Former National Basketball Association star Yao Ming is within reach of his goal to get $3 million from crowd funding to expand his wine business.
Napa Valley's Yao Family Wines started the campaign to expand his wine business on March 2, including the building of a visitor center in Napa Valley and a tasting room in Yao's hometown of Shanghai.
As of Wednesday, Yao had commitments for more than $2.77 million, 93 percent of his goal, according to Crowdfunder, the website used by entrepreneurs to get public funding.
"Yao sees a good shot at his crowd funding goal of $3 million," said Dong Guanghua, group account director of New York-based global market-research firm Millward Brown. "The chances are as good as his impressive free-throw percentage." Among players with at least 1,000 free throws made, the 7-foot-6 center, Yao ranked second among 7-footers with an 83.3 percentage.
Jay Behmke, managing director at Yao Family Wines, was quoted by the Wall Street Journal as saying the company was prepared to increase the offering to $5 million if investors showed strong interest.
Yao Family Wine said only US citizens and permanent residents can participate in the fund-raising effort. Depending on the size of their financial pledge, which ranges from $5,000 to $25,000, investors will be given admission to exclusive events and private dinners.
Yao co-founded the winery in 2011 and sold more than $8 million of its wine in its first 39 months.
Dong said Beijing's anti-corruption campaign and the cooling down of China's luxury wine market has led to Yao Family Wine, the biggest seller of high-end Californian wine in China, to shift its attention to the US market.
"Beijing's anti-corruption campaign has sapped demand for expensive wines, especially for those pricing over 1,000 yuan ($161), and Yao Family Wine, targeting mostly the business banquets, has to shift its focus from the Chinese banquet tables to overseas market," he said.
According to Yao Family Wine, 15 percent of its revenue now comes from the US, compared to almost zero when it started in late 2011.
Yao Family Wine's previous offerings, all reds, have cost from about 1,500 yuan a bottle for Yao Ming Napa Valley, to 6,000 yuan for a bottle for its premium Yao Ming Family Reserve. Napa Crest, the company's cheaper wine introduced in 2013, sells for 535 yuan, is still out of reach for ordinary Chinese, the company said.
Dong predicts that the luxury wine market in China won't rebound in the near future.
Together with Yao, many Chinese celebrities have focused on investing in vineyards, including Chinese actress Zhao Wei, who spent millions in 2011 to acquire a Bordeaux chateau and functional winery in France's Bordeaux area.
"Many celebrities chose to involve themselves with a business or an investment after rising to fame, and the wine industry is one of the popular fields because it's profitable," said Dong. "Not many celebrities succeeded in shifting their roles from public figures to a businessmen, but Yao made it."
Small California wineries are usually owned by wealthy people who do not care about losses, but the retired Chinese basketball center, who has attended classes on economics at Shanghai Jiaotong University after giving most of his school years to basketball, sees the wine business as more than a vanity investment with bare returns, said Dong.
"He wants his business to be successful and investors in his venture to expect a satisfactory return, and he knows how to do it," he said. "Being in the NBA has given Yao a more international perspective, while his fame has also gained him publicity for his wine products. For Yao, opening a winery is more than a passion project."
Yao's fame and national hero status in China is not the only factors that drive the purchases. The winery has also received significantly good reviews, with ratings between 90 and 98 points from top wine critic Robert Parker, Wine Spectator and Wine Enthusiast, said the company.
