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Biohacker Grows Cannabis Compounds in a Lab, Is This The Future?

kevin-chen-hyasynth-bio

Why grow huge gardens of cannabis plants when you take gene samples of the cannabis compounds you want and grow them in yeast? This is the argument Kevin Chen of Hyasynth Bio presents.

Key Takeaways:
– Kevin’s scientific education and background
– Growing cannabis compounds in yeast
– Why growing whole plants in 12 weeks when you can grow compounds in 1 week
– The most desirable cannabis compounds clients are asking for
– Why the future of cannabis is in laboratory, not a grow

Learn more at
http://hyasynthbio.com/

Important:
What are the five trends that are disrupting the cannabis industry?Find out with your free cheat sheet at https://www.cannainsider.com/trends

Read Full Transcript

While many in the cannabis industry are looking for new and more efficient ways to grow, some biohackers with biology and chemistry backgrounds are creating new ways to access the essence of the cannabis plant without growing a full plant. Here to tell us more is Kevin Chen of Hyasynth Bio. Kevin, welcome to CannaInsider.

Kevin: Hi, yeah, great to be on the podcast.

Matthew: Okay. Well, give us a sense of geography. Where are you in the world today?

Kevin: We're based in Montreal, Canada, which is pretty cold right now, it's the winter time and, yeah, but it's a nice city. I like it a lot.

Matthew: Yeah. There's some dish there with like potatoes and cheese curds or something like that that people love. What's that all about?

Kevin: Yeah. The potato is something that is definitely here and you can get it in large quantities and there's some pretty good stuff around here, too. It's not necessarily a delicacy, but some people think of it as that. But it is a great fruit to have after a long night of partying or maybe on a cold winter day for example.

Matthew: Yeah. It looks good. It looks like a real comfort food. So it's like potato, it's like French fries, gravy, and like a cheese curd, which sounds gross but actually, it looks really good.

Kevin: Yup. And you can get that in all kinds of sizes and in all kinds of flavors and with that I mean cheese curds and gravy is the most basic one and then the most, you know, you can get into stuff that has smoked meat on it or it has stuff that is more like Mexican theme or there's salsa and avocados on it and then, yeah, pretty much whatever you want on fries, you can probably find it around here.

Matthew: Oh, good. Hey, at a very high level, what is Hyasynth Bio, so people can get a sense of what you're doing?

Kevin: Yup. So what we're doing is we're looking at engineering strains of yeast that will then be able to produce the cannabinoids like THC and another thing is in Cannabidiol, of course, CBD. And so our goal is to not have to depend on growing plants to make these compounds and also to be able to produce a wider range of compounds in the plants, it can do just on its own. So there's all kinds of different reasons for why this is important in the industry and, you know, from looking at it from our perspective and being up in Canada, we have maybe different scene than in the U.S., but in general, across the cannabis industry, there are a lot of questions of quality and of scale and if you're developing more serious therapeutics, and the FDA doesn't necessarily like that you're growing it from cannabis, they have certain regulations around that. So we're hoping to address a lot of these questions by changing the manufacturing system from, you know, depending on these plants and these big fields that have all these quality issues to something that's much more like a pharmaceutical manufacturing process.

Matthew: That's really interesting. We'll get into more detail there, but first what's your background? How did you come to have this idea and what's your education that allows you to think this way?

Kevin: Yeah. So my background is in biochemistry and I started on this track just by, I mean, started by being enthusiastic about genetic engineering in general, and that came from doing a undergraduate competition called the International Genetically Engineered Machine competition which is, kind of, like an engineering design competition where you're building like a boat or a car but instead, in this case, you're building organisms that do all kinds of different things, maybe it's just all for the environmental problem or maybe it's to make a certain product. Anyways that was, you know, several years ago that I first got enthusiastic about genetic engineering and about working in small teams on very, you know, problem solution focused projects

And so after that experience, I really wanted to keep doing that kind of thing where I'm working on projects that have very specific, you know, goals and impact and that work in a very fast pace. And so my longer story short, did an undergrad degree in biochemistry and started master's degree then started a company, and withdrew from the master's degree just to focus on that company since it master a lot of my interest and what I wanted to do, you know, in science and in general.

