Hollywood got the message loud and clear when George Clooney and Rande Gerber sold Casamigos to Diageo for almost a billion dollars in 2017. Tequila was the new movie deal. Then came Dwayne Johnson, Kendall Jenner, Nick Jonas, LeBron James, Bryan Cranston, and Aaron Paul. It wasn’t really a business movement; it was more like a stampede. It seemed like every time someone walked the red carpet, a signature agave spirit was playing in the background for a while.
It’s not their fault if they chase it. Clooney said the quiet part out loud: “You know, acting used to pay the bills, but selling a tequila company for a billion dollars changed everything.” Folks will leave quickly and not think about it for a while. That gut feeling paid off for a while in the market. In 2021, sales of tequila around the world reached $5.2 billion. During the same time period, sales of premium spirits went up by 43%. The category was really on fire, and the money from celebrities helped fuel it.
But somewhere between the tenth launch party and the fifteenth design for a limited-edition bottle, the formula began to fail. Some people in the industry had been predicting for a while that the market for celebrity-endorsed tequila would become saturated. These days, every big star has their own spirit brand, but none of them are as unique as Casamigos. People don’t mind when celebrities endorse a product; they still care about how real it is. What they don’t like as much is feeling like their name was given to a marketing firm and called it a passion project.
A supply problem also comes up that isn’t talked about enough outside of trade circles. Agave needs years to mature, usually seven to ten years for blue weber, which is the type needed for real tequila. Because of the rise in demand, many farmers have had to harvest their plants earlier, add extra things to them, and switch from using traditional methods to using more scalable industrial ones. A nonprofit called the Tequila Interchange Project has been keeping a close eye on these changes since 2010 and has noticed what it calls “concerning trends” in how the category is being farmed and made. There are real effects on the environment, such as waste, water use, biodiversity loss, and even stress on bat populations that pollinate agave plants. It’s possible that the celebrity gold rush didn’t just bring too many brands to the market; it also put a lot of stress on the systems that make the products worthwhile.
Tequila still has the same geographical and cultural appeal that drew so many famous people to it in the first place. A lot of the most famous investors have family ties in California and Mexico. The ties to the land, the traditions, and the sense of place aren’t made up. But the authenticity argument is harder to make when more than 700 new brands are registered in a category in four years. It seems less like a personal project and more like a choice for a portfolio.
It seems like the smart money has already started to move. Some people who follow the industry believe that the wave of celebrities will eventually give way to a connoisseur market. In this market, serious drinkers will turn their attention to smaller, family-owned distilleries that didn’t need a famous face to sell bottles. That could be the good thing. It’s clear that the mainstream attention that celebrity brands gave to tequila has grown the category, educated consumers, and created jobs in the places where the spirit is made. The gains don’t go away just because the gold rush is over.
The idea that starting a tequila brand is a surefire way to make a billion dollars seems to be coming to an end. Casamigos was not the norm, it was the exception. People are much more skeptical and know what makes a spirit worth its price in a market that it helped to begin with. The famous people who knew that early on or who got lucky with timing did well. People who just followed the plan without looking at the foundation are going to have a much harder time getting ahead.
