If you’re lucky, it won’t take a near-death experience to reveal your true life’s purpose. But for Steve Lipp, it took two.
Steve Lipp, who’s the founder, president and CEO of Alexander Murray & Company — a Scotch Whisky company — is a man of many stories. The kind of person you can shoot the shit with all night long and never seems to run out of tales.
But our sit down with Steve focused on how he fell into the Scotch Whisky industry and what it means to be an independent bottler. Don’t worry — he managed to squeeze in a few stories. Steve being Steve and all.
Tell us more about Alexander Murray, the company.Steve: I grew up in northeast Scotland, in a small town called Turriff. It's about 30 minutes from Aberdeen, and Aberdeen is the oil capital of Europe, so we have a lot of oil rigs off the coast of Scotland. Apart from farming and Whisky, oil is one of Scotland's commodities.
My school report card said, "could do better," so instead of going to college or university, I went to make my fortune on the oil rigs at the age of 18. You could go to the oil rigs and work on the drill floor and make $100,000, so that's what I did. They stationed me in the Magnus. It was the furthest North Sea oil rig, and it took three hours in a Chinook helicopter — one of those double propeller military helicopters — to get there.
Alexander Murray doesn't actually own a distillery, so you have to educate them that 100 years ago, people weren't drinking single malt.
On my third trip offshore, we had gearbox failure and ditched in the North Sea. I survived that. And then about five years later, I was stationed on the Piper Alpha for a year—two weeks on, two weeks off. I was on my week at home, and the oil rig had a gas leak. It blew up and killed 190 people. So, I decided it was time for a career change.
My sister's husband was a successful businessman. He grew up with The Glendronach Distillery. His father was the manager there for 30 years, and he told me that he wanted to start a Whisky company. I took my oil money and that’s exactly what we did—that was 27 years ago. We found an old distillery… well, the ruins of an old distillery. The trademark had elapsed, so we started a blended malt. We bought casks of single malt and we made Scotch Whisky.
I started looking around the supermarkets in Los Angeles, and none of them had a premium private label. So I saw an opportunity there.
I used to travel the world in my kilt. And then, in 2000, I was in San Francisco looking for a headquarters and I met an English fellow. He owned some bars, restaurants and nightclubs in L.A. and he was looking for investors. So I invested in a bar-restaurant in Hollywood and left Scotland in January 2000.
I kind of took a hiatus from the Scotch Whisky industry. But then I started looking around the supermarkets in Los Angeles, and none of them had a premium private label. And all the supermarkets in Europe — Asda, Safeway, Tescos in the UK — they all have premium spirits. But in the U.S., all they had were bottom-shelf bottles. Nobody was doing premium spirits. So I saw an opportunity there, and I went to the Hollywood Chamber of Commerce’s meet and greet event. I wore my kilt, and this lady came up to me and said, "Are you in the movie business?" I said, "No, no. I'm in the Whisky business." And she said, "Oh, my best friend is the spirits buyer at Trader Joe's."
So I went to meet him. They had private label Beers, Trader Joe's Wines… but they didn't have any spirits. That was 2002. So I thought, "here's an opportunity." Things weren't going well with my old partner, so I decided to break off on my own.
We launched Trader Joe's single malt range in 2003 and 15 years later that's fortunately still going strong. Then, in 2007, Costco called and they said, "We like what you're doing with Trader Joe's." Costco's brand is Kirkland, but back in 2007, they didn't have any spirits. I had some casks of Macallan back then. That's when Macallan would sell you casks, so we started off with a Kirkland bottling of Macallan in 2007.
And then my Costco importer — he's out of Texas. One of his customers is Goody Goody and Twins. They're both independents, but they have about 100 big stores between them, and he said, "They're looking for a range of single malts. Why don't you start your own brand?" I think a lot of the smaller independent bottlers are having difficulties getting good quality casks in any volume. But we benefit because we buy so much for our private label, it gives us access to some wonderful casks for the Alexander Murray brand. So that's how the Alexander Murray brand came about.
The U.S. is learning. The consumer is getting younger, and a lot of women are drinking Scotch.
Tell us more about Alexander Murray, the person.Steve: I was thinking of names for my new Whisky company, and my last name is Lipp—not very Scottish sounding. My great uncle, he was a Murray, and I used to work on his farm as a kid. And he was a great character. Even though he was a farmer, he was always dapper. He would have a tweed jacket and cravat on. He was also a chain smoker that would let me drive his tractor and his Jeep. And he had a silver hip flask, that he’d let me take a drag of Whisky from. But he was also a hard worker, and when I went to work at his farm, he had a great work ethic.
I thought his name would be a great name for a Whisky company. So, I named it after my great uncle, Alexander Murray. That’s where the name comes from.
Let’s pick an expression and talk about the flavor profile.Steve: Our main business is private label. I think the main thing is that if you go to Europe and Scandinavia, they're very familiar with single malts, the different brands, how they’re produced, the difference between blended Scotch, deluxe blends, blended malts, single malts, single grains. The European, Scandinavian and Asian markets are very well educated, but I think the Americans are about 10 years behind. They're just catching up.
