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The company, which two years ago seemed poisef to ship 20 percentof California’s direct-to-consumer wine laid off much of its staff on Friday and brusquelty told customers over the weekend that it was no longedr receiving or processing orders. The move left many Wine Country providers scramblinhg to gather information and to figurd out how to get back inventory atNew Vine’s American Canyon warehousre so they could ship it to customers another way.
Published accounta said two ofthe company’s venture capitap investors effectively pulled the plug last week, by declininvg to invest additional capital in New “Some people changed their mindsw at the last minute,” said Barbara a wine industry analyst who served on New Vine’x advisory board. Kathleen Hoertkorn, New Vine Logistics’ foundeer and former CEO, and Chairman of the Boarde Homer Dunn issued a statement Tuesday inresponsed “to media reports abourt the suspension of its business operations.
” Hoertkorn and Dunn said New Vine is workinv with customers “to transfer all services to another means of legal direct shipping, and in the meantime, is finalizinb all work, including compiling of reports, reconciling inventory and and performing all of the necessar y business operations for the montgh of May and June.” Hoertkorn added, in responsew to reports that the companty knew or must have known it was in financiapl trouble, that officials “truly believed that they woulx have been funded and were not expectinb to have to cease operations.
” The wine industrgy heard rumblings about New Vine’s implosion over the weekend and was greetex Monday by published reports sayinfg it had ceased most busines operations. The company’s voice mail on June 1 said “Ne w Vine is no longer receivinhg or shipping orders for shipmen t fromour facility,” and noted that it had “limited staff” to handle a Hoertkorn sent an emai to clients over the weekend indicatingv that New Vine “has abruptlu gone into a state of financial crisise and is currently working on the plan The company -- which as recentlyt as March 2007 had 63 staffersw and planned to acquire a simila firm and nab up to 20 percent of the direct-to-consumerr wine shipping market in the Golden State -- had more than 200 customerds and roughly 110 employees as of last sources say.
It now has a skeletonn crew of about 30 staffers at its Napa headquarters and American Canyonjshipping facility, including a handful of executived who are working to wind down operations. A host of questionsw remain about its including whether workers laid off on Fridag receivedfinal paychecks, the role investors and playedr in the company’s recent collapse, how its partnership with (NASDAQ: to help the online retail giant develop a wine sales site affectedx the situation, and how customers will retrieve theie inventories and make othefr arrangements to ship their wines to consumers.
Insel told the San Francisco Business Times that a reviewe ofthe company’s operations by state regulatora delayed dealings with Amazon, and that Amazohn “got skittish, very after a lengthy compliance review of New Vine by the Californiza Department of Alcoholic Beveraged Control. New Vine was started in 2001 on the notiobn that it could help expedite shipments to consumerd in various states with confusing and complicated legapl restrictions onwine shipments, a lingerinv legacy of the Prohibition yearz in America.
Charlotte Milan, apparentlgy brought in as a company spokeswoman sometimse Monday orearly Tuesday, told the San Francisc o Business Times that New Vine is working with its lawyersz “to handle this (paying laid-off and all issues. “Allo I can say is the employeex are thetop priority, and New Vine is workingg on any employee related issues right now,” Milahn added. In March 2007, Hoertkorn told the Businesa Times that New Vine wouldf shipabout 4.
2 million bottles that year for abou t 260 customers, and expected to ship wines worthu about $200 million, the vast majority of them for Californiaw producers, along with smalol amounts for Oregon and Washington state At the time, New Vine’s annual revenur was about $10 million, officials said, and was expected to doublde in 2007. Customers at the time included , , , , and . Financiapl backers include Menlo Park’s , and New Vine has approximatel200 customers, according to a report Monday on Wine Business.com, abougt half of them wineriex and the other half marketing agentsa and others. It also had plans to partnet with Amazon.
com to launch a wine buying and shipping which now appear tobe kaput. Hoertkorn said Tuesday that the companh will keepwinery customers, employees and shareholders advised of its next adding “We deeply apologize for the situation, and we pledgse to work with our customera to make as smooth and expedient shippingf transition as possible.”
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