Matthew: Now, are you familiar with this CRISPR/Cas9 genome editing technology that's kind of emerging?

Kevin: Yup. That is all the rage now and it's super fascinating to, you know, watch that unfold and I mean, not just from, like, you know, how we could use it in our genetic engineering at work, but also how, you know, lots of other people can use it and there's some people pushing boundaries in terms of human experiments and that's super interesting to see as well because it's kind of pushing that, you know, limits of sci-fi and everything and it's more of a problem for the FDA and negative than it is for me personally, but I've got some friends who are like very into that scene and it's super fascinating.

Matthew: Yeah. The FDA is kind of slow on picking up on new technologies, it seems. Tell me, how do you understand the CRISPR/Cas9 because I want people to be able to understand what that is because it's this emerging technology that has huge impacts and it's being used now as we speak, but I don't, it's not really covered in mainstream media and people don't really understand it. It's kind of emerging and it's hard to digest what's happening, so maybe you could just give us an overview for the layperson.

Kevin: Yeah. So simply put, it has to do with editing genomes in general. So there's a few different ways that you can modify an organism but if you want to make that modification permanent, then you want it to be in the genome of that organism. So I think of, let me see if there's an example that comes to mind. If I just think of, like, let's say, engineering humans, and this is a case for using this technology, in cystic fibrosis, let's say, where it's a very specific mutation in the person's genome that causes them to have cystic fibrosis. If you had a way to edit the person's genome to remove that mutation, then suddenly they'll be healthy again. They don't need to have any kind of transplants or use very intense drugs. Their body will just naturally be the same as it would if they didn't have that mutation. And so that, I mean, the CRISPR itself, the reason why it's so interesting is that we've always been able to do a lot of gene editing and genome editing to some extent, but the CRISPR/Cas system helps make it a lot more precise where you're editing very specific points of a genome and you can do that with at least enough consistency that, you know, one can imagine using this at large scales.

So historically, there was a case, and I'm being tested on my timeline now. I'm gonna say the 1980s, 1990s, where the gene therapy was first becoming a thing and they had to use viruses to, you know, take fragments of DNA and distribute them throughout the human body and it ended up being that one of the patients that was being tested with this, you know, viral DNA transfer technique ended up dying because of complications from that virus. And so that was a big, you know, negative impact on gene editing and now it's all coming back again because now we have these new techniques and they're gonna be more precise and we can actually have a lot more options for how we want to do genetic modifications to a human being or to another animal or to a plant or to a microbe if you want to make, yeah, make a microbe, make a bunch of THC for example. And that's basically it. So I mean CRISPR/Cas is like the specific name for the system. I like to call it all just like genome editing technologies and there's other ones that exist, too, that are also pretty revolutionary and CRISPR doesn't always work in every single organism, but the idea here is that genome editing and having a genetic engineering being a lot easier thanks to this system this is what's happening.

Matthew: Okay. Now, let's circle back to what you're doing at Hyasynth Bio, but I want to frame this and paint a picture of what you're doing in the lab and how it's different or better than a traditional grower because there's people listening and they're saying, "Hey, well, you know, we have our grow all optimized and everything and, yeah, but it's 10,000 square feet and it requires all these inputs." How is what you're doing different or better than what a traditional cannabis grower might be doing?

Kevin: Yeah. It's physically different in the way that we're not really growing any plants. So we've got a pretty small lab and what we're growing is cultures of yeast. So we have either glass or stainless steel tanks that grow the...that you actually put the, you know, grow the yeast in. And each of these tanks looks maybe a bit like, you know, what you'd see if you were visiting a microbrew facility where there's, you know, some pipes that go in, some pipes that go out, and you're feeding different kinds of materials at different times of the process and keeping it all at the right temperature to actually grow the yeast that you want. And so that's what our process looks like physically. And what that means is that, you know, the yeast grows a lot faster than a plant so where it's actually like, you know, one-week turnaround to actually grow a yeast strain up to its full, you know, volume. Whereas with plants it's more like a few months. And then, yeah, there's not a whole lot of like, you know, green in our space. It's like you'd have a big room and a big stainless steel tank and that's kind of where you'd be producing your yeast and then you have a lot more, I think in general we'd have a lot more knobs and buttons that would go into the system just because there's some like finer points of control and this has been like, you know, inside a pharmaceutical like GMP manufacturing for such a long time that that's how things are done with this kind of technology. Whereas with the cannabis you can sometimes maybe just grow it in like a pot and then you're not really trying that many knobs and buttons but you're controlling the environments, I guess.

