Former Rothschild employees unite with influential Russians to release luxury vodka

A luxury vodka launch at Vinexpo this week has brought together two former top level employees from Group Baron Philippe de Rothschild and a powerful Russian family with connections to Vladimir Putin.

Taiga Shtof hails the Taiga region in Siberia

Called Taiga Shtof, the spirit – which comes with a €70-90 price tag and hails from Siberia – was officially unveiled at Vinexpo on Sunday complete with the tagline ‘the unbreakable spirit’.

Aside from the high price and source, what’s notable about this new addition to the luxury spirits market are the people behind it.

Co-founded by four partners, who each have an equal share of the business, Taiga Shtof has been created following an initial US$2 million investment from former CEO of Group Baron Philippe de Rothschild, Xavier de Eizaguirre and his former export director for Russia, Roman Gazine, along with two cousins from the Magomedov family, who are not only extremely rich, but have connections with Russian president, Vladimir Putin.

Speaking to the drinks business at Vinexpo on Tuesday 20 June, de Eizaguirre explained how it was crucial to have political connections to produce vodka in Russia, because the distilleries are almost entirely owned by the state.

“Russia, as far as distillation is concerned, is a monopoly and, while there is still about 20-25% private distillation, the country is in process of nationalising everything, so soon it will be 100% [owned by the state],” he explained.

Co-founder Xavier de Eizaguirre is the former CEO of Group Baron Philippe de Rothschild

In particular, he said that the state control the production of the prized Alpha spirit, which is purist you can get, and obtained by distilling wheat and winter rye that grows under the snow of Siberia, giving the vodka a” special taste and aroma”.

“We were lucky enough to get some Alpha spirit through our connections,” said de Eizaguirre, explaining that it is produced in “limited quantities” – the wheat and winter rye are hard to get because of the harsh conditions of the areas where they are grown, and the expense of producing them.

“We have two Russian partners, Mr Magomedov and his brother – who are a family that is very influential in Russia – they are very wealthy people with connections, and, with the monopoly, at end of day everything is controlled by Putin – so you have to be friends with the friends of Putin,” explained de Eizaguirre.

But why did de Eizaguirre become involved in such a project?

“I’ve always liked Russia; I was one of first to go there when it opened up 20 years ago, and I hired a Russian [Roman Gazine] to open the wine market.”

Through that experience de Eizaguirre said he “got to love Russia”.

Continuing, he recalled, “Over the years we were thinking of doing something in Russia, and then [in 2010] I retired from Baron Philippe de Rothschild, but I was still travelling for Vinexpo [from 2007 to 2017 he was chairman of the board of the exhibition organizer].”

Nevertheless, in partnership with Gazine, and with the help of their Russian connections, de Eizaguirre decided to launch Taiga Shtof this year at Vinexpo, following the investment of “a lot of time” and $500,000 from each one of the four partners.

The idea for a luxury vodka from Siberia came from both Gazine and de Eizaguirre, with the latter explaining, “I’m a vodka drinker and I have been for a long time… and we were already friends with the Magomedovs.”

Co-founder Roman Gazine is Russian but lives in France

Because of Gazine and de Eizaguirre’s background in Bordeaux – group Baron Philippe de Rothschild is, of course, owner of first growth Pauillac-based Château Mouton Rothschild – they took a novel approach to the vodka.

“We are from a wine background, and from a very high quality level, so we decided to produce a ‘grand cru’ vodka,” de Eizaguirre said.

From 1980-90, de Eizaguirre lived and worked in the US, during which time he created The Palace Brands Company, an importing and distribution JV for Finlandia Vodka among other brands.

“I saw the vodka boom in the US, and I was involved in Finlandia vodka… So I was always looking at vodkas, and I realized some were better than others because the way they were created,” he said.

So why go to Siberia to make Taiga Shtof?

“We went to Siberia because it is the last place on earth to be discovered… everywhere else you can fly to and stay in a good hotel,” he explained.

Furthermore, Siberia is not only the place for finding the resilient wheat and winter rye for making the Alpha spirit, but it is also an area rich in pristine water, and Taiga Shtof uses three sources.

“Because we come from the wine business we thought that a blend of water would be more interesting,” said de Eizaguirre, noting that the vodka uses water from the mountains of Altai, Lake Baikal and a well that goes deep below the permafrost soils of Yakutia – which he said was the coldest place on earth, and home to a extremely mineral-rich and ancient water table.

As for the name, the Taiga was inspired by the Siberian tiger, and shtof takes its name from the 12^th century vessel used for the communal drinking of vodka, which later gave rise to the use of the word to represent a liquid measure totalling 1.23 litres.

In terms of the future, de Eizaguirre hopes to seed the vodka into the top bars and restaurants in the world, starting with the US, and hopes to sell 50,000 cases of Taiga Shtof in the next three to five years.

So why launch a vodka, and why now? de Eizaguirre explained, “Like many other areas, the US is moving from standardised products handled by large producers to the crafted phenomenon, and we believe the momentum now is for crafted products.

Continuing he said, “We think the timing is right, because we think bartenders and speakeasies are looking for something they can talk about, something with provenance and taste.”

Taiga Shtof describes itself as ‘the unbreakable spirit’

As for targeting the US, he states, “It is the second largest market for vodka in world after Russia, and what success in the US usually succeeds outside.”

Finally, de Eizaguirre told db that he will be working with Gazine to personally establish the vodka, selecting and visiting the sites where they would like to see the vodka poured themselves, with a focus on “prestige distribution”.

But surely his former colleagues back in Bordeaux must be surprised to see him resurface as the face of a vodka? “Mouton Rothschild are not surprised to see me do something – they know I am not the sort of person to go to an island and look at the sunset – but they are surprised that I’m in the spirits business,” he says.

However, he states, “But I’m not sure I’m in the spirits business – I’m in the specialty business.”

Taiga Shtof: the facts

• Taiga Shtof is a new vodka blending wheat and winter rye with the purest water from the Taiga region in Siberia.

• Taiga Shtof is made with 100% Alpha spirit, the purest alcohol available in Russia.

• The vodka is said to embody “the unbreakable spirit of the Siberian people”.

• It comes with a €70-90 price tag, and Taiga Shtof is targeted at top end bars and restaurants, initially in the US.

• Taiga Shtof aims to become a 50,000-case brand in the next 3-5 years.

• The vodka has been co-founded by former CEO of Group Baron Philippe de Rothschild, Xavier de Eizaguirre and his former export director for Russia, Roman Gazine, along with two cousins from the Magomedov family.