If your first encounter with Shane Baker and Pat Heist were to happen in a sports bar, you just might ask them for a menu. Both are so wholly without airs that they’d probably get you one without mentioning neither is a server. Nothing in their appearance provides a clue that they own and operate a pair of multimillion-dollar Danville, Ky., businesses: Wilderness Trail Distillery (WTD) and Ferm Solutions, a technical services consultancy for fermentation and distilling companies.

In real life, these good ol’ boys from Danville are brainiacs in blue jeans and golf shirts, men whose heavy Kentucky accents belie their ability to speak over the heads of most folks.

Heist, for example, is a microbiologist with a PhD—and a six-inch billy goat beard. As the mastermind behind Ferm Solutions’ 450 unique strains of yeast, he leads entertaining tours through Wilderness Trail’s on-site laboratory, pronouncing microbes as “my-krobes” and fermentation as “fur-mun-tAYtion.” One might confuse him for a hick until he drops in some brain-twisting terms that remind you of why he lectures on biology and you don’t. Baker’s no slacker either: a degreed mechanical engineer who’s the master distiller at WTD and the guy who designed the place. Together, they’re a savvy business force that parlayed Ferm Solutions’ successes into a debt-free launch of WTD in 2013.

“We didn’t have to seek third-party capital to open Wilderness Trail, and we wanted to self-fund,” Baker said. “So, we added to our savings every year and strategized to get where we wanted to go. Ferm Solutions allowed us to do all that without debt.”

And seemingly without much sleep. Driven entrepreneurs, and former partners in a rock band, Baker (guitarist) and Heist (singer) spent years building Ferm Solutions into an industry-leading enterprise. Their efforts required years sharing a single car and many hotel rooms while traveling cross-country for three- to four-week spans.

“It’s amazing what you can do working and driving together over the course of a 100-hour week,” Heist said. “In those early days, that’s what it was like, just what it took. … But as we got a lot of experience working with other distilleries, that got us planning our own.”

STRAINS AND GRAINS

Wilderness Trail’s original distillery was set up in a nondescript warehouse where Baker and Heist tested yeast strain performance for fuel and beverage alcohol customers. Working on others’ strains led them to the DNA they later would use in their proprietary yeasts.

“Ferm Solutions sells thousands of tons of yeast every year, so we had a lot of data to draw on,” Heist said. “Our job for our customers was the same for us: to create very-high-quality products that had great yields. … [Ultimately], ours was also about flavors we wanted to create.”

Wanting to make whiskeys that were unmistakably Wilderness Trail’s, the men didn’t source others’ aged whiskey to give their business a quick start, and they wouldn’t sell immature whiskey in a rush to generate income. They made the costly decision to barrel their own rye whiskey, rye bourbon and wheated bourbon and let those liquids age patiently while paying Kentucky’s dizzyingly high whiskey taxes. (NOTE: A small aside about the double standard of alcohol taxation: Fuel alcohol production is identical to beverage alcohol production in that both producers distill cooked grain to capture ethanol. Fuel alcohol producers are taxed $1.50 per proof gallon, while beverage alcohol producers are taxed $27 per proof gallon.)

“Our goal all along was to create and age a very mature product, and then be about five to six years out [with whiskey stocks] before we sold anything,” said Baker. “At least we could sell our [Blue Heron] vodka and [Harvest] rum while we were waiting for the whiskey to mature.”

The men also chose to produce sweet mash whiskeys rather than sour mashed, which is the industry standard for large American distilleries. Sour mashing sees a portion of post-distillation “spent” mash added to each new batch while it ferments. Adding spent mash produces batch-to-batch flavor consistency and adjusts the mash’s pH to promote yeast propagation in new batches. By comparison, sweet mash whiskeys use no spent mash. The result, Baker said, is softer, grain-forward whiskeys. “The true shaping and quality of a flavorful spirit happens pre-distillation,” said Baker. “We understand fermentation really well, and we know that if you produce a beautiful product up front, you’ll have a beautiful product on the back end.”

NOT SMALL FOR LONG

WTD started small, filling about 20 barrels of whiskey a day from a modest still and doubler set. Slowly but surely, full whiskey barrels were rolled inside its first rickhouse, a small structure (by industry standards) with capacity of about 10,000 casks. WTD began as a craft distillery in every sense of the term, but it didn’t stay small for long. A full year before selling their first bottles of rye whiskey in 2018, Baker and Heist committed nearly $10 million toward a much larger still set that would boost production by a factor of 10. Their investment also funded the construction of several 20,000-barrel rickhouses.

