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How an Austrian vodka with Siberian roots shows F1's strength in the US

Last week's confirmation of title sponsorship from Visa and Cash App for the Formula 1 team now known as RB was a sign of how much is changing in Faenza.

NEFT Vodka

Photo by: AlphaTauri

The days of rookie drivers and few backers from outside the Red Bull family have long gone.

The team has been relaunched with a new name, new management, an influx of top technical brains and with Netflix star Daniel Ricciardo in the cockpit, inevitably helping to attract attention.

It's a sign of the changing face of F1 that the team has been chosen by two huge American corporations for their international marketing campaigns.

However, Visa and Cash App were beaten to the track by another much smaller US-owned brand, albeit one with a Russian name and a product made in Austria.

The arrival of NEFT Vodka at the then AlphaTauri outfit in Las Vegas last year represents an interesting case study in why sponsors, and especially those with American links, are flooding into the sport – and indeed why the Italian team in particular is suddenly flush with new backers.

NEFT's logos may only have a modest presence on the RB car's headrest and front wheel deflectors, but for billionaire owner Jeff Mahony, it's an important project and one that he sees as a great investment.

Mahony is a little like one of the wealthy business gurus featured in the TV show Dragons' Den, always keeping an eye open for interesting investment opportunities.

"My degree is in cognitive science, which today translates into artificial intelligence," he says. "As a young man, I was recruited into aerospace firms and the Department of Defence.

"Everything really started in 1999. I created some technology that now services a little over 7000 banking operations around the world. So that was my creation.

"I've sort of stepped out from there, but I used those income streams to create an ecosystem of a much larger set of companies. We own about 22 companies in our mix, and probably half of them are global in nature. Anything from trucking to dating apps, you name it, we're participating there.

Daniel Ricciardo, AlphaTauri AT04

Photo by: Red Bull Content Pool

Daniel Ricciardo, AlphaTauri AT04

"We're always looking for a great product, something that doesn't have to be finished or tweaked, so that we can begin to put our work into that. Our work is really about setting up the logistics and operations worldwide.

"We look to acquire a majority interest, if not the entire company. And we also have a large enough infrastructure and ecosystem that we're able to help those companies. If they're smaller in nature, we can kind of help them through an incubator style.

"NEFT is our flagship. There were a lot of companies we could have brought to the table to hopefully partner with AlphaTauri. And we chose the vodka."

Mahony came across NEFT by chance in a bar. It sounds like a bit of a cliche, but he liked it so much that he bought the company, and added it to his portfolio.

The brand was founded in Austria in 2011 by Russian expat Katya Kuzmina, who named it NEFT – which translates to oil in English – to honour her family's Siberian roots in that industry.

To hammer the point home she designed a replica mini oil barrel to take the place of a traditional bottle.

The packaging may look a little industrial but it's more efficient than glass in terms of recycling, as well as lighter for transportation, traits that help to improve the company's carbon footprint.

The oil-inspired branding also contrasts with the quality of the Austrian mountain water and other ingredients used in the vodka production, and which caught Mahony's attention when he first sampled it.

He acquired NEFT in late 2018, while founder Kuzmina remains involved under the title of chief visionary officer.

"It was a fledgling company," says Mahony. "But the vodka was spectacular. It's made from the highest quality products, there's no additives, none of those things.

"It was very appealing to me as a finished product, designed as a sipping vodka, as an ultra-premium category solution to what is kind of a stale category of vodkas out there.

"It was really operating in one country then, and now we're in 22. We want to be in 60 by 2026, or late '25. As we were seeking out AlphaTauri and F1 in general it was how do we get a worldwide platform that will help us operate in those other countries?"

For Mahony F1 emerged as a way to push the brand both in the USA and around the world as it expanded into new markets.

"We sponsored the Andretti Steinbrenner IndyCar for a number of seasons," he says. "But that's a US-based constrained solution.

Jeff Mahony, CEO of AlphaTauri sponsor NEFT Vodka

Photo by: AlphaTauri

Jeff Mahony, CEO of AlphaTauri sponsor NEFT Vodka

"Then F1 started to branch into the United States, which in the spirit space, represents about 40% of worldwide consumption. We must have a footprint in the United States if we're going to make it as a brand.