We benefit because we buy so much for our private label, it gives us access to some wonderful casks for the Alexander Murray brand.
So I think what Alexander Murray does, is that it takes the American consumer on a journey across Scotland. We find unusual distilleries, popular distilleries, different vintages and cask strength Whisky. So we're sort of taking the American consumer — who would normally just drink Glenlivet, Glenfiddich, and Macallan — on a journey around Scotland.
Tell us about your selection process.Steve: Each company is different. With Trader Joe's, we've got a 10-year-old Highland single malt. It's on the shelf every day, so that's available all year round, and that retails for $19.99. So that's sort of an everyday value product — a 10-year-old Highland single malt. We don't name the distillery, and it's great value at 19.99. And then two to three times a year, we find different... specials.
We bring in different specials at a lower volume, probably 300 to 500 cases of each. So those are different vintages, different distilleries, and we actually name the distilleries on those. Usually, I'll go to the buyer and say, "I have these available," send them samples, it goes through a tasting panel, and then they select the ones they require.
When you're buying those big batches from different distilleries, they don't allow you to name the distillery.
Costco picks the market leader in the category. For them, the market leader for a blended three-year-old is Johnnie Walker Red Label, so we have to find something that's a similar taste profile and it will go on the shelf next to red. They'll put a palate of Red Label in Costco and then a palate of our private label Kirkland, and it's usually 25% less than the market leader.
It’s the same process for the blended 12-year-old. The market leader was Johnnie Walker Black Label. We had to find something similar. The single malts are different. They've got a lot of volume. They probably buy 10,000 cases of single malt a year, between 18 and 20-year-olds. Again, we don't name the distillery. They prefer a Speyside in the 18 to 21-year-old range. So we go and secure large batches of single malt in that age range, and it's bottled under the Kirkland space. When you're buying those big batches from different distilleries, they don't allow you to name the distillery.
1. If you could have one superpower, what would it be?
I would stay at the age of 40.
2. How would you describe Alexander Murray in three words?
Journey around Scotland.
3. What is your favorite music and what drink goes with it?
Classic rock. Favorite drink? Oh, I would say a single malt from 1964, the year of my birth.
4. What would you eat and drink for your last supper?
Italian pasta and a Black Bowmore 1964.
5. Assuming Alexander Murray Private Label is your favorite, what's your second favorite Scotch?
No, my favorite Scotch doesn't have to be Alexander. My favorite Scotch is Lagavulin 16. And I have a great story about why that is.
When I worked in the oil rigs, I wasn't really into Scotch. My best friend, he lived down on a farm in the south of Scotland. He worked on the oil rigs with me. And one day, he appeared at my house with a bottle of Lagavulin 16.
Now, his father was a farmer. And one day, his father was driving over a bridge. There was an estuary to the sea, and he looked over and he saw a fisherman. The fisherman fell off the boat and he started drowning. My friend's father parked his Land Rover, dived in and saved the fisherman's life. So for the next 25 years, the fisherman gave my friend's father a case of Lagavulin 16.
So fast forward a few years, my friend's father passed away. His mum wanted to sell the farm. They cleaned the farmhouse out, and they went down to the basement on the last day and there were 25 cases of Lagavulin 16. So they opened the boxes, and all the bottles are empty. But Lagavulin 16 has a beige kind of label. He had written the time and date and whoever he'd had a drink with and what the occasion was. So it was like a 25-year diary on these cases. My friend told me this story and then we opened a bottle and drank Lagavulin 16. And since then, it’s been my favorite single malt.
What can you tell us about selling Scotch in the U.S.? Do Americans have a different palate for it and does that impact the spirits your source?Steve: The U.S. is learning. The consumer is getting younger, and a lot of women are drinking Scotch. So it's definitely an educational journey. You have to explain to them what an independent bottler is. Alexander Murray doesn't actually own a distillery, so you have to educate them that 100 years ago, people weren't drinking single malt. Everybody was drinking blended Scotch, and the distilleries would sell their casks to independent bottlers. So, independent bottlers were really responsible for the growth of single malts.
They were the ones marketing and selling single malts. And there's an old ruling in Scotland that says if you're an independent bottler, you're allowed to name the distillery on the label provided it's smaller than your brand name. That's how it all came about. So generally, people don't know what independent bottlers are, so they're very keen to learn, to taste the different Scotches. There's nothing wrong with Macallan 12 or Glenlivet. These are great single malts. But I think people are curious to taste different distilleries.
So at Alexander Murray, what do we look for when we're selecting casks? You can't just fly to Scotland with millions of dollars and select your single malts. You have to be in the industry for a long time. And there are various batches of casks that we get offered. So we'll go in and we'll look at gaps in our portfolio. And are we looking for some Speyside, Highland? Are we missing some Islay? So it depends on the ages, the distillery and the gaps in our portfolio. At the moment, we have everything from nine- to 52-year-olds.
Some of the distilleries in Scotland are owned by the big guys: Diageo, Pernod Ricard. They don't actually have a brand. They all go into blends. So we can buy those casks and offer them as an independent single malt. So it’s definitely a learning experience and a journey for both new single malt and old single malt consumers.
This interview has been edited for clarity and length.