“People look at how quickly we grew and ask us, ‘Why didn’t you just start out making 220 barrels a day?’” Heist said. Doing the math on the cost of barrels needed to match the production capacity of its new stills, he added, “We couldn’t afford to spend $40,000 every day on barrels back then, but we can now. We needed to be smart with our cash, reinvest all we could back into the business and pay those taxes.”

For nearly two years, both men poured their WTD salaries back into the distillery. Their spouses invested as well, taking on alternate jobs and cashing in 401(k)s. Baker called their investment strategy the 53g program, which is a nod to the number of gallons held by a standard American whiskey barrel. Going all in with their personal savings turned out to be “the best decision we’ve ever made in our lives,” Baker said.

Though their hours were long and hard, Baker said the similarities between their work for Ferm Solutions’ clients and running WTD allowed them to “grow both businesses in the same conversation. … It was nice not having to overthink the day-to-day operations of either.” Today, Baker devotes 80% of his working hours to WTD while Heist spends 80% of his time on Ferm Solutions. Those remaining 20% slices are used for catching up on the performance of both businesses.

SWEET MASH FEED: CATTLE APPROVED

As lifelong locals, both wanted to support businesses and farms in and around Danville. Of the corn, wheat, barley and rye milled daily on site, only barley is trucked in from northern states where it thrives in cooler weather. In the beginning, WTD cooked 800 pounds of grain daily, but now it cooks 160,000 pounds a day. As a producer of more than 2 million proof gallons of spirits annually, WTD ranks among the state’s top 15 distilleries.

“We’ve always wanted to help the community grow with us,” Heist said. “Over the seven years Wilderness Trail has been in business, we’re still using the same local businesses. Caverndale Farms provides all our corn and wheat, and some rye, and Walnut Grove Farms [in Adairville] also provides us rye.” Heist said that designing a completely new distillery allowed him and Baker to choose modern equipment and create strategies that minimized energy consumption. Getting grains locally reduces transportation distances and it shortens trips for farmers picking up spent stillage to feed their cattle. In recent years, 15 semi-trucks were required to carry away a day’s spent stillage (essentially thin porridge of cooked grain and water). But using a first-of-its-kind dewatering system, only six trucks daily are required now to haul away the stillage. The water extracted from it is reclaimed onsite via reverse osmosis and reused throughout the distillery.

“It’s much more environmentally sound since we reduce our carbon footprint and create a higher-value product in our stillage,” said Baker. Farm soil runoff resulting from the wasted excess water also is reduced. “We can produce more whiskey without using more resources, and the technology allowed us to move to 24-7 production.” Farmers claim their animals not only prefer sweet mash stillage, they can tell which cows prefer wheated stillage vs. rye stillage.

“Like bourbon drinkers, some are wheaters, some like high rye,” Heist joked. Spent stillage makes up about 35% of those cows’ diets, he added. “We call any alcohol that winds up in the [stillage feed]—which is zero, by the way—the Angus share.” *Note: The portion of every barrel of whiskey lost to evaporation during the aging process has long been known as “the angels’ share.”

In addition to its flavor-enhancing benefits, Baker said sweet mashing has taught them more energy-efficient ways to cook grain mashes. WTD’s proprietary “infusion mashing” process heats the mash just enough to gelatinize grain starches (which assists their conversion to sugars that feed the yeast which convert it to alcohol) without degrading their taste. The result is a rounder distillate that complements the company’s proprietary yeast strains. Those energy-saving efforts are also shared with Ferm Solutions’ clients.

“All these enhanced cooking techniques have helped people save money on electricity just by adjusting how they heat and cool their mash,” Baker said. “There are a lot of savings to be had as we improve our own operations, and we enjoy sharing those with others in the industry.”

ENTREPRENEUR AWARD
 

In October, Wilderness Trail Distillery founders Shane Baker and Pat Heist received the Entrepreneur of the Year 2020 East Central Award from Ernst & Young LLP. Nominees were evaluated on the following criteria: overcoming adversity; financial performance; societal impact and commitment to building a values-based company; innovation; and talent management. As an East Central award winner, Baker and Heist are eligible for the Entrepreneur of the Year 2020 National Awards, which had not been announced as of press time. 

www.WildernessTrailDistillery.com
4095 Lebanon Rd.
Danville, KY 40422