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The Evolution of Cannabis Cultivation Technology

The Evolution of Cannabis Cultivation Technology

cannabis cultivation technology for monitoring a cannabis grow

Remember when your only grow schedule was in a tattered notebook?

Who are we kidding, half of us still do it that way! But the truth is that cannabis cultivation technology has advanced exponentially just in the last 5 years.

Controllers that can monitor and alert you when CO2 levels or temperature gets too high or low, irrigation feeding systems set on timers so you never have to worry about feeding on time, and more. But what about one application that can monitor all of it?

That’s where Trym comes in.

Trym is the brainchild of Matt Mayberry, a homegrower who began to notice a lack of software services designed specifically for aiding cannabis growers. He noticed that there were individual products for monitoring your team, environmental conditions, and regulatory compliance, but not one single product that could do it all.

Matt set out with the goal of simplifying the grower’s life with easy to use cannabis cultivation technology software, and Trym does just that. Trym software is helping to manage more than one million square feet of cultivation space. Designed in collaboration with valuable farming partners, integrated with numerous solutions to help cultivators run their businesses better and keep them inspired to grow smarter every day.

As the industry evolves, so do growers and the cannabis cultivation technology they use. Trym continues to evolve with them through collaborative efforts and essential customer feedback that helps shape the future of the app.

In this episode, Chip sits down with Matt to talk about the inception of Trym, the services that they offer for cannabis growers and cultivators, and the continuous evolution of cannabis cultivation technology!

Transcript

Chip: Hey! This is Chip with The Real Dirt. Thanks for joining us today. Today I’m in my newest of new podcast studios. Yes, there’s quite an echoey sound in here. And we’re going to turn this into the new Oklahoma City podcast studio. So look forward to many, many episodes here. You’re gonna have people from all over the country, and all over the world to guest here at The Real Dirt. Hey, I want to thank you for joining me today. And if you haven’t, please go to iTunes or Spotify, and subscribe to The Real Dirt podcast. Please join us on Facebook and Instagram. And, you know, if you need any hydroponic, or indoor, or outdoor growing materials, please contact us at cultivatecolorado.com, cultivateokc.com, and if you’re using soil or soilless medium, Growers Soil is what you should use. So without further ado, on today’s episode, we have Matt Mayberry. We’re going to talk about software and how it relates to the cannabis industry. So sit back, fire one up and enjoy this episode of The Real Dirt.

 

Chip: Hey, Matt. Chip here. How you doing?

 

Matt: Good. How are you?

 

Chip: Oh man, I’m doing great. It’s starting to be nice and fall weather over here in Oklahoma. Wait, where am I talking to you, are you in California someplace?

 

Matt: Yeah, we’re just north of San Francisco in Marin County. 

 

Chip: Oh, man. I was just over there up in Humboldt. Rough fires, dude. 

 

Matt: Oh, man. It’s crazy. Yeah, this summer, it’s definitely been a strange one. We left California actually, when the smoke got really bad here. The fires weren’t very close to [inaudible 1:48] for us so far. Well, I guess my definition of close has gotten a lot different over the last few years, but we didn’t have any, like imminent fires like that were in our town, that were, that were meaningful in any kind of way. But the smoke is really bad, so we took off the Oregon to get away from the smoke. And then the fire solid is up there basically, the smoke got really bad up there. Stayed there for a few weeks and we decided to come back down here.

 

Chip: Yes, right. We had a podcast scheduled and you had to postpone it, because you were fleeing from the smoke.

 

Matt: Yeah, it’s been a wild one. So I’m glad we finally did it. And we got this thing on the books.

 

Chip: Yeah, man. Thanks for joining me, man. So Matt, you know, technology is now like, and it’s starting to be so much part of everyday life. And the cannabis industry is no different. No matter if it is hemp, or ganja, or medical marijuana, we’re all using technology in and Matt, tell us a little bit about what you do.

 

Matt: Yeah. So I’m Matt Mayberry. I’m the cofounder and CEO of a company called Trym, and we build farm management software for commercial cannabis cultivators. And ultimately, what we do is we help growers better manage their operation, and manage their team, and then also help scale their business so they can be successful.

 

Chip: Yeah, you know, farm management software is something that industrial agriculture has been using. I mean, it’s probably one of the first things that happened with the computer, right? It’s to figure out how to count how many pigs or chickens that you got. But the industry really has been dominated by some major, major industrial, agricultural players. And there haven’t been too many people like yourself to want to come in, you know, to the farm management side. Man, what gave you the idea to do this?

 

Matt: Yeah, so I started out my journey in cannabis, I guess when I was about 17 years old in North Carolina. You know, I was smoking cannabis recreationally with my friends and – 

 

Chip: Mothership, you were were smoking Mothership over there?

 

Matt: I don’t know. We did not have the quality of products that we have these days [inaudible 3:54].

 

Chip: So, okay, famous weed strain from from my past, Mothership.

 

Matt: Okay, nice. 

 

Chip: Asheville, North Carolina. 

 

Matt: Okay, cool. I wonder if that has a parliament funkadelic influence.

 

Chip: Asheville’s the center of music in the south, you know.

 

Matt: Oh, yeah, absolutely. Yeah, I got my first degree at Appalachian State in North Carolina, which is like about an hour away from Asheville. So, spent a lot of time in the mountains of North Carolina. But yeah, so I mean, when I was a teenager, I was riding around my friends. We were smoking cannabis, and I really enjoyed it. And I was always been, you know, I’ve got two different engineering degrees. I’ve always been kind of a tinkerer. And so that started at a very young age. So I decided to try and see if I could grow the stuff myself. Got a little bit better, go into App State, met some other growers there. When I graduated, I went into tech and I didn’t, I didn’t grow commercially. Kind of still home growing though, and I had kept my eye on the industry. I had a lot of friends that are in the industry. I still have a lot of friends that are growers, some of them from back in North Carolina. When Prop 64 passed, essentially, I started looking at the industry more seriously as a career more than just something that I did in my free time. And so, started looking at the space. And given my experience in cultivation, I say that in a very humble way, my experience in cultivation is much different than a lot of our customers. You know, I don’t grow product that looks like what our customers grow, but with my interest, and mild experience in cultivation, I decided to take a look at the space. And me and my cofounders felt really comfortable with cultivation. Benjamin, who’s one of our cofounders, actually he used to work on the commercial farm off in Mendocino. And then he was an electrical engineer at a company that he and I used to work at. And my wife, Karen is our third cofounder, and she was part of my experiments in home growing here, once we moved to California. So we all three had experience with the plant. And we started looking at when Prop 64 passed with the lens of how can we apply the experience that we have in technology, and apply it to the cultivation space. So really, we just started poking around and grows, trying to find like, what was going on at these farms, and how people were currently managing things, and seeing if there was a place to actually apply some additional technology in one way or the other, whether it was hardware or software to make their lives easier. And what we found was that as far as the record keeping went and the management of the farm went, really the most sophisticated technology was whiteboards, and Excel spreadsheets, and notebooks. And in I guess, the regulated markets that currently had that kind of compliance element as well, they had software that was provided by the state that most of the growers didn’t like. So we started thinking, you know, it looks like there’s a pretty big opportunity here, but let’s figure out what that is. And so then we just started to iterate on releasing small amounts of product and working with the farms that we had pretty good connections with, to try and see if that was something that would be valuable to them. And eventually, we ended up with a product and started selling it to people.

 

Chip: So you’re homegrown.

 

Matt: Yeah, I mean, I –

 

Chip: Yeah, you’re homegrown, you know.  You know, I kind of put, I put people into two basic categories in the weed industry.  There are the pink shirts, and there’s the homegrown, right? And the homegrown people are people who’ve been growing, you know, cannabis for themselves, you know, and the people around them were started out that way, right? They had this desire to like, “Hey, I want to help, you know, cultivate cannabis.” And the pink shirts are generally the people that want to cultivate the business of cannabis. They both intermesh and, you know, I lovingly say the term pink shirts, because several of them work with me. But like, they come from the business side, and often not from the homegrown or from the cannabis side. Now, almost every other tech person I have talked to were pink shirts. They wanted to bring some business side to it. Did you have like, a problem that you wanted to solve? You know, ’cause like, you’re looking at, you’re growing, you’re seeing what people are like, is there a number one like, oh, man, nobody’s taken advantage of nobody’s doing this.

 

Matt: Yeah. So what we found when we started talking to growers was that they have really a multitude of different problems that they face every day. And in order to solve those, they’re either using manual processes, or they were using multiple different pieces of software to do that. So scheduling out a batch of plants from seed all the way through to harvest. And people are using things like Google Calendar, or those like paper calendars that you buy at Staples, and they’re mapping everything out. And they’re either mounting them into grow, or they’re sharing that calendar with their employees. And then, the compliance element of it, that they were usually using their notebooks and Excel to track all the compliance reportable events, and then handing that over to a compliance manager that would then put all that into the state system, and report it to the regulators. And so the other thing was, you need to know what’s going on in your grow, you need to know what the conditions are, you need to know what happened last week. And if you don’t know what’s happening right now, if the lights go out, you need to know that. And there were people basically, putting together like, there were some people that we talked to that were putting together their own systems for like, thermal shut off where you know, if their air conditioner went out, they would turn off some of the lights. And they were kind of rigging a lot of this stuff themselves. There’s stem systems that were out there that were doing some more advanced control,  somewhere out of people’s price ranges, or some just didn’t have access to those types of systems, I guess at the time. But, we just saw there were a lot of different problems that a lot of people were putting together, you know, they say innovation is born out of necessity, right? There was a lot of, kind of, micro-innovation in all of these grows, where people were solving the problems that they had. And we were able to kind of look at all those problems, and then think about, alright with our, so my background was I worked in hardware, software, and firmware. Benjamin who is our business partner has worked in hardware, software to a degree, and firmware. And Karen, our third cofounder, she is basically all things customer facing, marketing, and revenue, that kind of thing. So when we started looking at how can we apply what we know to these, we were able to look at the multitude of problems that people had and kind of figure out what that solution was. And what we saw is that there was really no software that was built specifically for cannabis cultivators. So you mentioned earlier in this call, that there’s all these systems that exist for broader ag, and that’s true. But the reality is, a lot of those systems were built for like row crops in Iowa. And farming –

 

Chip: Yeah sure.

 

Matt: 20,000 acres in Iowa is a lot different than growing like, five warehouses in Oakland. It’s – 

 

Chip: And most of it is animal husbandry, or a lot of it, animal husbandry.

 

Matt: Yep, exactly. There’s a ton of that, and a lot of row crops have to, where they’re using like, satellite imagery to detect like, pathogens, or water necessities, and things like that. So, what we did is we actually took a lot of lessons from, we explored the farm management space. We looked at what a lot of those companies were doing for large scale commercial agriculture. And we looked at cannabis, and we saw kind of where the gaps were. A surprise kind of insight was we, we said, “There’s not really anything that’s specifically built for cannabis growers.” And with my experience in software, I’d seen there were restaurant softwares, and there were dental office softwares, and things like this, and everything was built, you know, with the idea that you can do everything that you need to do on a daily basis in those softwares. And so, we kind of took some lessons from those as well, and set out to build a software that would cover all of the major aspects of a cultivator’s business. And those, I kind of generically put those into three different categories. One is managing your team, the other is managing the environmental conditions, or monitoring at least the environment conditions in your facility. And then, the third is your regulatory compliance. So those are probably the three biggest challenges that people face every day. Creating groups of plants, tracking the activities that need to occur on those groups of plants, knowing what conditions they were exposed to, and then reporting all of that to the state. So that was really the problem that we set out to solve, was kind of simplifying the growers life and allowing them to really focus on what they do best, which is growing really high quality product.  And ultimately growing better product as a result of not having to worry about a lot of the other nuances that affect them on a daily basis.

 

Chip: Yes, man, so many states like Colorado, and California, and Nevada, they’re just so complex about their tracking. And man, then there’s you know, there’s some things about California that’s really nice about their harvesting, their batching. Where Colorado, it’s like, “Wow, you got to weigh it all. You have to track it all,” like Colorado is, in my opinion, has one of the best programs, because you do have to track so much of it, but it’s not ridiculous, like maybe Nevada is. You know, it’s tough out there, man. It’s really hard for new cannabis operators or experienced operators to really keep up with it all, right? You like, literally have to have some sort of technology now. It’s not just growing plants.

 

Matt: Yeah, I mean, the legal market invented a new role in a cannabis cultivation facility, which is the  compliance manager. You know, before regulation, there was no compliance, because there, you know, everything was –

 

Chip: It was like, “Oh man, is this good? This is good, bro! I like this one.”

 

Matt: In addition to the compliance element that comes with the regulated market, it’s also that there’s now this kind of quality expectation with brands where you put out a product and you say, you know, this is a pretty good cultivar, I’m branding it with my farm. And then, the consumer tries that, they like it, they go back to the store, they want more of it, or they get it delivered or whatever. If it’s not the same experience, then you might lose that customer. And so, there’s experience, expectation, and potency expectation, and kind of brand image all kind of encompasses all of that now. And that’s a really new thing that we really didn’t have in the legacy market. You know, it was you knew, so and so down the street had the fire Sour D, but you didn’t necessarily like, expect that every time you got that Sour D, it was gonna be the exact same or what have you. And so we’ve kind of created this machine to the industry that has also led to a lot of changes beyond just reporting to the state for compliance. It’s also like, developing standard operating procedures that are unique to different cultivars and things like that. And I think that’s a really exciting evolution, because it’s what you see in like, wine and spirits, and what you see when, you know, you look at other industries. You know, you kind of have a recognition of the brand, and you expect certain things from them. 

 

Chip: I mean, you kind of gotta be feeling like the, when you go and talk to some of these cultivators, like you know, you’re introducing the you know, the Ford Raptor, and they’re still on the like, donkey and car type scenario, right? Because I mean, ganja farmers, they’re like, salt of the earth, right? Like, most of them, the older school ones, you know, this isn’t what they’re interested in. Do you have like, I don’t know, it’s almost a cultural like difference to be able to talk to people in that manner. Do you see that?

 

Matt: Yeah, I’d say it’s a mix in the industry. You know, we’ve got some growers that know they want something, but don’t know exactly what it is. And they meet with us to kind of see if we’re at, and then some cases we are, and in other cases, you know, like you said, they might say, “Well, this is not necessarily what we’re looking for.” But for the ones that get it, some of our larger customers are actually telling us what they need still. You know, we started out very much customer centric, focus on what the growers needs are and figuring out like, here’s what their problem is, here’s what the ultimate need is, let’s figure out a solution to that, working really hand in hand with them. And we still have that to this day, like, a lot of our new feature development comes directly from growers saying, you know, “This is now really important in my business, can you help me figure out how to solve this?” And as the industry evolves, our customers are evolving, and our software platform needs to evolve to keep pace with them, as well, because there are a lot of –

 

Chip: And do you have an example?

 

Matt: – the customers.

 

Chip: Example of one of those customer changes or customer like, developments you mean? Customer based research?

 

Matt: Yeah, I mean like, almost every feature in the app, I’d say. But I’ll give you a couple of examples. 

 

Chip: So I mean, you talked heavily to people about what’s going on, this isn’t just your ideas?

 

Matt: We would not be anywhere without the guidance from our customers, you know.  What we try to do is spend as much, I mean, ultimately, all the way down to our head of engineering, actually, right now on this call, our head of engineering is covering a customer meeting for me. And he’s meeting with a large client that we’re trying to close, and working with them to figure out how we need to make some adjustments to be able to deploy our software across their portfolio facilities that they have. So all the way down to like, the engineering level, we have people talking to our customers, because if you don’t understand the problem that the grower has, then you’re not going to be able to build software that’s going to solve that problem. And so, from our customer support to our marketing, to our engineering team, to myself, you know, we spend an immense amount of time talking to our customers. But a great example is when we first launched, we had a mobile app only. And it worked well for some of our really early customers, we had basically the ability to monitor environmental sensors like temp, humidity, co2, in the rooms. You could create groups of plants and assign them to those rooms, and then track them on the way and harvest them. And then you could also assign tasks to those groups of plants, so that your team could execute them all from the mobile app. And we started out very much mobile focused because the farms that we were working with at the scale that they were at, basically, a lot of them didn’t even [inaudible 16:56] in the facility. It had to be on mobile. So then we started working, honestly, we probably want a deal that was, we were way over our skis on and we probably shouldn’t be one, but we want it. And yeah, one day, they immediately said, “This is great. We like what you’re doing for the team. But you know, managers, we really need a web based application. And we got to be able to map things out like we do on this current calendar that we’re using. And we need to be able to plan out months or even harvests in advance.” And so working really closely with them, we built out that functionality. And now it’s probably like the most popular feature in our app is this like, that this kind of concept of task planning for your team. And I mean, literally, we just did a survey not too long ago, it was one of the more popular features that we have. So I mentioned cultivation earlier in the call. I’ve grown but I’ve never grown at the scale that these guys are growing, and I’ve never produced product that was anywhere close to it. So these guys are great. So, humility is a really important thing, being humble at what you’re good at, and recognizing where other people have expertise that you don’t have. And these growers know their craft inside and out. And you know, I think we know tech and software inside and out. But you gotta we got to listen to those that really know what they need. And that’s the way we were able to really build solid features that actually match their expectations.

 

Chip: I’ve said this over and over again. And it’s my number one encouragement or advice that I give people is, growing cannabis on a small scale or large scale is more about logistics and movement of materials and people, right? Like, you know, there is a certain magic and magical moment that happens when you cultivate cannabis. But especially on a commercial scale, the logistics associated with it all, you know,  you have to be detail-oriented, if you want to be successful and on, and  the cannabis to look the same brandable, you know, be it the same high quality, or similar every single time. It’s more than just talking to your plants, right?

 

Matt: Yeah, absolutely. That’s a hundred percent right. Another example of a feature that we built in collaboration with customers is actually very much in line with what you’re talking about here. So, after we built out that task calendar, we had some customers saying, you know, “I’ve got, you know, 22,000 plants that I’m managing in this cultivation facility, and I’ve got a team of, you know, 30 people that work here every day. And I have to coordinate all of them on these plants. And I have to grow these plants in the exact same way every time. So I really need a way to repeat that process for groups of plants, and be able to basically like when I create a group of plants, we already know exactly what needs to happen on it all the way through from when I initially cut the clones, and plug them all the way through when we’re harvesting and hanging. We came up with this idea of a workflow. So, a workflow is just a series of tasks that need to occur on any group of plants. And you can create as many workflows as you want. So you can have one for each strain, you could have one for for different cultivation styles. Maybe you’ve got one farm that’s greenhouse, you got another one that’s indoor, one that’s outdoor, you can have different workflows that apply to those. Or maybe you’re testing out like, rock wool and cocoa together. You can have different workflows for those. And then when you create a group of plants, you just assign this workflow, and it’ll automatically populate your calendar with all the tasks that need to happen for that group of plants. So 100% agree with you with the inventory and team management problem being one of the major things that the growers have to overcome. You know, the art of growing cannabis is in itself a full time job, you know, to really figure out exactly what your plants need, and what you need to do, and then to coordinate that across, I mean, some of these farms that we’re working with are like, measured in miles almost, right? They’re like 400,000 square feet cultivation facilities. When you’re talking about growing at that scale, you really need to have really strong processes in place in order to manage effectively. And to get the same output that you’re expecting every time. Labor is the number one operational expense, at least here in California this is true.

 

Chip: Everywhere, you know, and you just can’t be, some things just can’t be automated, just like the grape industry. So much of the you know, grape industry is still hand labored, still handpicked, still hand trimmed, you know, it’s a part of it.

 

Matt: So take that, and then imagine that you had to tag each individual grapevine with a barcode, and you had to know what grape came from each vine. 

 

Chip: Yeah, God. Right? Yeah, I mean, this is literally, do you have a statistic on how much compliance costs and labor?

 

Matt: I mean, I’ve heard numbers as high as like 30% increase in labor. 

 

Chip: Yeah, it’s 30%.

 

Matt: That’s coming from older markets in California, because California is still pretty new in the compliance area. But like Colorado, and Oregon, I’ve heard, it adds 30%, to just everything that we do, when it comes from, you know, planting all the way through, I mean, harvesting is probably the most laborious part of cultivating at this point, because you do have to weigh every plant. And a lot of these regulations, it’s pretty clear that whoever wrote them, either didn’t consult extensively with growers about it, or ignored grower advice, because there’s a lot of things that add a ton of additional expense to the industry. And ultimately in time, that doesn’t, in my opinion, add a lot of additional value, but.

 

Chip : I’ve been in on those rule defining conversations with legislators and, man, it just it, you know, they’ve got this certain perception of public safety that they need to meet. And it kind of, that trumps everything. So even though we know that cannabis as a plant is pretty much harmless, right? They have to have this like allure that they’re protecting, you know, the public from it. And that’s why you get, you know, these weird laws, right?

 

Matt: Yeah, I mean, I’ve seen, especially like, I’ve seen it, you know, the distance to school thing. It’s like you can, in some areas, I’ve seen schools that are down the street from a 7-11 where you can buy alcohol. Or down from, you know, a big box store where you can buy hunting rifles, but no, you can’t have them. Cannabis store or anywhere close to that where they actually have a bouncer at the door that checks your ID to make sure you can come in there. You know, it’s pretty ridiculous, some of the things that we see. But I, yeah, I get it. The public fear that started at the beginning of the 20th century in this country, and continues all the way now to this day, I think is, is one of the biggest things as an industry that we have to overcome. You know, the federal perception is one thing, and the federal legality is one thing, but the public perception is a whole another mess. 

 

Chip: Interesting how in California has the oldest history of cannabis in the country, right? I mean, I know people were growing cannabis all over, but California’s got one of the oldest histories. And there’s all this preconceived information and leftover PTSD on both sides of the fence. And, you know, I was just there, I’m dealing with a cannabis license up in Humboldt. And you know, there’s so many concerns people have that are just leftover with historic stuff that doesn’t occur anymore, and it might not have ever occurred. But like, you know, just the like, the preconceived notion that cannabis farmers you know, don’t care about the environment, or polluters are trash, or you know,  other places like say, Oklahoma where I’m at right now. I’m targetting my former city. Like, people are so open to cannabis here and they’re really interested in it in a way that like, I don’t see it in California, righ? It’s really, really strange man. You know that, you think that a state that has so much history with it and people who actively voted for it right, and you know, and smoke weed at night, or at home on the weekends. Just the conversations they have as they’re against cannabis and cannabis production because the myths you know, of system abuse.

 

Matt: Yeah, I mean even the county that I’m in here, there’s no storefronts where you can buy it. We have delivery services, but you know – 

 

Chip: In Marin County?

 

Matt: Marin County, yeah.

 

Chip: Home of the Grateful Dead, right?

