Once upon a time in America

In the week that marks the 100th birthday of Robert Mondavi, Nicholas Faith tracks the shifting fortunes of the man who did so much to shape the Californian wine industry.

Margrit Mondavi

Robert Mondavi was born exactly 100 years ago but the legend – and the business – surrounding his long life live on. In fact the Mondavi story contains two totally dissimilar elements. One is of a feuding family which formed the basis for a real-life TV soap opera called Falcon Crest which involve ructions and fissures in two generations of a wine-making family. The other is the impressive tale of a man who was one of the most influential figures in the history of the Napa valley and thus of the making and selling of fine wine in the United States, a man who created a brand which has demonstrated the capacity of an iconic name to survive and flourish even when cut off from its family roots.

Robert’s father Cesare had arrived from Italy in 1908 but it was only in 1943 when he bought the well-known Krug wine business (not to be confused with the Champagne of the same name) that the family became serious winemakers. Twenty years later Robert, Cesare’s oldest son, travelled to Europe, visiting 40 wineries in a few weeks, a journey which gave birth to an ambition to make fine wines. Unfortunately the rest of the family, above all his younger brother Pete, were less ambitious and after a series of family rows Robert, already in his 50s, started up on his own, yet he created a billion-dollar business.

Typically he started the business with a splash. He bought suitable vineyards and hired Warren Winiarski, later the creator of Stag’s Leap and the first of a series of talented winemakers he employed. More recklessly, in an early example of his strong streak of showmanship, he built an iconic – and expensive – winery. This was built in the Spanish Colonial style complete with a tower and an arch giving onto the vineyards at Oakville in the heart of the valley, and designed to be an educational centre offering tours and events – for he always felt that it was never enough to produce and sell great wines, it was just as essential to promote his name. In the words of Paul Lukacs, the wine historian, “The construction of the Robert Mondavi winery marks the effective beginning of American wine’s rise in both quality and prestige.”

Although he was helped by many of the growers he had known in the 20 previous years when he had worked at Krug – “he was friends with everyone in the valley”, says Glenn Workman, the veteran general manager at Oakville – he had to sell control of his fledgling business to a brewery. But in the in 1970s he was saved by two triumphs. One was legal when he received $10 million from his brother – though only after a 10-year long law suit – which enabled him to buy back control of the company, while in 1976 a tasting organised by Steven Spurrier showed that the best red wines from Napa – which did not at the time include any of Mondavi’s – could compete successfully with their French equivalents.

HIGHLY INFLUENTIAL

Robert Mondavi’s Hall of Fame plaque

In the next 15 years Mondavi not only created the biggest fine wine business in California but at the same time he had an enormous social and cultural influence which created what can only be called a “vinous civilization” in the valley. Robert’s younger son Timothy was responsible for the vineyards and winemaking was sufficiently skilled to conquer even that most neurotic of varieties, Pinot Noir. Moreover the firm was keen on technical experiments and improvements – for instance in its use of different types of oak including early experiments with degrees of toasting.

His most famous wines were based on Cabernet Sauvignon but his most typical venture was to rename the Sauvignon Blanc wines he made from selected vineyards as “Fumé Blanc” to distinguish them from their French equivalents. These proved a great commercial success and became the general American name for the variety. The final proof of an international fame unique among American winemakers was the immensely successful joint venture he set up with Baron Philippe de Rothschild, the aristocratic French winemaker-showman, to make a Bordeaux blend mostly made from Cabernet Sauvignon in the Napa, which, with typical bravado, they called Opus One and which soon went on to sell 30,000 cases.

Less easily definable but equally real was his influence on what might be called the “civilisation” of the valley – in which he was helped by his Swiss-born second wife Margrit (he and his sons were, to put it mildly, notoriously susceptible to female charms). The ventures ranged from the Napa Valley wine auction and the spread of the “food and wine” movement, derived from such establishments as Chez Panisse, the iconic restaurant in Berkeley.

