Hidden Gems: Meet Timothy Kelly of FELENE VODKA

Today we’d like to introduce you to Timothy Kelly.

Hi Timothy, so excited to have you with us today. What can you tell us about your story?
Growing-up in New York, my family was in the liquor store and restaurant business. The spirits, libations and hospitality business is very much a part of my “evolutionary DNA.” Living in Italy for an extended period of time as a young adult really influenced my appreciation for celebrating the epicurean lifestyle.

About ten years ago, I began to develop an interest in crafting my own spirits. I’ve always been a bit of a DIYer and have always maintained a robust social entertaining schedule. I decided it was time to jump-in with both feet. After a cross-country road trip, visiting over 30 distilleries, I made the decision that I would breathe new vigor into the character of vodka…or die trying. To me, vodka was mostly all punishment and no reward. Even the US Government relegated vodka to a dull “characterless” spirit by definition. I was determined to change that, or be a part of that change.

When I first started distilling, I used a number of base agricultural products to make vodka. No matter how much I tried to innovate, the result was often bitter, astringent vodka that was not what most people would consider pleasing to the palate. I mostly fermented corn, wheat and potatoes. Potato was my favorite, but it was still not pleasant to sip neat.

After some time of moving sideways without any breakthroughs (2016-2018), I wanted to try a quick wash using crystalized cane sugar, so I bought 50 pounds of sugar and went to work. It was quick, clean and very efficient, but between using a rough, industrial-type yeast, and a crude filtration system, it was not yet there…but getting closer. After researching yeast strains and evolving by carbon filtration system, I went back at it. From that moment I could tell during fermentation that I had done something differently. After distilling in a reflux column still and several stages of my proprietary filtration, I had a vodka that was clean, had tons of character and taste and was free of a pungent odor and that did not burn the palate. It was the eureka moment!

The next step for me was finding a pristine water source, that was naturally alkaline; and to move to organic ingredients. That destination was Denver, Colorado and the water source was the mineral-rich Rocky Mountain snow-melt.

In 2020 I opened the Felene Distillery in Denver. After all that excitement building-up to that point it was like we were hit by a freight train, as Governor Polis announced that the state was shutting-down due to the Covid Pandemic. We had just launched Felene American Handcrafted Vodka just two weeks earlier. We signed a lease, bought equipment and hired staff, it was a devastating shock for business, not to mention the fear and sadness we were experiencing for our friends, family and neighbors stricken by Covid.

Within hours, the governor lifted the restriction on liquor stores and producers; and declared us essential workers. While that was a relief, we still knew it would be a very difficult year or two ahead. Bars and restaurants remained closed and liquor stores were operating under strict Covid-era rules, it was not a great time to introduce a new product.

In the weeks and months ahead, we began to realize what a blessing it was to move our operations to Colorado. The entire community seemed to spread their arms and welcome us in. If they didn’t we would have understood, because we all had so much to deal with back then. But many stores realized our situation, knew we were local producers and that we continued to employ our staff, so they gave us orders for Felene Vodka. As bad as the initial Covid news was, this act of civic benevolence was nothing short of incredible.

In the summer of 2020, Kim Laderer-Veiga joined Felene as the New York sales Director and became an investor in Felene. It was a bold gamble considering the state of the business environment in New York and most of the country. Within a year, we had surpassed 150 stores selling Felene vodka in New York, Florida and Colorado. That also included the nation’s largest retail chain, Total Wine and More. Kim’s arrival at Felene was a seminal moment as she fully embodied the true essence of an American entrepreneur, and an amazing partner.

In 2024, Felene is now in Colorado, California, Florida, New York and Texas. Felene is also one of the fastest-growing vodka brands in the markets it services. In addition, Felene won a gold medal and was named Best in Category by the American Distilling Institute in 2023. In the past 3 years, Felene has been awarded 4 Gold Medals, 1 Platinum Medal, 4 Silver Medals and a Best-in-Category honor.

“The arrival of Kim changed the outlook of the company in an instant,” explains Tim. “Kim is one of those people that you instantly recognize as kind soul. She is sincere, passionate and works so hard for her clients. That has made all the difference in making Felene a success.”

We launched our flavored vodka line in early 2022 with three new flavor profiles based on our organic vodka. We went with natural flavoring, no sugar and kept the flavored vodka at 80 proof. Almost all flavored vodkas on the market have been diluted, contain added sugar, artificial flavors and artificial coloring. We took a shot (no pun intended) that America’s sweet tooth was giving-way to healthier, more natural products. The gamble on natural flavors has been a huge success for us.

In the past year, we have expanded our staff and have a truly knowledgeable and professional team. One thing we look for in our new staff are people with passion and a proven track record to demonstrate that they take their craft seriously. “Love of the game” goes a long way. Another criteria that we consider is asking the question, “is this a person we would want as our business partner?” We give every staff member an opportunity to become an owner of Felene. You put that all together and you have a team that functions as a world-class squad that has the motivation that only comes with pride of ownership.

Can you talk to us a bit about the challenges and lessons you’ve learned along the way. Looking back would you say it’s been easy or smooth in retrospect?
While we love what we do, it has not always been a smooth path for us. Having a passion for what you do and having people you love to work with makes it easier, but you must be wired for dealing with adversity as an entrepreneur.

The first major obstacle we faced was Covid. It was one of the times as a business owner where I struggled to see a solution or alternate path forward. Sometimes, you hear people say, “just hold-on.” I must say I really did not understand the real meaning of that until that time. We had spent most of our own money, lot’s of it at that point, and we were planning on having a business that generated revenue. That was delayed for months, so we really just were holding on, trying to stay composed until something broke in our favor. Looking back, the only way to describe it is like having a dream where you are falling uncontrollably.

