For 107 years, the Terry College has produced men and women of legendary entrepreneurial spirit.
Turns out you can bottle it.
Ask two Terry graduates, Jim Chasteen (BBA ’98) and Charlie Thompson (JD/MBA ’99). In 2011, they fired up ASW Distillery in pursuit of long-simmering entrepreneurial dreams.
Today, ASW has successfully blazed a trail into the hard liquor distillery business in Georgia … and Chasteen and Thompson and two other Terry-smart team members have cooked up innovative brands and libations that could revolutionize whiskey-making itself. The first-of-a-kind concoctions developed by partner Justin Manglitz (BBA ’04) and the unique product branding dreamed up by partner Chad Ralston (BBA ’08) have brought ASW prestigious awards and shots of celebrity.
The initial success has been heady. This spirited venture with Terry roots attracted substantial investor money and provided hospitality to thousands of guests and curiosity-seekers in a classy distillery showroom and events space. The venture has a sprawling second location for distilling spirits and warehousing.
In short, ASW has become something new under the moon in a state where illegal ’shine, bootlegging, and corked jugs are a proud tradition:
The Terry crew at ASW is cooking up the stuff of legend.
A 100-proof vision
Chasteen and Thompson were UGA undergrad roommates and Lambda Chi fraternity brothers in the late ’90s. They spent a decade apart, Chasteen on the road raising money for real estate funds and Thompson at King & Spalding, the prestigious Atlanta law firm.
In late 2009, the two men reconnected as friends. They found a shared passion.
“We were both exploring a lot of different whiskeys independently,” says Thompson. “So we decided we should make our own and start a business.”
They faced one miniature problem: Making whiskey at home is illegal in Georgia.
But whiskey-making is all about tradition, of course, and Chasteen and Thompson skirted their legal issue by observing a proud family one. Both men claim ancestors who craftily made aqua vitae outside the regulatory framework.
So Chasteen and Thompson allegedly started some home experimentation to understand the distilling process. And they began to research the spirits business.
“It was a nights and weekend hobby,” says Thompson. “And we started interviewing firms to help us design a brand and product.”
With enough pocket money to invest in branding but not yet build a distillery, they vetted firms around the country. They settled on a Charleston-based private label distillery, Terressentia, that offered them the freedom to design their own spirits to bottle and label instead of simply choosing a pre-produced liquor from an available menu.
Chasteen studied risk management at Terry. Now he took one — he spent $10,000 on a marketing concept to get things going. Then, in November 2011, the world beheld its first bottle of American Spirit Whiskey, with Chasteen and Thompson the sole owners, operators, and funders. They went to market with a white whiskey, lightly aged but still clear, not barreled long enough to pick up color.
“We wanted a flavor profile between vodka and moonshine,” Thompson says, “something with a sweeter taste than vodka but that didn’t taste like jet fuel.”
Their launch was well-timed. The national farm-to-table movement had begun, and it paired nicely with a cocktail revolution sweeping bars and fine restaurants everywhere.
The locally owned Georgia white whiskey made news. It even sold a few bottles.
The making of a maker
A country boy from Haralson County, Manglitz made a little all-grain beer now and then, and a little wine from California grapes with his daddy in September.
By high school, though, Manglitz had a vision that took hold of his life.
Long afternoons, he sat in the tack room of a barn allegedly tending a still that a friendly neighbor let him set up. Manglitz practiced the fiddle too, scratching out tunes born in the same Georgia hills where his ancestors had allegedly made whiskey since days of yore.
Manglitz says his self-education as a whiskey man came through trial-and-error … with a lot of error.
“Unfortunately, there is not much accessible, usable, and correct information on distilling,” he says.
“That’s very different from beer brewing, which is essentially standardized across the world, with programs of instruction and reputable sources of information. Whiskey making is still highly individualized, guarded, and esoteric … which is to say, I had a lot to figure out with basically no resources. My art developed through years of trial and error, frustrations … and poured out spirit.”
At 18, Manglitz headed off to UGA with a single mission.
“I went to Terry to open a distillery,” he says. “A desire to spread my whiskey to the entire world pushed me into business school.”
Manglitz took all the entrepreneurship classes he could. Every class project, he worked on a fantasy prospective distillery that would make Outlaw Whiskey, an unaged white liquor.
The youngster saw ahead of the curve — it would be six more years before the white whiskey concept exploded nationally.
After graduation, Manglitz opened a store in Athens called Blockader Homebrew Supply. He found time between sales to allegedly experiment with whiskey-making … from shelves heavy with wholesale ingredients.
Manglitz worked like a mad scientist, refining, inventing. Fiddling with something big.
The right start-up ingredients
From 2011 to 2015, Chasteen and Thompson peddled ASW and learned the spirits business on their own, “screwing up more than we got right,” according to Thompson. They kept their day jobs, families always first, but meanwhile ran a classic entrepreneur’s gauntlet: They sponsored charity events. They called on accounts. They bought pricey dinners and made sure the cocktails sparkled with American Spirit Whiskey.
They put themselves on the map in Atlanta.
By 2015, with a brand too valuable to abandon but not yet valuable enough to sell, Chasteen and Thompson decided to go big … or go home. They began looking for capital and drawing up plans for a distillery. And they began looking for more good people.