 

Matt: Yeah. Home after they got busted, right. Over selling at San Francisco and then –

 

Chip: Safehouse.

 

Matt: Yeah, we had a little stint in LA where they were manufacturing LSD and then they came back, and they all landed in Marin Country. And ultimately that’s where Jerry died since the beach but yeah, that’s where Bobby still lives. And Phil Spot and Sandra Fells.

 

Chip: I mean, isn’t that ridiculous? Like, I mean, The Grateful Dead really did like, define so much like street level cannabis dealing and like help, you know, find cannabis travel throughout the country, right? It’s so many. That’s the first time so many people got exposed to high end cannabis, is going to dead shows. 

 

Matt: Yeah. True story.

 

Chip: Anyway, man, thank you. My cannabis licenses is in Humboldt. And they’re the hardest, it is so hard to get a cultivation license in the county of Humboldt. They’ve just regulated it, and restricted it, and zoned, it’s pretty much to death. It’s just nuts, but like used to be like, where all the weed came from, right?

 

Matt: Yeah, for sure. Yeah, I don’t know, it’s, it’s interesting. I’ve heard plenty of stories of people that have attempted to get licensed in California that were coming from the legacy market. That for whatever reason, you know, either they had a hard time getting a license, and they had challenges with their facility, they’ve just decided not to, some have remained in the legacy market. And others have moved to other states to try and, you know, give it a go in some of the newer markets that, depending on which market you’re talking about, in some cases, like Oklahoma’s a good example, it’s much easier to, from a licensing perspective to start an operation there that it is in California. It doesn’t necessarily mean that it’s any easier from a building a facility, and designing it, and actually running it. But you know, when it comes to licensing there, there are some newer markets that are a lot more liberal with their their kind of allocation of licenses and things like that.

 

Chip: You know, the limited liability, or the limited license states like Missouri, and Arkansas, and Georgia and Florida, you know, they make it a little bit different, because there’s no application process. And it’s not quite the same over there. Usually, when there’s a limited liability state, there’s no legacy people evolved into into it at all. Right, or like somebody on the board, or some other like. billion dollar group of people would come in to like, try to get a license. Because that’s what it takes, man, right? Like, it takes millions of dollars to get a license in one of those exclusive states.

 

Matt: It’s like that in some parts of California to where maybe not the millions of dollars, but there’s like a whole side of the industry right now, which is like license application writing, right? Where you have to, like, say the right things and portray yourself the right way in order to kind of, especially when it comes to storefront, you know, dispensers are I think especially a really coveted areas are much more challenging thing. But yeah, there’s –

 

Chip: In Oklahoma, one of my favorite customers is Danky McNuggets. Yeah. But when you’re writing an application, like you have to, you know, have a, it can’t be fun like that. It can’t be the Cheech and Chong show so much anymore. It’s like, “Oh, we’re growing and building a sustainable cannabis operation. And we’re gonna give back to the community and healthy harvests friendly cannabis shop,” you know, ends up being the name, right? And that’s why so many of the names are so, you can’t remember anybody’s name, right? Because they’re all like, you know, something THC related, but like, you know, Co-Op, or I don’t know, that whole weird thing that’s happened with cannabis has like, definitely decreased the culture of it all when we used to go and buy it on people’s couches.

 

Matt: Oh, man, I still trip out when I drive through Oakland and I see the billboards like, on the interstate. Because I’m just like, you know. Did you grow up in Oklahoma?

 

Chip: No, no, I grew up in Georgia. I moved to California when I was like, in my early 20s.

 

Matt: Alright, so I have a similar story, but grew up in North Carolina. And so like, I remember having conversations with my parents, and they were like, I was like, “This stuff’s gonna be legal there!” And they were like, “Bullshit.”

 

Chip: It’s federally legal now.

 

Matt: So but now, I’m driving down the interstate, you can you know, you see it advertised on the interstate in Oakland. And that’s just a really awesome experience, to see the evolution and, you know, we have these kind of, I guess, high-end problems now that we’re talking about, of, you know, the way that they’re regulating it. But the fact that it is regulated in a positive way is a really amazing thing.

 

Chip: We got to complain a little bit, you know, I mean, checks and balances of it all. And, you know, the way we of course, cannabis people win is by like, “Hey, let’s get some software to track the growth in the way to the plant all the way through. So if anybody like questions where my cannabis went, I’ve got the data that shows exactly where it went.” That’s kind of the beauty of it. That’s how we get the win, right? That’s how we get to grow. It’s like, “Oh, we just track it. Oh, sure. I’ll do that. Oh, I’ll have a fence. Oh, sure I’ll be far enough away from people.” And you know we just comply, just you know, compliance. That’s exactly what that means, is we’re not trying to fight it, right? We’re just going to comply. “Okay, whatever you want. We’ll do it,” you know, and keep getting to grow more weed.

 

Matt: Yep, absolutely. We’re happy to help.

 

Chip: So man, you get to talk to just a lot of great people, I’m sure. You’re primarily in California, but do you go other, you know, other places?

 

Matt: Yeah. So we’re actually in 14 different states. We focused on California, because that’s where the bulk of the team is here. And it’s really where we have probably the majority of our connections. But, you know, we do have customers in Colorado, and Oregon, and Oklahoma, and Massachusetts, Maine, Actually just recently got our first customer out in Hawaii. So yeah, we’re all over the place, Indiana, Pennsylvania. 

 

Chip: And you work in hemp, as well as in ganja, and medical marijuana as well.

 

Matt: Yeah, we just recently started bringing on some hemp farms. The compliance piece is obviously not really a major factor there. But the farm management work that we’re doing is really helpful there. So it’s been interesting evolution of the product, I’d say, to see that we have customers outside of cannabis that are using us. 

 

Chip: When you’re talking to your hemp customers. I mean, they’re more like traditional row crop farmers. Where the ganja customers, the medical cannabis customers, it’s more like a nursery style type of operation. How do you handle that with your software?

 

Matt: Yeah, it’s interesting. A lot of the hemp farms that we work with actually are similar to the anecdote that I gave earlier, which was a lot of growers in California that, you know, for whatever reason, were having challenges getting licensed or whatever, they move to other states to give it a go there. So a lot of the hemp farmers that we know are actually people that started out in like, medical cannabis states, and then moved to either, move back home to like Tennessee or South Carolina, or somewhere like that to start doing hemp. And the interesting thing is, I think a lot of the hemp farmers are establishing themselves in markets where they believe legalization will happen soon. And then, they’ve already got the infrastructure built up so that when licensing becomes available, they can get their cannabis license, and be ready to drop the cannabis license. So we focus mostly on high-end smokable flower hemp, because it is so similar to cannabis, aand it works really well for the software that we built out. The other aspect of the industry that’s moving towards the like, massive row crop outdoor hemp, that hasn’t really been something that we’ve addressed yet. But we do have aspirations to do that over time. Now, we just need to, I think, make some slight adjustments to be the ideal solution for that type of cultivation.

 

Chip: Yeah, no, I get it. It was, you know, my first thought. And yeah, this year, we just saw the industrialization of hemp, and when incurred with that, the glut in the marketplace, the development of machinery. But yeah, you know, they don’t, it’s not as regulated here as much as ganja and medical marijuana is, but you still need all the stats. You still need to know what grows where, you still need to know your water consumption, you know? So are you guys integrating any like, drone technology or satellite technology? You’ve kind of mentioned those before.

 

Matt: Um, no, we’re currently we’re integrated with like, environmental control systems. So things like troll master, agricultural type of aeration controls, things like that, as well as Argus controls out of Canada. Their industrial environmental control systems, we’re able to pull data in from those systems, and then represent that in our system. We’re looking at some other environmental control integrations as well. And then, obviously, we’re integrated with Metrc. And also we’re looking at some complimentary software systems now to integrate with as well. 

 

Chip: So like, Link4 or Privo, something like that?

 

Matt: Yeah, those are, those are the types of companies for sure, that are on our integration list. We’re mostly indoor and greenhouse, although we do have some outdoor farms that are on the platform. There are indoor trained drones, we have not specifically started working with those yet. That plus, there’s a lot of like imagery technology that’s out there, that I think is still maturing. But, they’re using machine learning, and imagery to essentially identify like, pathogens or pests, or things like that on plants. And so, I think as the industry continues to evolve, those technologies will also evolve. And if it seems like that’s a need that our customers have, then we’ll look to integrate those types of technologies at the point where it seems like it’s sufficiently developed and would solve problems for our growers.

 

Chip: Yeah, absolutely, man. I mean, it seems like everything’s coming with a data port these days, you know, and sensors, you know, are soon to be on everything. I mean, I’m surprised that like, we don’t have sensors on our lights for temperature or par. And, I mean, it seems like they’re already, it’s just not too complicated to put it in there. Maybe should somebody get the idea. Hey, give me 1% for this idea, there’s a par reader on your lamp out there, send me one lamp anyway that reads par, I only need one. But you know, but you know what I’m saying? It’s like, the integration of all this is all just phase and a half. And I mean, it’s just happened with, like the GPS and satellites have just started to happen with tractors. And even though we’ve been talking about GPS and satellites for years, but it’s taken such a long time. And like, now I’m out here in Oklahoma, this turnpike they’re building. I saw this one guy was driving one tractor, and then there were other two graders right behind him that were totally empty, right? And they’re just, you know, following his GPS, you know, he’s controlling them.

 

Matt: Wow.

 

Chip: Yeah, yes. It’s totally crazy, man.

 

Matt: It’s a drone tractor.

 

Chip: Yeah, drone tactor.

 

Matt: That’s pretty amazing.

 

Chip: Yeah, the technology is everywhere, you know what I mean? The most expensive thing with cannabis is labor, like you said, to be able to automate any point. But then, you also have to, like read the data, right? Like, you know, just because you know, you’re shoving all your weed in your automatic harvesting machine, and it sorts the nuggets, and pushes the big leaf to one side, the small leaf to the other side, the eighth nuggets this way, the pound nuggets this way, you still need the data from it all.

 

Matt: Yeah, absolutely. I think when we started Trym, we thought it would be really great if we could Google set out the catalog the world’s data. I think, you know, you could say we set out to catalog the cannabis cultivation industry’s data, right? We didn’t actually set out to do it at the industry scale, though. We started out to do it at the grower scale, where we could actually catalog out their data, and then they can look back on it, and reflect on it, and figure out how to make improvements. Because ultimately, you and I can both be growing like you know Mac. We can both be growing a strain. And your version of Mac might be different than mine, right? Because like, we think it’s the same cut. But ultimately, it may not be, and I mean, there’s been obviously a lot of efforts to try and make, to try and identify those similarities. But knowing that I’ve seen one of my friend’s Gorilla Glue, I’ve seen  the other one’s Gorilla Glue, and they look fundamentally different. It’s like, something happened along the line, and maybe [inaudible 37:01], or whatever. But also like, we don’t track everything, right? So these outside influences around like, how tight is the envelope of the room, and that kind of thing. So yeah, we have the inputs, but we don’t know every, we haven’t characterized every element of every room. So we think we’re you know, the kind of similarities across different growers make a challenge with the differences of their grow environment, the differences of their strains, make it difficult I think, to really create this whole industry wide, perfect model of what’s the best way to grow cannabis. But what we can do, I think, is provide growers along the way, as we continue to get better about how we make it really easy to track data, we can make it really easy to provide recommendations to growers on how to make improvement. Like hey, you know, normally when you run your Alien Cookies in room three, you keep it 73 degrees, and you get this output. You’re running at 75 degrees on average, you know, if we could drop that back down, then you might get x percent more output.  You know, those are the types of things along the way that I think we should be able to provide, becauseyou know, you can already provide those types of assertions, and a lot of, there’s a lot of technology to provide those types of assertions in other industries. You know around like, turbine performance and around you know, broader agriculture, you know. If the field looks this color of brown from the satellite image, then you’re probably suffering from this pathogen, you know. That’s something that they can do [inaudible 38:22]. The fact that we can’t do that in cannabis is, I think, a statement to the fact that it was federally illegal. A lot of growers weren’t didn’t have the will, or the motivation to take really accurate records that were especially digital. Because you know don’t have a record what you’re doing, and with the medical, you know, there was a lot of that. So, a lot of internal nomenclature. And there’s a lot of unique cultivars that exist, and a lot of unique environments. And so, that’s been a gap to go to provide that cannabis. But that’s what we’re on the way to do, is to help growers ultimately grow a better product. And we’re doing that by tracking all those major pieces.

 

Chip: Oh man, that’s where it’s at. We need to grow better weed, dude. Everybody needs to grow better weed. I need better weed, you need better weed, we all need better weed. That’s for sure, man. Man, this has been an awesome conversation. A lot of people look you up. How do people find out about Trym?

 

Matt: Yeah, so our website is trim with a Y, so trym.io. You can go there, you can request a demo, or you could email us at info@trym.io. Love to talk to anyone that’s interested. As I mentioned, we’re in 14 states, our farm platform works in any state irrespective of the compliance system you guys use. And then, if you’re specifically looking for Metrc support in California, definitely reach out, because we, over the experience of building out that integration for compliance, have turned into industry experts as far as compliance goes in the state of California. So yeah, we’d love to have a conversation with any of your listeners that think we could be helpful.

 

Chip: Oh man, that’s great. Yeah, Metrc is coming to a town near you, Oklahoma. So get ready for yeah, we just passed it a couple of days ago.  Not passed, but it just came into action, I believe just a couple of days ago. So it’s all starting to happen here.

 

Matt: That’s the truth, man. Yeah, those guys have a pretty good grip on on the regulated states. 

 

Chip: Yeah well, here it comes. It’s all good. Hey, man. Thanks for the conversation. I really appreciate us finally getting together. It looks a little clear out there. Not so smoky. I hope the breeze keeps up, and the fire stay down.

 

Matt: Yeah, thank you. I really appreciate it. It’s been really nice talking to you. And yeah, hope you have a great rest of your day.

Chip: Yes, thank you. And hey, thanks for listening to another episode of The Real Dirt. This has been The Real Dirt with Chip Baker. If you’re interested in this episode or others, you can subscribe on iTunes and on Spotify. If you have any grow needs check us out at cultivatecolorado, cultivateokc.com. And remember, when life’s getting you down, just grow a little bit of weed. It’ll make you feel better. Thanks again, Real Dirt.

The Real Dirt on Permaculture and Cannabis Tourism

The Real Dirt on Permaculture and Cannabis Tourism

permaculture and regenerative cannabis cultivation
Notice: This episode was recorded before the forest fires in California began.

Restorative agriculture is no joke.

As cannabis cultivators, we are all stewards of the environment. Our actions can directly impact our local ecosystems, and as cannabis cultivation spreads across the nation, that impact can grow rapidly.

Restorative agriculture, or permaculture, is the act of farming while trying to prevent as many environmentally harmful practices as possible. Water usage, nutrients, soil beds, and farm design are just some of the aspects that go into restorative cannabis cultivation, and Sol Spirit Farm is doing it all.

Judi Nelson and Walter Wood are the owners of Sol Spirit Farm, a licensed 10k square foot regenerative cannabis farm in Trinity County, CA and Sol Spirit Retreats, a cannabis tourism-focused, farm stay hospitality business. Walter has been cultivating cannabis since 1996, and his passion for improving the environmental footprint of his cannabis cultivation is what drives every cultivation decision.

Judi and Walter started Sol Spirit Retreats in 2019 after meeting a lot of people, even people working in the cannabis industry, who had never seen a cannabis plant growing in the ground under the full sunshine. They wanted to share the experience of being in the Emerald Triangle on a cannabis farm, and show off how regenerative farming, permaculture principles, and appropriate technology can enhance the cannabis we bring to market, while improving the health of our land.

In this episode of The Real Dirt with Chip Baker, Judi and Walter take Chip through their grow processes and how they maintain their restorative cannabis cultivation practices. They also dive in to the new world of cannabis tourism and the many challenges, especially the legal hurdles, that the two had to overcome just to operate.

While still small and driven mostly by word-of-mouth, Sol Spirit Retreats has drawn in a lot of people trying to experience the northern California life. Judi hopes that one day it will be just like a winery and orchard, where visitors won’t just be able to tour, but also taste the cannabis on the farm!

Check out this episode on our new YouTube channel or go to your favorite podcast platform to listen on the go! TRANSCRIPT BELOW

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Transcript

 

Chip: Oh, here we are, The Real Dirt. Today at The Real Dirt, I have some peoples from one of my favorite place in the world, Trinity County, California. Man, Trinity and Humboldt, and along the border there, is one of the most beautiful and rugged places in the world. And I have Judi Nelson and Walter Wood of Sol Spirit Farms and Retreats. Say hey, Judi and Walter.

 

Walter: Hello!

 

Judi: Hey, Chip!

 

Chip: Oh, man, I just love that whole area you guys are in, outside Willow Creek all the way to Hayford. I’ve got some really great friends over there. Little Hill Farms is over there, and man, you guys are just in paradise.

 

Walter: Definitely, definitely. We love it. We have been out there for about 20 years now and I don’t know, we hardly leave. It’s home. It’s a magic place.

 

Chip: So are you guys on the mountain, or the river?

 

Walter : We’re about 300 feet up from the river floor. So we’re just out of the river fog, but at the same time, we’re not up on the hilltop. So it’s a nice kind of in-between. We’re in the valley, but we get about 12 hours of sun so it just works out perfect.

 

Chip: Oh man, it sounds beautiful. Yeah, that river fog can plague you. I lived over in, off the Vandusen for a number of years. Man, the fog just creep right in on you.

 

Walter: I had no idea how bad it was until one day, we just took a little drone up and it was like, 10 o’clock in the morning. We’d been in the sun for hours and the whole valley was fogged in just below our shelf.

 

Chip: Oh yeah, there’s places like that all over. You know I lived in, up in Kneeland right outside Arcata for a number of years. And we’re at the 3500 block, which is 3.5 miles up that hill. And if you went just a half a mile further, you’re gonna have enough fog. Almost every single day like, hours before you know, we got out of the fog.

 

Walter: Luckily, we were living in the area for a few years before we bought the property, and we had a pretty good idea what the [2:18 inaudible] were. Permaculture course really helped nail in what exactly makes a good piece of property for homesteading, and growing some fine medicines.

 

Chip: Well, man, you guys are in the homesteading capital of the world, that’s for sure. And you mentioned permaculture, and you know, we talked about regenerative farming earlier. You guys have a unique cannabis business. You know, many people just have a, they cultivate, or extract, or are packaging something, but you have this cultivation that you integrate with a farm stay. Tell me how that works.

 

Judi: Well, so we have been inviting guests up to the farm. The [2:59 inaudible] as legalization of recreational hemp in California, we started going to a bunch of different trade shows. And it was kind of amazing to meet people who are in the cannabis industry who have never seen a cannabis plant growing in the ground. And it really surprised me, because obviously, we’ve been sort of up in our little bubble here for the past 20 years, and I just didn’t realize it. And so, we just really wanted to be able to bring people like that up, and be like, “Hey, check this out. This is this way that this can be done that’s not taking a lot of resources.” We’re actually trying to make our piece of property and the land that we’re working with in a better state than when we found it. And in order to do that, we have some bell tents, which are these beautiful canvas tents. And people come up, and they generally spend two nights in the tents. And we raise pigs and chickens on the farm, as well as vegetables and fruit, and so we’re able to do farm-to-table meals. And then Walter takes them on a really nice farm tour, and shows them all the different techniques that we’re using. And we usually take them rafting on the Trinity or on the South Fork, depending on what time of year it is. And it’s just been really great, because I think to people who are suffering nature deficit, nature connection deficit, it’s a really rejuvenating experience I think for people.  Especially if they’re coming from a city, to come up and just chill out, smoke some good medicine, and connect with nature. And it’s been really rewarding for us too, and hopefully for them.

 

Chip: That sounds so fun. But you guys don’t have a normal cultivation or I shouldn’t say a normal, but it should be normal. But you guys use permaculture and regenerative farming techniques.  Many people have heard organic or maybe living soil, and those are kind of part of regenerative farming and permaculture a bit. And I know it’s a huge question to ask, but man, can you like, tell me how it applies to cannabis?

 

Walter: Well, we’re working on a whole bunch of different angles and we did this, we have transitioned substantially in the last few years. We were doing the full season plants up until almost legalization, and then we switched over to the light dep, and so we’re getting all that worked out. And so we’ve now got about six and a half thousand square feet of, we got living soil beds which for us that means we don’t till them, we don’t broadfork them or anything. We did originally broadfork them to just loosen them up a little bit, but not to actually turn the soil. There is a living clover cover crop growing year-round, it’s a little bit died back right now, because they were associated out by the ladies on the first round. We just replaced the spot where the plant itself was potted in, or the pot went in into the ground. And so the rest of it’s all connected, all natural, all living. Tilling really disrupts the biology of the soil and releases a lot of CO2 into the air. With this, the clover cover crop, we didn’t have to import any nitrogen this year. All’s we’ve been feeding has been compost fees, most of that’s made with onsite compost, we’ve been doing various KNF type things, which we are importing some sugar to make our nutrients. So that’s just about it. It’s all natural farming, just trying to to make as many nutrients as we can at home to import as little as possible, and just build that soil. 

 

Chip: When you say beds, describe what your beds look like.

 

Walter: Well, so I mean we are on a little bit of a slope. It’s pretty mellow, but it does slope so we went across that hillside.  And when we broadforked it and all that out, we leveled out a six foot bed going across the hillside, it’s tied right into the soil. There’s no cage around it or anything like that, it’s just directly in the earth. And then, we’re going to be putting up some wood edges on the downhill side to just help retain that edge. It’s grown right in the earth. It’s super important to me. We don’t have to feed as much, and the plants have access to what they want. They can make choices, and they’re not stuck in a little tiny soil spot, they have access to the whole area.

 

Chip: What did you have to do to your soil to prep it? What did you add to it at the beginning, and what are kind of the things that you add to it now?

 

Walter: Well, so this year, like I said, we actually, we did not add anything besides wood cover crop (7:50). And then we also did bring in forest duff from the hillside above of the patch. And so we brought in a couple inches of the leaf litter and stuff that’s just starting to break down a little bit, so that brought in our indigenous microorganisms or IMOs, as they’re known sometimes. So we covered the beds with a six inch layer of that which completely covered that clover for a little bit, then that cover crop burst right back through that, and basically just incorporated all of that leaf matter right away. And so previously, when we first did prep those beds, we did bring in some manure. I think that was about it. I’m so scared to bring in even from outside anything because our tests, our flower’s tested to the parts per billion on these pesticides, and what if I’m bringing in some straw or something, and if it were to have something? So we avoid bringing in anything. We like to keep everything from on-site, that way we know it’s clean.

 

Chip: These aren’t like, beds that normal people think of that have wooden sides, their area is that you’ve built in the soil, grown in and added your own ingredients, local ingredients.