Aside from that, its the normal struggles of a business owner. People think small business owners live a very glamorous life, and we do have our moments. However, most of us worked for years at little or no salary, you also drain your saving to frighteningly low levels, you have to take big risks and just don’t stop until you are successful. The long hours are debilitating when you are not seeing immediate results, you are paying your staff and vendors before you pay yourself and that takes an emotional toll.

The biggest challenge in running a small business is: running a small business. Brands are not built overnight, there are small steps, setbacks and occasional big wins, but mostly it’s an ebb and flow that seems to have its own cadence of unfolding. You have to have a strong constitution for drama and unexpected challenges almost every day.

The biggest challenge in running a vodka company is getting market share. The industry is insanely competitive, with literally hundreds of new brands emerging every year. At the top, there are roughly 10 brands that control roughly 95% of the market. On top of that, national distributors rarely engage smaller, emerging brands, so you are forced to go it on your own. National distribution is a monumental challenge and is very capital intensive.

One of the tactical challenges we face are dealing with competitors at the retail level. Marketers who have never stepped foot in a distillery are peddling questionable products using flagrantly false advertising. One popular advertising gimmick used by quick-buck artists is “number of times distilled.” These marketers are telling the average customer that the more times a vodka is distilled, the better the vodka will be. That is just an outright falsity! That’s not good for the industry and that’s just deceiving to the consumer. Accurate and strong consumer knowledge is Felene’s best friend. If a consumer understand the care and quality that goes into making our vodka they would not buy many of the top-selling competitor’s products.

Most vodka’s contain citric acid and sweeteners that are introduced to help reduce the harshness of the vodka. Because of certain regulation quirks, this does not have to be disclosed, but if you don’t use these additives, you are required to prove it on your label. So, making the case for a purer, cleaner product has some systematic barriers. Felene uses only organic sugarcane juice, water and yeast in making its vodka. We then use filtration methods that are between 8-10 times finer than the industry standard.

The multinational brand owners and distributors have a vested interest in perpetuating these marketing gimmicks to peddle average-quality products.

Appreciate you sharing that. What should we know about FELENE VODKA?
Felene was created as a “product solution” concept company. “How could we improve vodka?” Growing up in the family business of retail liquor stores, I was always wondering why vodka was the largest-selling spirit, and was the worst-tasting too. This paradox was the catalyst to trying to make a better-tasting, smoother vodka.

At the distillery, we are focused on making one thing and doing it well. Our obsession is making amazing vodka and vodka products. The staff all bring an industry specialty to the table. Whether is is as a buyer on the retail (or customer-facing) side, distribution, info technology, mixology (bartender), chemistry or industry sales, we are a collaborative force. We have brought people together from various disciplines that have a pretty strong opinion of their specialty, that’s the “secret sauce.”

With all these strong personalities meeting once a week, it can get heated and seem like chaos at times. Our CFO chastises us to stay focused on sales, our creative types are taking the conversation to discussions on new design ideas and others are thinking with their marketing hats. That may seem unproductive, but we really get a lot out of it and it’s important for us to mix-it-up.

At the heart of it all, we are very focused on quality. Every bottle is given personal attention by one of our staff who are experts in quality control. Why is that important? With social media, one bad bottle can create a negative impression of your product or company. We can overcome a lot of non-product-related exposure, but if your product has defects, that’s not easy to overcome, so we are obsessive about it from start to finish.

A competitor of ours recently released a corn-based vodka not too long ago. It was not a high-quality vodka to begin with and it was outsourced by the husband and wife owners to a co-packer. They slapped the name of a famous concert venue on the label and threw it into the market. Suddenly, the vodka was appearing all over social media because it had a white sediment floating in the bottles, like a snow-globe. Despite efforts to explain-away the defect, liquor stores slashed prices and discontinued the product. Clearly, the husband and wife owners did not think it necessary to oversee production and allowed quality to become sub-standard.

That’s why we made a decision to get our organic certification. As of March 19, 2024 new traceability rules went into effect for organic certification. USDA Organic Certification standards have been dramatically raised to ensure the highest quality. In the months ahead, Organic will be synonymous with elite quality in spirits.

The balance between dedication to quality, on a bottle-by-bottle basis and scaling to a nationally-distributed product is helping to define the new standard of excellence. We proudly proclaim our product as the resurgence of American-Made quality and pride. That is reflected in our name: Felene American Handcrafted Vodka.

On a final note about quality and smoothness, we stand on the fact that we have a superior product to begin with. The reason that Felene is smoother than other brands is because sugarcane juice ferments much cleaner than vodkas made from potatoes, corn or wheat. Once customers understand the real attributes of quality and taste Felene, they usually become customers for life.

Alright so before we go can you talk to us a bit about how people can work with you, collaborate with you or support you?
We are always engaging in fun collaborations with our customers. Whether is educational or tasting events at liquor stores or crafting new cocktails with our bars and restaurants, we have conducted over 1500 events in the past 4 years.

We have over 20 charitable organizations that we support with gift baskets and we are regulars at festivals in the markets we service.

We are actively seeking collab’s with non-alcoholic beverage companies to pair with to create craft cocktails, like a kombuchery, seltzer companies or juice-makers; or even chocolatiers who would use our flavors for their chocolate flavor creation with an alcoholic twist.

Pricing:

• 750ML Bottle (All types) $19.99 avg. price
• 1.75L bottle (straight only) $26.99 avg. price

Contact Info:

• Website: www.felenevodka.com
• Instagram: https://www.instagram.com/felenevodka/
• Facebook: https://www.facebook.com/felenevodka/
• Youtube: https://www.youtube.com/@felenevodka1023