah, come visit.
Dr. Sandra Magnus: Awesome. I will do that.
David Duncan: Yeah. Okay, great. Well, thanks.
Sandy Winnefeld: All right. Good talking to you.
Dr. Sandra Magnus: Thank you.
That was David Duncan, who runs the Silver Oak Winery in Napa Valley. I'm Sandra Magnus.
Sandy Winnefeld: And I'm Sandy Winnefeld.
Dr. Sandra Magnus: Check us out on social media, including a short video of our interview with David on TikTok. Our handle is very simple: @theadrenalinezone.