 

Walter: Exactly, exactly.

Chip: When you talk to people about cannabis techniques and grow techniques, a bed means so much different, so many different things. You know, in the indoor world, it can mean something, it’s totally different than the outdoor world.

 

Walter: We are directly in the ground for sure.

 

Chip: You’re directly in the ground and you say you do light dep, is it under plastic? Or is it under natural sunlight during the day?

 

Walter: So yeah, we do not have the clear covers on the greenhouses, so they are open to the natural sunlight. It makes it simpler. We don’t need as many fans, things like that, because it is open. And then yeah, we roll down some tarps over it at night, give us the 12 hour cycle.

 

Chip: Oh yeah, absolutely, man. I’m just envisioning your garden here as we’re talking about it. I mean, I’ve been in quite a few Humboldt and Trinity Gardens on the hillside. I feel like I know, I feel like I’ve been to your place before.

 

Walter: One thing that’s a little unusual is each bed is on its own, a foot higher than the next, because it’s sloping down the hillside. So then the bottom of the greenhouse has just some leg extensions to level it out. And so once again, just trying to simplify, keep things as minimal, and environmentally friendly as possible.

 

Chip: That’s the name of the game. And you know, the interesting thing about everything we’re talking about, is there’s no cost in doing this. Like you virtually have, I mean, you have very low input costs. 

 

Walter: Yeah, comparing it to an indoor scene it is very drastically reduced. I would do only two runs a year. So we have very little lighting, very little inputs, and that way, the light dep is significantly more labor I find than the full season was. And you know, just pruning up all these plants and anything when you multiply it by 1800 or 2400 pound a run, all of a sudden like, just a few [11:13 inaudible] here and there adds up.

 

Judi: There is an increased labor cost, you know, you’re just trading going out into the forest and having to collect these inputs. That’s a labor cost, right? So you’re trading maybe some increased labor cost on going out and sourcing the nutrients ourselves compared to like, just going to the store and buying something that somebody else made in a bottle. So it’s a little bit of a trade-off. It’s not like there’s no cost associated. There’s no material cost, but there is a labor cost for sure.

 

Chip: Wait, wait a second. I thought that’s where the farm stay came in. Don’t you have the guests doing that for you?

 

Judi: I gotta make that work out, right? That’s the next step.

 

Chip: Sounds like you guys got a great trim camp. You really need to be hustling guests here in October, huh?

 

Judi: Right. Yes, come pay to trim our weed. That sounds like a great plan. I gotta get to work on that.

 

Chip: You would be the first person to try to implement that one.

 

Judi: I’ll let you know how it goes.

 

Walter: We’ll outdo what everyone else has [12:16 inaudible].

 

Chip: You know, not too many places have cannatourism, and that’s what we’re talking about here. And this is so akin to, I mean, wine tourism or fishing tourism. Like, this is like, a brand new thing. And how has it been perceived?

 

Judi: Well, you know, it’s been a little bit of a challenge just working out all the legalities of doing it, obviously because cannabis is so highly regulated. That’s, I would say been the most challenging part, is just trying figure out and make sure I’m not breaking any rules. And one thing that I mean, the people who have found it and have come out,  we sort of kept it a little just word of mouth so far, but the people that have come out have all had a great experience. And I think that, especially in Trinity County, and in Humboldt, like, it’s a huge thing if we can make it so that it’s easy for farms to do this, and to show it. There’s a huge demand for people who want to come and have this experience. It’s like, legendary, this area. There’s lots of people that want to come have the experience. So it’s been really well-received by the people who have come so far. We’re just trying to make it better all the time. And someday too, what we hope is like, just like wine, it would be amazing if we can get to the point with the state laws and the local laws that I could actually allow people to purchase cannabis at the farm when they come, you know, be able to buy our flower on our farm. So far that’s not allowed, but I really do hope that one of these days soon, the various involved agencies do allow us to do that, just like you can at a winery. And do tastings, and do that whole thing, because that would be amazing.

 

Chip: Absolutely man. They’ll treat us like adults one day.

 

Judi: Someday.

 

Walter: Maybe, I sure hope so. We know it’s come a long way.

 

Chip: It’s amazing, you know, Humboldt and Trinity County has such long-standing history, but there’s just always been this fight against cannabis there, and it just still remains. It’s one of the most difficult places to get licensing to this day. They’re really missing out on so much great culture. And this huge brain trust is there of people like yourselves, and living environment, sacrificing to grow cannabis, and cannabis growing them in return. It’s just an untapped resource, and they just haven’t used it well enough, that’s for sure.

 

Judi: Especially in Trinity where, you know, there was logging and mining, and that’s kind of what everything was built upon. But that’s been gone for decades now. And there’s not a lot else going on in Trinity. And I do think it’s changing. You know, we were able just recently, the Trinity County Agriculture Alliance, of which we are members, which is a group of licensed cultivators in Trinity. And we actually proposed our own cannabis commercial, cannabis tax measure, like, to tax ourselves. Because up to that point, Trinity didn’t have one and, you know, we all want to see our community services happen. And, we were able in five days to collect 10% of the registered voter signatures in the county to get our measure on the ballot.  And you know, who would have thought that that would ever happen in Trinity County? But it just did, so it’s coming around, it’s happening. You know, we’re getting more organized, and as people can kind of come out of the closet a little bit, I think that’s only just gonna increase.

 

Chip: Yeah, ’cause people are still scared to talk about cannabis there, even legal cannabis owners. They’re scared to talk about cannabis. They’re scared to bring it up to their neighbors. It’s still taboo in so many communities, in so many places.

 

Judi: Yeah, it’s true. I think that for me, that’s been one of the best parts about recreational happening in California. It’s just like, “Okay, you know what? We’re here. We’ve been here the whole time, but now we’re letting you know.”

 

Chip: So tell me about this tax initiative.

 

Judi: Well, so there was a tax measure proposed on the March election by a group of people who really actually just wanted to put all of – my perception – was that their tax basically was just to put everybody out of business. And so this, the Trinity County Agricultural Alliance came up with one that is much more small farm friendly, because in Trinity County, almost everybody has 10,000 square feet or less because of the way that the ordinance was written. There’s only a few people who have more than 10,000 square feet. And so basically, the TCAA came up with this proposal where it’s all based on sales, right? So for instance, in Humboldt County, you have this square footage tax where you’re charged per square foot, kind of regardless on whether you grow anything or make any money or not, which personally, I don’t think is the best way to do it.

 

Chip: Oh, it sucks.

 

Judi: I think that like these other industries, you should be taxed once you make money, right? And so luckily, we kind of had time to look at all these other counties and be like, “Okay, what’s good, what’s not good?” And so this tax, it’s like, for your first hundred pounds, you’re taxed at this rate. And I can’t quote you the exact numbers, but you’re taxed at a lower rate. So if you’re a very small producer, those first hundred pounds you grow is taxed at a low rate. And then it goes up, like okay, and then the next 200, I think, and it goes up from there until like, over I think a thousand pounds, you’re paying, I believe it’s $15 a pound in cultivation tax to the county, basically. And, you know, there’s some other things in there about different businesses, there is no retail in Trinity County yet at this point. And so they’re not, you know, they’re missing that, again, they’re not collecting any tax revenue because they’re not allowing anybody to sell retail, which hopefully, again, they’re gonna get that together. But this initiative mostly is for taxation on cultivators, because I think that’s appropriate as long as you wait to tax them. Wait until I’ve made some money, I’m very happy to contribute to the county coffers to do roadwork and, public safety, and things like that, and schools. And so, we just wanted to show as an industry like , “Look, here we are, we want to contribute, but don’t try to put us out of business.” Because that’s not going to be good for the county long-term.

 

Chip: Yeah, there’s so much green greed, it comes from every place. The counties get it for sure, and the state governments get it for sure. Well man, I salute you guys, for working so hard to put it together. Trinity was considered one of the harder places when it all started, I think Humboldt’s shown that it’s the hardest place right now. I mean, Mendocino might not be so easy either, but it hasn’t been any easier anywhere in the Triangle.

 

Walter: I think the triangle has some like, 60 or 80% of the permit since, it’s a large number.

 

Chip: More like 15, 16,000 people in Humboldt with commercial grows, you know, before all this has happened. And to say that you have like, and to say that you have 500 people or 600 people with licensing? Man, I just don’t think that’s a good enough attempt to get people out of the private market industry, and get them into tax. Because literally for Humboldt, it’s billions of dollars. They would convert all of that private grow – sorry guys, you should probably pay some taxes, all of my private grow friends that are out there just growing in the hills. I love you guys, you should pay more taxes. If they would incorporate all those guys into it, it would like really, really change. I mean, my local school, Trinidad Union School District, man they’re failing, they don’t have any money, right? Like, COVID’s hit them so hard like, there’s like, just so much stuff, and through Humboldt and Trinity County an educational loan that needs to be worked on. And you know if they played their cards right, like, cannabis could totally bring the whole Emerald Triangle out of all of their problems, right? It could help with the fire suppression issues. It could help with all the drug problems, it can help with all the homelessness, it can help with all of the educational stuff. I mean, it’s just such a wasted resource. It’s just kind of frustrating when we see as there.

 

Judi: Yeah, I think some of that is not necessarily seeing the legal market in California. And it is a challenge right now to, when you compare just all the hoops you have to jump through, all the money you have to pay. And yet, I personally think, because the state especially is taxing the end product so hard, they just have this huge black market that’s still going, and it’s hard to not look at that and be like, “Wow, that was so much easier back in the day.” But again, now it’s all changing and it’s the time to like, get together and move forward into the light.

 

Chip: No, it’s the responsible thing to do. And I mean, I don’t know about Trinity County, but Humboldt County per capita always had more people contributing to fundraising than anyplace else, you know? And that was because all the cash dollars from the fishing, the logging and the cannabis. And now the fishing and the logging, it’s like next to nothing compared to what it used to be, and it’s just cannabis. If they could just, open up their arms, just embrace it.

 

Walter: Relax a bit.

 

Chip: Yeah, relax, relax a bit. I know you have such a special place and inviting people out there. Tell me about some of the people that have come in and visited you.

 

Judi: So last year, we mostly focused on some different folks who either own, or manage, or the buyers for various retail shops in California. Again, because there’s no better way for someone to learn where this particular brand, our Sol Spirit brand of flower comes from. And, the lot of them had never been to the Emerald Triangle. So last year, it was a lot of retailers. And most of them were so stressed out when they arrived, because they’re jumping through their own set of hoops. And that job, I can’t even imagine trying to pull that off. And so, it was just super relaxing and rejuvenating for them. And most of them, you could just like, see their faces change by the third day where they were just like, “Oh, okay, we’ve let go of the stress. We’re here. ” And also getting to see the way that we farm, I think really opened their eyes to like, it’s not all the same. So like, indoor has its thing and then people with like, really large grows who are maybe putting out more mid-quality stuff, but in volume, that’s a whole different thing. And then our particular craft, regenerative way of doing it, it’s like, you’re actually talking kind of about different products, right? And so I think it was great for them to be able to see, like, “Oh, yeah, the next time somebody comes in and tries to sell me a regenerative craft cannabis, I’m not going to compare it to this $8 eighth in a mylar bag that came from a 12-acre scene in Salinas,” or something, you know. So that I think is like, an education piece that’s super important to us. And so there’s that, and like, that really, I think, changed a lot of their perspectives. And then this year, we’ve had more just regular folks. It’s been interesting with COVID to kind of work that all out, and so we had a bit of a slow start just making sure that we could keep everybody safe. And now I feel like we’ve got that down. And it’s been, I feel like even more rewarding, because we’ve had several people from the Bay Area come up, and some of them have been stuck in their apartment for months. So to be able to come out and of course, the beautiful cannabis medicine also helps with their mindset. And we had a couple of people come out where they sort of like, changed their whole life trajectory over the weekend, because they were able to just kind of step out of their normal life and gain some perspective on what they were doing which of course the cannabis is also really helpful for.

 

Walter: Yeah. The hills of Humboldt County and Trinity County have a way of doing that.

 

Judi: It’s been really great. We’ve had all kinds of different people, yes. Yeah. You know, you get used to where you live, and you kind of stop seeing it, I think sometimes. And being able to have all these different people come and see it from their perspective and out of their eyes, it really refreshes our love of the place as well.

 

Chip: Oh man, you know that’s the thing that people don’t understand or know about that area, Northern California is it has the least light pollution I’m pretty sure of any place else in the US. Right, maybe even the continental US. I mean, it is you get to see this guy.

 

Judi: Yeah, it’s pretty amazing.

 

Chip: It’s been great chatting with you guys. If people want to come to Sol Spirit Retreats, how do they get in touch with you guys? Can they follow you on Instagram? Or how does it work?

 

Judi: Well, they can follow us on Instagram. We have two different Instagrams, so one for the farm and one for the farm stay. And they’re, Sol Spirit Farm, s-o – like the sun, Sol Spirit Farm and Sol Spirit Retreats. And then our websites are the same, solspiritfarm.com and solspiritretreats.com.

 

Chip: Yeah, well, hey, thanks for joining me and man, smell some of that good Trinity County here for me. God, I wish I was there right now with you.

The Real Dirt on Investing in Cannabis with Narbe Alexandrian

The Real Dirt on Investing in Cannabis with Narbe Alexandrian

how to invest in cannabis

There’s those with a passion for cannabis, and those with a passion for money.

In Narbe Alexandrian’s experience, both have been successful in the cannabis industry. But those with more passion for money rarely stay around as long as those with a passion for the plant.

Narbe is the President and CEO of Canopy Rivers, a venture capital firm specializing in cannabis. Prior to joining Canopy Rivers, Narbé was a Venture Capitalist at OMERS Ventures, one of the most prominent technology venture capital funds in Canada. During his tenure, Narbe helped fundraise for two funds ($520M of capital), sourced and led multiple debt/equity financings, and acted as a Board Observer for several portfolio companies.

Now he has turned his focus to cannabis and securing financing for cannabis startups, and investing in cannabis businesses across the country. Narbe knows a thing or two about what investors are looking for in a cannabis business or startup, and has valuable information to share on new and emerging markets.

From how Canada’s market exploded and businesses scrambled to take advantage, to the step by step process of investing and growing a business portfolio simplified, Narbe and Chip talk about it all in this episode of The Real Dirt Podcast.

Transcript

Chip: Once again you have reached The Real Dirt, and on today’s dirt we have Narbe Alexandrian. Narbe, he is the President and CEO of Canopy Rivers. They’re the largest cannabis venture capital company. They’ve invested in some of the largest cannabis operations in the world. Thanks for joining me today.

Narbe: Thanks for having me. Really excited.

Chip: I love Canada. I love Toronto. There’s so many polite and pleasant people there. I’ve been to Toronto a handful of occasions, and even the police officers that were trying to arrest me were really polite.

Narbe: Yeah, there’s a lot of sorry’s, a lot of thank you’s, that’s for sure.

Chip: Just for the record, I didn’t go to jail, I never have been. It was a totally misunderstanding and they let me go.

Narbe: Awesome. Glad the city was nice to you.

Chip: Yeah. You know I was really excited that you know, we were able to organize a conversation, because you know, cannabis business is the most important part about the cannabis industry. You know, everyone thinks just cultivation, growing weed like you know, that’s all it’s about. But like, that’s only where it starts. And ultimately that’s, the point is to provide that product. But business in cannabis is so much more complex than it used to be.

Narbe: Absolutely. I mean, the beginning piece is cultivation, like you need to grow it out of the ground in order to be able to do all the things that you can to it. So when we look at the industry, we see it as seed to sale of what are all the different steps that are needed to go from the initial idea of I want to cultivate cannabis, all the way to the products that you see on the shelves today, and all the post retail services and products that you see on the shelves for cannabis businesses as well as consumers out there.

Chip: I talk to people all the time, I talk to, especially here in Oklahoma. You know, one of the things about Okla- we were speaking earlier about Oklahoma, and California, and Colorado. One of the really different things here as opposed to other states, is it’s so many mom and pops. And there, there are some like small investment type structure,  and there’s some big companies that have moved down here. But when you look at the stats, there’s 7000, 8000 cultivation licenses issued so far. And most of those people are just small mom and pop people that their only interest in is growing cannabis. But other places, like Canada, or California, or now even Colorado, and kind of the only way you can get involved in the cannabis industry is by, you know, coming at it with lots of capital resources. And that’s kind of where you guys come in, because you tell me kind of some of the stuff you guys have done in the past.

Narbe: So we’re a venture capital vehicle, like our job is to invest capital into the cannabis industry, specifically into companies early on, and watch them and help them grow, hook them into the ecosystem of what Canopy River’s in and its partners, including Canopy Growth have, to put fuel on the fire and get them towards some sort of a monetization event naturally. So, get them big enough that some large company wants to buy them, get them big enough so that they can go public on their own, get them big enough so that they’re just driving cash, and there’s a dividend potential in there as well. So that’s our idea. Like we’re looking for companies that want to grow and can continue to grow. So, there’s two types of businesses out there, successful businesses. One are the ones that want to grow, grow, grow, and then sell the company, and get a financial profit. There’s other types of businesses that aren’t that interested in hypergrowth, or blitzscaling like we call it in the industry, but they’re more so looking for a lifestyle. They’re looking to build a company, get a good income off of it, enjoy it every single day, not necessarily looking at growth at all costs, but more so looking at just simply growing and earning a paycheck off of it, and potentially building some equity into the business over a period of time. The latter businesses, like those businesses that are more lifestyle, they’re harder to invest into because as an investor, you don’t get the same bang for your buck as you do for the ones that really want to pour out oil on the fire, and just keep going, and going, and going. So whenever we look at a company, we’re looking at how they fit into each of those molds, and how we can help them out. We don’t ever say no to a single call or an email or anything of that sort. We want to talk to every single person we can, every single entrepreneur we can. We’re very grateful to have had the opportunity to have seen over 2200 deals come in. So 2200 companies, over 2200 companies, have pitched us to date, telling us what they do, how they fit into the ecosystem, why they’re so different from each other. And through that process, we’ve met over 4000 entrepreneurs, or founders or founding teams that have a specific thesis about where this industry is going. So having that many conversations, and we do a great job of codifying that information, those discussions, in order for us to really understand how things are playing out gives us a lot of domain expertise in terms of where we think this industry is headed. So, love to talk more about that as well, and get a bit more deeper into where things are going.

Chip: Man, you know, one of the things you just said that struck me. You’ve talked to 4000 people who had the confidence and the desire, and to seek investment in order to grow their cannabis business. That just seems like an incredible position to be, like just to be able to like, talk to so many people in the almost the exact same position, even if they were doing, you know, different things from extraction to, you know, business development. Is there something about, I’m really intrigued about the people you talk to. Is there something about them that is all similar, you know, or that’s surprising?

Narbe: Yeah, I mean, I’d say that they all have a passion for cannabis, or they have a passion for money. I see that those are probably the two different pieces that you do see. The best businesses are the ones that are just hyperfocused on solving a problem. So they come to you and they pitch to you and they say, instead of saying, “This is what my product is, this is what my company is,” they don’t start it off like that. They say, “This is the issue at hand in the cannabis industry today.” If we’re looking at a certain state, call it Colorado, they would say, “There’s too many small cultivators out there, there’s too many small retail stores out there. And to get these cultivators to talk to these retail stores, means that there’s a lot of phone calls and emails flying around everywhere, trying to get product on the shelf, and trying to get distribution. And there’s no broker to go through, there’s no channels to go through, it’s very hard to do that. So that’s the problem at hand. Now, our company, our product is to create a marketplace where cultivators can talk to stores, and get their product listed on there without having any friction, without having any human interaction. And they can send samples, they can send mass shipments, so like a wholesale business to business platform.” Those are the types of companies I’m more intrigued with, because they’re actually trying to solve a problem that’s out there, instead of trying to create what everyone else is creating. That’s kind of like, the best case scenario of when you hear a pitch. And then there’s the two other sides of it. You see the one side where people are so invested into making money in this industry that they don’t, they don’t consume cannabis. They don’t understand the consumer of cannabis, they don’t understand the intrigue of it. They build product that nobody really wants to buy, because they just don’t get it, and they don’t make money off of it either. And then there’s another set of, kinds of companies and entrepreneurs that are very passionate about cannabis, but aren’t as willing to do the homework to understand how to build a business around it. So they take bad advice, they don’t really think through their decisions. And they get into deals where they can’t get out of, and then it becomes much harder for them to operate, and much harder for them to grow. And my background has been in technology I spent up close to a decade in the tech industry. And when I see the cannabis industry, there’s just so much sophistication that’s still needed. We’re so early in the game, that it’s pretty intriguing to see where we are. It’s pretty exciting to know that we’re all trying to help this industry grow and mature to what it will become in the future.

Chip: You really did identify my customer, for sure. The passion and the get rich quick person. Those are the people that we commonly come into contact with, you know, their technique, or they love the plant, or they have a healing story about it. They say something like, “Oh man, me and my best friend from Google and Microsoft, we all got together, we had an [9:18 inaudible] on something. And we bought these other team of people in, we’re going to build this big thing. We’re going to exit it out in three years and be billionaires.” And some of them do it, right?

Narbe: Absolutely. And then I think they missed the mark on that, at the most parties. I mean, I’d see a few of them that actually do succeed, and I call those the lucky ones. But for the most part, it’s very hard to do so. So as an investor, like one of the things that we’re so focused on is, can we work with this company, with this individual for a very long time? Because you might see the stories about the Instagrams or like the Canopy Growths that just go from a nothing to a huge company in a short period of time. But those are Cinderella stories in the grand scheme of things, because for most entrepreneurs, it is a huge grind to get to, from the beginning towards building an empire or a huge business. And that period of time takes a long time. I like to use an anecdote of a US marriage. And a US marriage on average is about ten and a half years. Similarly, the period of time between founding and exit of a company, on average is about 9.6 years. So it’s 9.6 versus 10.4 years. when you make an investment into a company, you’re basically getting married to the company, the entrepreneur needs to understand how to work with them. You need to understand what strengths they have, what weaknesses they have, where they want to really focus in on, and you have to really see it as a ten-year relationship that you’re building off of. And if you can’t do that, then it just, you shouldn’t put the money in. And even if it means that you’re missing out on a Facebook type opportunity where you can make 100 times your money, you just don’t want that risk of working with someone you just don’t understand, and who does doesn’t understand you.

Chip: Yeah, bad partner relationships are, if you get into the wrong one of those, they can just be a nightmare, absolutely. Partnerships are often made to break up. I’m glad you really brought that point up. You know, I’ve talked about this with my other partners, whenever we start a new business, there’s always, you know, an understood exit plan for everyone involved. And if anyone wants to pull the parachute cord, they can. But it’s really important that you do that for people, and be very clear at the very beginning. I just had a partner exit from our business, and you know, it was time for him to go. He wanted to get paid, he didn’t quite know how to bring it up. We figured it all out really kind of amicably, and he walked away with you know, with what he exactly, what he wanted. We didn’t quite figure it out at the beginning of the business, because we didn’t know any better. You know, but yeah, that relationship lasted about 10 years, right? That’s a really interesting point you bring up.

