Heini Zachariassen laughs when explaining why the world needed another wine app in 2010. There were already 600 available at the time but none like Vivino, through which users photograph a wine label for instant reviews and prices.
“You need a certain naivety to go into such a crowded space,” Zachariassen jokes, “but those other apps didn’t solve the problem that ours does. If they did, would we have wanted to compete with them?”
The problem that Zachariassen refers to is a familiar one for wine lovers: knowing which bottle to buy when faced with so many brands in their local supermarket. “I was in a store one day looking at a wall of wine, thinking, ‘What the heck do I buy here?’” Vivino’s co-founder says.
“There was no way for me to distinguish the good from the bad wines. I could look at the labels and prices but I didn’t have any unbiased reviews at hand to guide me. Movies, books and restaurants are regularly critiqued online – I wanted to do the same for wines.”
Despite having never worked in the alcohol industry, Zachariassen was determined to get Vivino up and running after selling his cybersecurity firm to investors. He and co-founder Theis Søndergaard started by assembling data on wines from around the world in two ways: building a small team tasked with gathering information, and holding a competition where people sent in pictures of their favourite brands. The winner received a corkscrew.
With that information, the Vivino team quickly developed and launched its first app. “I’d actually had the idea for a while, but the timing hadn’t been right,” Zachariassen says. “By 2010 everybody had smartphones – with cameras – and they were all online, which were the three things we needed to start this business.”
The next two years were spent mining more data – “that side of things is never done” – with Zachariassen expanding his team to India. More than 100 people were hired for the company’s data team, although most of them had little knowledge of wine. In fact, the majority had never even tried it.
“It’s much more important for us to understand the user and their needs,” Zachariassen says. “The key thing is to continually gather data every day, which takes exceptional stamina, and make small, incremental improvements to develop the app.”
That attention to detail coupled with Zachariassen’s vision to address a long-running issue for wine drinkers has paid off. Today, Vivino has nearly 30 million users, 130 staff in locations including San Francisco, Copenhagen and Dublin, and more than US$40 million (£29.5 million) in sales. The company is also a Real Innovation Awards winner, having won the Best Beats First accolade for 2017.
Zachariassen attributes the company’s success to gathering masses of data – “it was the nut that no one had cracked” – and word of mouth. “We had around 100,000 downloads in 2012 and that was driven by organic growth,” he says. “In 2013, we had one million and now we have 30 million. Around 80% of that is just from users talking about us. People find out about Vivino and then install the app after seeing their family and friends using it.”
Securing investors has also played a key role in Vivino’s growth. In 2010, Zachariassen convinced Janus Friis, the Danish entrepreneur and angel investor who co-founded Skype, to help finance the venture. He and Søndergaard have since received backing from Seed Capital (2011), Creandum (2012), Balderton Capital (2013) and SCP Neptune International (2016).
Like the data team in India, investors didn’t need to understand wine or how the app worked to spot Vivino’s potential. “Having some traction with your business overrules everything,” Zachariassen says. “Investors don’t have to understand the product – the important thing for them is to see people using it and loving it.”
The company’s success has inspired the founders to consider developing similar apps for spirits such as whisky and gin. “There’s potential to branch out and we’re looking at other areas,” Zachariassen says. In the meantime, he and Søndergaard want to establish the business as the Amazon of wine. In recent years, they have set up an online marketplace where consumers can search for and buy wines from across the globe.
Vivino’s online marketplace and app have data on more than nine million wines. Through the website, tens of thousands of those are available for purchase from 600 partner merchants, a number that is growing by the day. “We’re seeing a similar change to the wine industry as we saw with books 15–20 years ago,” Zachariassen says.
“Today, you can go into a book store and choose from a limited selection. Or you can go online and get endless choice, ratings and reviews, so you’re in a better position to decide whether or not to buy a particular book. That’s what we’re doing with wine. We’re using data to understand which wines you like and to personalise your shopping experience. The idea is to have thousands of merchants fulfilling orders, giving people infinite choice.”
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Despite knowing little about wines, Heini Zachariassen launched an app in 2010 for people who wanted to know more about fermented grapes, vineyards and brands. Today, Vivino has nearly 30 million users, sales exceeding US$40 million and 80 staff around the world. Here’s how the co-founder did it.