The Sobriety Revolution That Never Was

When I started Basbas, we found product-market fit relatively quickly. Trading on the bohemian lifestyle of Ibiza culture, the club scene, a superior product, and premium positioning. We sold out our first drops in as little as a few hours.

It wasn’t product-market fit that proved to be our challenge. It’s what came after that. Tapped out of friends & family money, but too small for venture capital. A fast-growing trajectory, but no one with the right mix of spirits business thesis at the moment when it would have done us the most good.

To succeed, I had to do things that no founder should.

I cleared out my retirement funds, maxed credit cards, took high-interest loans, doubled down on friends & family, and cut costs until we were cash-flow break-even. But all of that slowed our growth. It was unnecessary, unstrategic, and made us vulnerable to things like unplanned tariffs, global epidemics, and logistics disruptions that had nothing to do with the demand for our product or the value of the brand. We were caught in a gap that only seems to exist in the spirits industry — tragically under-invested, and overshadowed by a growing but false narrative about the state of the category.

I’ve helped raise money for maybe a dozen companies. In tech, investors compete for the best founders. In CPG, a little less so. In bars and restaurants, only the passionate few show up. In alcohol, the landscape is nearly empty.

Some funds have vice clauses and simply cannot invest. Others won’t move until you’re doing a million or two in revenue. The category is hard to diligence if you haven’t lived it. And spirits, like restaurants, tends to start as a passion project, which makes it easy for the professional investment community to dismiss. For all of these reasons and more, there is a canyon between the first friends & family check and seasoned category investors. Somewhere in that canyon, you’ll find some of the best operators you’ve ever met, running out of road.

I know this moment. I have lived it. I’ve been that founder.

When I started Solitary American, I made myself a promise. I would not become a professional mourner. I would not build a career cataloguing the disappearance of things I loved.

The loneliness epidemic is real. The slow death of our communal spaces is real. But documenting destruction without picking up a hammer is its own kind of cowardice.

So I picked up the hammer. Again.

This week, I along with a group of seasoned investors and operators launched Overproof Ventures, a fund focused on backing the operators building what I believe is the most important infrastructure of our time: the brands, venues, and experiences that bring people back into physical proximity with one another. Specifically in the spirits business and the spaces and systems that enable it.

Along with Alex Staniloff, one of the early investors in Olé and co-founder of The Beverage Collective, and Ha Nguyen, who has deployed and managed more than CAD $300M for McRock Capital, we see blue ocean where almost everyone in the investment community is getting the story wrong.

I’ve been citing this data to anyone who will listen. Sometimes here in this newsletter.

Scroll through Instagram for any amount of time and you are bound to come across some version of the same headline. Gen Z is done with drinking. The sober-curious generation. The wellness revolution. The death of the bar.

It has become received wisdom, repeated often enough that capital began to treat beverage alcohol as a category in structural decline.

The data says otherwise, and it’s becoming harder to ignore.

In the United States, the proportion of legal drinking-age Gen Z adults consuming alcohol jumped from 46% to 70% between 2023 and 2025. When you examine what they actually spend as a percentage of after-tax income, Gen Z is virtually identical to Millennials at the same life stage. The IWSR’s own chief operating officer said it plainly: much of the recent decline is cyclical, not structural, and is definitely not the fault of Gen Z.

They weren’t drinking less. They were drinking later.

Because, maybe you heard, there was a global pandemic that locked an entire generation out of the classrooms, dorm rooms, bars and nightclubs where interpersonal bonds form, responsibly if often in a lubricated fashion.

The data everyone was citing five years ago, and for click bait, continues to cite today, captured a delay in the socialization of the younger Gen Z cohort. Now that they’re entering and finishing college, often with classmates in the flesh, their drinking is largely on par with previous generations.

This. Was. Predictable.

And layered beneath all of this is something investors seem to have forgotten entirely: this category has historically laughed at recessions. Looking back at downturns since 1991, IWSR found that wine and spirits still saw growth during recessions, then rose substantially the year after each one ended. Between 1992 and 2022, liquor stores saw year-over-year sales declines just twice.

Goldman Sachs put it simply: alcoholic beverage consumption should be resilient during an economic recession because beer and spirits tend to be seen as affordable luxuries, or even staples.

A false narrative, repeated convincingly enough, drove institutional capital away from a category that was never actually in decline. That left a desert where informed capital should have been. Which means it also left us an ocean.

That desert looks even more attractive when you consider what is happening next door. Early-stage tech investing is entering a reckoning. A company can be the hottest app in the App Store one day and obsolete the next, rendered irrelevant by a platform update or someone’s afternoon vibe-coding session. The volatility is structural and it is accelerating.

Spirits brands do not work that way. A great product, a loyal account base, and a proven distributor relationship do not evaporate overnight. Many spirits are tied to a historical or geographical provenance, making the moats deep and wide. Some are produced with secret recipes that don’t have to be revealed and can’t be decompiled and reproduced by someone else.

In the spirits business, strategic acquisitions often occur earlier than in traditional technology or consumer sectors. Yet dedicated capital at the post-product-market-fit stage remains limited. Many brands struggle to bridge the gap between early validation and scaled distribution — and we know this firsthand. The buyers are active. Diageo, LVMH, Bacardi, and their peers are hungry for brands that have proven product-market fit and built real demand.

Friends & family get you to proof of concept. Traditional VC wants to see $2M or more in revenue before they’ll return your call. The stretch in between — when a brand has proved itself but hasn’t yet scaled — is where almost no one is playing.

And there are major upsides to be had there.

That is the gap Overproof was built to close.

We built Overproof because the places where people gather, eat, drink, and talk to strangers are not an amenity. Neither are the brands that support them and the tech that enables them. They are infrastructure. The same way roads and schools are infrastructure.

They are not optional.

We are not experiencing a sobriety revolution. We are experiencing a loneliness crisis that suppressed the social occasions where people have historically chosen to be near each other.

The cure is not a wellness app, a $26 smoothie, or an ultra-processed protein bar.

The cure is for the founders of our generation to build the places, brands, and systems that will support the next generation, to invest in our communities, and to reap the rewards that come with blue ocean investing, especially when what we are building is bringing people together instead of dividing them.

The data shows the industry is healthier than the story. We’re betting on it.