Narbe: I’m going to use that point any time I bring up this anecdote again.

Chip: You know, you start out a business, you got these ideas. And you know, of course, like, you know, you’re younger than when you exit it, unless you’re just, it just happens in months. You have these long periods of time between changing your idea of what that business started out to be, to realizing like, what the business is really good at, and focusing on that, and turning it into something successful. And few people, I’ve seen few people that started out with like, the idea that they maintain ten years later.

Narbe: Yeah, absolutely. And things change a lot. People’s personal lives change, their professional lives change, they want to move, they want to, they want to build a family, they don’t want to spend as much time. So, when you’re starting off a business, it’s really important to think about structuring it so that all partners within the company have a way in, and have a way out. So, I’ve always believed that on day one, you shouldn’t be splitting the pie between all the partners and saying, “You own 25%, I own 30%, so and so owns 40%.” You shouldn’t be doing that on day one. Instead, you should be thinking about where you want to end up, and putting everyone on a vesting schedule so that over a period of time, people have to work for that equity. So, if you and I, and someone else, we partner together, and we all split the pie evenly, so 33% each. And then tomorrow, I decide I don’t want to be part of this anymore, I shouldn’t have the ability to walk away with my 33%. Those are some very fundamental aspects of growing a business in the early days that honestly a lot of entrepreneurs miss out on. Again, because the sophistication of this industry just isn’t there. And the onus is really on entrepreneurs to listen to shows like The Real Dirt, and read publications on the internet to really understand the pitfalls that they can avoid.

Chip: Oh man, I should have talked to you like, ten years ago, man. You would have solved so many problems for me. Where were you? So man, I got to say, there’s a lot of confusion in the US here over the Canadian market, over venture capital. Like so many people see that or have this perception that the Canadian market rose and fall with a bubble bust on it, or man, could you give me kind of an outline on what’s happened in Canada? And what’s going on today with the Canadian cannabis market?

Narbe: Yeah, so Canadian legalization was first put on the table in 2016, when Canadian Prime Minister Justin Trudeau was elected for prime minister, or our president in Canada equivalently. And at the time, everyone started to race to build a company. So legalization was set to be in 2018. It was 2016 at the time, and if you were a cannabis company, your evaluation wasn’t based on how much revenue you were generating, because you couldn’t sell. It was illegal at the point in time, but it was more so on how fast could you ramp up the the production of the facility, or the manufacturing of the facility in order to get ready for legalization in two years. So, a lot of the Canadian licensed producers, they went crazy in terms of trying to build as much capacity as possible. They would buy all the greenhouses and retrofit them. And these greenhouses would be filled with like, mold and like, the walls would like, be baked in with like, pests and mold. And it’d be very hard to to get, to not have that impact the plants, but they do it anyway. They did find facilities that had no water, they had to ship water in every day, no electricity, they’d have to bring generators in. But it was it was by all means, “Let me pick up the most square footage of cultivation space that I can within the country prior to legalization taking place.” And the idea there wasn’t that Canadian population was going to be booming in terms of the number of consumers that are buying cannabis, but it was more so if Canada is the first G7 country that’s going to legalize cannabis. Well, guess what? There’s another six of them out there that are going to probably follow suit and say, “If a big country like that’s doing it, why don’t we do it in the US? Or why don’t we do it in parts of Europe, or all the European Union?” So, the race for capacity was, what I’d say 2016 and 2017, was characterized that. 2018 rolled around and legalization hit. And suddenly you found out that —

Chip: And that, pardon me, pardon me. That race is really what fueled all the speculation.

Narbe: Absolutely.

Chip: Because people are going into these chutes and there’s like, “Ah, this group just bought 100 acres of greenhouses.” And the reality of it, it’s a defunct nursery, like you’re saying that needs significant amount of work. But that’s not what the market hears, and that’s not what the media picks on. It’s like, “Canadian market is huge,” is what they hear.

Narbe: Exactly, exactly. And a lot of that was driven by hedge funds. So the hedge funds were putting in money into the industry, saying that we will fund the initial asset purchases for a lot of these companies and we’ll give hundreds of millions of dollars. And the reason why they were doing that was, they were forcing these companies to go public. They knew that retail investors out there understood cannabis, understood the benefits of it. And they would say, “I’ll give you 100 million dollars right now, you need to go public.” And the way I’m going to structure it is that there’s no downside for me, because I’m going to own a piece the company. And I’ll also be using financial mechanisms in order to make sure that any downside I get covered, and I’m only working on the upside. So they made a ton of money, but they also fueled the tide of companies. And while the companies they fueled shouldn’t have been fueled with that much money at that point in time, and some of the companies that they did actually succeeded as well. So there’s wins and losses across the board.

Chip: Everybody wants to shine on the bad news, too.

Narbe : Exactly. Exactly. But I mean, I quote Benjamin Graham who is the idol of Warren Buffett, by saying that in the short run the market is a voting machine, with a long run it’s a weighing machine. So right now, we’re at a point where it’s not a voting machine anymore. It’s not about how much capacity or square footage you have. It’s about, what are you doing in terms of revenue? Are you actually selling it to the customer base? And if you take a step back from that ship, there’s two flavors of companies out there. One are the artisanal, premium quality cannabis cultivators that are doing indoor or greenhouse or outdoor, but they’re really weighing in on,  “I don’t care about the yield. I care about creating the best product that I can for the consumer. High THC, beautiful bud, no crow’s feet, like it’s just stuff they can actually sell in the market, and that’s what I’m going to be working on.” And there’s another set of companies that are saying, “I want to be the lowest cost provider. I want to be the person who brings in the can to a curious customer with a $3 joint or a $4 joint, because I have the ability to cultivate at a low cost. I might not be getting the high 20 percentages in THC, I might be getting 20%, or 18%, or 23%. And it might not be the best cannabis you’ve ever consumed in your life, but it’s going to be what gets you into the market. And it’s going to be what gets you into the more premium product afterwards.” Anybody that doesn’t fit either of those two bills is stuck in the middle. And that middle is where you’re selling product that isn’t of high quality, or isn’t at the right price, and you’re just not growing anywhere. So right now, there’s a lot of companies stuck in that middle category, and they just can’t break out of it, because their infrastructure is old. And you can’t create quality cannabis, and it’s old so you can’t be the low cost provider, because you’re paying more than your competitors are in order to make sure that it’s free of pests and molds and heavy metals etc.

Chip: Worldwide, it doesn’t matter how much you put into that kilo or pound of cannabis. It really is how much someone’s willing to pay for it.

Narbe: Absolutely.

Chip: I hear people say it all the time. It’s like, “Oh, I’m organic. I have living soil, like, you know, we put all this effort into it. This is biodynamic, I, you know, have a solar powered greenhouse, we made all this stuff by hand.” And I really appreciate all of that, but it has absolutely nothing to do with the commercial value of cannabis.

Narbe: Absolutely.

Chip: And that’s driven by other factors, you know, every state seems to be different. I’m learning more and more, but you know, here in Oklahoma, a variety is definitely important. More so than any other state, it’s a new state to cannabis, so people are really open to the different flavors and the different names. There is a smaller segment of society that will really pay for the higher end cannabis. Most people want inexpensive but good cannabis. They came from $40 an ounce Mexican import ounce, $100 is, $200, $300 is significantly more than they use, you know, you’re used to paying. So I see exactly what you mean, you know, is here specifically it’s very little at the top and then all the rest of it at the bottom.

Narbe: Exactly, exactly. And if you’re stuck in the middle then who’s gonna be looking at you, right? You’re not the, you’re not one of the cheapest, you’re not one of the best, and then what are you? Mediocre? Who would want to buy mediocre cannabis right? So —

Chip: No one ever said that. “Oh, if I had my choice,  I’d buy some mediocre cannabis.”

Narbe: Exactly, exactly. And then you have other companies as well that are just so key focused on trying to teach customers about everything else outside of THC. So I understand, you understand that when you look at a cannabis bud, it’s more than just THC. It’s about the entourage effect, the terpene profile, and how it looks, and the moisture content of it. There’s just so many different attributes of it. However, you can’t expect the customer to, on day one, to know all of those with that information. You can’t expect them to know that on year five of this industry. When we go and buy a bottle of wine, for the most part, for the most part, the majority of customers don’t actually know what they’re buying. They don’t know what the difference between a Cabernet, and a Merlot, and a Malbec is. Same thing on the cannabis side. You can’t expect for the customer to know this. And so, if the customer is saying that our focus is on THC content, then that’s what you should be focused on. To think that you can educate the customer is a foolish concept in the short term. Like there’s so much going on in people’s lives like, why would they sit down and try to understand how to buy a bottle of wine, as well as how to buy a pre-roll of cannabis?

Chip: You know, that’s something that we really should strive here though. And we’ve, and we’ve done it everywhere to Colorado and here, is customer education. And you said it,  it’s not something that’s immediate. For instance, when the early days of pesticide use started to come up in our store in Colorado, it was one of the states where you could buy any pesticide off the shelf. So it really kind of became up to our staff to educate people on the pesticides they were using. We did that for years. And it wasn’t until the state came out with regulations on it, that anybody paid any attention, or even cared, you know? And we put a lot of effort into it, but you know, it just wasn’t mandated. It wasn’t something they had to do, and they didn’t do it.

Narbe: Absolutely. Keep it as simple as possible. I say this to companies all the time. I say, “Why don’t you just create a cannabis product called 20%?” And it just says it right on there. Or call it sleep, or call it creative, or call it–

Chip: Yeah.

Narbe: Just explain what the product is. And it’s very, very much like a Soviet Union type vibe that I’m putting out there, which saying that, just make, just tell them what it is. Hiding behind the logo and expecting to teach the customer everything that exists. Instead, just give them what they want, and just be obsessed in and hyperfocused on being one thing to the customer. Don’t try to be everything.

Chip: One of the things that is kind of new to the cannabis industry is this idea of brand. In the past, you know, people just grew weed and there was other people that sold weed. And then it came to like, strains and preferred cannabis. But brands are relatively like, you know, new thing to cannabis. Do you see many people coming to you, and saying “We’re gonna make this brand of cannabis that’s internationally known?”

Narbe: Oh, yeah, for sure. For sure. So, we see the industry kind of moving in five waves. The first wave is cultivation, where if you’re one of the first ones there, and you get a heads up on building a greenhouse, or building your facility, and just getting through the experience curve of being one of the first in your state to grow cannabis, then there’s success there. As the industry progresses, it goes into wave two, which is ancillary, the picks and shovels, fertilizers, LED lights, software technology, paraphernalia, vaporizers, etc. Third Wave is CPG, which we’re currently in right now, where there’s brands coming up every single day. I think there’s about 90 new skews of products coming into the cannabis industry per week within North America. So there’s a lot of brands just being hit in front of the customer. The top five players in any given state are changing on a quarterly basis all the time. Wave four is pharmaceuticals, which we’re still not there yet, because it takes time to prove anecdotal effects are actually driven by research. And then the fifth wave is maturation, which means that like Coke and Pepsi, there’s going to be a few large giant global companies that handle majority of the market share. And there’s gonna be small, not mom and pop shops, but mom and pop shops are always medium-sized enterprises, which then take another 30, 40% of the market as well. So right now, we’re in the CPG phase, which is consumer packaged goods, brands that are being created. And to me, there’s a big disservice that companies are doing by creating cannabis brands, and not creating brands that use cannabis, because cannabis itself as an ingredient. It is becoming more standardized and commoditized every single day we go through. So, you need to, instead of looking at it as the product, think of it as an ingredient. Are you trying to help someone with sleep aid? Cannabis can help, as well as melatonin and many other products. Are you trying to help someone to be more creative? Well, there’s sativa strains that are absolutely awesome for stuff like that. So think about what the problem set of your customer is. And just hyperfocus on it. Be the sleep product that your customer wants, and don’t be anything else. And it’s a hard thing to do this early in the industry. That’s the difference we’re seeing between the companies that are growing very rapidly, and the ones that are just the me too’s of the industry, trying to create a copycat of whatever else exists.

Chip: Right. Take something and own it.

Narbe: Exactly.

Chip: Right.

Narbe: Exactly.

Chip: It’s hard to find that niche, that’s for sure. I’ve had it in my grasp a couple of times. It’ll slip out especially in our modern world, how everybody communicates with each other and, you know, using online applications to design you know, everything, and we can communicate with thousands of people. Yeah.

Narbe: Totally, totally. I have companies that I speak to time to time where they say, “Well, I can’t tell you anything unless you sign an NDA.” And I say, “Well, we’re just having an introductory call. Why don’t we just talk about it before we sign anything?” And they say, “No well, if we tell you we’re scared that it’s gonna go away.” And my response to that is, “If you think within a half hour conversation, you’re gonna tell me something that is gonna, that you think that’s not going to be stolen, then I think you’re wrong. Because, not that I would ever do that, but the internet can disseminate information very quickly. And if you get to a big enough size, not too big, but you’re growing, and Forbes comes to you and asks you that question, you can’t make them sign an NDA, you’re gonna have to tell the answer. Or you’re gonna want to tell the answer, or else they’re not gonna run the story. And guess what, all of a sudden, everyone knows what your secret sauce is.” So it’s just all about just trusting the other counterparty, and really taking a step back and just being very honest with yourself and saying, “Do I have something special? Some sort of a competitive advantage that’s sustainable over time? Or do I not? And if I don’t let this go find one. And if I do, how do I hold on to this, and make sure nobody else gets to it?”

Chip: This has been an awesome conversation, man. We’re really just getting into it. And the big thing I want to chat about with you is venture capital, and how it works. So many people have, you know, different visions of it. You guys are considered, you know, the devil of the industry and to some people, other people are totally scared of venture capital, because they think that’s gonna, like, you know, take their opportunity away. Tell me how it works. If I’m a small company, and I want to, I want to get some capital, like, like, how does it work?

Narbe: Sure. So from a very general basis, a company comes in and says, “I want to raise capital.” They present us with a PowerPoint presentation or a deck that walks us through who they are, what they’re doing differently, how they stack up to competition, what their financial profile is in terms of how much they’ve raised, where they got money from, what revenues they have, what geographies they service, what categories they service, and they just basically give us this very introductory high level overview what the business is like. The next step after that is to provide us with a financial model of where they see the future going. The value of your company isn’t in what you’ve done in the past, it’s what you’re going to be doing in the future. So through that mechanism, we get to understand how they see their company evolving. There’s a lot of weight attached to that financial model, even though it is fictitious in a sense, you’re assuming a lot of numbers around it. But we want to understand, A. where the entrepreneur sees the business going? So do they see the business becoming five times as large in five years, or they see it being the same value or the same size for the next five years? And those have different motives attached to them, and they have different mechanisms of investment attached to them as well. And then once we’ve done those two conversations about the deck and the model, the next thing we do is we create a data request. Then we say, “This is the information we need to really understand, take a deep dive into the company.” And once we’ve done all that, as the investor, we proceed with the term sheet that says, “This is what the deal was that I wanted to do. This is how much money I’m gonna put in. This is what I’m going to get back, I might get a board seat, I’ll tell you If I am. What happens if the company doesn’t succeed? What do I get for that? Or what do I not get for that?” And you walk through all the high level terms. The next step after that is an important one for the entrepreneur. And for everyone listening to this show, you need to have a good lawyer in hand because you need so when —

Chip: You say that one again, please.

Narbe: You need to have a good lawyer, because you need someone to walk you through the legal jargon involved in getting to a deal with investors. Because there’s some investors out there, and I’m not going to name names or anything like that, that ask for a lot, that asked for a lot. They want to have all the upside of the business, but want to mitigate the downside of the business. And that doesn’t drive. We shouldn’t be doing that. Again, like they’re not thinking of a ten year partnership, they’re thinking about themselves in that situation. And they could be the nicest, kindest people out there, but you need to really work with a lawyer to understand what it is you’re actually signing up for, and what happens if things don’t work out. I love to really focus in on things not working out, because while everything looks rosy and awesome when you first put the money in, things can change very quickly, you need to be ready for that. So that’s kind the entire thing in a nutshell. After that investment has been made, we work with venture capitalists in general. Work with the portfolio companies in order to help them grow, link them up to other portfolio companies, and other companies they know, their network, help them with hiring by bringing in consultants, help them with legal matters by providing them with resources. And it’s really just unleashing the network that that investor has to help that company get to that next level. Build, build, build and get towards an eventual exit, which is either through acquisition or through a go public event.

Chip: But you make it sound so simple.

Narbe: I mean, I’ve done it so many times. But yes, it seems a bit simple to me. But —

Chip: Hey man, out of those 4000 individuals that have come to you, do you, you got a percentage of how many people you guys worked a deal out with?

Narbe: Yes. So we’ve seen over two 2200 deals, pitches of companies. And of course, like every time someone pitches, starting company pitches, there’s multiple entrepreneurs and operators, and we’ve done 18 deals.

Chip: All right. What’s the odds on that, do you know what the percent is?

Narbe: Venture capital is typically around 1%.

Chip: Okay.

Narbe: You need to see a lot of companies in order to do the deals.

Chip: Okay. Okay.

Narbe: So we’re right around there, just under that 1%. Maybe we’re a bit more pickier than the average.

Chip: I mean, if I do an email campaign, and I get 1%, I’m usually pretty happy about it.

Narbe: Yeah, you know what? I love that topic. I was actually reading up, back in the late 90s, t by email, click through rates were like, 70%. I don’t know if you remember those days, but I got any time I got an email, I’d open it.

Chip: Oh yeah, I’d read it all.

Narbe: It was a very —

Chip: “I got an email!”

Narbe: Yeah.

Chip: Yeah, “you’ve got mail,” right?

Narbe: Now it’s the complete opposite.

Chip: AOL really dominate- I know, absolutely. It’s like, “Please turn off my notifications. Please, please, please.” And I mean, is it just capital that you guys are, you mentioned earlier that kind of sounds like you’re a turnaround slash, do you have a description for what you guys do? Because that’s not what I would think of as venture capitalists. I mean, I know a couple people that do turnarounds. But you guys do a little bit something more than that.

Narbe: Yeah. So we’re not, we’re not turnaround. We’re not a turnaround type of an investor. And I’ll honestly say like, we don’t, we just don’t have that skill set, nor do we want that skill set. We want the entrepreneur to be running the business, we don’t want to run the business ourselves. So the key here is to find the right operator. And I’ll use the anecdote that there’s no eBay for great ideas. If you have a great idea, like a killer idea, nobody’s gonna buy an idea off of you, nobody’s gonna pay you 50 grand for an idea. If you take that idea and you execute on it, then you can sell that company. So it really comes down to the entrepreneur, the operator. What our job is, is to give the domain expertise and the relationships that we’ve developed in the industry, to our portfolio companies, and to friends of the company as well, in order to help them succeed. So, we have a group internally at Canopy Rivers. They’re called the impact team, run by the former CEO of Canopy Growth as well as, he’s a McKinsey consultant, Harvard MBA. He’s created a team of experts in life sciences and regulatory affairs in growth and scaling. And our job is to help compliment the employee, the entrepreneurs that we invest in, in terms of getting to know different people in the industry, getting to know different parties. So I’ll give you an example. If you’re a small cultivator that’s looking for capital and you go to a venture capitalist like ourselves, we would help you find proper genetics to help you with volume purchases on supplies, we’d help you with getting to know retailers and customers in order to sell your products into, we’d help you with everything in and around your business. But we wouldn’t, at any given time, run your business, because that’s not our job to do.

Chip: So it’s more like an accelerator.

Narbe: Yeah, yeah. I mean, it’s more similar to an accelerator, except that typically when you think of an accelerator, it’s usually very small companies that are built off of an idea. It’s a bit different because we’ve already picked up the company where you have revenues, you have some market share, and you want to go to that next level, that next level, and the next level.

Chip: So you’ve got, you’ve got 18 companies, do you guys have an idea of the type of company that you’re looking for, or the type of return that you’re interested in when you decide, or is everybody different?

Narbe: Typically, for venture capital funds, you’re looking at investment returns about 15% year over year. Every year, your portfolio grows by 15%. But to get that 15%, when you get into a deal, you have to think of it as being a deal, “I can give you ten times your money.”  And if you believe it’s going to be 10 times your money, you’ll probably end up with 3 to 5 times your money, which then will convert to 15 to 20% return on investment. So that is kind of the mindset that you have, “Is this a 10 bagger? Is this going to be 10 times my money?” Because it’s growing very fast, it’s very competitive in nature, and it has, it’s carved out a niche for itself. In terms of where we look into across the value chain, there’s four key areas that we’re really honed into right now, and this changes all the time. One of them is on the brand side, we truly believe there’s no true customer affinity with brands that are out there. The customers aren’t only choosing one brand of edibles or one brand of pre-rolls, and not buying anything else, similar to how you see customers using Coke and Pepsi. The second piece is on the plant science side. We’re really zoned in on how to help take cannabis cultivation to the next level. So it looks a lot like what you see for vegetables and fruit cultivation around the world. The third piece is bio synthetics. Similarly, aspirin is derived from the bark of a willow tree, but you don’t see any willow tree cultivation facilities anywhere in the world. And the reason is that, the enzyme that that tree develops to help you with a headache is made in a lab. And similarly outside of THC and CBD, where the plant does give you a lot of that, the other minor cannabinoids, we have a view that they’ll be created in the lab instead of being created organically on a plant everywhere. And then the fourth area is data and technology. We really do believe that that there’s a lot of value in understanding the mindset of what consumers are buying, and as well as what retailers are buying from producers. And to understand that gives you a leg up in terms of what to develop next, and how to present it in market.

Chip: Are you looking at companies that have $1 million in revenue today and want to grow it? Or $10 million? I guess it’s kind of all over the place, tech companies might not have any sales.

Narbe: Yup, yeah. So our view is that we’re a lifecycle investor, like our smallest check has been 750,000 off of an idea, our largest check has been $50 million. So, we are very open to talking to all types of entrepreneurs and all types of businesses, not necessarily anybody with a certain threshold. To me, it’s great to just learn about how entrepreneurs view a business. So, I mean, I say this a lot to companies that are based out of Latin America, or China, or Europe where they’re looking for funding. And I say the first thing you should do is focus on teaching your prospective investor about your geography, and why it’s different than in North America, and then go into your company at the end of the day, and then that’s key. Like, it’s about the teaching piece of it. You’re a company, you’re looking for investment money, teach your investor why you’re different than anybody else. Teach them about how you see the industry as well, and build that rapport to show that you’re different than every other company that’s out there.

