How Gary Vaynerchuk Built His Empire

How Gary Vaynerchuk Built His Empire

Wine Library began as a small New Jersey liquor store owned by Sasha Vaynerchuk, a recent immigrant from Babruysk (now Belarus). Gary grew up in the businesss, sweeping floors at first, then selling on the floor before he was old enough to drink.

Eventually, Gary took over his father's business and started to inject his own personality into the brand. was an eCommerce trail blazer and Gary used tools like email lists and video to expand the reach beyond New Jersey. 

Last week, I sat down with Gary Vaynerchuk over Skype to talk about his entrepreneurial roots. Due to some technical difficulties with the call, there's no video to post. Fret not, every detail of the conversation has been meticulously recorded below for posterity.

Mike Freeman - Hi Gary, you're coming to us today from the Vaynermedia office in New York?

Gary Vaynerchuk -  Yes, which we're about to move out of. Couple more days until the big move to our third office in three years. Good growth going on here and things are good.

Mike Freeman - Excellent. I wanted to chat today about your entrepreneurial history and how you built an online retail empire with Wine Library. I'd like to start all the way at the beginning, your family moved to the U.S. when you were around 3 years old. How long after that did your father start up his own liquor store?

Gary Vaynerchuk - He started working for one probably about 6 months after arriving and then eventually became the manager. He bought his own small store about 5 years later. He did an amazing job to come to this country with no money and no language and get to that place in 5 or 6 years, it's incredible.

Mike Freeman - I read that one of your first business ventures began with a $1,000 loan from your dad. Want to tell us a little about that?

Gary Vaynerchuk - Ya, sure. When I was 13 or so, my dad lent me $1,000 to buy baseball cards and I blew it. The best part of the story is, I went to Costco, Price Club at the time, and bought a bunch of boxes of a non-good year, non-good sets, because I was just too excited. It was burning a hole in my pocket. I pretty much burnt that thousand. So, I had to really hustle, but I payed him back very, very quickly and that started my career.

Mike Freeman - It's always interesting to hear about entrepreneur's first businesses when they were kids.

Gary Vaynerchuk - Ya, going back even further, when I was 5, I was doing lemonade stands, washing cars, shovelling snow. 

Mike Freeman - As a family business, I guess you started working pretty early in the store?

Gary Vaynerchuk - When I was 13 or 14 my father dragged me into the store and I've been pretty much working there until now, when we started Vaynermedia and I'm a little less involved. It was every weekend, every school holiday, every day of the summer. I was really all-in, I worked every day of my freshman, softmore, junior and senior year. And I mean everyday, literally from the first day of the summer to the last, except for Sundays sporadically. It was definitely something were I worked a lot. 

Mike Freeman - How did the passion for wine start for you? Especially since you were so young?

Gary Vaynerchuk - It was kinda by default. I didn't care about liquor and beer. Wine was the only interesting thing, it had more to it, and so that's how it happened.

Mike Freeman - Being under-age and not really able to drink, how did you start getting your fingers wet?

Gary Vaynerchuk - I just read a crapload. I don't know if you've ever heard of this thing called books? Back in the day, we had them and I read them, and I read them heavily. I read the magazines, I was a very big reader of Wine Spectator and Robert Parkers' Wine Advocate. And I just listened, I listened to customers. I used my ears quite a bit in those early days.

Mike Freeman - When did you start playing a bigger, more managerial role in the business?

Gary Vaynerchuk - Probably at about 16 or 17 I started to become a bigger sales force in the business. Then by 18 or 19 I started chirping in my dad's ear. By the time I was 22, I basically ran and made the decisions day-to-day. I took over operations in '98 and we moved into the new building in 2003.   

Mike Freeman - Were you already pretty online savvy at that time?

Gary Vaynerchuk - A little bit. I mean I wasn't online savvy until 1994-95. In 1995-96-97, I started selling things on eBay and AOL chatboards. Selling baseball cards, collectable toys and Star Wars figures. I started understanding retail online. But, I was no where close to the savvyness that I am today, or the first 1.0 bubble entrepreneurs. They understood much, much more. I was just a better business man, but I wasn't as technically savvy. Now I have both, I'm like a super hero… just kidding :) 

Actually, I'm having a new epiphany Mike, I'll be honest with you. Over the last five years I've been so heavy into becoming technically strong, I think I forgot, maybe 1% forgot, it all comes down to business chops. There are way too many start-ups and companies right now that suck. They've raised $5 million, they have NFC technology with virtual goods in the cloud, they've got the buzzwords down, they work their Facebook and Twitter, but, they can't sell shit. They don't understand how to run a real business. I'm starting to focus more on that.

Mike Freeman -  Ya, I think we've all learnt that the rules of business still do apply, whether its online or offline, it's not some brave new world were everything gets thrown out the door.

Gary Vaynerchuk - No, the artists have not taken over the business. It's the truth. You've got to have a combination of them both to be really good. 

Mike Freeman - What was it like building an ecommerce site back in 1996? Couldn't have been easy, one of the trailblazers I guess.

