Giant in distillates, Diageo invests in alcohol-free drink

After 257 years in business of beers and alcoholic spirits, Diageo made its first investment in a non-alcoholic beverage company.
The largest manufacturer of distillates in the world, owner of the Smirnoff vodka and Guinness beer dark, yesterday announced the purchase of minority interest in Seedlip, a British company established in 2015 by entrepreneur Ben Branson to produce distilled beverages without alcohol.
The investment in Seedlip was held through a vehicle that Distill Ventures, Diageo has created three years ago and describes as "a capitalized entrepreneurs Accelerator program".
The program invests in 8 to 12 companies at the same time and does not reveal the size nor the identity of their investments, unless they involve companies with desire to go public
The Distill Ventures allows Diageo to make small bets in emerging brands at a time when the tastes and preferences of consumers go through big changes.
One of these changes is the fall in alcohol consumption, at least in developed markets, as in Western Europe and in some areas of North America.
Alcohol consumption in the United Kingdom fell 26 percent between 2002 and 2012, according to government statistics.
Diageo, which also manufactures the Johnnie Walker Scotch whisky, for years faces this problem trying to persuade people to pay more for better quality alcohol. But investing in a soft drinks company is a new direction for the company.
"We recognize the non-alcoholic beverages as an opportunity," said Diageo''s global innovation Director, Helen Michels. "We will continue to explore and invest in this area".
The Director described the Seedlip as "a company of exceptional quality with a visionary founder offering a sophisticated alternative to alcoholic beverages".
Diageo already has stepped up investments in non-alcoholic versions of some of its brands such as Guinness Zero, a non-alcoholic beer launched in Indonesia in 2014.
This year, launched the Orijin Zero, a version in his bittersweet drink soda, in Nigeria.
Branson, of 33 years, said the Seedlip arose from his interest in herbs and remedies extracted from plants, whose images appear prominently in their special design bottles, in format that recalls the packaging of distilled beverages.
The Seedlip is "a non-alcoholic option really mature for all occasions when you''re not drinking, either because you''re driving, pregnant, taking medication or because it''s a Monday morning," said Branson.
The businessman, a former marketing, said that since the launch of the brand in November all "got a little crazy".
The Seedlip, who fell in the taste of chefs such as Gordon Ramsay and Heston Blumenthal, is sold at high-end retailers such as Selfridges and Fortnum and Mason.
Branson said he wants to produce more varieties and expanding outside the United Kingdom. So far, the brand has just two versions: the spicy, clove, cardamom and lemon, and the softer, sweet pea, cucumber and blue grass.
Have the support of the Diageo was "an enormous credibility statement for us," said Branson. "We don''t want to be small. The problem of what you drink when you don''t want to drink alcohol is not small. We have great plans and dreams of scary ".