Interviewing Sir George Fistonich of Villa Maria

Sir George Fistonich
Jamie Goode interviews the founder of New Zealand star winery Villa Maria

50 years ago, Sir George Fistonich founded what has since become one of New Zealand’s leading wineries: Villa Maria (www.villamaria.co.nz). Now just into his 70s, but looking younger, he’s unassuming, friendly and softly spoken. I caught up with him in London, where he’d just arrived to pick up the Lifetime Achievement award at the International Wine Challenge awards dinner. Here’s our conversation.

Jamie Goode (JG): I’m very interested because you started out in 1961: in terms of New Zealand, that’s prehistory. What was the wine industry like then?

Sir George Fistonich (GF): We were very much a beer drinking country. Rolling back to the turn of the 20th century there were quite a few grape varieties grown, and then we got phylloxera and they got pulled out. Then the First World War started. You might say we went through an era of prohibition. In a lot of ways wine drinking didn’t feature. When I started it was very much about port and sherry.

For wine, a lot of Croatians had come into the country, and they had wine with their meals. So they tried to make wine in their back yards. A lot of them ended up in the wine industry: the likes of the Babichs and Selaks.

I was brought up in this environment of the Croatian community, with many of them making wine. My father didn’t think that the wine industry had any future. I was the second brother. They’d saved enough money to put my older brother through University. Then I had to do a trade. I was told to do carpentry and joinery. Those were the days when you did what your parents told you to do—it wouldn’t happen now!

I did a trade but I wanted to get into the wine industry, because I mixed with a lot of the Croatian community. I finished my apprenticeship in record quick time and I had six months off; I’d managed to squeeze a five year apprenticeship into three years and 10 months. I started making wine at home. I played around with dry red and dry white.

I was actually sitting round a coffee bar with two mates when I chose Villa Maria as the name. Maria was quite an international name, and was also a Croatian name. It sounded quite romantic. Villa is a common expression for a house. Probably today you would come up with a real Kiwi name. A lot of people thought I was married to Maria or my mother was Maria, and all sorts of rumours floated around.

In 1962 I entered two dry reds in the Royal Easter Show and got second and third prize. This put me on the map quite early on. This was all Henderson Valley (Auckland) fruit. At that stage there were probably about 80 or 90 wineries all around Henderson and Kumeu.

JG: So you were focused on local fruit from Auckland. When did you move away from Auckland?

GF: In the late 1960s/early 1970s we moved down to Gisborne, which was growing a lot of Muller Thurgau. This is a cross of Riesling and Sylvaner. Overnight it became the champion white wine of New Zealand, and became 50% of the market. It converted the population to drinking table wines. There were names like Bernkastel Riesling and Liebfraumilch – imitations of German wines. Muller Thurgau made a nice medium dry white wine. It was a great entry wine and helped convert a lot of people to table wines. As fast as it grew, it suddenly crashed.

In 1975 I brought Vidal, a small winery in Hawkes Bay. It had changed hands and gone from the Vidal family to Seppelts (Australia), who ran it for a couple of years and couldn’t cope with the New Zealand market, so they sold it to the manager, and I bought it off him. I was buying grapes off him initially, and in the end I bought the winery, which gave me 100 acres of grapes in Hawkes Bay. This was a good boost because I was a bit behind the rest of the industry in terms of finance and the ability to grow grapes.

So we suddenly went into Cabernet, Merlot and Chardonnay: it was an explosion of new varieties. In the late 1970s/early 1980s we moved into Marlborough and started planting Sauvignon Blanc. We planted 100 acres using a public company called Seddon Vineyards in 1993. 100 acres was huge then. We formed the first unlisted public company in New Zealand for this. It was quite risky and it took us well over a year to raise $1.5 million. We finally got $1.65 million which wasn’t enough to complete the project, so we borrowed $350 000 privately by mortgaging everything. But by today’s standards that is peanuts, and 100 acres is quite small.

In 1998 we formed another company called Terra Vitae, which is actually 400 acres and was $9.5 million. We ended up getting oversubscribed, with $13 million. This was really big. But now, people plant 1000 acres with no market and no brand. A lot of these companies have gone in and planted and then looked for the market. We have established a market and then planted a vineyard to supply this. We sell 95% of everything we produce under our own label.

The majority of our grapes are now from Marlborough, but we are also strong in Hawkes Bay. We have 500 acres in the Gimblett Gravels region, which is about a quarter of it. Hawkes Bay is a great area. There are some fantastic Chardonnays coming out of Hawkes Bay now. Syrah is also fantastic. Our Syrahs are totally different to the Australian ones; they have this nice peppery, spicy character. You don’t get that in Australia.

JG: What are your plans for Villa Maria? Are you going to do more of the same or do you have some new projects in the pipeline?

GF: The industry is changing rapidly at the moment. It is becoming dominated by supermarket chains. When I started there were around 1400 small wine shops, and restaurants. Now there are really just two supermarket chains. There are many similarities between the UK and New Zealand, and Australia is heading in that direction. It is quite a complicated market now because it is all about promotion and pricing; the big get bigger. We are in a funny situation: we are about number 6 in New Zealand, but are perceived to be bigger. We are competing with the big multinationals. There are products like Monkey Bay at a low price (under $10) when the normal price should be $14–15.