Chip: You know, when I started my first potting soil company years ago, a friend of mine said, “What makes you think you can do this so special?” I immediately was resistant, you know, and as a young entrepreneur it was my second business at the time, I was just literally so bold and brazen, it was like, “Oh, because it’s me, I’m doing it.” And, you know, the market was so much smaller 20 years ago, right? And no one had heard of cocoa fiber at the time, or very little people had. I was on the cusp of a revolution. But to start a business now, it seems so difficult to me, for young entrepreneurs, to be able to come into a marketplace and just immediately be able to compete with people in the cannabis industry specifically that have been doing it a long time, or just have so many resources, you know, behind them. I mean, I started my first potting soil company with literally like, $3,000, right? And I just don’t know if anybody could do that today.

Narbe: I think so. I’d challenge that. I’d say it like there’s never been a better time to start a business than it is today. Like the amount of resources, and podcasts like yourselves that entrepreneurs, young budding entrepreneurs, pun intended, could really listen to, read, understand what the pitfalls were, how people succeeded, how people screwed up, to really just really zone in on what the idea is. There’s an unprecedent amount of data out there about how to start a business that we’ve ever seen in the history of mankind. So compare starting a business now to ten years ago, [41:33 inaudible].

Chip: You’re saying just the sheer access people have to information just accelerates the overall growth.

Narbe: Absolutely.

Chip: And your chance to exposure to any market in the world is readily available at the stroke of your fingers, honestly, right?

Narbe: Absolutely. The [41:55 inaudible] is on the entrepreneur to really sit down and learn these things. And if you have the time of any, you can carve out the time, and I say, if you’re looking to start a business, and you don’t know where to start, just carve out an hour every day, sit at a Starbucks, and just read. Just read articles, read about that industry you want to get into, read about what other companies are doing, listen to a podcast of a successful entrepreneur, and just get your mind going. And it is a snowball effect of within the day, and I’m sure you can attest that as well, that every small move you make, somehow turns into a very tangibly big deal later on.

Chip: Yeah.

Narbe: And you can’t predict that, you can’t. And it gets a bit daunting when you think of the successful people and you say, “How do I get there?” You just have to show up every day and put in your work.

Chip: Yeah, no man, plants grow, man. You put a seed in the ground. You give it every single thing it wants, it gets huge and big. Sometimes you can’t water it so much, or feed it so much, it’s that much smaller. But like, if you get it everything it needs, just the potential for growth is just incredible, and that’s in businesses, and in relationships, and people as well.

Narbe: Absolutely.

Chip: Well, you’ve changed my mind. Okay, okay. I now think that it was harder when I started my business. And now I realize it was. I was literally getting phone calls from Sri Lanka at four in the morning, you know?

Narbe: I love it. I love that —

Chip: And they’re speaking broken English —

Narbe: I love hearing the grind.

Chip: Yeah, it is easier today. Like if anyone wanted to go start a potting soil company, they could look up manufacturers at the touch of their fingers. You know, when I started, I don’t know how old you are, but we’d go to the library. And there was this encyclopedia of businesses and manufacturers.

Narbe: Yup.

Chip: And we would search through it and find like, suppliers and nobody had websites, you would call people directly and build a relationship with them.

Narbe: Yeah just think about the long distance charges you’d incurred just to call them. Nowadays, you have Google Hangouts, and video calls, and voice calls made over the Internet that you’re not paying anything extra for. So, it’s just remarkable how much easier and cheaper it is to run a business.

Chip: Yeah no, absolutely man. The virtual assistants, the on demand workers, the sheer amount of like marketing talent, and graphic talent, and product development talent like you know, you can access all those resources for inexpensive. You just have to know how to like, who to ask and how to ask for what, and anybody today if they wanted to get involved in you know, breeding cannabis, breeding hemp, breeding, you know, high THC hemp, anybody can get involved with a two day at a high level, because they can just, you know, look up people in the industry that want a job, frankly. Somebody in India, or even in Seattle, or Vancouver, and there’s somebody who’s interested in cannabis that, you know, has a PhD in genomics, genetics, biology and wants to help you out, and will over the phone, or over Zoom, right?

Narbe: It’s just a matter of doing it right. It’s just a matter of just picking up the phone and doing it. Not many people do that actually, a lot of people sit there and just fantasize about what their company can do, instead of just learning, and it’s remarkable if you just contact someone and say, “Hey, I just want to pick your brain for five minutes on a certain topic that I have not, going to sell you anything. And I’m not going to ask you for a job. I just want to know what you did in this scenario to get to where you were.” It’s remarkable how many people actually reach out to you and say, “Yeah, I’m okay with that. Let’s do that call.” And you do that call, and that call turns into a follow up call, and that follow up call is half an hour, 45 minutes long, and soon enough, someone wants to give you a job and someone wants to buy your product. And it’s just about putting that process in and getting those at bats.

Chip: At bats. Oh man, I say it all the time, you just got to jump in, you really do. We have all this hesitation and resistance. And it’s product development, or entrepreneurs, you like, want to build this perfect thing and get it perfect and it hits the market and everybody loves it, and you know, you get a home run. But I think it’s more important to have a base it to literally just hop in the deep end and learn how to swim,  right? You get great product development, you get customer feedback, you might get a lot of shit too. If you can get beyond that, like for me anyway, that is my preferred method of launching a product, starting a business. It’s just getting into it, right?

Narbe: Yeah, it is remarkable how much you’ll learn from it too. Like I remember this one time I got an investor, sorry, an entrepreneur that came to pitch me and every time I asked – it was half an hour long – and every time I asked a question, she just dumped a data dump on me of the number of people he surveyed. So I asked a question, like, “Who’s gonna buy your product?” and be like, “Oh, I used Google Search, Google Audience. I surveyed 300 people, and these people said they would pay for it.” I can’t say anything against that. “Okay. So how about the pricing?” Well, as you come up with a price, then you said, “Well, I looked up all of my competitors, then I scraped the web for their pricing, and this is the price that they’re selling it at. And I think that I can sell at this price and get better margins.” “Okay, I got that, too.” And every time I was asking questions, it was data, data data, and you can’t, the data itself, like, it really answers the question without putting any objective opinions into it. But at the same time, the data does have confirmation bias attached to it as well. So as an investor, you always worry about the best data being shown to you, not the bad stuff. But what I’m trying to get to is, if you back your idea and your thesis with data around you, it’s going to be very hard to refute that you’ve done a lot of homework on this. The best pitches that we see are the ones that the entrepreneur’s ready to answer every question, because they’ve sat back and they said, “You know what? There’s a finite number of questions, there’s a known number of questions that someone can ask me over a half hour to understand my business, and I’m gonna be ready for every single question that’s going to come out there.” And there might be some weird one that’s like, “What kitchen utensil might you be?” that they’re not prepped for. I don’t ask that question, but there’s always those random questions that they might not be prepared for, but you need to be prepared when you come into that pitch. And those are the ones, the ones that answer the questions and give you that look like, “Is this as hard as it gets? Because I live and breathe my company, and you think I can’t answer these questions. These are easy.” And those are the ones that you see the passion just glittering in the idea that they’re presenting to you.

Chip: Oh man, I’m smiling just thinking about it. I mean, I know people make the television show comparison to you guys all the time, but it must feel just like that, right?

Narbe: It is except you’re not trying to find those one-liners to stump on the entrepreneur and make yourself look good on screen.

Chip: Oh, that’s funny. You’re right. Well, you know, you gotta sell the story. You guys sound like you’re having a great time.

Narbe: Yeah, you know, I’m grateful for the opportunity to talk with so many bright minded individuals all over the world about how they see this industry progressing. I’m literally so grateful for it.

Chip: We’ve kind of talked about one side of it. We’ve talked about the, you know, the entrepreneur side and kind of how the venture capitalists work. Many people today feel like they’ve had some bad cannabis investments. And there’s more people that have gotten, lost their investment in cannabis operations, than you’d care to know. People enter it often with passion, without so much data, it’s often a brother in law, cousin, best friend type scenario. And you, things just kind of go wrong. All that is changing. Do you have a tip for the investor? On how to be wary, and how not to get involved in a bad relationship?

Narbe: Yeah, I think the first step is that you need to really understand that venture investment, or angel investing, or  investing in a private company, that is most basic level, is a very high risk move. High risk because once that money goes in, that company’s going to spend that money, and there’s no way for you to take that money back out. This isn’t like buying Apple stock where every day there’s a market for it that you can sell your shares to. Instead, it’s a very difficult proposition because you need to wait 5, 6, 7, 8, 9, 10 years in order to get your money back and get, potentially getting return. And between that period of time, there’s a lot of areas where companies can screw up and can really change the way the outlook of that company is. So when you’re looking at an investment, and you need to kind of tell yourself like, “I’m okay losing this money, and I’m taking a risk here.” And I’ve always like, financial literature and theory tells you that for these types of investments, you should put no more than 10% of your wealth down into investments such as these, and you hear all too much that people are putting their entire nest egg into an idea that just doesn’t pan out. And this is why governments in both Canada and the US create systems in place where individuals can’t invest in these private companies, unless they’re what they call “accredited.” Which means you have, and it varies by state and by country, but in general, it means you have wealth. You have call it, $5 million of assets in hand, or you’re making a million dollars of cash flow per year. And the government then allows you to invest in these private companies. And there’s a lot of times where companies that take investments from individuals don’t do that work to make sure that those investors understand the risks that they’re going into, and it turns into a bad place. When we look at the cannabis industry itself, it’s a bit different.  You’re seeing different data coming from Main Street versus Wall Street. So when you’re looking at the capital markets and stocks right now, they’re much lower than they were a couple years ago. But when you look at what’s selling in each of the states, you’re seeing monumental growth rates like 10, 15, 20, 50% within a few months. So you’re seeing the industry grow very fast, but you’re seeing companies getting smaller, smaller in terms of evaluation. And that’s just generally the nature of the stage that we’re in, in the cannabis industry, where the ones that are going to win are going to win, the ones that are going to go bankrupt are going to go bankrupt. And because of the, you don’t know which ones are which at this point in time, and because it’s so early, everyone just kind of takes a hit until those winners are figured out.

Chip: Business is so much like gambling. Serial entrepreneurs, we’re gamblers at heart. But you throw in some cannabusiness in it and wow, it sure it sure can make it exciting, that’s for sure.

Narbe: Absolutely. [53:15 inaudible].

Chip: Sounds like a good country song or Jerry Garcia song.

Narbe: Yeah, the returns aren’t as good as gambling either, though. You can’t double your money by betting on red or black.

Chip: Yeah, well, you know, that’s just a fan- it’s a fantasy. Yeah, well, I get it. Man, it’s been great talking to you today. You know, cannabusiness, like I said, is the most important part to the cannabis industry. It’s maturing so much right now. And really come in and [53:45 inaudible] it is really great to hear your perspective on the consumer packaged goods, on cultivation, and where you think the cannabis industry is going, man. I really appreciate you joining me today. If people want to get in touch with you. what’s the best way for them to do that?

Narbe: Yeah, you can reach out to me on LinkedIn, you can email me narbe@canopyrivers.com. So if you’re interested in learning more or talking, happy to chat.

Chip: Thanks for joining us man. I really appreciate your time.

Narbe: Thanks for having me.

Chip: This has been another episode of The Real Dirt, and that was Narbe Alexandrian with Canopy Rivers. Man, it was really great speaking to them about capital investment into cannabis. You know, the only way we can grow is sometimes we get a little help from our friends, or help from others. And you know, don’t let quote unquote, big business keep you down, or think you that you can’t survive in the cannabis industry. Listen to this conversation. You know, we talked heavily about how people with just an idea can get one started. So if you’ve got an idea, man, take that first step. Just try it. If you’re thinking about growing cannabis, if you’re thinking about getting into the cannabis business, man, just hop into it. Just try it, right? Don’t let money stop you. Don’t let time stop you. Definitely don’t let your friend’s shit talking stop you. Just try man, and you know, when you get slapped down, stand up. When it’s not working, examine what you’re doing, and be determined to make it work. If you have the desire, you can stick it out long enough. If you can keep your eyes open, and make sure that you’re right, making the right economic decisions, man, chances are you’re going to do just fine. So thanks again for listening to this episode of The Real Dirt. This has been fun and exciting for me. Please, if you’re interested in other episodes like this, check us out on iTunes, The Real Dirt podcast. You can also download other episodes at therealdirt.com. Please check out cultivatecolorado.com, we can supply you with all of your propagation and equipment needs. Thanks again. This has been The Real Dirt.

The Secrets of the Country’s Largest Cannabis Operations with Nick Morin

The Secrets of the Country’s Largest Cannabis Operations with Nick Morin

commercial cannabis grow

Remember that show Cribs?

You know, that show where we got to take tours through the mansions of the rich and famous and feel bad about ourselves. While it’s been a long time since we watched Master P show off his gold ceiling, there’s a new, better, completely unrelated Cribs that is all about cannabis.

CannaCribs was started by Nick Morin through his company the Grower’s Network to show us all what it’s really like inside some of the largest and technologically advanced cannabis cultivation operations across the country. But it isn’t all green ganja and piles of cash in these operations.

What you don’t see on CannaCribs is the behind the scenes details that Nick gets from the head growers and owners of these operations. From the shady investment dealings that growers fall into like overfunding and inexperienced fund managers to the stressful work that goes into maintaining a large scale cannabis operation, Chip and Nick dive into it all in this episode of The Real Dirt Podcast.

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Transcript:

Chip: Once again you have reached “The Real Dirt.” And on today’s dirt, it’s a very special episode. Today, I’ve got Nick Morin from Canna Cribs. Now, if you haven’t seen Canna Cribs, you’ve got to check it out, great YouTube channel. It’s absolutely one of my favorites, it’s one of the best production in our whole industry. And if you haven’t seen Canna Cribs yet, you’re missing out. Thank you so much Nick for joining me.

Nick: Chip, thanks for having me. I really appreciate your time.

Chip: Nick called me up a couple, a month or two ago, and said he was going to start a podcast. And we’ve exchanged a bunch of information and talked back and forth and you know, I’m really excited to hear about your podcast. You’ve just launched a new podcast and you know, we just immediately got along on the phone. ‘Cause like, we do the same thing. You know in some manner, is we get to go talk to ganja people all over the country and world and find out, you know, what they’re all about. And get to go into gardens that we may, people just dream about. What’s it like having this dream job, Nick?

Nick: I just would say I’m extremely grateful to be working with my team, you know, my bestfriends and going out and filming these stories, telling these stories now on the podcast. It’s a dream job and it’s something that you know, as a little kid I never would have imagined I’d be here today, but it’s pretty special at this point in time in this industry, as we’re evolving rapidly.

Chip: I know we have a lot talk about. But like, let’s talk about Canna Cribs. How did it start, when did it start, like tell me about it.

Nick: I’ll take you to the exact point in time. CannaCon Seattle, I was talking with my friends that own uh, Glass House Farms in uh, Carpinteria, California. You know, it was dinner, it’s after the trade show. As many people do after a trade show, you go out for dinner and drinks and we’re just brainstorming. And when you get those energies, you know, across the table going and some good ideas, Canna Cribs was born. You know, I wanted to create a Youtube series. And I was really inspired by Marijuana Mania by Berner, and Strain Hunters and their team, and I wanted to come up with uh, kind of my own version of garden tours. I think Growing Exposed was coming up around the same time as well. So you know, I was chatting with, you know, Graham and their whole team over there. And we came up that – it sounds like you got the intro going, so yeah, that’s, that’s it right there, man. So we flew out there shortly after, actually flew to Tucson and picked this up which was a surreal experience in itself right there. I put together my team from University of Arizona, you know, some friends from college, some friends that I’ve worked with, and then some acquaintances kind of one degree away in Tucson. And we flew out there, filmed our pilot and as they say, the rest is history.

Chip: I’ve actually got it on right now, “Glass House Greenhouse Commercial Cannabis Growing Operation in California,” Canna Cribs. I really love this episode, I love everything about it. Like it’s so like, highly produced. I’m a TV junkie, I love format. And like, just the way that you guys have produced this whole series, it like, mimics you know, several other of my favorite type of genres. The like, you know, fix and flip style genre, where they’re either it’s an old junk car they find, the barn find, and turn it into —

Nick: Right.

Chip: You know, something. Something great. Or like, you know, a house, where like they buy it, and they like, fix it and flip it. You’ve got a lot of the like, elements in the editing with that. It really like, draws people in. Man, I also love all of the, the product placement that occurs in this episode and other episodes. It shows the products that people are using, but it’s not like an over the top infomercial advertisement. ‘Cause we all know it’s like, advertising helps pay for it all. It’s very discreetly done, it’s done well.

Nick: Yeah. You’re exactly right. The product placement and advertising, it allows for us to go out there and film. And you know, a lot of people don’t know this, but it’s not like we’re charging farms tens and thousands or you know, a hundred thousand dollars to go out to film. It’s actually no cost, vast majority of the time. So the farm doesn’t pay anything, and we of course have to pay our crew and get out there. And you know, you know this very well, Chip. Youtube gives us zero dollars in advertising. I can’t even spend money on Youtube to promote our show so, it creates an environment where you have to be very scrappy. You have to be wise and extend your dollars through organic content. And the thought leadership behind the brands, the products, the services that these growers are using, it’s a pretty straightforward model where these are the products that their success is built on. Those companies you know like, let’s say soil companies. You know, your background and growing media, and every episode there’s a different growing media. And these growers rely on that product for their success so it’s a really natural fit where we get to educate fans all around the world. We get to help promote the grower through the episode. And then the vendor has an opportunity to promote their products naturally, because we don’t place products that aren’t naturally used at the farm.

Chip: And you can tell the authenticity of it due to that. What was your background in cannabis previous to this?

Nick: So I just say, a lover of the plant. I’m relatively —

Chip: You’re an enthusiast. You’re a cannabis enthusiast. Excellent.

Nick: That’s exactly right. So I started consuming young and you know, I have two older brothers and that probably helped a little bit. Yeah, I actually started Growers Network and Canna Cribs shortly after, during my senior year in college. So, this is my first foray into the, into any professional industry, really. I started a couple communities while I was at the University of Arizona. So I guess I do have a background in kind of grassroots community building from the ground up. And then you know, I have a passion for both cannabis and also technology, and the marriage of the two of those things, as well as marketing and community building, it’s kind of where I live today. And what I’m super passionate about you know, when it comes to sharing very special stories that will impact the history and our future, everyone in this industry with the rest of the world. And just kind of showing and proving that there is a way to have you know, legal, compliant, and really good cannabis at the end of the day that saves lives and builds businesses.

Chip: You came to this as just an enthusiast. You had a surface knowledge of how cannabis operated, how it grew, the production of it all. Did you have some misconceptions that were immediately proven inaccurate when you started doing Canna Cribs?

Nick: I would say that like, everyone on our crew including myself, we didn’t really know, we didn’t really know what went into a commercial sized grow operation. You know, we might have had friends growing here and there, more you know, underground and maybe at the hobbyist or kind of that caregiver scale. But, to walk into a commercial grow operation and see that scale, it was incredible. So I’d say, maybe less misconceptions but more just, you know, kind of what’s behind the curtain. Having the opportunity to share that with the world is really special.

Chip: You talked about the stories, you’ve mentioned that a couple of times. Do you have a favorite cannabis story, or favorite episode that you made?

Nick: Oh my gosh, that’s a tough one. Choosing between your babies —

Chip: Oh I just keep pressing the memo, hey I just started man, I just started.

Nick: I love it. I love it. Yeah, no, I love the question, Chip. So I’d say you know, one of the stories that I probably enjoyed the most telling and also was the most moved by, was Scott Reach of Rare Dankness. He’s gone through a lot of personal turmoil and you can listen to his story with his health, and how cannabis really healed him and gave him an opportunity to you know, run a business and support his family. So, a lot of that comes up in you know, throughout the episode and you know, it’s not every single episode that that story is going to be exactly the same. You know, each episode kind of has a unique, I guess unique story to tell. But with Scott and Rare Dankness, before we went out there you know, we did some research. We always like to do some pre-production research to come up with some story points and kind of build out what the episode’s going to look like before we set foot on set to film. You know, his personal fight with cancer and how cannabis really helped him personally with his fight with cancer, but also his background with breeding and as a geneticist. And through his other companies, he’s building, in my words, he’s building a cannabis empire. It doesn’t stop with just House of Dankness, it doesn’t stop with just Rare Dankness, he has a seed company around the world, he has a new nutrient line. So, one thing that I really resonate with and connect with is the entrepreneurial spirit of these cannabis grow operation owners. And there’s a lot of different types of commercial grow operations, but that episode with Scott, it really shined through, all the different things he had going on, and I loved it.

Chip: He’s really built an incredible room. If anybody’s out there who wants to see great, great, great cultivation grow room, look up that episode. Which episode is it? I’m looking for it now.

Nick: Episode six, it was right after Honeydew Farms in Humboldt.

Chip: Episode six, man, totally. Episode six, Honeydew Farm. The first Canna Cribs was the Honeydew Farms one.

Nick: Oh really?

Chip: And I’ve spent most of my life in Humboldt. I moved there ’97, and still have a property, and farm, and business there today. I heard that there was some, you know, because it’s a small community, so I’d heard that there was some like, thing being filmed, Honeydew Farms. And it was out, so yeah I went and checked it out. That was my first exposure to you. And then of course, I watched all the rest of the episodes.

Nick: Yeah. Yeah, it’s bingeful content. You know, it takes you about a weekend to watch all the Canna Cribs and Deep Roots, and we have a couple you know, new projects on the horizon. But, you know, if you ask me the favorite episode to film as far as where I was, it’s hands down, Alex Moore’s Honeydew Farms in Humboldt. It was my first time travelling there. And I mean, honestly Chip, I felt like the time froze. You know, our cellphones weren’t working. You know, we just had our cameras and we were kind of like, paused in this beautiful forest and his property is pretty amazing as well, you know, on a river basin. It was, it was magical. And we stayed in Arcadia?

Chip: Arcata.

Nick: Arcata, Arcata. So we stayed in Arcata and you know – or no sorry, I apologize. We stayed in Eureka.

Chip: Eureka.

Nick: Yeah, we drove up about an hour and a half up the hill and then an hour and a half back down to our hotel each day. So, we had to wake up super early and we went to bed pretty late each night, because we were battling sunlight. You know, most the farm’s outdoors so we had to film very efficiently with the daylight there. So, part of that was probably some lack of sleep that added to the effect. But, it was amazing. We went out to the waterside as well at the end of the episode. We went to the Redwoods. Everywhere we go, Chip, we try to characterize the region. We try to give the audience a glimpse into what it’s really like. Not just in the farm, but the surrounding area. Because we have around 150 countries around the world watching our Youtube channel, right? So, if someone’s in let’s say, Russia, and they’ve never been to Humboldt, I kind of put it on our shoulders like as a responsibility, to tell them what it’s really like, and to show them that glimpse of the world. And Humboldt is such a beautiful place, and I, I’m actually going to be, right after this interview, I’m actually interviewing two brothers that cofounded Lit House Farms in Humboldt, Big Al and Chris. And then last week, I interviewed Nat at Humboldt Seed Company for the Canna Cribs podcast. So, I love Humboldt —

Chip: Yeah, I know Nat. I’m actually like, growing his seeds right now, Auto OGs.

