How do you solve a problem like tequila?
Eric Brass, HBA'05, founded Tequila Tromba in 2010, inspired by an international exchange to Mexico as an Ivey student
By Jeff Renaud
In the early days of Tequila Tromba, Eric Brass, HBA’05, faced a huge obstacle. And knowing the formula for ‘discounted cash flow’ by heart wasn’t going to help.
Thank god Ivey Business School also teaches students how to solve a problem or two – or maybe a million.
Fast-forward a few years. Tromba is now the No. 2 premium tequila in Canada and one of fastest growing tequilas brands in North America, but at the time, Brass and his partners knew they had an exceptional product. They just lacked the resources (read: money).
Industry insiders told Brass he needed at least $1 million to get Tromba off the agave plant, but the most he could rustle up was $20,000 from his savings and some family and friends. So like any good Ivey grad worth a lick of salt, Brass got solving.
“A lot of really smart guys told me that we needed $1 million to launch a tequila brand in a major market like Ontario and they weren’t wrong,” laughed Brass. “The only thing to do was to go around and speak to the bartenders and have them taste Tromba and fall in love with it. And we did just that. We backpacked bar by bar, bottle by bottle, and we ended up the No. 1 tequila in bars and restaurants in the province. And we’re very proud of that.”
And guess what? Brass didn’t need to know his discounted cash flow to find his answer.
“I can memorize the formula for discounted cash flow from a textbook, but do you know how many times I’ve put a discounted cash flow together in the real world? I don’t remember a time when I’ve done that,” Brass quipped. “Even when we’re evaluating our business nobody asks for a discounted cash flow.”
That’s the Ivey difference. Of course, Brass says there is a time and a place (and an importance) for memorizing the definitions of ‘debt,’ ‘dividends’ and ‘discounted cash flow’ but the thing Ivey does best is teach its students to solve problems based on a learn-by-doing approach.
It’s called the Ivey case study method.
And it works.
You just might not know it at first.
“I definitely didn’t appreciate that approach when I was going through Ivey. I just didn’t see the tangible benefit,” said Brass, who also mentioned his entrepreneurship class with Eric Morse as an Ivey highlight. “It’s not like taking a test and getting right and wrong answers. It’s a bit fuzzy. But even with my first job in investments and asset management, I understood exactly why and how it works. It trains you to become a great problem solver. And you start to approach problems almost subconsciously. Just take a step back and every problem is just like a case. You don’t even have to think about it. It’s kind of ingrained in your mind. It just clicks. Now I’m a really great problem solver and I credit Ivey with that.”
What isn’t a problem for Brass and Tromba is the quality of the tequila. That’s because one of his partners is Marco Cedano, the ‘godfather of modern premium tequila.’
While at Ivey, Brass studied in Mexico as part of an international exchange. One of the life-long friends he made during his stay was Rodrigo Cedano, the son of the legendary tequila maker. The elder Cedano was the original master distiller at Don Julio. Now, both Cedanos are partners in Tromba.
“Marco is really our big advantage. His son and I became friends when I was on exchange. When we came up with the idea for Tromba, we thought better be lucky than smart, so we pitched him on being our master distiller. That’s like asking Wayne Gretzky to play for your men’s league hockey team,” Brass said. “We thought he would tell us to bugger off, but he actually said he was interested because he’d never been a partner. He’d always been an employee and never had full control of the production process. Well now he does. At Tromba, Marco and Rodrigo oversee every single step of the production process.”
When asked point blank the difference between a good tequila – let alone a premium one – and a bad tequila, Brass didn’t flinch.
“There is definitely bad tequila. Most people have had bad tequila because it’s a mix of 51 per cent agave tequila and 49 per cent sugar distillate, corn syrup and caramel and I had many of those when I was going to Western,” admitted Brass unabashedly. “That’s what I thought tequila was. Going to The Ceeps and Jim Bob’s, most people don’t have a good tequila story. They have a bad tequila story.”
Tromba, like other premium tequilas, is 100 per cent agave but even those tequilas aren’t created equal.
“Think of tequila like a steak,” offered Brass. “You can get a steak at an OK restaurant or you can get a steak at a fancy, top-of-the-line steak house like Morton’s. They’re both steaks but the meats are different grades; they’re seasoned a different way, they’re marinated a different way and they’re cooked in a different way. There are many, many things that separate one steak from another steak. And they’re priced accordingly. It’s everything from soup to nuts. Everything from raw materials to how they’re plated is different but they’re still both steaks. And the same things goes for 100 per cent agave tequila. Some
are good quality, some are not.”
Tromba is good quality. And it’s a good story. That’s a problem that doesn’t need solving.