Matthew: Okay.

Kevin: But that's kind of how, yeah, how this would go.

Matthew: So people are I'm sure still scratching their head like, "Okay, Kevin is growing yeast and he's got a cannabis culture in here. Why yeast and what's the output of this? What does this do for people that want cannabis material, or is this allow them to do?" Can you talk about that a little?

Kevin: Yeah. So this allows people to produce something like CBD or THC or another cannabinoid at pretty large scales. So you can choose which cannabinoid you want and in what quantity or if you want a combination then that's possible, too. And then you can also scale this up to volumes that would be enough to treat, you know, millions of people who might have a certain disease or need a very specific combination of cannabinoids. And those are the main, you know, two things that this does and you can have that process be like pretty consistent in high quality, you know, GMP, whatever you want. But the key idea here is that, you know, we can choose what our yeast makes, you know, very precisely. And then that process scales up to actually, you know, supplying an entire country or population that is in the millions whereas you haven't seen that much of that in interest of cannabis.

Matthew: Yes. So this is pretty interesting here because you're isolating the one part of the plant you want and then, let's say, a typical grow cycle is 12 weeks for a plant, you're doing it much more efficiently in one week and getting exactly what you want from the plant. Now, there's people that are listening that are saying, "Well, the entourage effect, you know it's how these cannabinoids work together and interplay to create medicinal output or result." But you're saying you can create that in the lab, in the yeast, you can get that entourage effect. You can create whatever kind of tissue culture or plant culture you want and then put it in the yeast and just grow it in a way that orders of magnitude more efficient, is that correct?

Kevin: Yes, except we're not really growing any kind of tissue of the plant, like, it's just that this grows and it makes cannabinoids and it has all the parts in its genome that are going to produce the cannabinoids. And that's, but, yeah, that's pretty much it, like, we're looking at shorter processing times and being able to make for a specific products, and that's our interest.

Matthew: Okay. So what happens to the yeast then after you get your desired output? Is your output's in the yeast or is the yeast go away somehow? How does that work?

Kevin: Yup. Our output isn't the yeast but we extract a product from the yeast so at that point maybe it starts to look a lot more like what plant growers would do with their, you know, oil production, for example, where, yeah, they're taking a whole lot of plant material, they're mixing it with some kind of solvent maybe that's in oil and then they...or I guess supercritical CO2 is the most popular one that people talk about and you can probably use that same, exact same process for a yeast culture and then still get the same kinds of products out. And so in the end product you're not really...it's not like we're selling the yeast and it has all these, you know, other stuff in it where we're isolating the pure cannabinoids and then that's what would go into an oil or into a pill or into some other product that could go to market.

Matthew: Okay. And how many compounds are you focusing on right now and why did you choose the ones that you are focusing on?

Kevin: So right now we're mainly focused on the cannabinoids that are...and of on or on their way to the market, so like THC and CBD, of course, and then CBG is another target that we're after. The reason why we chose those is partly from like a technology standpoint, like, it would be easier for us to go for those ones than to go for the more like extremely rare ones that haven't really been discovered that much of. But in terms of like where our breadth extends, like, we might end up producing a lot more of these minor cannabinoids than producing the major ones. And so we're not necessarily that interested in producing THC because you can get that pretty easily from plants, but we would be pretty interested in producing something like THCv or CBDv or CBN where it's like not really a plant product and so we can make it definitely more efficiently and be able to serve, you know, people who actually need these materials in larger quantities.

