Do you want to invest in wine, whiskey, and spirits for uncorrelated appreciation? Find out whether Vinovest vs Vint is the right fit to get started for less than $100.
Introducing These Wine Investing Platforms
Both Vinovest and Vint are newer investment platforms following the emerging trend of increasing the accessibility of alternative assets for retail investors. They are exclusively dedicated to investing in wine, spirits, and alcohol.
Vinovest Vs Vint – Similarities
Outside of being focused on the same asset class, there are not a large number of similarities between these two platforms.
Vinovest Vs Vint – Differences
How different can wine investment platforms be? As we’re about to see, quite different.
Types Of Offerings
Vint has one type of offering, while Vinovest has several. These provide investors different approaches to getting exposure to the asset class.
Vint Offerings
Vint provides investors the opportunity to purchase shares of “collections.” These offerings may contain a single bottle of an extremely rare wine or spirit. They can also contain an assortment of bottles arranged for a theme. For example, the Cristal Champagne Collection has 189 bottles of Cristal Champagne from 2008-2014.
As with many fractional investing platforms, each offering (“collection” in this case) is actually an LLC. Investors are purchasing shares of that LLC.
All of Vint’s offerings are qualified by the Securities and Exchange Commission (SEC) under the Regulation A framework.
Vinovest Offerings
Vinovest is not a fractional investing platform and is not regulated by the SEC. A portfolio with them will be made up of actual, physical bottles or cases of wine that you own. Vinovest takes care of the storage and insurance, as well as providing the tools to buy, sell, and manage your portfolio.
Wine investing with Vinovest has two different forms of offerings, managed and trading.
Managed
Managed offerings are an automatic investment solution, with an advisor available at higher account tiers. Investors deposit funds into their account and wines will automatically be selected, purchased, and added to your portfolio. There isn’t a minimum investment per se, but it typically requires at least $500 for a purchase to be made.
Trading
Trading accounts can buy individual bottles of wine from a primary or secondary market. Periodically there are new collections that are launched for purchase on the primary market. After that, bottles can be bought and sold between investors on the secondary market. The prices vary widely, ranging from below $100 to over $1000.
Whiskey
There is also a newer offering being made increasingly available to investors called Whiskeyvest. The Whiskeyvest page allows investors to reserve a cask of American Whiskey or Ultra-Rare Scotch. Beyond the reservation, the rest of the investment experience largely mirrors that of a managed account.
Vinovest vs Vint – Who Can Invest
Vinovest is available to a much wider investor base. While you don’t have to be an accredited investor to invest on either platform, Vint is limited to US citizens. Vinovest is available to anyone that can legally drink in almost all countries.
Fees
Properly storing and insuring wine and spirits for years at a time definitely has a cost, so we can expect to see that reflected in the fee and cost structure of both platforms.
Vint Fees And Expenses
Vint has a very simple fee structure. There’s technically only a sourcing fee that’s applied. It ranges from 0% to 35% of the offering amount, with the specific amount being chosen at the sole discretion of Vint. There is also an additional ~3.2% of any offering that goes to covering expenses like insurance and storage.
These fees and expenses are all built into the offering price, so investors are effectively pre-paying these for the lifetime of the investment when they purchase shares.
Since there’s sourcing fee amount can vary drastically, let’s take a look at what it has been for some of the most recently qualified offerings:
All information is taken from Vint’s SEC filings.
We see expenses are consistently 3.2% whereas the sourcing fee has ranged from 8.78% to 34.3%. However, both the high and low numbers look like potential outliers. Offerings have mostly seen the fee range from 13-16%.
The offering with the highest sourcing fee, The Bowmore 50 Collection, has what appears to be a somewhat unique characteristic amongst offerings I’ve screened.
There are currently only three offers for sale of this bottle in the world. Additionally, due to favorable acquisition costs, Vint is able to offer this collection for 27.7% below the asking price for the only US offer and 23.20% below the lowest global retail offer.
– The Bowmore 50 Collection from Vint’s Website
It’s unclear if the high sourcing fee is reflective of extraordinary efforts to obtain such a rare whiskey, or Vint pocketing some of the “discount” they secured.
Vinovest Fees
Storing and insuring your wine or whiskey has ongoing costs. Vinovest charges a fee for this on a monthly basis for both managed and trading accounts.
