Jeff Shaw claims to have been entrepreneurial since birth. There is no evidence that he tried to rally the other infants around self-cleaning diapers or pacifiers with bling, but he probably could have. When he was in summer camp, he bought a box of Warheads, a popular hard candy, for a couple of dollars and then sold the individual packs for a quarter each. He couldn’t believe all the quarters he’d have at the end of the week.In middle school, Jeff was already developing websites, including one for the Arizona Jewish Theatre at age 12, which he proudly remembers earned him a $100 check. Shortly after, he developed a content website called highschoolhumor.com and then sold it a few years later at a hefty profit. By the time he graduated from the University of Arizona with a degree in entrepreneurial business, he was already well on his way to fulfilling his promise to himself: Never work for someone else.
Jeff next established Arcadia Identification, named for the area of Phoenix in which he grew up. The company created and distributed Internet software to make identity cards and badges for clients such as the U.S. military and major airlines. That company was sold to a Fortune 500 company executive. All well and good, he thought, but for his next project he really wanted to focus on something he was passionate about. That’s when he thought about wine. And he came up with a revolutionary way of connecting folks who love wine with the wines they love.
Undergroundcellar.com is unique. For two years Jeff researched and worked with wineries and web programmers to meld the two components into one creative and exciting new adventure. His research led him to a few conclusions. Wineries really don’t want to discount their wines; they refer to that process as “bastardizing their brand.” Once a wine is known to go on sale, folks will simply wait for the sale and not want to purchase at full price. Wine lovers want to know they’re getting a good wine at a good price; buying directly from a winery is a plus. If there were a way to put all these elements together, Jeff knew he’d have a winner.
So here’s how it works. Customers sign up for free on the website and browse the day’s collections. As one collection sells out, a new collection is added. Each collection includes bottles in a range of prices, but you pay the cost of the lowest-priced bottle in the collection. You can purchase just one bottle or as many as you like. Rather than discounting wines, the site offers random upgrades to higher-priced bottles in the collection. For example, if you buy six bottles from a collection at $15, you could receive three to six upgrades to wines worth $20, $40, $60 or even an occasional $200! The more bottles you purchase in a collection, the more upgrades you receive. The more you interact with the site, the more participation points you accumulate, leading to even more upgrades.
Another plus is that Underground Cellar will store your wines for you in its climate-controlled Cloud Cellar in the Napa Valley. When you want your wine, they will ship the bottles to you for – are you ready? – only $5 for six bottles or a case of 12 for free. During its initial 6-month pilot program, Underground Cellar sold $200,000 worth of wine and now boasts of 47,000 members, with a 5-15% daily growth. After renovations and improvements, the official website launched in March. The company is already so successful that Jeff, now 27, has moved to the San Francisco area, bringing along several of his key employees with him. “I knew I needed to be here, near both the wineries and the Silicon Valley folks. Here, it’s true what they say: you can sometimes make great deals on the backs of napkins.” Jeff and his team work at least 16 hours a day, and he “loves every minute of it!”
Jeff received the basics of his Jewish education at Temple Solel and became a bar mitzvah through Congregation Ruach Hamidbar. But he says it was the Birthright trip he took to Israel in college that really cemented his commitment to Judaism. He had been an occasional attendee at Hillel (“there was this adorable girl there!”) but after the Israel experience, he became vice president, helping to oversee 20 student groups and establishing a calendar of Jewish events.
Jeff credits his early interest in creating computer software to the visits to places like Fry’s Electronics that he’d take with his father, Dr. Lawrence Shaw, a plastic surgeon in north Scottsdale. “At 10 years old, I would get these books and devour them. That’s how I was able to create websites by age 12, and no doubt also the reason I’d get in trouble for staying up so late figuring things out on the computer!”
While Jeff had the expertise in the product, he knew he could use some help in marketing – and he knew just where to turn. Robin Shaw, Jeff ’s mother, had been chair of the Commerce Committee during her four-year stint as an Arizona state legislator. Between that job and her work as a financial planner with Edward Jones for 12 years, “She knew everyone!” Plus she had experience with her own start-up enterprises. Robin was a biology teacher in Tempe when she was informed she would also have to be the cheerleader coach. Though she knew little about cheer, she knew how to fundraise for cheer camp scholarships. She immediately worked a deal with See’s Candies to buy their lollipops for a few cents and then resell them on behalf of the cheer team. Soon other schools were calling her, and before she knew it, she had “a conveyer belt in the living room” of her friends helping her to bag and distribute the candies. Later she worked similarly with “miner’s gold,” the popping corn on the cob, which she sold to grocery stores.
After Robin did some marketing and fundraising for Fife Symington, Arizona’s governor from 1991-1997, she was approached with the idea of serving on the Arizona
Commission on the Arts. She explained she was a scientist, not an artist, but the idea intrigued her. Symington appointed her to the Commission, on which she served several years until she joined the legislature in 1994. Once in the House, she successfully carved out a private/public partnership for the arts known as ArtShare, setting up an endowment to ensure the preservation of arts funding in the state. Robin, an avid AIPAC supporter, is perhaps even better known as the author of Arizona’s “Hate Crimes” bill. To get that legislation passed, she had to do some clever manipulation of procedures and committee work to get the issue brought to the floor for a successful vote.
Robin is now an official member of the team at Underground Cellar. She said she realized early on that Jeff really “knew his stuff.” Jeff says he couldn’t have gotten the business this far without the help of his mom. “We came up here six months ago to do an event, and before I knew it, she had 21 wineries involved. I really know the technical side, but she really knows how to talk to people. It’s a great combo.”With Underground Cellar still in its infancy, for now Jeff is content to spend every waking moment working on the development and growth of the company. But one gets the feeling it won’t be long before he comes up with yet another sparkling adventure.