Gary Vaynerchuk - I got ripped off by some guy, some guy named Alex to make an HTML website for like $15,000 that probably took him 2 days. It sucked. I mean 1996-97-98, we didn't do anything. Then I met Eric and John, and they ended up becoming our full-time developers. They're the ones that took us into the modern age. I sucked out a lot of information from them, they sucked out a lot of information from me, and we became a really strong force. Wine Library became a real player in 2000.

Mike Freeman - A lot brick and mortar businesses still aren't really selling online. They have a website with their address and an email on it. How did moving online effect the retail store? Was it a positive, negative or neutral sort of thing?

Gary Vaynerchuk - It was hugely positive. But it was mainly the email service that was driving it. I understood data collection and that was a big thing. It was a huge force in our growth. It is the reason that I am relevant. There was no way I was building something from $3 million to $60 million in a heartbeat without the Internet or the website. It was the catalyst, it was the springboard.

Now, I look at social media and it's the same thing, but it takes longer for it to develop. It's running a marathon instead of sprint. Email and Google AdWords is a sprint, social media is a marathon. Together, you're an unstoppable force. 

Mike Freeman - A big part of Wine Library's success is obviously your personality, and energy. The decision to do video reviews is what propelled Wine Library beyond just wine enthusiasts.  What brought you to realize that was going to be a great decision?

Gary Vaynerchuk - Same reason I started using Twitter very early. Same reason in 2008 when I wrote Crush It!, I told everyone to bet on Tumblr. I am a good entrepreneur, and a good entrepreneur tastes the vibrations of where the world's going. I feel like that's what I did. Why did I do it? Cause I thought online video was going to be a big deal. Honestly I had no clue that I would be good at it. I just knew that I wanted to try it because it was going to be a big deal. Nothing really too crazy. I saw Youtube a few months earlier, payed attention, saw Lazy Sunday go very viral. I watched zefrank build an audience and said "I can do this". I have enough wine knowledge, I didn't realize I'd be so entertaining, I didn't realize I was a showman, or an extravert on-screen, but I ended up being that too, which didn't hurt. But the thesis was video was going to be big and I wanted to be a part of it. 

Mike Freeman - Unfortunately  for us, you've hung up your hat in the wine review business. Is that just to move on to bigger and better things?

Gary Vaynerchuk - Ya, I think I'm leaving the same way I came in. I woke up one day, I watched zefrank and Youtube and was like "I gotta do this". I woke up one day this summer and said; "If I want to buy the NY Jets one day, if I want to be the entrepreneur that I am, I need to move on". I've done this everyday of my life for five and a half years. I don't mail these in, they're 20-30 minute videos. I've put out a lot of content and I've owned it. I got a really nice compliment from Anil Dash, one of the real pioneers of the internet, he was introducing me to some friends and he said "nobody's really done it on video the way Gary did. As hard, for as long, at that quality level". There's Youtube stars that have made it even bigger, you look at someone like Perez Hilton, that's become a huge brand out of blogging. So there's people who have done it, but I'll definitely be one of the posterchildren, especially because I was very tech oriented, very early, on Twitter. Up until the Ashtons of the world came in, I was a top 30 followed person on Twitter. This has been a big part of my growth, I just felt like it was time to move on.

Mike Freeman - I guess you probably have put out the most content of any single individual in a lot of ways.

Gary Vaynerchuk - Ya, I think for non-Youtube celebrity, cause as you know, Youtube was not where I did it, I used Viddler. As a non-Youtube video person, I gotta be way up there because Youtube is such an ecosystem, most people bet on that.

Mike Freeman - You always push engagement over just blasting out ads or other things like that. With Wine Library everything you have done has been about engagement, from the 1996 email lists up to the more recent videos.

Gary Vaynerchuk - Everyone is in the content business and I'm in the context business. That is the battle that I'm fighting. That's what I care about, it's what I think about, it's how I roll. Everybody wants to throw the football, I want to catch it.

Mike Freeman - Your new venture, well not so new, Vaynermedia, what do you guys do and why are you 10 times more awesome than everyone else?

Gary Vaynerchuk - Ya know, I think we're 10 times more awesome than everyone else because of the quality of the work. The thesis isn't crazy - we are a social media consultant/community management company. We focus on a couple of core things: 1) consultancy, meaning making our clients smart, knowing what's going on with Instagram, Tumblr, how to use it and why should we use Quora and Google+ , what do we do blah, blah, blah. Understanding the client's needs and how we can use those emerging platforms to help the customer. 2) we really focus on community management, we're really in the context game. We really work and fight to win the context battle for our clients. We'll apply the principals of The Thank You Economy to a client's business, whether it's Campbell's or PepsiCo or the NY Jets. We've done it really successfully. The retention of our clients has been remarkable and that's what I most proud of.

Mike Freeman - And the result is having to move to new offices every couple of years.

Gary Vaynerchuk - That has been the growth. We're up to 35 employees. I'm excited, confident and now that I have even more time to spend I feel like I can help out A.J., my brother and partner, even more.

Mike Freeman - It's always kinda been a family business for you.

Gary Vaynerchuk - Family first, Mike Freeman.

Mike Freeman - Thanks a lot for talking to us today.

Gary Vaynerchuk - Thanks so much.