Enter Manglitz, introduced by Chasteen’s sister, Joy, a high-school acquaintance. The boy from Bremen showed up with his résumé — bottles of his allegedly hand-crafted whiskey.
“As soon as we tasted what Justin brought us, we knew we could not move forward without him,” Thompson says. “That whiskey eventually became our Ameireaganach single malt line.”
Ralston also joined as chief marketing officer. He’d been selling a technology product to breweries, but it turned out his deeper talent lay in branding concepts, including labeling, and managing social media and consumer communications.
Manglitz and Ralston blended like, well, whiskey and chaser.
“Justin designed what’s in the bottles, Chad designed what’s outside,” Thompson explains. “Both are necessary to be successful in this business. What’s on the outside sells the first bottle. What’s inside sells the second.”
Now Chasteen saw a chance to step full-time into ASW. The company just needed some capital.
“We were creating a business without precedent in the state of Georgia, so there was no blueprint for us to follow,” says Chasteen. “So we developed a concept of ‘many roads to revenue,’ a strategy to employ multiple ways to make money, which we felt would lower the risk to investors.
“Our concept included creating wholesale revenue from multiple stand-alone brands, driving revenue from private events, and working to modernize the laws in Georgia to give us opportunities to drive revenue through retail bottle sales.”
An offering memo went out on Aug. 2, 2015. Six weeks later, Sept. 16, the offer period closed with just under $2 million in equity from more than 70 investors and LLCs who wrote checks of $25,000 each, on average. Naturally, there was a strong UGA and Terry presence.
After funding, things happened fast.
Lean and thirsty
In October 2015, ASW made its first hire, Josh Anderson, director of sales. (He’s now a partner.)
In July 2016, a spanking new distillery opened on Armour Drive in midtown Atlanta. (No more whiskey trucked in from Charleston.) Manglitz rambled into the city every Friday to tend the new pot stills cooking up ASW products. The company slogan, “Southern Pot-Still Pioneers,” pays tribute to its distilling process.
Chasteen’s wife, Kelly, also a UGA grad and a partner, took over design of the distillery and events management. Cash flow from her charity events and tastings kept ASW going as its first barrels of whiskey aged.
And the whiskey!
After Manglitz and Ralston blended talents, ASW launched Fiddler, a fine bourbon and the company’s best-seller. (“A true ode to American Bourbon, perfect for campfires, concerts, and a killer Old Fashioned,” lauds the ASW website.)
The team followed with multiple brands, most notably Resurgens, an Appalachian-style rye whiskey that “really put us on the map,” Chasteen says. It surprised shelf shoppers with its eye-catching label … and tasting experts with its quality.
An even bigger surprise awaited.
In 2017, Manglitz poured up a first glass of something new under the sun. Duality Double Malt is believed to be the world’s first whiskey made from malted barley and malted rye in the same batch. The uniquely conceived spirit brought back a Double Gold Medal at the 2018 San Francisco World Spirits Competition, the Olympics of whiskey tasting. A double gold medal means judges unanimously awarded the spirit a gold medal. In all, ASW captured five medals for its brands in 2018 — an outstanding haul.
Most recently, in April 2019, ASW opened a new facility for distilling and warehousing. Located in the Lee + White development on Atlanta’s West Side, by the trendy Belt Line among craft breweries and fellow makers, the expansion can age 1,200 barrels of whiskey while Manglitz and Ralston invent new brands to their hearts’ content.
Time in bottles
“We fancy ourselves an incubator of brands,” says Chasteen. “I don’t know of any other three-year-old distillery with 10 separate brands.”
The ASW business plan is all about those product lines.
“If Fiddler takes off as a brand and a big global distributor wants to buy it, we can peel that off,” says Chasteen. “We know that not every brand is going to be a winner, but we’ve designed multiple bites of the apple.”
“In the big picture,” he adds, “our group of investors would like to have an exit and make some money. To the extent an opportunity [to sell a brand] presents itself, we’ll take advantage of it.”
The champagne may well flow one day.
In recent years, big firms have been aggressively looking for opportunities to grow portfolios. A number of craft breweries sold at eye-popping numbers in the last decade, usually after they developed into mature, cash-flowing businesses.
“On the spirits side, we are well behind craft beer,” Thompson points out. “Craft is in the range of 15-20 percent of the U.S. domestic beer market. On the craft spirits side, we are more like 3-4 percent, so we have a ton of room to run … and far fewer regional distilleries have grown into mature businesses, ready for sale.”
“But we’ve observed,” Thompson says, “a significant number of strategic investments by major spirits companies into craft spirits companies in the last three years, probably 10 to 15 of them.”
“In the next five years,” Chasteen admits, “we could be very attractive as a target.”
Right now, though, ASW stays tightly focused on growth as a start-up, brand by brand, bottle by bottle. “We still generate a supermajority of our income in just one state, Georgia,” says Chasteen. “We’ve got to keep reinvesting to grow inventory because if we want to expand into new states, got to make the whiskey now.”
“Our view,” Thompson concludes, “is that we need to grow into a stable, cash-flowing business that we are perfectly happy to keep forever and pass on to our children. If we do so, we are highly likely to attract the attention of a larger suitor who can help us go to the next level and create a lot of value.
“If that happens, we know we have investors who certainly are interested in an exit if it makes sense,” he says. “And we are rational business people and are willing to listen.”
Who really knows how much Terry’s legendary entrepreneurial spirit has gone to their heads?