- Managed Accounts (both wine and whiskey)
- Starter Tier – 2.5% per year / ~0.208% per month
- Plus Tier – 2.35% per year / ~0.195% per month
- Premium Tier – 2.15% per year / ~0.18% per month
- Grand Cru Tier – 1.9% per year / ~0.158% per month
- Trading Accounts
- 1.5% per year / 0.125% per month
After purchasing a bottle, there’s an up-front 2.5% fee. This also covers 3 months of storage and insurance costs (basically the management fee). This effectively makes the first year management fee 1.875%.
For trading accounts, there’s always a 1% fee for selling wine to another user.
For managed accounts, there is a 1.5% fee for selling wines on the marketplace. If wines are held until they reach maturity, a sale will also be brokered by the Vinovest team. They state there are no additional commissions taken on the sale. We take this to mean there are no additional fees if wines are sold in this way.
Vinovest states they will charge an additional 3% fee for users that sell wine in less than 3 years. For whiskey, the early liquidation fee is 10%.
Below, I have attempted to model out the fees for both a managed account, as well as a trading account. It uses the following set of assumptions:
- A $10,000 initial investment
- The value of the investment grows linearly at 1% each month
- Investments are held for 10 years and then sold
- Trading accounts face a 1% selling fee at the end of the 10 year period
- Managed accounts sell within the ideal selling / maturity window and face no additional fees
- Vinovest does not change the fees over the period of time
In this example, the investment is worth almost exactly $33,000 after 10 years. That’s a $23,000 gain in investment value. The Trading user paid $3446 in fees, while the Managed, Plus Tier customer paid $4550.
Liquidity
When making an investment, it is always good to understand what the options for liquidity are. Can you sell your investment early if you need or want to?
In the case of Vinovest, the answer is simply “yes.”
Trading accounts have assets that are already tied into their wine marketplace. Your fine wine bottles can easily be listed for sale. Likewise, managed accounts can also pursue a sale or liquidation at any time. There will be fees associated with these transactions, however.
For Vint, the answer is no.
There is no secondary market to sell your shares to other investors. There are also no options to exit after a set period of time. Once you purchase shares from Vint, you’ll have to hold them until the collection is sold.
Taxes
If your investments are successful, you’ll exit them with gains. How those gains are taxes is an important consideration when evaluating the valuation proposition of an investment.
Vint’s collections are Limited Liability Companies that operate like corporations from a tax perspective. When part or all of a collection is sold, investors will effectively receive a qualified dividend payment.
Vinovest has a completely different structure. Since investors own the wine and whiskey directly, they’ll be subject to collectibles taxes.
Both collectibles and qualified dividends are taxed like capital gains, with one exception. This could mean that investors pay the same tax rate between Vint and Vinovest. However, while capital gains are generally capped at 20%, one exception is collectibles which can be taxed up to 28%.
Vint’s structure keeps tax forms simple, requiring only a 1099-DIV. Vinovest seems to suggest that they will not provide investors with any tax documents.
Automatic Investment
If periodic, automatic investing strategies are your preferred investing approach, then Vinovest’s managed account is your only option here.
The collections offered on Vint and Vinovest’s trading accounts all require irregular, manual investments. Both platforms often see their collections sell out quickly, so investors will need to carefully follow announcements of new offerings to secure them.
Payment Methods
Vinovest offers a wider array of payment methods supporting cryptocurrency from BitPay, check, and wire transfer. Vint supports payments from a bank account as well as select self-directed IRA providers.
Vinovest Vs Vint – Summary
Both of these platforms offer respectable options for investing in wine and spirits. They have low investment minimums and are available to non-accredited investors. Each platform also takes care of safely storing and insuring the wine. However, the approaches they take to developing their offerings are very different.
Vint allows investors to easily diversify by making fractional investments across a variety of collections. Vinovest allows you to directly own cases and bottles of wine. Vint bakes their fees into the offerings and doesn’t collect any payments from investors. Vinovest collects monthly management fees. Vint lacks liquidity while Vinovest has ample amounts.
Overall each platform has their strengths and drawbacks. Vint may be the best place. to look for investors just getting started in the asset class and only planning to make small investments. For anyone that wants liquidity or to directly own the bottles they are investing in, Vinovest is the best option.
If you’d like to learn more about Vint, take a look at some of our additional resources:
Vint Summary
A basic introduction to Vint, their historical performance, a summary of their offerings, and more!
Detailed Introduction To Vint
This article will explain what Vint is and how to access their fractional wine and whisky investments.
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