Gary Vaynerchuck Takes Mad Money

Three places I have not seen Gary Vaynerchuk recently:

1) Ditch Plains lineup, Montauk

2) In my bed

3) On CNBC...whoops.

Gary Vaynerchuck has been everywhere recently in conjunction with the release of his new book, 101 Wines. He even stopped by Mad Money tonight to talk wine with Cramer.

There are not that many ways to play the wine boom on Wall Street, and they spent some time talking about Constellation Brands (STZ-NYSE) among others.

I owned the stock back in 1994 when it was called Canandaigua Wine, and had a weird moment chatting with Marty Romm, the long time beverage analyst at First Boston. He had sponsored a meeting with Richard Sands of Canandaigua Management at the “21” Club, which happened to be held at the same time Quaker Oats bought Snapple.

Snapple had recently gone public and was trading at a ridiculous valuation. I knew a number of people that were short the stock, primarily based on its huge premium to the other beverage stocks and all the hype over the brand.  It was 1994’s version of Netscape, which went public a year later. Hot Hot Hot.

Anyhow, Quaker Oats was fighting off a number of activist investors at the time, and decided to buy Snapple, which diluted shareholders and killed the stock, big time. It was the ultimate poison pill. The deal made no financial sense, but got rid of the activist shareholder who were badgering Quaker’s management. Quaker Management threw their shareholders under the bus to save their jobs.  It was incredible, in its twisted brilliance, and every one that was short Snapple got crushed. It just goes to show you, anything can happen in these markets.

After the lunch ended I was talking to Marty in the lobby of “21” Club while he was on the television 3 feet in front of us on a taped segment of CNBC talking about the deal. It was surreal.

Snapple, the hottest stock of 1993-94. As I remember, anyhow, my memory is shot. Some day I will tell the story of how I made David Faber famous.

Gary talks about branding on Mad Money tonight. The Snapple deal was of course a huge failure for Quaker; they paid too much and they ruined the brand to some extent.

But for a short time it was hotter than even Gary is in 2008.

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Mad Money
CNBC

Brand culture failures: Quaker Oats’ Snapple
Brand Failures
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The content contained in this blog represents the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author.

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