about scion advisors what and why

September 2009

Building stronger family businesses ™www.scionadvisors.com | 1339 Pearl Street, Suite 204, Napa, CA 94559 | 707.258.9130_____________________________________________________________________________________________________________________________________________________________________________

©2009 Scion Advisors. All rights reserved.

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“We enable clients to build financially-viable businesses in less time.”

Deborah Steinthal, Scion Advisors

September 2009

Building stronger family businesses ™www.scionadvisors.com | 1339 Pearl Street, Suite 204, Napa, CA 94559 | 707.258.9130___________________________________________________________________________________________________________________________________________________________________________


During these complex times …

Opportunity: Cup is half full, not half empty!

In 2008, U.S. wine consumption up for 15th

consecutive year– 2/3rd of consumers spent the same for a bottle of wine

– 43% of restaurant diners wine orders remained the same

– Millennial wine consumption segment grew 23%

Innovation (distribution, direct shipping, internet, social media)

Next generation vintners

Big money on the side lines

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September 2009



During these complex times …3

Challenges: “It is no longer business as usual!”

Consumption shift

– Flat/declining baby-boomer segments

Competition: Large wineries, other states, other

countries, beer and spirits, private/control labels

– Big pricing pressures

Consolidation

– National distribution: broken for <100,000 case wineries

Cost of business

– Increased costs: marketing, sales and capital

– Unknown tax and regulatory impacts

September 2009



Demand for wine is not going away

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The strong will get stronger– Leveraging opportunity is not for the weak

– Fall out of the hobbyists (out of cash, work too hard)

Maximize the value of your business– Run business as if planning to sell

– Adopt the best practices

Focus on cash flow: VALUE = CASH FLOW

September 2009



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Who are Scion Advisors®?

Seasoned general managers from world class organizations

We have walked in clients’ shoes and run businesses

Track record with over 100 companies across several industries

Proven approach to building stronger businesses

− Specialize in family-owned, closely-held

September 2009



Experienced across multiple industries

Wine industry - global

Consumer packaged goods

High tech and internet

Retail

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Scion team

Deborah Steinthal, General Management & Business StrategySteinthal has a track record across a variety of industries and helped companies large and small transition

from startup through high growth; restructure due to poor performance; and integrate new acquisitions.

Driving higher performance and building businesses that are worth more, Steinthal has worked in

executive positions at Lockheed Martin, Oracle, and with over 100 companies globally.

Hank Salvo, CFO/ Financial Strategy & GovernanceSalvo’s skills and expertise in finance, accounting, planning and governance supported his rise to senior

financial management as vice president finance and vice president controller at the consumer goods

giant Clorox Company. Salvo transferred these skills to the wine industry joining Robert Mondavi

Corporation as its CFO in 2000. Since 2005, Salvo advises family wine business owners across as

variety of issues such as strategic planning, succession planning, and governance.

Rosemary Richardson, Leadership & Management DevelopmentRichardson is dedicated to helping leaders advance business performance during times of unprecedented

change. A seasoned executive coach, Richardson is experienced at conflict management and working in

partnership with CEOs and their teams to build the leadership skills required to win in the marketplace. As

Vice President Human Resources for Johnson & Johnson and Applied Materials, Richardson developed a

keen understanding of the challenges of global business and development of leadership and human

capital.

Erica Valentine, Go-To-Market StrategyValentine is a leader in strategic marketing: creating and implementing marketing and sales programs

that work. At Constellation Wines, she grew a luxury business line from 45 to over 90 million dollars. At

Seagram Chateau & Estates, she worked extensively with major international brands such as

Champagne Mumm and Sandeman Port. She has over 10 years consulting experience, working for large

and small wineries, venture capital and web-based businesses. Valentine advises companies on how to

differentiate and compete successfully in a complex marketplace.