Matthew: Okay. When you say larger quantities, what kind of quantities do you anticipate your customers or your current customers wanting?

Kevin: That ranges from maybe like a few grams if you're a registered university and you want to do something like mouse studies, for example, up to a hundreds or even thousands of kilograms if you're going for like a big pharmaceutical indication. So I think if you do a bit of math around the epilepsy case of like CBD or CBDv that GB Pharmaceuticals is developing, if you look at epilepsy as a whole and if we could treat, you know, everybody that had epilepsy with cannabis, then that's something like 50 million people worldwide. And if each person is using X milligrams per day of a certain product, it ends up coming out to pretty close to like 1500 tons or something crazy like that.

And yeah, when you think about those, you know, quantities and even like, I think, the biggest single growth operation is maybe that's actually running is one or two tons and that is now coming up to maybe tens of tons if you look at the biggest ones. But then that's still making, you know, orders of magnitude too small for this kind of, you know, broad and massive population. So that's kind of the, yeah, the range that we're looking at where it's like, you know, very specific high-quality products that research can use and then on the higher end of things like, you know, these massive supply chains that would be amazing, you know, to supply and to be able to meet that need.

Matthew: Okay. And is there companies that are like nutraceutical companies that are saying, "Hey, I need to add CB, let's say, CBD into some sort of finished product like, let's just say, a protein powder or a hemp protein or something," and they need a certain amount, is that a prospective customer base do you think?

Kevin: Yeah, for sure. Yeah. And we've been in touch with a lot of different people in the industry across like, yeah, pharmaceutical and recreational and nutritional as well, of course, so we kind of, we understand like different aspects of marketing, what they're looking for. So that case in particular is pretty interesting for us where, yeah, we can definitely just provide CBD at the larger scales for nutritional products and probably do that in a much more consistent and reliable way than what you can get from hemp because I know that that's one of the biggest issues with the hemp source CBD, is that sometimes it's, you know, maybe it's coming from Europe or maybe it's coming from China or maybe it's coming from somewhere else and then in the end, maybe there isn't that much CBD in it after you buy the actual product or maybe there's like way more than what the label actually says. And so there's some weird issues in that industry that needs to be resolved and we think we can solve them.

Matthew: Yeah. Or just the volume of hemp you need to get down to that CBD oils may seem oppressively large to some people.

Kevin: Yeah.

Matthew: So you mentioned that the cannabis industry is approaching you, pharma, any other industries that are looking at what you're doing and saying, "Hey, this might be able to help us."

Kevin: That pretty well covers it. There's some stuff coming up in the veterinary sciences as well. And I think there's at least a few different researchers or studies or talk about, you know, people using CBD with their pets and maybe it could also be used in an agricultural setting as well for, I mean, there's something like antimicrobial stuff but also behavioral related issues that sometimes come up, I'm not asking, like, "Are you familiar with industrial agriculture and growing animals at large scales?" But there are at least some talk of that, too. Yeah. And that's super interesting. I like to see this, you know, it's a newer idea and I think it has a lot of, like, potential and so I'm super interested in learning more about that.

Matthew: Have you been following what's going on with this company called Memphis Meats that's raised, they've raised a ton of money and they're creating, I guess you would call this...they're creating animal proteins in like a Petri dish essentially without actually having to kill animals to get their meat. Have you heard anything about that?

Kevin: Yeah, for sure. That's like the same scene that we're part of and, yeah, generally, the term that people use for this technology is cellular agriculture. For us, we fall under a few different terms whether that's like synthetic biology or metabolic engineering or cellular agriculture. But the cellular agriculture scene consists a lot of, you know, that kind of technology where it's like we're gonna use this biotechnology technique to produce a food product that normally comes from animal. And so, yeah, Memphis Meats is a great example of exactly that where it's all about, you know, let's get a petri dish that will grow a hamburger or grow a meatball, I guess was their first thing. And yet, it's capital intensive. It takes a lot of money to get that to, you know, produce that like a relevant price point because I think the first one that got made, like, whatever, a few years back, was a few hundred thousand dollars and now it's still maybe $10,000 for a hamburger that was produced this way and they're pushing that limit of price. But yeah, it takes capital and...but once it gets up to that kind of scale that can compete with industrial, you know, growing of cows, that should happen pretty soon and it will be super interesting to see how that unfolds.

