Cannabis next big thing, says John Teeling, the man who revived Irish whiskey

John Teeling says the whiskey industry has been a labour of love but there is nothing like the excitement of a mining discovery. Photo: Damien Eagers / INM

Ellie Donnelly

By the time we get to our 70s most of us are ready to retire - not John Teeling. He's looking at his latest radical departure.

"I want to keep a very close eye on the whole cannabis sector, simply because it interferes with alcohol and it will and it's coming, it can't not come," the 73-year-old veteran investor says. "I would like to be in that space somewhere, and note the 'somewhere' that I want to get into it. And I think I probably will," he adds.

The father of three, who played rugby till the age of 68, also has further plans for work in the two industries he is most known in - mining and distilling.

"I will do some studies on so-called synthetic diamonds," he says. "These are natural diamonds, you grow them in a pressure cooker, it has some major technical issues. Will they ever replace natural diamonds? No, they won't."

While when it comes to distilling he says there is "more development to come in whiskey" and that the firm has to grow Great Northern Distillery - the whiskey distillery he founded in Co Louth in 2012 on the site of the Great Northern Brewery.

"That's enough to keep me going."

Mr Teeling's career started early, impacted by the death of his father when he was just 14 years old.

"I was the eldest and I was working from the age of 14. There was no choice. My mother was 37, had come from the country with no education. It was terrible at the time, but a great education."

Blessed with what he describes as the ability to concentrate "fantastically well", Mr Teeling thrived in school. What followed was a scholarship to UCD, where he studied commerce.

This would lead to a further scholarship to Wharton School, part of Pennsylvania University, and shortly after his return to Dublin, Mr Teeling - alongside teaching in UCD - started working as a mining consultant.

Fifty years on and he is still in the same spartan office he rents in Dublin. It contains little more than a filing cabinet and some whiskey bottles.

"I was put in there 50 years ago and I never left it, why would I want to? I'm not big into 'things'," he says.

He'd already been trading in shares when teaching. He follows the Benjamin Graham model.

"If you have followed it explicitly you will just make money, none of us do. You buy undervalued shares, it's very simple, you don't need anything - your Leaving Cert would be far too good for it. You buy at a certain price and you see if it goes to the price you think it's worth and you sell them," Mr Teeling says.

Known as the man who brought about a revival of Irish whiskey - a tradition his sons Jack and Stephen also carry on with Teelings Whiskey Distillery in Dublin's Liberties - his move into the sector was almost accidental.

While undertaking a doctorate of Business Administration at Harvard University in the 1970s he had to write a number of case studies. "My adviser at the time liked whiskey and said 'Why don't you do it on Irish whiskey?' So I did."

"I knew nothing about it, [and] was shocked at how badly it had been marketed, so I wrote a background note on the decline of Irish whiskey - a failure beyond belief. In terms of value-add it's the best industry you can possibly get."

In 1987, back in Ireland full-time, Mr Teeling set up Cooley Distillery, tapping Business Expansion Scheme (BES) tax breaks. He would go on to sell the distillery to American bourbon whiskey giant Beam in 2012 for just over €70m.

However, he admits the industry is "a labour of love". "The risk premium attaching to something like whiskey was 30pc per annum. No venture capital company ever came in and supported me, even to this day, no, too risky. VCs have three to five years, the world is not three to five years," Mr Teeling says.

"A very big weakness in the modern world for entrepreneurs is they underestimate the time it will take them to get to positive cash flow.

"The whiskey was an absolute disaster. It was 11 years before we made a profit and 15 years for payback. The best you would get from a VC is five years. Now I look like a guru in whiskey, but it isn't me at all. What happened is, it's you. Young people started to drink brown spirits about 20 years ago and it's gone all over the world. Do you know who drinks Irish whiskey? 22-39 -year-olds - it's fantastic."

Famously, he has never listed any of his companies in Ireland, the reasons for which he is not shy about expressing.

"Institutions never supported me in Ireland - the big investment companies, the insurance companies, the pension funds, things like that. They didn't support what I did, possibly because I never tried to develop a very serious working relationship with them and I always preferred to deal with the London Stock Exchange. So AIM would be where all our 15 companies would be. I never listed one in Ireland. It was expensive and they applied different, stricter regulations."

"I would imagine [the sale of the Irish Stock Exchange to Euronext] will make it more startup-friendly. The future for AIM is not good in London because they are putting more and more regulation on it," he adds. "If you stifle entrepreneurs nothing will happen."

The other great business love of his life is mining, though he admits "it's very high-risk". "All my guys say: "You are still doing it in your 70s or 80s, so you know what you are doing." I haven't a bloody clue! Do you think I know what's three miles under the ground? Sure it won't go where it's supposed to go anyway," Mr Teeling says, gesturing with this hand, "[it] might even come back up again. It's high-risk and high-risk means you have a high risk of loss, not of gain."

"In the resource companies the critical thing is the geology never changes, but you go to high-risk countries because the politicians do. I went to Zimbabwe because [former Zimbabwean leader Robert] Mugabe had to die in 1986, its now 2019 and he hasn't died yet so that wasn't clever," Mr Teeling says. Adding, "We went to Bolivia which worked brilliantly from 1988 to about 2006, but then we were nationalised and thrown out on our heads, but the geology was very good."

In addition, he says mining and oil is industry that is "seriously bad PR".

"When the share goes up it's because we made a good investment decision, when it goes down it's because I'm a crook."

He cites the example of the claim made in Ireland that exploration companies are "stealing our resources".

"What effing resources if you haven't found them? You can't steal something you haven't got, I mean some eejit - and it is an eejit - is going to put $200m to drill a hole in the deep Atlantic."

"Why doesn't the Government put its money into doing it? It's all so self-evident. You have no idea what's underneath the ground, and the only real lie detector is a drill hole, all the other fancy stuff in the world, magic bullets my ass! So it's very exciting," Mr Teeling says.

Why do it then? Why not look at a different sector? Such as property? (Mr Teeling famously has never invested in property down through the years, owning only his house).

"Because one of the greatest experiences is: on the 19th of November 2004 I got a phone call, you don't get this phone call too often, from the worldwide head of exploration for DeBeers," Mr Teeling says.

"He said 'John, they have drilled a good hole in Botswana. I think we might have something there' - there is nothing in the world like that. Nothing in the world like finding something in a drill hole, absolutely, in all the other things I have done. "That became the Lucara mine. It was taken off us eventually in the end, but one of the very best mines in the world.

"We live in hope of the one big hit, [I've had] maybe four hits in 50 years."

The man with business plans for cannabis sector continues to live for that one big hit.