September 2009

Building stronger family businesses ™www.scionadvisors.com | 1339 Pearl Street, Suite 204, Napa, CA 94559 | 707.258.9130

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Scion approach8

Proven process: a framework that delivers results

Assess Align Plan Execute

September 2009



Develop a framework for the future

Preparing for exit: transaction readiness

Preparing for business growth

Preparing for generational continuity

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September 2009



Transaction readiness10

EXECUTE: Bridge to resources

Build game PLAN & Quantify scenarios

ALIGN and coach owners

ASSESS business

Corporate agreements

Estate and tax planning

Wealth planning

Financial audit, reviews

Valuation/appraisal

Investment banking

Commercial banking

Private equity

Brokers

Other sources of capital

ROA, ROI, EBITDA, ROL

Business owner

Preparing for growth

BusinessStrategy

Market Strategy

Functional Strategies

Functional Action Plans

Align Vision & Goals

Execution

Framework for driving decisions

Goals

Get the team aligned and connect the dots between strategy and execution

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September 2009



Scion competencies12

Framework Assess Align Plan Execute

Leadership competenciesTeam developmentBoard development

Succession planning Organization strategy

Leadership coachingCulture Building Conflict resolution

Gap analysis ScorecardsOperations benchmarksProfitability /value analysisRisk analysis

Alternative business scenarios Developing, aligningbusiness vision and goals

StrategicFinancial forecastingOperationsAnnual offsiteGovernance

Decision making skills, practicesCascading goals (KPIs)Clarifying roles and accountabilities

Opportunity analysisPositioningMarket and competitiveresearchChannel auditing

Developing, aligningbrand vision and goals

Market & brand strategyChannel strategy Product portfoliostrategy

Project mgt.Brand doctoring

Transaction readinessOwnership alignmentSuccession assessment

Alternative ownership scenariosDeveloping, aligningbusiness vision and goals

Family code & constitutionGenerational continuitySuccession planning Governance

Family council,meeting facilitation

































































September 2009


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Case study #113

Preparing a north coast business for profitable growth

Problem: Channel consolidation and supply realities perpetuates lagging

profitability in national sales.

Approach: Develop focused, consistent market strategy focused on margin

improvement.

Decision: Reposition the business to grow profitably thru the right product

and channel mix; sharpen brand identity across all channels.

Results: Reposition business leads to 50% growth in net operating income

produced through realigned national product mix; stronger brand attracting

more profitable customers.

September 2009


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Case study #214

Road map for portfolio growth

Problem: Client has outgrown its old channel and product strategy.

Approach: Create a road map for growth and cash-out options.

Decision: Relaunch business as a portfolio of separate brands each

focused on high margin opportunities.

Results: EBITDA CAGR growth > 20% over 5 years; flexible exit strategy;

stable organization driving solid decision making and communications;

leadership team incentivized to perform as owners.

September 2009


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What our clients say!15

“Scion helped us reposition to grow profits.

Their approach allowed us to achieve a

stable organization driving solid decisions

and accountability for results.”

Jeff Bundschu, 6th generation CEO

Gundlach Bundschu

“Scion gave us the courage and the

reason to believe that we can do it."

Tim Wallace, President

Benziger Family Vineyards

Scion clients include:

• Benziger Family Vineyards

• Brown Forman

• Cakebread Cellars

• Domaine Carneros

• Far Niente Winery

• Goosecross Cellars

• Gundlach Bundschu Winery

• Hanzell Vineyards

• J Wine Co.

• Luna Vineyards

• Patz & Hall Wine Co.

• Rodney Strong Vineyards

• Seghesio

• Silver Oak Cellars

• Six Sigma Ranch

• Spottswoode Estate

• Viader

• Windsor Vineyards

•Several large wine companies

“...Patz & Hall Wine Company today

announced the first step of many that

are part of a strategic sustainable

business model developed over the

past year by Patz & Hall founders in

collaboration with Scion Advisors.”

SF Business Times

about scion advisors what and why

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