Nick: Oh nice. Okay.

Chip: Totally, totally. Yeah we got like ten thousand Auto OGs we’ve planted in the past like, two weeks.

Nick: Wow.

Chip: They’ll come out some time in October.

Nick: Well, I’m always finding a reason you know, trying to find a reason to go back so if you still have property, if you have friends up in Humboldt, I’d love to film them some time.

Chip: Ah man. I love it out there. We’ve got so much stuff going on up there, you know. It’s an incredible, geographical environment, you know. It’s a really rough political environment, you know. There’s just a lot of people that do not support legal cannabis and try to stand in your way at every point. It’s really unfortunate because there’s so many small farmers over there that can really bring and grow the best cannabis in the world. They’ve got like, the experience and the time, and the understanding, and the desire, and the heart to do it. But you know the, so many you know, at so many levels, the county and the bureaucracy, and the county is against what they’re doing. How many people in the county, they totally accept it. Right, many of the board of supervisors totally accept it. But, it’s just a fight you know, for anybody trying to get a legal cannabis operation there. And absolutely anybody who has gone through the worst to get one because, it’s not at all, easy there. It’s not at all easy there. So yeah, let’s hope that the industry survives. But yeah, I’ve got tons of connections up there. I’d totally hook you up with anybody you want to, if you can’t figure out who to talk to. You know, I started a potting soil company up there years ago, Royal Gold Soils. I sold soil to everybody up there for years. And currently, my new soil company, Grower Soil, I’m not in California yet. I’m mostly just focusing on you know, the midwest and the east coast. Yeah, I’ve got tons of connections all over man. If you ever want to go see anybody, just ask. I might know them.

Nick: Thank you. And that’s what I love about this industry when I first started out you know, I was working with my bestfriend and roommate at the time, and current business partner, Nate Lipton of Growers House. And he had a spreadsheet of growers, right, that are commercial growers that buy from Growers House. And I was originally, and I still run Growers Network today, all the work you know, a lot of the conversations around Canna Cribs up to this point. But the first company, and it is the production company of Canna Cribs, it’s called Growers Network. And it’s an online forum. We have about 11,000 members all over the world. And just people where they can go, and connect, and learn from each other. And I was just originally handed a spreadsheet of the top contacts from Growers House, and I just interviewed for ten months. You know, I picked up the phone, and the Lean Canvas methodology in the startup world, it’s called Customer Segment Testing.

Chip: Sure.

Nick: So, I just picked up the phone and called the you know, a hundred growers and listened to their paying points and you know, how they learned how to grow cannabis, where they were at in their career you know, super seasoned or new, what hurdles they were jumping over to become a legal professional grow operation. And at no point did I say, “Oh, join Growers Network,” or, “Oh,” like, Canna Cribs didn’t start at that point. So in the very beginning, my first ten months in this industry was just network building and acceptance amongst growers that were complete strangers. And what you just shared with me right now has been my experience up to this point, just generosity and open arms and

welcoming into the industry. So thank you, and thank everyone out there that helps to you know, nurture this industry.

Chip: You know, it’s interesting you say that. ‘Cause there’s really two sides to the cannabis coin. And well, you know, it depends on which coin you’re talking about. But the knowledge coin that we’re talking about, there’s two sides of it. There are the guarded people that won’t let you in, and are closed off, they don’t really want to talk about it so much. A lot of it’s leftover from prohibitionary you know, thinking. Some of it is you know, the propriety knowledge, they think what they have is like, the best. There’s often ego associated with all of that, but that’s one portion of the community. And then the whole other portion of the community, like 75% open. Talks about it, invites you over, wants to know what you’re doing, ‘cause they want to know if they’re doing it right or wrong, right? Are absolutely like, enthusiastic about what they’re growing and want to make it better. So it’s real interesting, it’s not an even coin flip that most people in the cannabis industry that I come across, and I’m a, you know, both us are kind of a unique pawn in the pyramid, but you know, but they openly want to tell us what we’re doing. And tell other people, and talk to other people openly.

Nick: Yeah.

Chip: It’s just a great place to learn, that’s for sure.

Nick: Yeah and right now, you know, I like that you said it’s a great place to learn. Right now, trade shows up to this point were kind of like, the in-person exchange of like, information, and knowledge, and contacts and products, and services. And now that they’re all shut down, what I’ve seen is a huge influx of traffic to our Youtube channel. And to our, you know, Growers Network Grower Forum because people can’t meet in person anymore. So I mean obviously, no one planned for this. But for the content creators out there such as yourself and you know, my team, we’re really in a pivotal point right now where, and that’s why I started this podcast is, we need to kind of ramp up, you know. We need to, you know, create more content and share more stories because there’s not a whole lot of in-person outlets right now. We’re kind of leading that charge and I kind of take it upon us to provide, and kind of have that responsibility to provide that knowledge and information exchange.

Chip: You know, cannabis, the way you learn about it and the way people learn about it now is through this open source. It’s through Youtube, it’s through Google, it’s through this open network of people like, bragging, or people just completely enthusiastic about cannabis. You know, it’s so much different than say, let’s take a trade like, photography. Or marketing, right? With marketing, if you’re interested in marketing , you can go online, and you can buy like, you know, two dozen Frank Curran courses, you can buy like, you know any type of how-to Youtube advertisement, or how-to Facebook advertise or how-to content. But the cannabis industry isn’t like that. Can you shed some light on why you think that is?

Nick: Well, I think you said it a little bit earlier Chip. You know, a lot of people, I’ve heard it on your show as well, there’s a lot of growers out there that in their mindset, and in their belief, they’re growing the best way, right? There are so many processes that go into

growing cannabis. I’m not a grower myself, you know, but in filming these large scale grow operations and then telling these stories, I’ve learned a whole lot about you know, growing cannabis organically. Growing cannabis you know, kind of boutique indoor. Growing cannabis outdoors, you know. 36,000 plants at Los Sueños Farms. So, what I have found is it’s extremely fragmenting on how to grow cannabis. There are so many unique ways and the beautiful part to me, is there’s not one right way, you know? Like, you can grow soil, you can grow soilless. You can grow you know, indoor with LEDs, or indoor with HPS. And there’s all these, right path, left path that you can take throughout the entire grow cycle. And I want to educate the world on all those different options. And in each scene in Canna Cribs, if someone’s listening to this and have not seen a Canna Cribs episode, we always start with genetics. We go through propagation, and we follow lifecycle of the plant all the way through kind of seed to sale, if you will. So throughout each scene, you know, I have not filmed an episode that has completely replicated a previous episode. You know, everyone’s doing propagation a little bit differently. You know, they’re doing veg a little bit differently. So to your question, I think it’s fragmented. You know, email marketing is email marketing, right? There’s some tricks to the trade, but it’s an email at the end of the day. But you know, growing a plant, there are so many different unique ways to do that, and furthermore, there’s always new ideas, right? There’s always someone with an innovative idea and when they share, it’s the rising tide for every grower in the world. And then, kind of you know, fuel to the fire here, new products, right? You are a product inventor. You are a product genius and innovator, and when you, Chip, bring a new product to the market, it opens up a Pandora box of all these new types of cultivation methodologies. So, I think it’s fragmented because there are so many different ways to grow the plant.

Chip: Man, you really hit the nail on the head there. There’s absolutely no one way and that’s just the beauty of ganja, of cannabis, THC or hemp, right? It can grow in a million different spots.

Nick: That’s the resiliency to the plant itself, right? I mean, it’s pure for a reason. I love your saying, plants grow us. You know, we don’t grow plants. And I got to pinch myself right now, ’cause it’s so surreal to actually be on your show, talking to you about that. But, I completely agree. This plant’s here for a reason, it’s extremely resilient. And the fact that it can be grown in all these different, you know, unique ways to the region, to the grower, you know, to the product. It’s here for a reason.

Chip: You started Growers Network 2017, 2018, something like that?

Nick: Yeah, so the end of 2016 going into 2017, I’m a senior at University of Arizona, I did about ten months of research, just trying out what business model to start. You know, I had my hypothesis that I wanted to do something in the community space, get my background, and I thought there was a model there to build a new breed of online growing forums, which is Growers Network today. A little bit more of you know, I pay all my respects of course to the forums that got us here today, like the Grass City and Overgrow and all those amazing forums. But I wanted to do it a little bit differently and provide a safe place for the professional growers that were trying to transcend out of let’s say, a house grow into a you know, 300,000 square foot greenhouse. Like, how do you do that, you know? Who do you talk to, you know, where do you go to learn? Those are the kind of questions that

I was trying to ask these growers and that was what Growers Network was born out of, was that research.

Chip: Man, it has changed since 2016. I mean compared to 2020, right now as we record this episode, it’s August 2020 here in Arizona. I’m in Oklahoma, we have seen cannabis become legal all over the country in the past four years. We have seen, like you know, trends in cannabis happen. We’ve seen governments legalize it, we’ve seen Ponzi schemes associated with it. When you started this, at some point you started to get like, a vision of what was happening. Your perceptions of it in 2016, how did they change from your perceptions of it today, knowing all that change has happened?

Nick: Let’s just start with vendors, for example. Equipment suppliers, manufacturers. So in the beginning days, let’s say 2016. You know I went to my first trade show was a maximum yield show with Nate and his father, my mentor, Pauly. And they’re with you know, Growers House, and we went there to talk to vendors and walk the shows in San Francisco. And, it was all new to me. This professional side of the industry that I just didn’t know existed, you know. You know, as a connoisseur, or a consumer, or advocate in high school and college, I just didn’t know that this whole professional industry existed. You know, I was kind of naive to that. So, since then, I have seen a lot of new products hit the market. I’ve seen consolidation of different companies. Like, take Fluence for example, with you know, OSRAM coming in, and take Hawthorne, for example, and Scotts Group coming in and acquiring Davita. And you know, I listened to that episode on your show, and I loved that one, by the way. And I’ve seen that consolidation happen in a short amount of time you know, past five years on the equipment side alone. On the grower side, you know I’m always trying to pick the next market to go out and film. And I definitely will reach out with you about Oklahoma you know, once it’s a little bit safer to start flying. I definitely want to bring the Canna Cribs crew over to Oklahoma and film some farms out there. But what I’ve seen is, you know, a lot of expansion, you know. It expands into a new region, new state, and then, it kind of restricts down. You know, it’s a period of time where it grows, grows, grows, hits that apex and then, consolidation starts to happen. And kind of that market equilibrium starts to happen, right? The supply and demand starts to balance out. So I’ve seen that happen over the past five years which is pretty incredible. I’ve seen you know, Canada come online and some other parts around the world, Colombia for one, that’s really you know, kind of blowing up and they’re part of the world. So, it’s exciting, and at the same time I’m honored to be able to help document that history.

Chip: Who could have predicted cannabis at Canada would have just skyrocketed and plummeted so quickly?

Nick: Right.

Chip: You know, who could have predicted that Oklahoma, once one of the most conservative places about cannabis in the country would become the best and most premier place you know, to cultivate cannabis in the country? Nobody thought that was going to happen.

Nick: Right. So let me —

Chip: It’s incredible where it’s turning.

Nick: Yeah. Let me ask you this, Chip. So what can we learn, as a country, what can we learn from Canada’s missteps so we don’t follow in the same footsteps?

Chip: Well you know I think we’re already doing the exact same thing. We just weren’t able to have publicly traded companies that could directly trade cannabis on the NASDAQ, right? And any like, insulary type businesses that were allowed to be publicly traded, those were all you know, over the counter, OTC trading stocks. So I think that is really what kept the US investment schema from exploding. But essentially, we still have the same exact elements that were going on in Canada, that are going on here, going on here today. Which are just like, some incredibly savvy people that know how to manipulate the market. That know how to manipulate venture capital groups or family offices. And you know, for instance, the typical cannabis “investment.” There’s two types. There’s one, it’s just like, me, you, and my brother all get together and we decide we want to do a cannabis operation so we throw in our money and make it.

Nick: Kind of the friends thing —

Chip: Friends and family thing. The bootstrap. And man, sometimes like, you come up with millions of dollars that way to start your operation, people call you corporate cannabis. But it’s not, it’s just you, me, and your brother putting it together. And then there’s the venture capital model or the investor model, we’ll call it. And it stems on you know, somebody like you who wants to put in a cannabis operation. Or somebody like me, who wants to put in a cannabis operation. And we develop a business plan, we develop a proforma that’s you know, fictional that we decide, “Yeah we think it should be this way. And we’re going to make this much money over this period of time.” We develop an operational cost, and schedule you know, points of time where we make profit, and investors can get paid back. And people can paint incredibly accurate pictures like that, but then they also create these you know, inaccurate portrayal of what’s happened. And that’s what went on in Canada. Right, it was an inaccurate portrayal of how big the market was.

Nick: Right.

Chip: And so many people went into the marketplace and estimated it to be like, ten times bigger than it actually was and just drove that whole investment strategy. Right, so like that happens here in the US, but it usually happens in two different ways. It happens from the person that’s actually trying to like, get financed or get investors. And they over-exaggerate but you know, knowingly over promise, you know, they don’t either know they can do it or they’re being promised by other people who don’t fulfill their promises. Or you know, however that pans out. And so then, it collapses, right? And then the other way it collapses is when a venture capital group comes in and they you know, the way that venture capital groups work or many of them work, is their funds and they’re someone who like, who’s running the fund and they’re getting paid a percent of the fund that’s spent annually. And they’re constantly going out, like, searching for more capital. And they’ll do stuff like this, so like go` to you Nick like, “Hey Nick, are you interested in cannabis?” Just say yes, just, you know, say yes.

Nick: Yes.

Chip: “Okay, yes you’re interested in cannabis! And you’ve got ten million dollars that you want to invest in cannabis this year?” Just say yes.

Nick: Yes.

Chip: “Well, I’m not going to get you to sign any [inaudible] right now. But, we’ve got all these cannabis operations that come to us. We’ve built a hundred million dollar fund, and if you want to contribute to it then you know, then you can contribute to it. Just deal by deal, you know, basis. You interested in that, Nick?”

Nick: Sounds good to me.

Chip: “Sounds great.” Okay so now, they go to the next guy and they say the same thing and they’re like, “Oh hey man, we’ve already got ten million dollars,” right? You know, “don’t be left behind.” And they hustle all of these people for the investment. Which you shouldn’t say hustle, because everybody’s willing to participate, ‘cause you love cannabis, you’ve got a lot of money and you want to invest in it, right? Like, nothing wrong with that at all. But, the person managing the fund is where it comes into play. ‘Cause now, they’re pressured to spend your money, because that’s how they get paid, right? They only get paid from your investment, is if they find an investment for you and you’ll go through ten before you say yes on one.

Nick: They’re pressured to –

Chip: And then they invest your money, yup.

Nick: And that kind of, it hurts the companies that might be overfunded because then that ties to unrealistic expectations that they have to deliver upon. And that could lead to the demise of their company, and also, the fund. But at the end of the day, the managing partner of said funds has already you know, received their —

Chip: They’ve already been paid.

Nick: Yeah.

Chip: They’ve already been paid. And you know –

Nick: Seems like a flawed model.

Chip: It’s a totally flawed model, but the reality is that you’re so rich, Nick, that you’ve got these ten million dollars that you need to like invest annually. So like, it’s you know, the Canna Cribs is a multi-billion dollar operation now, and you have to lose these ten million dollars every year, right? It’s an oversimplification of how it’s going down. But like, you spend the money and then you move on to the next project, right? And you are, you’re DC manager moves on to the next project, ’cause they got another bunch of people like yourself that got ten million dollars that they want to invest, or have an annual amount every year that they need to invest. So they keep up their legion, and man, that just pumps a bunch of like, a bunch of crap out there, you know. Projects that should be a million dollars turn out to be twelve million dollars. Greenhouses that should be three, four million dollars turn out to be ten million dollars. Indoor rooms that are two million are ten million. And they overspent and I know several of these people that have gotten caught up in this, and they’re my friends. And like, they thought they were doing the right thing ’cause it’s, you know what sounds great? It’s when you say something like this, “We’re building the most highly technical, advanced environmental control system in the whole cannabis industry. I’m going to be able to control my environment and the microcosm. I can control every square inch and I’ve got the data that’s going to be able to back it up.” And you know, that sounds great, right? Well, you know, it’s also like, cost you like millions and millions of dollars to do it. And you may end up you know, growing slightly better or more weed over it but the ROI, I’m spending twelve million dollars on a greenhouse that should cost a million dollars. It’s just you know, it’s not there. It’s not going to be there. And that’s how these things collapse. They’re not built on business, they’re built on investment. And now they’ve got all this operational cost, because it takes two people a hundred thousand dollars a year to run the software that gets all this great data, that they have to pay another whole accounting firm to read it, right?

Nick: Right.

Chip: Right, well.

Nick: You have, having gone through all these examples with your friends and people you know, what you know, cautionary advice could you give?

Chip: Man, the big pang is don’t really believe this investment business plan. I’ve got an investor like, you know, I’m an investor. Like, don’t think that the old way of doing it, the way that you probably thought that was the best way, the way that’s mostly used is the best way. And now, things have changed. And I believe that the investors want to be involved in cannabis right now, it is an essential business. And the opportunity, the advantage is on our side. And it is, an investment where it’s a good, reasonable return, you know, based on profit margin and standard accounting practices. Like that’s a, you know, that’s a good investment.

Nick: Right.

Chip: Right? Like some of the investments I hear about, like the return rates are just so high. The expectations are just so high, you know. It’s just, they fall apart, you know? And the best advice is to say, “Look if you’re going to have an investor, they should be an investor and you should think about it like you’re borrowing money.”

Nick: Right.

Chip: And otherwise, you have a partner. And if you’re going to get a partner, you need to bring in someone who has something other than just money. If they’re just a capital partner, and then don’t have operational stake in the business, man, there’s just so many details there over who gets paid, who does away, and there’s operational agreements that can

define all that stuff. But as soon as you have a silent partner that has invested all of the capital, like, things often go south, right? The paperwork’s not done appropriately, the investor becomes like, upset that you know, the cannabis isn’t performing appropriately. And you know, they’re hearing all these other ideas and they see Canna Cribs, and got all these ideas on how they should improve their scene. And it just often falls apart, right? So like, beware of your investor, is absolutely the best, the best advice. And man, form some solid partnerships. If you’re interested in growing world class weed, well you know what you’re going to need, is you need a world class extractor team. Because all of the weed that you grow, you’re not going to be able to produce into world class weed. So, go find an extractor that you can partner with. You know, hey, if you’re an extractor and you want to make world class weed, go find a grower and go partner with those people. And instead of bringing like this outside investment, like so much of it can be done with inside the community, and probably with like people that you know. But you know, it just takes, you got to get rid of the ego and solely think about the business. And think about the business that you can build together, as opposed to this get rich quick scheme that often comes through with this investor type platform. And I hope I’m not insulting any investors out there, and I mean, I’m one myself and I have other friends that are investors and I think they’d understand what I’m saying here, is you have to be savvy. You have to be savvy on the investment, and you have to be savvy on —

Nick: On both sides.

Chip: And hey, let’s take that on the other side. Just last week, a friend of mine called me up and he’s like, “Hey man. I’m thinking about putting money into this cannabis operation.” He threw out some rate of return, it seemed like a normal rate of return, you know, like a little bit better than bank money. But I looked it all up for them, and I look at their PLs, their BLs, I look at at the proforma, I looked at the location, you know. I checked them out with their state, and these guys were totally full of shit. And they just built this proforma to fool the unsavvy investor. And hey man, my friend he’s a savvy investor in the tech industry. But he doesn’t know anything about cannabis, right? And you know, we just went and looked at the guy’s like, proposed cost for growing a certain amount you know, a large amount of weed, and realized like, “Oh, he’s only spending 40,000 dollars a year growing weed. Like there’s no way he can grow 4,000 pounds,” you know. So like, also —

Nick: It goes on both sides, right?

Chip: It goes on both sides. Like —

Nick: It’s a booming industry right now, and I think with any booming industry it attracts so many apples. And some of them will be bad apples, right? So being cautious, savvy, and as you said, building a world-class community and network of people that can, you can rely now. Like, your buddy calling you whether it’s an investor investing into a cannabis grow operation or a grower calling you and saying like, “Hey, like, should I, should I take this money?” Um, I think that’s so vital to have people that you trust, you know, not part of the deal. It does not have [inaudible] that can you know, help mentor you.

Chip: Yeah, that’s true. And you know, I actually started a consulting group this year, kind of based on that exact principle. Is that you know, I have so many resources in the cannabis

industry and can easily like know or figure out a problem, someone’s already had it in just a matter of moments.

Nick: Yeah.

Chip: And, and we developed this, this, it’s called Greener Group, Greener Consulting Group. We developed this consulting group and you know, with the thought of like, “Oh we’re going to be able to like, help growers, retractors or owners like you know, solve some of their cultivation problems.” And for we immediately started getting calls for was from investors, from state and local governments. Because they need this information. From banks, they don’t know how to bank with cannabis people but want to, you know.

Nick: Interesting.

Chip: And you know, I actually have the connections to one of the guys. He works for us in one of our lead consultants at Greener Group and that’s exactly what he does. He helps banks integrate into accepting cannabis clients as clients, cannabis growers as clients. So there’s this interaction that can happen now that hasn’t happened in the past where you can ask experts. Where you can you know, talk to people that actually know the cannabis industry. And not just your great accountant who’s going to be leery, ‘cause he doesn’t know the cannabis industry or thinks it’s just a widget, you know. ‘Cause it’s not. It’s completely not a widget. So yeah, here’s my little rant, man. You got me talking today. It was supposed to be an interview for you, man.

Nick: Haha, well here’s the cool thing. I want to invite you onto the Canna Cribs podcast.

Chip: I want to come dude, yeah absolutely. Let’s schedule it up anytime, man. And absolutely, I’m going to promote your podcast. I’m stoked that we can be working within the same field and not have to feel that there’s a competitive nature going on.

Nick: Yeah. I’ve built Growers Network and Canna Cribs on collaboration over competition, right? When it comes to content, whether it’s you know, the Grow and Expose Youtube channel, or you know, your podcast. You know, fans around the world, they can listen to our podcast back to back. They can watch our Youtube videos back to back. So, it’s all about collaboration. And I want to say thank you again for you know, opening up your show for me today to join and share a little bit about what we’re doing. And being part of that, I believe you said 75% of the industry of being welcoming and accepting of newcomers like myself.

