World’s first online whisky trading exchange launches

Rupert Patrick, how has with 24 years’ industry experience, announced his venture Whisky Invest Direct earlier this year, in partnerships with Paul Tustain, the CEO and founder of BullionVault, the world’s largest physical gold and silver market online.

The project is looking to capitalise on a past decade of strong performance for Scotch whisky which increased in value by 7 per cent each year.

The platform is looking to change how some of the 3,000 million litres of maturing Scotch whisky are owned, stored and financed. In January its majority owner Galmarley Limited approved a £2 million cash injection, and a further £1.5m came from 60 angel investors.

Investors are expected to benefit through the diversification and potential returns they can receive via a liquid investment route, able to buy and sell whenever they choose.

The new online platform will allow investors who have bought whisky early in the maturation process to sell to large distillers for blends, which account for 9 in every 10 bottles of Scotch sold globally.

While aiming to build a “sizeable inventory of young whisky”, it also plans to launch a number of brands and resurrect a 160-year-old Scotch brand, James Eadie.

Mr Patrick said: “Scotch whisky’s long ageing process makes forecasting sales very difficult for individual distillers.

“Cautious production, plus the lack of a modern trading platform, has caused whisky’s traditional broking market to dry up, leaving a clear opportunity for a technology-based alternative.

“I have never been more confident about the prospects for the Scotch industry, and by using our cutting-edge platform, both investors and distillers alike can benefit from the growth of the multi-billion pound Scotch whisky market.”

Whisky Investment Direct achieved its funding target of £1,002,972 in order to launch via Angels Den earlier this year, offering investors in the firm a 20 per cent equity stake in the company.

The company plans to generate the majority of its income from “commissions and custody fees” on sales of whisky casks to crowd investors, while sales of its James Eadie Scotch Whisky brands will create secondary revenue.

A record number of collectable bottles of Scotch were sold at auction in the UK last year, according to a review compiled by whisky consultancy Rare Whisky 101 (RW101). The number of single malts sold in 2014 soared by 68 per cent, leading to a 69 per cent per cent increase in the value of collectable bottles to £7.656 million, although market leader The Macallan saw its value weaken by 7.5 per cent.

This is despite the the value of Scotch whisky exports dropping by up to 39 per cent in half of its 20 top markets last year, contributing to an overall 7 per cent decline in 2014.