Boutique distillery turning the gin revolution on its head

Alexandra Chappatte, founder of Kenyan Originals, a craft beverages maker. [Standard]

At a godown in Nairobi’s Baba Dogo, neatly sits a large shiny copper pot where ethanol is infused with botanicals – notably juniper berries – in a distillation process that creates gin.

This gin distillery is the newest of the frontiers sustaining Kenya’s increased appetite for the potent spirit but with a twist – flavouring it with everyday treats such as mabuyu (baobab fruit) and groundnuts to adapt it to the Kenyan palate.

Alexandra Chappatte, the founder of Kenyan Originals, a craft beverages company is the newest general in this gin revolution.

She has been disrupting the alcohol market since 2018 and built a $10 million (Sh1.1 billion) company with a beverage portfolio - alcoholic and non-alcoholic - of over 10 flavours, including ciders, mixers and tonics and iced tea.

The lucrative gin business, which is experiencing a renaissance globally, has been locally dominated by Diageo’s East African Breweries Ltd (EABL), which controls both the premium and bottom mass market.

EABL’s top moneymaker has been Gilbeys, with the firm aggressively pushing its spirits business over the last few years in a new strategy even at the expense of beer, which is more entrenched.

New market entrants such as Ms Chappatte have had to overcome significant barriers such as licensing and developing a distribution network.  

“We are the first craft company to get a gin licence, which is a huge feat... it’s designed for big players. Many people had the idea to launch a gin in Kenya, but making it happen is very hard,” she tells Financial Standard.

The dominant players, Ms Chappatte says, only take a spirit base and add flavour to produce gin.

She sources real botanicals locally and dries and distils the drinks through the copper pot to achieve the various flavours.

The only thing she imports is juniper berries, the main ingredient in gin.

She gets ingredients such as bitter orange leaves from Kilifi County, pink peppercorn from Naivasha, and roses and cucumbers from Nanyuki.

“There’s nothing in the spirits space being distilled with real ingredients. It will be spirit-based then a flavour added or they import, which means it’s expensive,” says Ms Chappatte.

She observes that there’s a sweet spot in the middle when it comes to pricing against the quality of that product.

She also reckons she is not coming to the gin party too late but is on the cusp of the revolution.

The gin revolution, Ms Chappatte says, was started by a craft company in the UK, which is the world’s largest gin market and home to the London Dry gin version and where brands such as Beefeater and Gilbeys trace their roots. “Fifteen years ago, one of the first craft beverages companies got the licence to distil in the London area, and that kicked off the gin revolution... it was craft that did that.”

“We have a real, unique proposition in the sense that we are the first craft company to get a gin license in Kenya.” The firm’s plant in Baba Dogo processes over three tonnes of fruit monthly with a production capacity of 2,000 bottles daily.

It has since expanded this capacity to include a new production line for spirits and is among the few alcohol manufacturers to have a canning line.

“I don’t see any issue of us being able to keep up with the likes of Gilbeys over a few years, and so we are in a good place on capacity,” says Ms Chapatte.

What triggered this gin revolution in Kenya? It’s happened before in the UK and developed African markets like South Africa.

Gin appetite in Kenya really accelerated when the Covid-19 pandemic struck. There was a financial aspect to it with price-sensitive Kenyans moving to spirits to match tough economic times. It’s also well consumed at home compared to drinks such as Vodka and Tequilla, which are popular as “shots” in clubs.

She describes gin as a perfume, where production begins on a blank slate then various botanicals and flavours are thrown in.

“Some people will like one type of perfume, others won’t. It’s a very experimental category where people can have different opinions about gin even when it’s of great quality,” says Ms Chappatte.

She notes that prior to the pandemic, the gin market was male-dominated, especially in the low-end market, while the premium kind was for the women.

Kenyans are moving from brown to white spirits. “There were the seeds of it before Covid-19, and really that is being able to access quality non-brown liquids as an alternative. Vodka doesn’t do this in that market, which is why people move to gin for a premium experience,” says Ms Chappatte.

Kenyan Originals’ entry level is the 58 Gin (named after the Buru Buru matatu route), retailing at Sh1,300 and which is taking on Gilbeys. Their top-shelf one is KO at Sh2,300, which is accessible but premium and squares off with Tanqueray, another one of EABL’s brands.

She says groundnuts are “lovely” to distill because they give one a softer mouthfeel, and the end is a smoother finish. Mabuyu (baobab) gives a nice fruity edge to the mouth of gin enthusiasts.

They also use limes. Ms Chapptte explains that the Kenyan palate is “citrus-led.” This might explain the popularity of Gilbeys, which has about 12 different ingredients in its botanical blending. As one reviewer summed it up: “It has a moderate burn, easy-drinking, has the telltale gin flavours but kind of underwhelming at the same time.”

No gin is alike, hence the variety, and Ms Chappatte insists they are not late into this market. Kenyan Originals is looking to raise $700,000 (Sh80.5 million) through crowdfunding to boost expansion plans.

The firm is willing to cede a 10 per cent stake valued at $1 million (Sh116 million). The minimum ticket size is roughly £10 (Sh1,500) and the maximum £50,000 (Sh7.35 million). The crowdfunding will run for a month, going live in June on Crowdcube, a UK-based platform.

Investors are set to get dividends once it is profitable, which is expected in a year.  The firm, which averages a growth of 40 per cent annually, has ambitions to hit an annual turnover of $25 million (Sh2.6 billion) in the next four years.

It has raised money primarily from seed funding before, with its early investors including Chandaria Capital founded by entrepreneur Darshan Chandaria.