"And if you can start in the United States, you're more apt to be successful elsewhere, because the regulatory environment is less stringent.

"F1 is in Miami, in Austin, in Las Vegas. Why that's important to us is there are six states in the United States that form 60% of the US consumption, and F1 is in three of them!"

Mahony did his due diligence before committing to an investment in F1, and he realised that it was the perfect fit in terms of his customers.

"My goal was to get my feet wet in Indy and understand the mechanics, the finances, the sort of day-to-day," he says. "The Andretti Steinbrenner folks were amazing people. It taught us a lot.

"But I've always had my eye on F1, particularly in the last few years, as the demographic has broadened significantly. Of course, you've got Drive to Survive and other mechanisms that have driven that.

"As an ultra-premium vodka, our actual demographic is extensive. We're recognising, as we're out in the market space, who it is that's consuming us and enjoying us. And it's a demographic that almost exactly overlaps with F1 today."

So why did AlphaTauri, as the team was still known when the deal was signed last year, come out ahead of any rival candidates?

In essence, CEO Peter Bayer and his management team convinced NEFT that it was going places.

"You have a team that's well-funded now by its parent company," says Mahony. "I needed synergies. And in my mind, I wanted a true partner, somebody who is in a key transformational stage of their history.

"I want to move from 22 countries to 60, so we're at that transformational stage as well. And we need a good partner who will frankly pay attention to us, that we can have some on-the-ground synergies.

"It fits with our ethos. Everything about what they're doing fits nicely into what we're doing, and vice versa. And we really do believe that the best relationships are those that are born out of an individual passion, and then you bring it together, and then your brands both excel.

"And we have a passion just like the team has for that entrepreneurial execution through creativity and innovation. They're hungry, they're trying, we're hungry, we're trying, we're out there doing something with a high degree of passion.

"I think we can do some fantastic and very meaningful things together. And hopefully we can help move the team's needle too. It's about presenting value to our partners, not just taking value from our partners."

Yuki Tsunoda, AlphaTauri AT04

Photo by: Red Bull Content Pool

Yuki Tsunoda, AlphaTauri AT04

Mahony says that NEFT has a lot in common with the reborn team in terms of their ambition and the way they operate.

"The synergies that we found are innumerable, and as we move forward with them, there'll be more and more and more synergies," he says. "And part of business, from my perspective, is there's just a gut feel.

"And my gut tells me that this team is on the move. It's got everything that it needs, it's hungry enough to move.

"You have these large companies out there, you have the Oracles etcetera, that are playing in motorsports. They're kind of in a maintenance mode if you will, they just need their name out there. They're not really hungry. They're just letting everybody know we're still here.

"But this team and NEFT are in different place, we want to engage, we want your awareness, we want to bring you something. and we have confidence in our product like the team does that we will win you over."

NEFT is pushing heavily on activations and events, whether they be on-site at race weekends or TV viewing parties where F1 fans can watch races from afar. The general idea is to get people to sample the product.

"NEFT doesn't do well in above-the-line marketing," Mahony notes. "You can't taste our vodka from a billboard. You have to have those exceptional experiences.

"Our goal as we say affectionately inside the company is we just need to get juice to lips. As soon as we get juice to lips, we've won them over!

"NEFT for us is our legacy company. This is the company that goes to the kids and the grandkids and their families and moves on.

"We're building something new that it's not only sustainable but will actually live into the future in a significant way. To do that, you got to have a quality product.

Daniel Ricciardo, AlphaTauri AT04

Photo by: Jake Grant / Motorsport Images

Daniel Ricciardo, AlphaTauri AT04

"You're going to buy a barrel once if it doesn't have anything good inside of it. So we need to have something good inside of it."

Mahony plans to build on the vodka involvement, potentially adding other spirit brands to the portfolio.

The bottom line is that he believes that F1, especially when tackled in conjunction with the RB team, represents very good value for money.

"The financial model for us is pretty simple," he says. "In comparison to virtually any other avenue F1, particularly with this team, its an immensely efficient dollar spend for marketing, it really is.

"NEFT brands fancy ourselves with vodka, but that's just one of our first products. So really we're a marketing company who happens to sell vodka today.

"We do a great job at it, we have a great vodka, but we want to add other products to the mix as well."

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