Chip: You’re no newcomer now, man. That’s for sure. Hey, Nick, I really want to thank you for joining me today. I really appreciate talking to you about all the stuff you’ve done and it’s been a great conversation. We’ll have to have you back on again.

Nick: Definitely, yeah. Thank you and for everyone on your team, keep working hard. I know it’s a really funky time right now, and it kind of sucks that we can’t go to trade shows and see each other and break bread over dinner afterwards. But, I’m looking forward to those days again and in the meantime, let’s podcast it up and you know, YouTube it up.

Chip: Sounds good man. And if you listened to this episode, enjoyed it, and would like to hear others, please download The Real Dirt at The Real Dirt podcast on iTunes. And absolutely subscribe, subscribe, that’s the only way we get to grow. You know, if you’re paranoid, or if you just want to listen to it on website, you can do that too. You can go to therealdirt.com and just stream it right there. But, uh, love you guys, thanks for listening, I appreciate each and every one of you. I always appreciate your comments on Facebook and Instagram. I feel like my growing network of friends just manages to expand every day. Just know, I’m a real person and you can always reach me. And this has been, The Real Dirt.

Growing Organic in California’s Cannabis Industry

Growing Organic in California’s Cannabis Industry

organic cannabis in california

From soil problems to government crackdowns, there’s no shortage of issues that growers in California have to deal with.

Jeff Bord is an entrepreneur, importer, grower, and consultant to start ups and cannabis companies trying to improve organic production and profits all over the world. As California’s legal cannabis woes continue to grow, Jeff has been helping growers in the state fix their problems and get in compliance with the state.

From regenerative farming practices and balancing soil chemistry to some simple techniques to check your work, Jeff has a ton of experience in cannabis cultivation that has helped growers all over the state improve their grow practices and stay within the state’s guidelines.

A lot of common start-up problems that are consistent with scaling can be easily overlooked by new business owners or growers trying to scale their operation. Jeff specializes in helping businesses stay on top of OSHA and a whole new world of laws and regulations with organic cultivation practices.

In this episode of The Real Dirt Podcast, Chip and Jeff talk about growing organic cannabis in Humboldt and how things have changed since California legalized, the serious conflict between growers and prohibitionists fighting legal cannabis businesses, common grow issues that California growers deal with when trying to grow organic and more.

For anybody interested in the strict world of organic cannabis cultivation, regulation and the diverse problems that business owners and growers can face in newly legalized industries, this is the episode for you!

The Highs and Lows of the Hemp and CBD Industry with Dan Ramsay

The Highs and Lows of the Hemp and CBD Industry with Dan Ramsay

colorado hemp and cbd supplier

Without the supply chain, there is no supply. That’s what Dan Ramsay specializes in setting up for hemp farmers across Colorado.

Dan Ramsay is a Hemp Supply Chain Specialist. He talks hemp all day every day (almost) and is a leader on the Western Slope of Colorado, helping hemp farmers accomplish their goals in various facets. Specializing in product fulfillment, education, and end product sales since 2015, Dan has had a pulse on the hemp industry in the heart of Colorado’s hemp country.

Currently, he’s the General Manager at the Natural Order Supply rooted in Grand Junction, Colorado. Natural Order Supply has been at the forefront of the hemp industry since 2015 and founded by a group of cannabis professionals and growers. Natural Order Supply advocates for and provides sustainable farming products that help farmers grow with confidence.

In this exciting episode, Dan shares his success story with their hemp business, how to cope with these hard times, and their advocacy to expand the awareness of cannabis and hemp benefits.

“As a company, as a person, my ethos has always been real education based in this industry.” – Dan Ramsay

Some Topics We Discussed Include (Timestamp)

18:53 – Getting involved with hemp

26:01 – Pandemic and hemp overproduction situation

36:56 – Fluctuation rate of some CBD products

40:11 – Hemp market’s downfalls

55:29 – Cultivation throughout the country

1:06:07 – Price per point of CBD

1:11:54 – Natural Order Supply’s future in the hemp industry

1:16:13 – Connect with Dan

People Mentioned / Resources

 

Connect with  Natural Order Supply

Dan Ramsay

 

Connect with  Chip Baker

TRANSCRIPT

Chip Baker: Hey, welcome to another episode of The Real dirt with chip Baker today I have Dan Ramsay from Natural Order Supply. Hey, thanks for coming, Dan, how are you doing today?

Dan Ramsay: I’m doing great. Thanks for having me, Chip.

Chip Baker: Oh man, I tell you in these COVID episodes, I’m able to talk to so many more people because, man we’re all just hanging out at home on zoom calls anyway, huh?

Dan Ramsay: Yeah, you know, there’s a lot more those talks just, one to one but but not in face. Or a bunch of screens at once.

Chip Baker: Pretty much had to turn off all my video. Audio seems to work for here at The Real Dirt studios but the zoom videos haven’t gone so well. Apologize for any fans out there any listeners who also have felt the poor quality of production and we’re going to try to pick up that and hey, we’re kind of starting today here with Dan. And Dan is a leader in the hemp and cannabis supply industry. He operates a supply store in Grand Junction, Colorado, the Natural Order Supply. And even though Dan sells stuff for all things growing, he have been focusing on hemp for the past several years.

Dan Ramsay: That is correct. It’s definitely been our niche and kind of the specialty where we feel like we’ve been able to, to fall in with a little bit of luck of you know, time and location. With just being out here located in Grand Junction, Colorado, there’s been a lot of hemp since we we 2015 out here.

Chip Baker: Yeah, and Grand Junction is one that has one of the best climates for growing outdoor cannabis in Colorado.

Dan Ramsay: It’s really a nice location just right up from us here in Mesa County. We’ve got you know, Palisade which is Colorado’s wine country and, you know, Grand Junction, always at the top for the most registered farms in the state or in the country. Especially when you look at the county surrounding us out here between delta and Garfield County, there’s just there, it’s been a good place to find hemp farmers in a country that hasn’t had them for so long.

Getting Involved with Hemp

Chip Baker: Yeah, so So Dan, how’d you get involved with hemp?

Dan Ramsay: So yeah, we’ve launched a Natural Order Supply. I come from a company called 3C Consulting and then working with some candidates and business investors who called Green Lion Partners we launched Natural Order Supply which I took over you know operations of in 2015. And you know, the first employee I got in Natural Order Supply was the first registered hemp farm out here in the area. So we started talking hemp when there wasn’t, no one had closed a sale yet with just the idea of the excitement. And as the years went on, it seemed like, given that like Grand Junction being in Colorado, there’s a moratorium on high THC so we don’t have any medical or adult use cannabis stores in Grand Junction. 

So I think it might have been a hotspot given the good climate, the land available. And kind of the lack of other cannabis entrepreneurial opportunities that might have just kind of made it a little hotspot. So pretty quickly, my goal was focusing on wanting to sell to businesses into farms that there was a rumor in 2015 that some of those marijuana entities were coming kind of towards our side of the slope, but we kind of shut down at that time. And every year as it grew, I found this niche in this new community, and I love the agricultural part of it. And that combination of what we’ve learned from growing in closets and how it translates to growing outdoors.

Chip Baker: Yeah, you know, that sort of the state is really responsible for a lot of the hemp genetics that are around the country right now. I mean, I believe the Wife came from the area and–

Dan Ramsay: Like Cherry Blossom–

Chip Baker: Yeah, Cherry Blossom. All of that stuff came from over there, right?

Dan Ramsay: Yep, we see a lot of that. And it’s like advocacy has been around here for a long time. And it’s always interesting, though, to see some of those genetics and other parts of the state back in the country and moreover, but then it’s, you know, back in expo days, as we travel a little more, it seems like there’s so many varieties that, it’s amazing how each state can find their own little set of new names or different varieties so quickly in this industry, but it is fun to see that some of these original base genetics have really made it throughout the country and being grown in different, you know, geographic regions and seeing how they’re doing.

Chip Baker: Oh, yeah, absolutely, man. I see the Cherry and the Wife all over. I see it. You know, Maine I see it in Vermont. I see it in Oregon. I see it Tennessee Kentucky. They were really the first to hit the market is high CBD hemp products. And over the years people have been able to do add on and interbreed with them and develop stuff for their local geography. I’ve never really liked the way that the Colorado Cherry or the Wife grows. I like vigorous plants. Those are they’re a little delicate, but they’re grow really well for Colorado. They grow really well for Oklahoma and windy areas. They’re they’re smaller plants. And you know, when people look at an individual plant, they’re like, oh, man, what’s that plant, but like you look at a field of it. It’s a totally different story.

Dan Ramsay: Looking at those genetic And they get whether they get bigger kind of stayed kind of short and stocky on some of those, you know, we’re really just harvesting became becomes such a thing too like some of those yeah, and I love that huge plants I love it when they set the hammock between plants. But boy sometimes harvesting takes a little while and when you’re looking at 50 acres, 100 acres all of a sudden and trying to get something that can be standardized and mechanized, it’s always easier said than done with genetic choice at this stage of the game, which is how reliable we see those genetics in the field and how, especially since kind of seeds came to town it was 2016, 2017 to 2018 it was really the clone wars. 

And we made a lot of discussion and sales around bulk clones, and how to be in more of a nursery than just to grow in a lot of sense. Because when all of a sudden you’re starting 10,000, 100,000 million-plus plants, which we’ve worked with clients, and then all those numbers in, there’s just a lot more to consider as he started scaling up from, from everything about, like, operational approach to costs, but then you get them out into the field. And it’s those clones seem to be pretty consistent. So some of those first fields, I thought we saw more of that predictable growth out there, versus in the last year or so, where, you know, really, after the Farm Bill passed in 2018, last year was like, seeds were king. You know, there’s a handful of people doing at least where we are, just because I think the labor and operational costs the uniformity of timing and everything seeds make sense. But the stability of them is still a–

Chip Baker: Still in the process still in development? 

Dan Ramsay: Yeah, exactly. 

Chip Baker: Totally. Yeah, you know, another part I have many projects, many business projects, and other projects. I just to launch this year, but due to COVID and the hemp industry, we haven’t quite launched it yet, which is Certified Seed Bank. And it’s a seed bank that we’ve done the prep work ahead of time and certified that all of our vendors have a quality product. Because this was a story we heard from people over and over and over and over and over again like they got hermaphrodite seeds they often bought feminized seeds, but half of them were male, or a chunk of them was male, or the phenotypes were all over the place or they did perform, or they had high THC in them or no THC or no CBD or whatever the problem was. And we saw a need and marketplace. 

Pandemic and Hemp Overproduction Situation

But man that federal hemp the last year really kind of flooded the market. And then COVID hit here, and we just haven’t really launched that business yet. I’m going to put it off till next year, but uh yeah man how has [crosstalk] COVID and the overproduction in our marketplace, how’s that affected, you guys?

Dan Ramsay: You know, I wish I could be more like optimistic instead of realistic about what happened between–

Chip Baker: Oh, this is The Real Dirt. You got to give them real.

Dan Ramsay: Yeah. I tell you what, last fall we got flooded market. You know it started flooding into came came pretty hard. You know that all of a sudden these clients you know most of the clients in 2019, 2018, 2017 a lot of that product was sold before January. And, you know, we were planning and I was working with clients about their new plans for the next year almost pre January, you know, just a little bit in December and then we get hit the ground running up the new year. 

But last year, yeah, it got flooded. You know, and I think there’s multiple, you know, reasons that that might be we just grew so much, you know, so much was grown, like so many acres. And so when I went to the Texas hemp convention this spring I couldn’t walk to another booth and not just be like, you know, like the amount of flower that was for sale and the amount of biomass that like everybody was, whereas a lot of those industries trade shows and just a year or two back you’d walk in and finding people who had the raw product for sale in one form or another was a, I stepped into the industry. 

And now, it was just like, you know, you could walk ten booths in a row and have ten comparisons, and everybody’s kind of like racing to the bottom, we’re telling you why they’re the best. So, just not a whole lot of sales. And then once that, you know, I think a lot of people being that it’s a young industry, and it’s AG, we just kind of sat there and we’re like, hold off, it’ll recover, and that moment of like, just watch the market, which is probably a good idea for your company at the moment for 2020 is just watching and seeing and learning. 

So February seemed like it was pretty; it was hard to make sales. I didn’t know a whole lot of clients who were making sales and a lot of times we were already planning commercial farms at that point with people, and they wanted to plan, and so we saw a pretty big industry, shipped I think of farmers who stepped out this spring and did replant. And then on that same aspect, all of our propagators or, you know, who do seed production or new clone sales, they just got to that point where they were like, don’t worry sales are going to catch us because there’s some prevention pretty good money made in propagation in the last few years. And hemp for sure just selling clones and selling them back east and selling them in state and it’s pretty lucrative part of the industry too if you can get that niche. 

But then this year, just the amount of new farms, they were only a few new farms. Last year, Colorado went from having just under 1000 farms at the turn of the year to having 2700 registered farmers, so 17 new farmers that came if not more considering the few that had dropped out the year before. But this year, I think everybody who went COVID hit everybody who was on the fence to replant or to start a new farm. Kind of just got conservatives on hold my money. I’m just going to sit back and not do this. So I think a lot of my farmers that I’m working with right now had genetics going into this year there wasn’t as much of genetic sourcing as there would be in an average spring of people stepping into the industry.

Chip Baker: Well, so many people just lost their ass to last year. So on the fence man because I mean literally we saw the prices go from the high point of 2019 at $50 a pound for biomass, all the way down to like I had someone say they take $1 a pound and January of this year. You know, and I mean that they had a million pounds. 

Dan Ramsay: And those million pounders though, the issue was they went to the larger extractors and extractors were like, sure, we’ll take a million pounds. And then all these smaller farmers that have you ever to some of these larger ones all of a sudden, didn’t have that outlet were like, Hey, we please, we can go to them. They don’t always give us the best price. But we could you know, that [inaudible] has been there for the last couple years for at least the bigger extractors out here on on the western slope have been able to buy local for the years previous. I’ve been having these all of a sudden someone’s like I produced a million pounds, we produced a million pounds in 2018. 

Or if they did, you know, they were there on the fly. But the idea that that that just kind of been, you know, turns the market so when somebody’s saying hey, I’m not only going to sell this for $1 pound, I’m going to take over the sales that would often have reached 50 smaller farmers even you know I’m saying or something [crosstalk]

Chip Baker: Oh, yeah, I mean, and it was the federal legalization of it the Farm Bill that brought like some really professional farmers. And at the same time, a lot of hemp farmers just hit their stride, kind of all at the same time. It was really a perfect storm.

Dan Ramsay: It was and you know, when you look at agriculture in Colorado, we are definitely like cannabinoid terpene farmers like, we just don’t have that, that infrastructure for grain or fiber, just like when you look at going to California or you know, heavy agricultural state where they’re like, oh, we’re just gonna do a couple minutes, 700 acres and like well, 700 acres, or 250 acres again, and unestablished market is that’s a lot to produce. Even if you have a lot of it not work out perfectly new and lessons you’re still gonna end up with a lot of product to move in a young industry. 

And it’s an interesting industry because hence unlike high THC, cannabis it’s like an open market you can sell it anywhere. You can sell it in gas stations, grocery stores you can find those outlets you can sell it anywhere. Whereas like marijuana that the fact that what you produce has to be sold in the state in the stores, it keeps a kind of a kind of sexy you know kind of elusive and suddenly you have to go there to get it and when you get it, hopefully, your budtender, tells you the right thing and helps push you in the right area so that you get what’s going to be the effect you’re looking for. 

As soon as all of a sudden CBD was in every gas station, I was making the joke like he saw CBD here now, I guess next to the Mountain Dew like all of a sudden, like even the retail outlets and advertently kind of sell down the value of it. Not meaning to, but just by the lack of education and presentation for a new market that’s trying to establish itself, I think as far as CBD goes.

Chip Baker: Yeah, absolutely. Well, hey, listen, Dan is a perfect place for us to take a break. When we come back. I want to talk about we talked about the farmers and the supply side. I want to talk about what’s going on within the consumable sides of CBD, and hemp. 

Hey, we’re going to take a quick break. This is Chip and Dan The Real Dirt. We’ll be right back. 

Hey, this is Chip from The Real Dirt. You know, I’m always starting new businesses. I’m a serial entrepreneur. I’m a little addicted to it. And I want to tell you about a new project of God, Greener Consulting Group. We see so many consultants throughout the industry. And some of them know what they’re doing. And some of them don’t, but almost no matter what it is, they have one specialty. And they might not have the specialty you need a Greener Consultant Group. We’re conglomerate of many different consultants all over the country. We have specialties from extraction, to municipal advisement, to venture capital. We kind of have somebody who is an expert in the industry, they can talk to you about whatever your problem is. And mostly we can solve that problem in just a day or two. 

So hey, if you got some time, check us out greenerconsultinggroup.com. Look us up on LinkedIn and Facebook. And yeah, hey while you’re out there, you might sign up for The Real Dirt on iTunes. Please subscribe. That’s how we get bigger is when you subscribe. So hey, man, thanks. And we’re going to get right back into this interview with Dan Ramsey.

Fluctuation Rate of some CBD Products

Hey, Dan, all of this overproduction on the biomass side on the flower side of it. How is it from your perspective, have you seen it affect the end-use products the thatchers, the edibles, the tinctures, the soaps, the shampoos, is that market increased any?

Dan Ramsay: I think that market it’s likely that it doesn’t seem to fluctuate as much from the price fluctuation we’ve seen, you know, as this year is continued, we’ve seen quite a few of those tinctures and topicals and things, at least go down a little bit in price to the end consumer. But you know, there isn’t always [crosstalk] Not much, it’s a good place to be. And I think that’s where there’s like a little bit of longevity for the smaller the larger companies that are vertically integrated so that they can actually be getting revenue on the accounts they grow once it’s like turned into a product

Chip Baker: You mean for farmers to make an added value product. 

Dan Ramsay: I’m saying for farmers and just the whole company as a general right like because once you farm it and you like extract it in house and you have a branded product you can get on the shelf, then all of a sudden, there’s a little embodied margin there for both the farmer the extractor and the retailer. You know, it all kind of because it works together. So I do think it’s getting going to be separated a little bit more just because so much of the industry has been weeded out right now for a better word to say

But I also think that like people are starting to tone down a little bit of the silliness with the in consumer products. Maybe I’m wrong, but some of the silliness is just seemed like you know, we like I’ve got a package of it. CBD macaroni and cheese, and you’re like Who are these people? You know, like, I don’t know where that was, and it seemed like in 2017 if you could think it up and put it into it, CBD had a little bit of an image on your face now–

Chip Baker: I have friends with CBD toothpaste and CBD shampoo. [crosstalk] they’re good at it. You know, they previously made shampoo and toothpaste but like you know–

Dan Ramsay: And that helps because they already know this niche market. I think that knowing a real niche in CBD is the key to be like resell tinctures that help people who don’t feel good, is rough to be like, Hey, we work with athletes. We work with toothpaste and people who have now been like, Where does CBD fit in the dental industry. It’s a niche community and you find the right people there and you can thrive there. But I think a lot of the companies that came out trying to define their voice and being general have just had a hard time being in like a CBD shop just another tincture on the wall right.

Hemp Market’s Downfall

Chip Baker: You know use a square bottle. That’s one of the downfalls to the whole industry too is that in high THC cannabis and medical marijuana, medical cannabis, adult use cannabis, a lot of it’s vertically integrated. And if it’s not vertically integrated, it’s in this tight community because you have to have a license of difficulty, a difficult license in most states other than Oklahoma. And where hemp is harder to grow here than high THC cannabis. But it’s allowed a bunch of co-packers and white label people to come into the marketplace. And that in itself is just like homogenized the marketplace that the you know the same guy is making The tinctures is the same guys making all the edibles, the same guys making all the gummies. And how are you going to differentiate yourself when you’re making the same gummy as the guy across the street? Right? You got the same blockchain as a guy across the street.

And I think that’s been one of the like downfalls of the industry, even though it’s helped so many people start and progress. I think a lot of those people are gonna fall out right now because they were co-packers of other products, and they hopped on the CBD make a billion bandwagon. And I think we’re going to see a resurgence. I think we’re going to see more on farm products, more specifically made products, like you said, more engineered niche products. And that’s going to, that’s the industry maturing.

Dan Ramsay: Yeah, I think so. I think there was a minute where a couple of these companies saw that accelerated growth and pretty quickly we’re like, Hey, we can crank out they want so much once they build a brand and they’re an established company that the ability to white label just seemed like the next– 

Chip Baker: No brainer 

Dan Ramsay: All of a sudden we went from being like just a couple white labelers or its is till, it’s like you know MJBizCon last year it’s like every, you can white label anything and can have a business it’s like the 133 booths down right and and i think that like you said, that’s gonna you know, the markets going to mature quite a bit this this year over having some hardships and we’ll see people who are in the industry for real and when we look at some of those, like cottage industries, more like craft beer or something and farm raid, like I’ve got a company here I work with Colorado Biodynamic that has a coffee shop and palisade where they have a consumption lounge and they sell the CBD, they’ve got their couple products but you know, smokeable flower and their topicals and they do all these things that are related there. So it really has a niche in the feeling that it’s all interconnected real nicely. And you see that kind of craft feel and mentality that you get back in the day from craft beer, you know?

Chip Baker: Sure, sure. Something that we haven’t been able to get with craft cannabis or craft high THC cannabis. It’s interesting. How like, well one it’s always interesting to me how there’s so much division over hemp versus high THC. I see it as all one plant and I know it’s hard but wow man hemp has really led the way for high THC in so many ways and you know, the products that consumption lounges man the commercial agriculture, the use of plastic culture, the use of aerial spraying with drones like all that’s happened with hemp first instead of high THC.

Dan Ramsay: You know hemp is gonna really look at that economies of scale. And as things get bigger, it’s like how do you really turn this in and the fact that hemp has all these uses when that will eventually come to the from the plant. And THC, a lot of those are their niche, right, they know exactly what they’re doing. They’re in these and they’re in these niche stores that still have a pretty nice. 

So I think when we see federal legalization, we’ll see a lot more of these practices being in, from hemp added to marijuana, but a lot of that has to do with regulations. Like, I think a lot of people in marijuana would like to do some types of cultivation that we see with hemp, but based on the square footage, they can have the plants, they can have, and state by state. It’s just enough that there’s no standard. And so once we see that, you know, kind of almost race to the bottom of cultivation of what people can do with the smokeable flower. You know, I project that we’ll see a lot of those same strategies just being implemented right into to the high THC platform as well.

Chip Baker: Yeah, we spoke about Oklahoma. You know, Oklahoma’s one of the only places in the country that you can scale and grow high THC cannabis in the same way that we’re seeing people grow hemp. One license, one easy set of regulations, and you can literally grow as much as you want. It’s been a testament to how much we’ve been restricted over research and development, because a man like in Colorado you can only plant so many plants, you can only have so many plants.

