Home Wine Business Editorial Jeff O’Neill: Fostering a Culture of Teamwork, Ingenuity and Opportunity

Jeff O’Neill: Fostering a Culture of Teamwork, Ingenuity and Opportunity

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By Laura Ness

Wine’s Most Inspiring People 2021

O’Neill, founder of the fast-growing O’Neill Vintners and Distillers (it’s the seventh largest winery in the US), didn’t really plan to go into the wine business. After graduating with a BS in business administration from the University of Pacific School of Business and Public Administration, the Marin native, who attended Redwood High School, and still lives in the area, got an unfulfilling and frustrating job as a wine salesman on the Peninsula. “Back in those days, you couldn’t buy wine in the grocery store!” There was no such thing as Costco or Sam’s Club, just a string of small Mom and Pop liquor stores. It was a shoe-leather operation.

Looking for a better job, he ended up working in the “family business,” which was essentially a pretty rundown table grape vineyard operation that his grandfather had started in the early 1900s, in Cutler, a small town in the Central Valley. “In those days, you sold all the unsalable grapes to a winery and made dessert wines,” O’Neill says. “Grapes like French Columbard, Tokay and Thompson seedless for white table wine, and Barbera for red. The goal was, how cheap could you make it? My grandfather started the business to help other growers find a market for their excess production.” It was essentially the first grape co-op in the state, providing custom crush services.

His uncle took it over in the 1970s and attempted to compete with the leading wine companies of the time, which ended with the bank taking it over. They appointed a trustee to either sell or turn the aging ship around. “The facility was in shambles by then, and could only provide products at the very low end of the market,” says O’Neill. Naturally, the bank would not invest in needed upgrades. He decided to walk. That’s when the trustee reached out and asked him if he’d be interested in doing a private equity buyout. “I wasn’t exactly sure what private equity was, but I said ‘absolutely!’” O’Neill recalls. He was then introduced to a group in New York, who helped him organize a small group to buy the broken-down winery from the bank in 1985.

“Once I was free of the bank, I could focus on growing the business. The private equity group was extremely supportive and within 24 months we had acquired a state-of-the-art facility located in Fresno, CA along with 10,500 acres of wine grapes from the Getty oil company. This launched a company called Golden State Vintners, and literally overnight, we became one of the largest grape growers and suppliers in California.”

But, says O’Neill, it wasn’t easy-street: grapes in those days sold for $125 a ton in the Central Valley. “Interest rates back then were in the 10 to 12% range, making any type of leverage a very onerous problem. And boy did we have leverage.  Ultimately, we acquired a few other wineries in Monterey County, Reedley, and the Napa Valley.” By 1998, his private equity partners were looking for liquidity and he agreed to take the company public. A few years later, in 2004, he wanted to take it private, but a hostile bid from one of his customers created a contentious scene.

“After launching my own bid to acquire the company, I waved the white flag and let them win the battle. However, I did not get a non-compete, and that was how I launched O’Neill Vintners and Distillers. I didn’t realize at the time how lucky I was!” 

While immediately building out the existing brandy distilling business, O’Neill ultimately aspired to be back in the wine business. He built a state of the art winery with the best available grape handling equipment next to their distilling plant in Reedley. “We were making better products than virtually anybody else in the Central Valley. The business just kept coming, and every year we added more cooperage, and over about six years ended up adding about 35 million gallons of cooperage to our facility, creating one of the largest wineries in North America.” 

In the process, he has acquired many brands, including the first, Moscato Allegro, created by Martin and Weyrich, followed by three brands from Kendall Jackson: Tin Roof, Pepi and Camelot. “We thought we could turn these old stodgy brands around. Boy did we learn a lesson there. On a positive note, we did get KJ’s distribution network, which we pretty much have to this day. We now are significantly more methodical about how we add brands to our portfolio, and only think about one thing, what do consumers need and want.”

O’Neill now focuses only on brands and wines that resonate with the consumer: they have to deliver value and provide an authentic story. This means price points well above $10, which is their future target. Among the national brands you might recognize are Line 39, Robert Hall (whose facility in Paso Robles they own), Harken, Exitus, Day Owl Rosé, Allegro Cellars and Charles Woodson’s Intercept. 

O’Neill plans to enhance the portfolio with wines from Washington, Oregon, or any region that “over delivers on quality.” They currently source from 14 AVAs in California, and have a strong network of 175 grower partners that they rely on to provide quality product. Fostering those relationships is mission-critical to the success of the operation.

The backbone of this booming business is an amazing team of around 325 employees, some of whom have been with O’Neill since the beginning, when he started with just 20 people. Three of his senior team have been with him more than 30 years. “We have been able to create a terrific culture, and as our success has grown, we have been able to reinvest in people, sustainability, corporate responsibility, education and so many other areas that I couldn’t even think about in the early days when we were simply trying to survive.”

