Few people are lucky enough to combine their business with their pleasure; fewer still are lucky enough to make profits from their passion. So Gary Boom, of Bordeaux Index, is part of an elite band.
Boom has built Bordeaux Index, the wine trading business he founded in 1997, into a £150m-turnover company with customers in over 120 countries. His company has grown into a fully-fledged wine merchant, and has used financial instruments such as a two-way price index to bring order to the often chaotic wine market.
Wine collecting had been Boom’s principal hobby for years before he launched Bordeaux Index, but the enjoyment it gave him was often diminished by the “shoddy service” he received from existing wine companies.
He says that the distribution service was often extremely poor, with couriers simply dropping the cases of wine he’d purchased round the back of the house, and the industry was blighted by vagueness and disorganisation.
Falling back on his financial background, Boom began to conceive a new venture. He explains:
“I thought wine was one of the last great commodities, but it was very badly served by the companies that ran it. The wine market is a big commodity market and, in City terms, it reminded me of an unregulated market.
“By providing transparency to the market, I could start commoditising it. We’ve always publicised our wine prices, shown exactly what quantities are for sale, listed the prices we buy at and the prices we sell it. Clarity is the key.”
Having made “a fair amount of money,” in the City, Boom and his business partner founded Bordeaux Index with an initial investment of £500,000, removing the need for external funding. The start-up fund was spent on office space, and buying an initial base of stock from European suppliers.
The early stages were not without challenges. With no permanent furniture in their office, the six original staff had to sit on wooden boxes as they did business on mobile phones. Furthermore, the task of establishing the brand was an onerous one as an early stage proposition, “your competition absolutely trashes you,” says Boom, “you get bad references from competitors, and you’re facing a wall of prejudice from start to finish.”