An ongoing narrative argues that younger consumers are drinking less, which is hurting the whiskey market. But one industry executive isn’t buying that the whiskey bubble is about to pop.

“Are people drinking less booze? 100 percent,” Brian Rosen, founder of InvestBev. “Are they drinking less in general? No, they’re not. They’re drinking other things.”

Yes, that includes THC drinks and non-alcoholic drinks for many people, but when it comes to bourbon and whiskey, Rosen (pictured) argues that consumers are simply shifting. Cheaper, more commonly found bourbons, he said, are being traded out for higher-end options.

In addition, he said alcohol sales have continued to rise. In addition, he said alcohol consumption has risen every year since the repeal of Prohibition in 1933.

“Bourbon is slowing down because the supply is too high,” Rosen said. Producers “will work through it in the next 6 to 12 months because production levels are coming down and distilleries are shuttering.”

InvestBev is a company that not only invests in bulk alcohol, but also provides capital and services for startup brands. For example, the company recently agreed to a strategic financing partnership with Lofted Custom Spirits, the contract sales arm for Bardstown Bourbon and Green River Distilling.

Rosen said there is a lot of “noise” around the narrative of Millennials and Gen Zers drinking less than older generations. Anecdotally, he believes the fact that younger people were derailed a bit by Covid, when no one was going to bars. No one was socializing. 

“There’s a lag in the training cycle of a young person that enjoys adult beverages,” he said. “Per data, that drinker is coming back. They didn’t have that socialization experience. It’s slow now, but it’s not dead. It’s just slow adjusting and reanchoring.”

In other words, he thinks the rising trend of investing in barrels for aging isn’t going anywhere. It may not be rising at the moment, but the trends he sees are positive. 

“It’s about what you’re anchored to,” Rosen said. “If you’re anchoring to 12 percent [appreciation] every year, that’s totally normal. That’s still a better return than real estate. If you’re anchoring at 30 percent, it looks like the market is down. But if you’re anchoring at 12 percent, hell yeah.”

In addition, he said, if for instance and investor buys a certain amount of two-year aged Green River barrels, those barrels are immediately removed from the supply. That helps create intrinsic demand for when those barrels mature to 6 or 7 years, which is the sweet spot. Combine that with production being scaled back across the country, and it’s a recipe for the American whiskey market to continue moving forward.

“The reality is, I’m looking at this thing analytically, not emotionally,” Rosen said. “With less bourbon being produced, you’re going to have demand. Period.”

-Kevin Gibson

Read more: InvestBev to Invest Up to $100 Million in Kentucky Bourbon Barrels