O’Neill says he feels so lucky to have had the opportunity to create a culture from the ground up. “It’s a unique opportunity that I never really thought I would have. As a leader, I always found it difficult to change cultures that were embedded over many years, which in a lot of cases includes behavior that does not foster teamwork and ingenuity.”

The company’s key mantra is “no drama.” Everyone in the world has problems, but work is not the place to bring them. If someone doesn’t find the place a good fit, the company graciously finds a way to land them a new job elsewhere. 

Fostering a culture that creates opportunity led O’Neill to partner with Charles Woodson to establish a scholarship initiative, specifically for people of color, called the Charles Woodson & O’Neill Family Wine Scholarship. “We want to be part of the change in the industry to improve diversity, and we identified education as the gateway to success,” says O’Neill. “Our goal here is really threefold: 1) provide a scholarship that relieves the family from any worry about 100% of tuition and room and board being paid, 2) Create opportunities at O’Neill for these young scholarship recipients to have an internship, and 3) Create an environment where our team can mentor these students at any time.” Two of these full ride scholarships will be awarded yearly, one each to Sonoma State University and California Polytechnic State University San Luis Obispo.

We asked two key members of O’Neill’s team to weigh in on what it’s like working with Jeff. Christine Moll, VP of Marketing, joined in 2018, in what was a new position at the company. She’s built a team of 11 passionate marketers who are “consumer obsessed and business minded.” Humility, she says, is O’Neill’s overarching virtue. “He leads by empowering and inspiring people as well as instigating progress every day. Jeff focuses on people, their ideas, their development and giving everyone the opportunity to make impact in the company and business. He is one of, if not the most genuine, inspiring, and charismatic leaders I have met in my career.”

A common focus on the customer is what drives the teams at O’Neill, says Moll. “The company’s purpose is to strive for unrivaled relationships, internally and externally. Jeff always says, “If we can’t add value, let’s not do it.” We always focus on making sure there is always a win-win with our customers, partners, vendors, growers, consumers, and our own team.” 

Head of Winemaking and Winegrowing at O’Neill, Marty Spate, who has been there a year and a half, and has known Jeff for a decade (he was a customer buying bulk wine from O’Neill), says he knew right away that Jeff had a special approach. “I figured out rather quickly that he was running and growing a different kind of wine company. One that, while focused on quality and safety like the rest of the wine industry, was also hugely focused on its people, and building a culture of high performing team members that have what it takes to succeed and have a boatload of fun doing it!”

Spate believes that “people-first” focus created a vibrant corporate ethos. “I believe that Jeff is a great example of a servant leader. He trusts in sharing power with our teams and people: putting a high priority on their need to develop and perform at all levels of the business. This empowers and inspires us all to make the decisions necessary to progress the company, knowing that we can deliver.”

O’Neill’s quest for ingenuity is also a great spark, says Spate. “I am constantly inspired by Jeff’s desire to always seek out and explore new things in the wine industry – it’s his call to us all to never allow our ingenuity to waiver. It could be something as simple (and cool) as putting wine in a can on a nationally distributed brand, or it could be as complex as erecting a worm farm in order to help us process our winery’s wastewater in one of the most sustainable and ecologically conscientious ways out there.” 

In 2020, O’Neill built the largest worm-powered winery wastewater system in the world, in Parlier, capable of filtering more than one million gallons of wastewater per day with BioFiltro’s worm system. 

Asked how the challenges of 2020 impacted his business, O’Neill frankly says they haven’t. “I’m humbled and fortunate to say that every step of the way, our team simply stepped up and pivoted to solve problems. I point out time and time again to other people that there were two types of reactions during the pandemic. It was either ‘I can’t do anything about my situation,’ or ‘Let’s pivot and get something done here.’ While the year did pose challenges, all of them were manageable, especially with a team that is built on a culture of teamwork, problem solving, and care for each other, it is quite amazing what can be accomplished.”

Early in the pandemic, O’Neill thought it was important to cheer on his teams by delivering a care package to each employee on the way out every Friday. This included many of the things they couldn’t get at the store or had to stand in line for, including toilet paper, bananas, strawberries and other staples. “We wanted to show them that we greatly appreciated them coming in and working hard during these crazy times. Instead of our annual party that for many is an important event of the year, at Thanksgiving, we provided turkeys and all the fixings for everybody’s family dinner. In lieu of the Christmas holiday party, we provided hams, bonuses and gifts to keep them warm over the holidays. These small things are incredibly important to me, and they have proven to be important to everyone on our team.” 

And small things, good or bad, lead to big things. So those small things best be good if you want your personal reputation to grow in concert with your corporate success.

Not even an issue, says Spate. Everyone in the wine business ecosystem trusts O’Neill. “They understand that when he says he’s going to do something – he does it. It’s how Jeff is: it’s a handshake you can trust.”

Continue ReadingWine’s Most Inspiring People 2021

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