'The personal touch is very important for us' - Cask investor Whisky 1901 targets Scottish expansion

Firm relocating more than 1,000 casks to warehouse facilities in Fife and looking to open Edinburgh office.

Interest in whisky cask investment has never been greater and one of the sector’s prominent players looks set to capitalise on bumper growth figures and further boost its presence in Scotland.

Founded in 2019 by Aaron Damiano Sparkes and headquartered in London, Whisky 1901 has grown to represent more than 250 clients and last year began the process of relocating in excess of 1,000 casks to two new bonded warehouse facilities in Glenrothes, Fife. It has also launched a bottling service for investors, offering another option for exiting the whisky cask market.

The company cheered revenues of £7.2 million in 2023, up sharply on £2.2m in 2022, and is projecting revenues of between £8m and £10m for the current financial year. Alongside the ambitious sales projections, the firm expects the value of whisky casks under management to reach a heady £20m in 2024 - which would mark a 66 per cent increase on last year’s value of £12m.

Some of the hundreds of casks stored on behalf of the firm's clients.

With those key financial measures on the rise, Whisky 1901 - the name being a nod to managing director Sparkes’ favourite Scotch, a GlenDronach from cask number 1901 - is planning significant expansion over the coming months. Central to that growth is the launch of the firm’s first bottled brand and the opening of an Edinburgh office to complement its headquarters in Knightsbridge. The company’s founder and managing director sees that latter move as instrumental in positioning the business within easy access of Scotland’s distilleries and the casks currently under management, as well as serving as a hub for local investors.

Speaking at a whisky tasting event in Edinburgh attended by some of those clients, Sparkes says: “It is important for us to have a base here in Scotland. Some 50 per cent of our clients are Scottish. We can have somewhere where they can come and visit and from a logistical point of view it is also extremely important.

“We as a business are now entering the independent bottling market - not just our own casks but we are starting to bottle our clients’ casks. It’s crucial to have a base here and to have our fingers on the pulse. We want to bring the open door policy that we have in London here to Edinburgh.”

The firm has been busy moving more than 1,000 casks to the Glenrothes storage site, allowing it to keep a closer eye on its clients’ valuable assets. Management of the casks involves regularly re-gauging to ensure there is no leakage, while carefully monitoring the strength levels.

Founder and managing director of Whisky 1901, Aaron Damiano Sparkes, pictured in the bonded warehouse.

“It is imperative to know what you have,” Damiano Sparkes observes. “The facility we have in Glenrothes is so important to the structure of our business as it allows us to check the casks on a daily basis and if there is a slight leak, which does happen from time to time, we can plug that problem right away.”

The interest in whisky cask investment has led to a spike in companies promising potential investors some very healthy returns. However, the cask investment market is currently unregulated by the Financial Conduct Authority and there have been concerns that unscrupulous investment firms and practices may be putting the reputation of the Scotch industry at risk.

Whisky 1901’s buying support service means that the legal and beneficial entitlement to the cask passes to the client, with detailed paperwork drafted on their behalf. Further down the line, the firm provides full support with the selling process.

“There are some good and not so good companies operating in the sector,” says Sparkes. “When I first entered about 12 years ago there must have been three or four companies and now it’s up to 30, which can be frustrating at times but allows us to always keep on our feet and positioned as a market leader. The personal touch is very important for us.

“A lot of these other players have a financial background and have simply joined the whisky bandwagon. I wouldn’t say these companies are going out and out to do wrong by the retail investor but I would say there is a lack of knowledge on their behalf and the information is not relayed to the investor.”

The firm is aiming to do its first independent bottling by June, to coincide with its fifth anniversary, thereby opening up a new stream of income and allowing clients to start opening their casks.

“The sale of cask whisky is the bread and butter of the business but to me my main interest is the end product, the actual liquid,” the Whisky 1901 chief asserts. “We remain optimistic about the opportunities and achievements that lie ahead, while remaining committed to our key promise, providing investors with a safe and secure whisky investment environment.”

Meanwhile, whisky giant Diageo said it had welcomed more than one million people at its visitor experiences for the first time last year. The group, which operates about a dozen distillery attractions and the Johnnie Walker visitor experience on Edinburgh’s Princes Street, has invested £185m to create “world class attractions” in Scotland.

The figures for the calendar year 2023 show that across all its attractions, the company welcomed 1.13 million visitors in the first full post-pandemic year of operations. Katie Harris, managing director of Diageo Scotland “brand homes”, said: “Scotch whisky is well-established as Scotland’s leading export to the world and every bottle we sell around the world is an invitation to visit Scotland and experience its amazing culture, heritage and environment.”