Genevieve Janssens, Mondavi winemaker

The family’s downfall can be dated from 1993 when they were forced to sell some shares to the public though control rested with the family. This was largely to pay for the cost of replanting because of the phylloxera epidemic which had swept through the valley. But the resulting need to satisfy investors widened the gulf between Mondavi’s two sons in an echo of his own story. His younger son Timothy wanted to remain upmarket, confining itself to the wines sold under the family name at Oakville and ignoring the millions of cases of a second wine under the Woodbridge label of lesser wine from lesser regions sold under the Woodbridge label. But his older brother Michael, who was CEO, was more interested in quantity – and in deal making – and the firm filled the gap between Woodbridge and the wines made in Oakville and introduced what was originally called the Coastal Range because of the grapes’ origin and which later became Robert Mondavi’s Private Selection – a name which worried Timothy. By 2001 the low-price Woodbridge accounted for eight million cases, three-quarters of all sales by volume and those from Oakville for a mere 5%. To make matters worse, by then Timothy’s elegant wines were under attack from the all-powerful Robert Parker who considered them “indifferent, innocuous”.

Michael had worsened the situation by trying to convert Mondavi into a world- wide company. He was unlucky in his boldest, but most sensible venture – to create a high quality wine in the South of France – defeated by French chauvinism and the jealousy of a neighbouring winemaker. His other initiatives, in Italy with the Frescobaldi and Antinori families and in Chile with the Chadwicks, faded into disaster. Yet all concerned were living high on the hog. Robert’s lavish lifestyle was copied by his sons – and their employees, although some of the expenditure, like sending the winemakers to see for themselves in European wine regions, made sound commercial sense.

BIG SPENDER

The financial problems created a crisis for the near-nonagenarian Robert. He had spent millions on an Opera House and an Arts Center and financed a disastrous wine-themed exhibit in a Disney theme park. Worse, he had given $25 million to the University of California’s campus at Davis near Sacramento to establish an “Institute for Wine and Food Science” named after him and a further $10 million towards a “Centre for the performing Arts” named after him and his wife, both sums based on the steadily declining value of the Mondavi shares. Robert’s extravagance, Michael’s financial disasters – and Timothy’s increasingly erratic behaviour – worried outside directors like Anthony Greener, the former head of Diageo, who changed the share structure and removed all the family from control.

The directors tried to separate the two sides of the company placing Oakville and Opus One away from the more ordinary wines in the hope that the family would bid for its treasured original home and its finest wines. But the family didn’t have the money. Michael wanted to sell his shares and Robert had to find a buyer to back his gift to Davis. As a result late 2004 witnessed the last episode of the Mondavi soap opera when the firm was taken over for $1.36 billion, the only consolation being financial, leaving Robert’s daughter Marcia with $330 million and all three male Mondavis with eight figure sums apiece.

Glenn Workman, general manager

The buyer was Constellation Brands. This was – and is – also a family-controlled company, but over the past half century the Sands family has worked its way up the quality chain from making wine in upstate New York to control of other quality brands like Simi and Franciscan where it learnt how to combine quality, profitability and an international outlook to make it one of the largest winemaking groups in the world.

Life after the takeover was pure anticlimax. Stability was the focus – including the retention of key staff like the veteran winemaker Geneveve Janssens. Indeed they were all relieved after the last years of the Mondavis when “the growers weren’t paid and grew impatient though now they’re better – we allow them to taste their own fruit as well as those of their competitors”, says Workman. He adds that the new owners “know the financial value of brands, they have more understanding of the business than the later, financially oriented managers at Mondavi”. Workman continues, “They’ve allowed investment through replanting and they’re not afraid of low yields.” There’s been a lot of replanting, with quality improving thanks to “low yields and a re-concentration on Cabernet Sauvignon. Moreover the Mondavi brand could be strengthened when, rather than if, the name Mondavi is removed from the Woodbridge wines. The only change in the wines is the way they’ve strengthened since Timothy’s day”.

The Cabernet Reserve has the number 93 proudly engraved onto its bottle to show what the all-powerful Parker thinks of it.

But overall, as Workman says, “We’re keeping the family tradition without the family… Mondavi remains a door-opener when it comes to new clients” – and the name is still alive as Robert’s widow continues to act as “brand ambassador” for the company.