Dan Ramsay: And metric nose

Chip Baker: Yeah and metric nose. I mean we literally just planted 9500 seeds of 12 different high THC cannabis varieties the other day. And we’re of course are fino tracking and keeping track of all of this stuff but like there’s no regulations that say we can’t do it and a portion of the seeds I know they’re not gonna make it I’m just growing them to for R&D purposes and in other states that would be so difficult to do because tracking, keeping you know, destroying them. People think that you were trying to sell them on the private market. But here just the way that they’ve approached it, it’s just really good for high THC cannabis. We’re able to do all this R&D. And we got to culture stuff down here, I want to get this pivot stuff down here, tons and tons of hoop houses like field grown like acres, like you can do all of that here. And you can’t do it with hemp here.

Dan Ramsay: As soon as you step out and you start really getting those acres that we get that whole new like, controlled, uncontrolled environment. You know, things that have come out here from like pests we haven’t seen because hemp hasn’t been planted in a while to out in palisade last year there was you just if you did the little wine tour bike loop, if you were to like ride your bike around, you’d see 20 different fields of hemp and how much got seated out. 

Like a lot of people have lost even when we talk about more factors that kind of made 2019 painful for the hemp industry combat harvest was how many harvests I know that were seated out even before like the early frost. But yeah, stepping outside and all sudden getting into the hoop houses. But once you start planting like, you know, acres on pivots, there’s a whole little new set of approaches that need to come into each one of those stages where we’ve been able to give the plant time and energy that it will take all your time and energy if you don’t plant it, right.

Chip Baker: Oh, yeah, absolutely. You know, we’ve got about an acre under plastic culture. For those of you who aren’t familiar with it, you may have seen it. We call it plastic culture, and it’s an implement that you run on a tractor, and it creates a bed out of the natural soil. And then it lay down some fertilizer your irrigation line and then wrap it in this really thin layer of plastic that acts as a mulch. And it’s incredibly effective for planting vegetables and weed abatement. It’s how like tons of organic foods and vegetables are grown. It really helps with water conservation. 

But I was just in this field this morning, and we were just doing some, like, it’s only an acre. So we were lightly steaking it up, right? In a trellising wine vineyard type of style, something that you couldn’t do in 20 acres, right. But in an acre, I can do it. But as I’m walking through it, I’m thinking about like, Oh, it’s time for all of these leaves to be picked off. And it’s like, dude, there’s no way that can’t happen in this. There’s not there’s no way that I’m going to send people out here to de-leaf, you know, the way up to center people out the bottom anything, you know.

Dan Ramsay: And then weeding has been a big thing because people love growing these monster plants and you know, put them on huge centers, but then on suddenly while you’re waiting for that plant to like cover that area, [inaudible] see weeds take over with your beds, you know, you might have more isolated watering, which is great for lots of reasons, but still just that meeting. And then also I’ve actually been talking with people who are trying to figure out some of the answers to like trellising some of these larger fields in some with a different way of trout just because of like out here. It’s like the wind, you know, because as soon as you’re at the mercy of the weather, is you’re like, oh man, it just needs a steak like you’re saying like it needs a little help because you can do so much work. But then it gets to the end where it’s got all that weight you want on it but you know those that fall weather’s for real most places. 

Chip Baker: Yeah, here in Oklahoma it’s a diverse weather system. The wind is no joke, that’s for sure. And you either have to like plant your canopy density has to be like an incredibly thick in order to guard against the wind because the wind will self prune the plants and keep them smaller here for sure. But if you don’t a wire them up, string them up, steak them up in some way. Like last year, we had a half acre field those literally all growing sideways. It’s just always this breeze. So it’s always just growing sideways.

Dan Ramsay: I was at a farm, a client just the other day where there were a couple bigger plants that had migrated Don’t just like the side of the roots, you know, and you’re like carrying Oh, and you’re like, Oh, isn’t that good? But it’s like, you know, once you start seeing that you’re like, how does it recovers the time we wanted stress but like, yeah, it’s like pulling them off. So, that’s kind of the next like, as we step out door and starting to say, like, wait, maybe a little bit smaller plant, maybe an auto flower, maybe more densely populated, and what’s going to get that being no raw plant matter per, cubic foot type thing or square foot, and as we kind of try to start realizing some of the these areas, that it’s got take some trial and error. 

So it’s good to hear like in Oklahoma, that they’ve created an area that’s with less regulation and has more ability for that R&D to get out there, at least just from a knowledge standpoint of we know what’s going to be effective here because, you know, I don’t can’t tell you how many people last year also had a like a, you know, early beat by curly beat top virus came through and we worked with the extension office here at like CSU and with so many clients just trying to identify some of these new diseases that we hadn’t seen or what we thought it was, you know, I thought it was tobacco mosaic virus thought it was, you know, you walk down through these and then to the end, and you’re like, Well, you know, and I’ve seen some, you know, it’s like, it’s now pet mosaic virus. Yeah, so it’s similar, but you know, they’re just things you haven’t seen, and it’s just such a different approach from growing in a controlled environment. 

Chip Baker: Now, yeah, it’s kind of the kind of the beauty of it all though, man is that hemp and cannabis is a new frontier for farming right now. Here ability to be able to do research in the area or develop technology or, it’s right now is the time for all of that.

Dan Ramsay: I always like to say that the learning for agriculture started in like 10,000 BC. So we’ve been learning for a long time all but like, education and, and transformation of knowledge was so slow, right? Every year, it slowly got faster until all of a sudden we got to like, and as we continued in the 19th century, early on to just like, keep pushing hemp aside and marijuana aside, it was like, we pushed cannabis out right when technology was really coming in. So now being able to take all this technology we’ve learned in the last like five decades and start saying, Wait, how do we apply this to what we know? We don’t have to jump all the way back. You know, we can jump right forward with a lot of the but I think one of the things I I really enjoy about this industry is that classic, what we can learn from other industries. Yeah, where there’s just so much,

Chip Baker: So many aha moments still to be had. You know, so many aha moments. It’s a great place, man. Certainly not boring, that’s for sure. Hey, Dan, let’s go. Go ahead, Dan. 

Dan Ramsay: No, you can go ahead.

Cultivation throughout the Country

Chip Baker: Man, I was gonna ask you, not boring man. What do you predict is going to happen here this year with the hemp industry. I mean, so many people haven’t planted that had in the previous some big people planted this year, some small people did but like how do you see what’s going on with current cultivation throughout the country? And how do you think it’s gonna affect the market?

Dan Ramsay: So I know in Colorado, there was, as you said, quite a few people who lost their ass man. It was just And got out of the game. So I yeah, I would predict that we have, you know, a good half of the market that grew last year in Colorado isn’t growing this year and those who were like, thought they were gonna blow it up. And do you know, hundreds of acres are doing 50 acres and people who were doing like, you know, everybody told me way back, instead of and was like, we’re going to focus on quality instead of quantity. 

My big question, as far as that is, how much our reserves do we have as far as like, biomass oil, flower that’s like stored in a way that it still has it’s all viable, so that the market once harvest gets here in a couple of months, most of that biomass I think, is kind of depending how it was stored, but I think there’s going to be a bad taste in the mouth for 2019 hemp season. It’s like the feel of it. And sometimes, people make decisions bound with feelings more than they do. But given that I’m in here I like to project that 2021 we’ll see a completely different situation because we will have like move through a lot of that inventory and the people who are around are people who aren’t here by accident and —

Chip Baker: Absolutely, it’s gonna mature the market for sure it has already like pushed out to get rich quickers.

Dan Ramsay: Completely. And the people who are like willing to put in the hustle work and and find a way when you can’t, it’s kind of one of those if you can sell in this market. If the water goes up a little bit, you’ll know how to swim. So I think there’s a lot of potential here the markets there, those in products are still selling. I just think that like we literally overproduced by whether it was one year or like a year and a half or where– 

Chip Baker: Most people can’t store the product, like you were saying, like, most people think that they were like, Oh, just hold on to it, uh, hold on to it, I’ll hold on to it, but like the product degrades, and they, some of them are out there still think they’re gonna sell their product from last year.

Dan Ramsay: And we used to be able to you used to be able to do in the good old days, you do more splits, right. So like the farmer [crosstalk] 

Chip Baker: Nobody wants to do split [crosstalk]. 

Dan Ramsay: Nobody is so like, now you have to pay more money to get it into oil and more storable form. But, you know–

Chip Baker: But hey, for our audience here, splits are a term we use for co-processors or toll processors, where you’ll split a percentage of the end product. And you provide the biomass. So, it may be a 50-50 split, it may be a 60-40 split, it may be a 70-30 split, you may be making crude oil or you may be making distillate or isolate or whatever on this split. But basically, I would give my product to an extractor and they just give me back a portion of it and extracted material.

Dan Ramsay: Exactly, well said, a split. And but that was a common move, right, like in the industry here was that people would get their product in the back, oh, we’re gonna do the split. Because, when you get, especially as a farmer, if you get one paycheck a year. It’s pretty rundown by the time you get back to October again. And so like shelling out capital to be able to process your material is not something who can’t sell it, the idea that they’re gonna invest more money into this business that they’ve already found on successful ah so i think a lot of that material is gonna go by the wayside and I know lots of people who are like I’m a storage shed you know with 20,000 pounds a hand and you’re like oh. 

Okay and then like in 2000, but at that point, and then I think the come it’s going to mature. And the cannabis industry is always one that loves your due diligence from a business standpoint. So as we have more established growers who have more established supply chains that can show that and a more established story that fits them in products. A desire for whatever it is they’re aiming for those niches will be defined, and I don’t think people are going to walk back in time as much as to buy that old inventory. They’re looking for you know that to make some, but I could be wrong there’s a couple of products you know companies out there that are happy to make shit products and just sell them. And [crosstalk]

Chip Baker: The technology can afford it because that is a thing but like the more the more the biomass degrades the less material you get out of in the long run less extractable material. So the harder it is for people to make money on it, or make the extraction [inaudible]. And now it’s August, I mean, all the early stuff, all the autoflower stuff, it’s starting to come out right now, like in the US and all over the country in the next two months. Like harvest is here.

Dan Ramsay: Yep, I’ve got clients harvest in this week for autos. And they’re sitting on product from last year too. And so but only a few of them. A lot of them and as I say that the last month has been been good for a lot of the clients I’ve talked to who have been able to move products that have stayed in here, you know, who are probably not as much biomass but people move in like smokeable flower and move in oil, or Delta 8 so hot right now. That’s so hot right now, Delta 8.

Chip Baker: That’s a sticky wicked, but it is.

Dan Ramsay: Mastered it is. Yeah. But it’s just like it kind of and the cannabis industry, I sometimes say is a bunch of early adopters. You know, like, the whole industry is like, we’re all early adopters of the industry, even our users. So as soon as we come up with a new technology, or a cannabinoid, CBG like, I’m interested to see how much CBG is harvested this fall, because I know a lot of people that went that– 

Chip Baker: Think they planned it out.

Dan Ramsay: For sure.

Chip Baker: Right. You know, interestingly we just plant out a bunch of autos for extraction this year. And we just got our first extraction results. And this is a butane extraction method, it’s for the medical market. But we’ve got 7% CBG in our extracted product. Something we’re like totally surprised that the seed producer that gave it to us they’ll don’t think they knew. Or they did mention it to me. Right, yeah. But we saw 19% in the flower that came out of the field and then that turned into an extracted 69%. But yeah, then the CBG was, up at 7.68%. Pretty, pretty surprised and impressed.

Dan Ramsay: Yeah, no, that’s, and that’s it. There’s a niche market for that, you know, and then the high kid side, that’s great. On the hemp side, the CBG is attractive because of a lot of those CBG strains don’t spike the THC as much. And while we’re waiting for– And then there’s some regulation coming in this, supposedly from the government in November, about the way that THC is going to be kind of measured on a national level. 

So, when we’re back in good old expo days, I feel, which seems like years ago, but it was January December. It seems like there’s real big talk about, like, do you really want to grow, these strains that could be higher with that risk for getting there and avoid content and just how it’s going to be enforced and interpreted.

Chip Baker: Oh, it’s all just started, man. The the terpenes the different cannabinoids. I mean, we’re talking about Delta 8 THC right now that’s extracted from hemp. And most people are familiar with Delta 9,and you know, there’s just so much research to be had in the coming years. It’s just really exciting. And, you know, necessity is the mother of invention. And part of the necessity is farmers trying to figure out like, how they can have that special niche and be able to be successful in the marketplace.

Dan Ramsay: Completely. And both the farmers and the market-defining itself and consumers defining what they want. But like I said, I think a lot of its just early adopters. Everybody’s like, Oh, [crosstalk]

Chip Baker: So, can you make a price prediction on price per pound this year?

Dan Ramsay: I you know, I think I’ll shy away from that one, just because–

Chip Baker: Can you tell me what you thought the low price per pound last year was?

Dan Ramsay: I thought people selling for like, I didn’t hear that dollar, but $10 a pound was pretty common and I heard people sell it for like seven stuff, you know the price per point of CBD, right?

Chip Baker: Sure. Hey, explain that. Explain that. Let’s talk about that. Explain what that means.

Dan Ramsay: So if you grow a pound of hemp, and we test it and has 10% CBD content, we pay $1 per point because when we extracted the CBD is what we’re after. So that would be $10 per pound. So if you grew for the molecule, plant, you have heard the molecule and you can get a little bit more technical, but that’s for the most part. The best way to realize that like not all hemp grown equally and that sometimes I feel like I have a 15% or 18% and and so much of what you know out here in Colorado I’ve seen just a lot more people who are doing you know biomass and extraction also really trying to leverage their greenhouses for flower. And that believing in that smokeable flower market which is I’ve seen 100 hundred dollars a pound up to like [crosstalk] probably seven you have seven or I mean they go all the way up there. And I the people I know who have been able to sell seven in those larger ones have established relationships and had a little bit more–

Chip Baker: And they’ve got a Primo smokeable flower– that’s the thing [crosstalk]

Dan Ramsay: It is and that Primo like hemp is like becoming a real thing like getting that next quality. Like cannabis, the cannabis industry has got a lot of pots knives in it like that quality is like really important. And so it’s It surprises me to have people being like, I want to evaluate putting you know, LEDs in my hoop house to for this hemp and you’re like, we just want to get every little, just trying to find every explore the different capital costs to get every little inch closer they can to being on the top shelf. So that’s–

Chip Baker: That’s cannabis in a nutshell man people. You know people, ganja, farmers, cannabis farmers throughout the known universe, all have incredible pride in what they do. And sometimes their egos get in the way. Our egos get in the way I’ll say and sometimes you’ll find those like really hidden gems that are just incredible and word to the wise when you see those people with really great, great, great great cannabis skills just shut up and listen man, take some advice in and really listen and see what they’re doing and check the ego a little bit at the door, you’ll learn line and you’ll grow better.

Dan Ramsay: For sure. That’s one of the things I get quite a few clients that will come to me because we do a lot of like product evaluations and just like little cost benefit analysis stuff to first your clients and when they come in– We all want to find that quick fix like you know, will the LEDs like increase my yield and make it that much better? I’m like, well not if you mess up the other parts. Like a whenever you’re growing and you meet somebody who’s done it well you better take pride in it because like a controlled environments. 

Like biomimicry, you’re mimicking the earth, like it’s a pretty there’s a lot going on here between the temperature the, the way your air and all of its changing and dynamic as the plants grow into the humidity at every part of it. And so to be able to move with a plant through that phase and control those variables and the way you want to you probably should shut up and listen to that person.

Chip Baker: Oh, yeah, man, it’s so simple. There’s only four pieces of magic that make cannabis grow and that are genetics, water, soil, and sun. Pretty much like you can manipulate those in many, many ways. But those are the four things you have to have. 

Dan Ramsay: [crosstalk] You need some [crosstalk] that photosynthesis just by [crosstalk] time, augmented I’m just saying like, in the like, have to happen, though. 

Chip Baker: You have to have Oh plants gotta go synthesize. 

Dan Ramsay: [crosstalk] You guys got it. But and whether you are already to CO2 or not, but no, I like you’re saying there’s only these couple. These only five kind of like variables or constraints of sorts. And, but what’s fun about growing is like the plant grows every day, the bigger the roots, the bigger it grows next day and it grows exponentially. And like, how does that change what you did last week? And so, asking those and we’ve got a digital solution we’re working on, that we’ll be bringing out here soon with like an app that we’re building to try to answer a lot of these questions. But that’ll be next year. We’ll have to just hop on and chat again, you know about that. But I love those questions. I think that’s a really fun part of the growing is the fact that you’re like, it’s really simple. You’re like, yeah, until it changes every day.

Natural Order Supply’s Future in the Hemp Industry

Chip Baker: Yeah, Dan, one of the things that you guys are doing a lot of is education, and you just brought up this app. But what we haven’t talked about is like your education outreach, and you know what your plans are in the future for that. So tell me about that man.

Dan Ramsay: Yeah, so, as a company, as a person, my ethos has always been real education based in this industry. Tons of it’s needed. We, last year as a company started a monthly event we call on Here for Hemp, that was just real hemp centric events that we did monthly, where we brought everybody from, like the Department of Agriculture to talk about their handle, what they do when they do a walk through, it’s like talking about pest control. Or we also brought in like just parts of the industry of people from like, the banking, the insurance side, all those business components that are needed, because just because you started a farm, that’s, you need the whole business behind it as well. And there’s so much that can be gleaned and learned and needs to be done there. 

So we did that all the way up until this last February when COVID decided like no more events. And but those were in-person events where we had the last one we did in February was a champ event. That’s like Colorado’s hemp advancement management plan. But that one you can actually see a recording of that one on the, our YouTube page at Natural Order Supply or at the I believe it’s posted on the Colorado Department of Agriculture’s like notes sites for when they came in and kind of talked a lot about just the process of transport, how do you register that was a big question, actually. This last year was when they pull you over, how do you be like, here’s my form that says this is what it is and people believe you and how does that work when you drive around Colorado to leave Colorado. 

So we like as much as we love the cultivation and the plant. We see the bigger industry. We’re aiming to really make our impact. And so, you know, starting in September, we’re going to start doing our Here 4 Hemp events, again, with a webinar series, but we’re going to offer, we’re going to have ten different cannabis professionals or city professionals from Grand Junction because we work a lot with it. We work as the economic department there and different like sometimes it’s good to get somebody from the fire department to come in or depending on what the conversation is we really like to talk about to those city officials and regulators.

But we’ll be doing alike probably a 10-minute local webinar held in our store with a ten person event that’s about as big as you can blow up events right now. And then having a webinar, we’ll be inviting people such as, like I said, regulators and educators. Where people will be able to hop on in and join and see both those webinars which will be posted to our YouTube site but also if they wanted to be able to hop in and enjoy the conversation or apply to come and hang out is one of the ten people in the store and get some swag, and enjoy–

Chip Baker: Man, that sounds like a great idea. We’d love to help you out with that real dirt has really tried to push many of our interviewees, webinars and educational programs and the only way that we’re really gonna do better at this cannabis thing, this cannabis life is to educate ourselves and others about it. Yeah, okay, definitely. Let’s work together help you get that information out.

Dan Ramsay: Yeah, that would be great chip. We appreciate anything we can. It’s amazing what you can learn with the worldwide web too. When you jump into from a different place and you know, I’ve been hopping on webinars left and right and forgetting about them too. Yeah, the nature of the COVID world, it’s like I sign up on my calendar but it’s just so different than the expo world that I think we were used to in the networking for a company like ours used to go have booths and do quite a few shows. But all changing. Yep, exactly. 

Where to Find Them

Chip Baker: Well, Dan, it’s been awesome speaking to you today about hemp, the future hemp and what’s going on with you guys. Over at a Natural Order Supply in Grand Junction. Hey, if our listeners want to get in touch with you or research you more, how do they do that?

Dan Ramsay: You know, it’s pretty straightforward. We’re at naturalordersupply.com. That’s the same book for our our online. Our social platforms as well as Natural Order Supply or and if you go to our website there, you’ll see it’s all hemp centric, there’s an area in the top right button to click to join our next event on our website. So, yeah, that’s just the best way to, to reach us online and hit us on the website or search for us on social and we’re on all those platforms sharing what we’re learning and we’re real excited to step into pushing as much of our education that we have and keep in local, digital this towards the end of this year and all of next year. Really watching that.

Chip Baker: Awesome, man. Well, hey, that’s great. Dan. I hope we hear more from you. We want to definitely help you out with some of your webinars and education in the future. So listeners, look for more natural order solutions, Natural Order Supply, hemp webinar with Dan Ramsey. Dan, thanks for joining me today, man. I really appreciate it.

Dan Ramsay: Oh, thank you Chip it’s been great.

Chip Baker: All right, this is The Real Dirt. Thanks, guys! All right, Dan. Thanks. Thanks, man. That was a great, great conversation we just had.

All right, that was Dan Ramsay with Natural Order Supply out in Grand Junction, Colorado. Man I’ve always loved hemp since I read Jack Harrows book, The Emperor wears no clothes I was just fascinated turned on with this. This history international history they’ve been going on for thousands and thousands and thousands of years of hemp as a textile, cannabis as a medicine and the the interaction in a relationship that that humans have with it. And let us not forget the hemp has only been a legal cannabis has only been criminalized for just a small portion of the time that we as humans have been using it as a product and man now is really the time for hemp to come back to the world for cannabis to come back to the world. 

And I truly believe, and I have seen that cannabis can save the world. And the best way for cannabis to save the world is for us all the planet and consume it. So no matter if you’re consuming CBD gummies or if you’re smoking a large high THC joint or maybe a dab, man while you’re doing this, just think a little bit about the other people on the planet and how maybe hemp and cannabis can help them and help your relationship with them and unless try to pursue that. 

This has been The Real Dirt. If you liked this episode, please subscribe on iTunes, man I need more subscribers. It really would make this thing go is the subscribers on it. Hey man, check me out at cultivatecolorado.com, Cultivate OKC supply. If you need any equipment in the country in the world, give us a call, check out our website, sign up for a commercial account. And we offer awesome pricing to people all over the globe, awesome shipping from people all over the globe. And we’re really, really, really there to help you.

As I mentioned earlier, I’ve started a new project Greener Consulting Group. Check us out greenerconsultinggroup.com. We’re a full-service cannabis advisory company, and we have dozens of different cannabis consultants and advisors all over the country in the globe that could help you out with your problem. It’s easier than you think. So look us up. And hop on for the free advisory call.

Hey, thanks again. It’s been a great Real Dirt; this is Chip Baker. I enjoyed this episode so much. Look for a bunch of new episodes coming out here saying. Thanks again, Real Dirt!

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