JG: Wasn’t there a tricky period for Villa Maria in the mid-1980s?

GF: Yes, we got bulldozed out of business and went into receivership. We got hit by Brierley. It is one of these multinational finance companies that goes out and buys companies, strips their assets and closes them down. They got into the wine industry and decided there were too many wine companies. So they sold wine at half price to try and restructure the industry, and that put me out of business. Nobilo had to sell all their land, and it destroyed their financial structure. Delegats followed a month after me. Eventually they had to sell out. I was quite fortunate: we went very public about the fact that we’d been bulldozed out, and we ended up with a miraculous recovery. I ended up losing half the company but I managed to buy it back. It had some benefits. I lost two stone in weight, and then put it back on! It ended up being quite a big story.

JG: So is the outlook good for New Zealand wineries at the moment?

GF: The problem now is that the exchange rate is horrendous. You used to get NZ$3 to the pound; now it is about 1.9. With the supermarkets and their promotional costs, the profit in the UK is virtually non-existent. I’d hate to have been in this situation ten years ago. We have built up quite a lot of equity in Villa Maria, and we have also built up a spread around the world. We are in the USA, Canada and Asia. I have always looked after New Zealand, too. So we can weather the storm, but it is hard going. I think I have worked harder the last couple of years than ever. We have been hit with the huge surplus at the same time as fewer routes to market, as well as an unfavourable exchange rate.

JG: You were quite outspoken about closures a few years ago? When did you become a screwcap only winery?

GF: Mostly from 2000 onwards. At that stage we couldn’t get enough caps and bottles. We did about 65% of the 2000 vintage. In 2001 we started doing all our reds, and were close to 100% screwcap. We weren’t the first. In Marlborough there were about 15 or 20 of us. I had no doubt that we were losing 8% of our wines as a minimum to bad corks. We got bales of 10 000 corks and we’d put some in neutral white wine or water and see how good the bales were. We found we were rejecting 3–5 out of 10 bales, and I don’t think these went back to Portugal. Our whole objective was to make quality wine, so when we had a decision to make it took about half an hour. We made this decision to go 100% screwcap.

I was in the UK and Matthew Clark were having a sales conference with about 400 people. I got a 20 minute slot to speak to them. I asked them how many believed in screwcap, and it was something like 35% believed in screwcaps, with the majority against them. The day before, at about 4 pm in the afternoon, Hugh Johnson’s pocket book was launched, and right on page 5 there was a small paragraph about screwcaps, saying if our ancestors 100 years ago had the ability to close wine with screwcaps, imagine all the fantastic wines we would now have sealed properly. About 7 pm that night we managed to track this book down, and it was the perfect thing to read out to this audience. We had a video, about 8 minutes long, on the screen, because we knew it would be hard to influence this many reps. But we managed to convert them.

The American market was hardest to convert. We got a listing at a chain of about 30 seafood restaurants, but as soon as we moved to screwcaps they delisted us. So we have had a few dramas. But we got relisted about a year later.

When we started using screwcaps we started to get lots of letters, very much from the USA, saying I’ve lived in America for 10 years, and I have been proud of the New Zealand wine industry, but I am ashamed about Villa Maria trying to destroy the great reputation of New Zealand wine. So we did a one-page 10-point explanation of why we were using screwcaps. We also had a 20 page detailed scientific sort of document. We designed a letter, starting off thanking people for their concern, then explaining why we were changing. Then we invited them to send their postal address or email address so we could give them a detailed scientific explanation. We had some dramas over two or three years, and sommeliers didn’t like it, but overall it was an exciting project.

I got one letter saying, ‘I’ve been drinking your wine for the last 20 years. My wife and I sit down every night with a meal and have a nice glass of wine. Unfortunately, because you have gone to screwcaps I’ll never be able to drink your wine again. Thank you for the great time I have had with your wine over the last 20 years. I used to be able to get home, get the corkscrew out and open the bottle, sit down and pour myself a glass of wine. Now I get home and my wife has worked out how to take the screwtop off and she has already finished the bottle, and is incapable of cooking my meal. So I’ve had to ban screwcaps.’

I have about 3000 bottles in my cellar. I have still got quite a lot of cork-sealed bottles. I have a lot of old Australian reds. I toss out almost 2 out of three bottles that are 10–15 years old. Oxidisation is a problem as much as cork taint. And I have a proper climate-controlled cellar.

JG: I always like to meet winemakers or winery owners who actually like wine. It is reassuring. So you are quite keen on wine then?

GF: Yes. I drink every day.

JG: What do you like to drink?

GF: I am quite seasonal in my drinking. I drink a lot of Sauvignon Blanc on the beach in January if the weather is hot. I really enjoy good Chardonnay. With reds, I drink more Pinot Noir in the summer and more Bordeaux red blends in the winter. I drink Riesling, Gewürztraminer and Pinot Gris, too. I like Italian reds, and I love good Bordeaux. We are getting so many good New Zealand reds these days. We are part of the Family of Twelve, and we swap wines among ourselves.