Matthew: Yeah. I mean it's kind of a chicken and the egg problem in that customers probably are a little bit standoffish about lab grown meats, but if they can get the palatability right, it could be a big win-win for everybody. These animals wouldn't have to die. We don't have to have all these, you know, all these waste around, you know, agriculture and animal husbandry and so forth, so...

Kevin: Yeah.

Matthew: ...it sounds a little weird in some ways, but I think this is definitely the future.

Kevin: Yeah, it does. And I think it is for sure. And having spent enough time around that scene, like, the more weird thing or this to me it feels more weird to talk about how viable industrial agriculture actually is where it's like, "Okay, we're gonna grow, you know, this many millions of cows in this way and then we're gonna have these machines that will slaughter them for us and then we'll have these people that are gonna cut them open and do this oil processing." And you're gonna run that at that large scales like that, and then, yeah, it seems almost more alien to me than like, you know, why don't we just use biotechnology to make the stuff and then that sounds way, way simpler even though it's, you know, the lab idea is a bit foreign, but I think the idea of industrial agriculture is also...and what actually happens there is very disconnected from what people will actually, you know, buy on the shelf. Like, I don't think that many people are aware of, you know, the issues that do come up and why it's so cheap to buy chicken from the store whereas if you thought about growing your chicken yourself, it'd be like really difficult.

Yeah. But anyway, that's kind of an interesting side issue that I think people should be more aware there like, you know, production methods and where their products are actually coming from and what kind of work goes into it, and the impact that it has on the rest of the planet. And then suddenly all these technologies that industrial agricultural build upon don't make that much sense and the technologies that are coming up now, like the cellular agriculture make a lot of sense. And they're extremely cost-efficient and extremely efficient for the environment and so on.

Matthew: It seems like every industry is right for disruption now, nothing is secure anymore so you got to disrupt yourself before you get disrupted, so...

Kevin: Yeah.

Matthew: You're in the right field here. Okay, so is what you're doing at Hyasynth Bio, is that patentable and do you have any patents right now you applied for?

Kevin: Yup. So we do have a patent application in and in terms of our...and our process is overall patentable. And beyond that there's sometimes that I can say publicly about, you know, what our patents look like and our strategy right now aside from that, but it is interesting to look at the patent landscape for cannabis and for cannabinoids in general and there's, you know, on one hand, a lot of potential for new technologies and new patents to come out. On the other hand, there's kind of these regulatory conflicts where it's sort of hard to develop a new technology because you need maybe clearance and you also can't necessarily patent your strains of cannabis yet because the FDA or the, I guess the...is still like an illegal substance in some sense.

So, yeah, that's the situation and I mean, one thing that we are super keen on is looking at, you know, what areas of specific formulations and combinations of cannabinoids will make sense and what IP or patents could be developed around those because, of course, for, you know, if you're following the rules of nutritional pharma which a lot of people have different opinions on that, I'm not sure how your listeners feel about like big pharma and how evil or good they are.

But if you follow those rules then they have a lot of value in being able to patent their products and the culminations and the structures that they want to bring to market. And I think that, you know, when it comes to cannabis and cannabinoids there shouldn't be that much resistance towards, you know, that because that's what it leads to like the big cures and that's what leads to, you know, GW Pharmaceuticals Epidiolex product and that's the next product that they brought to market a while ago and so, you know, that's something that we would be able to do better than people who are just trying to breed new strains, let's say.

Matthew: Yeah. And how do you think what you're doing might be able to help the opioid crisis if it all?

Kevin: Yeah. I should hope that the crisis is resolved by the time we get to market and get up to that kind of scale. But assuming that the opioid crisis does stick around for another few years, I mean, we know that in quite a lot of cases people are reducing their consumption of either opioids or other prescription drugs when they've started using medical cannabis. And I can probably follow-up with some references around this specifically, but this is quite a few different companies in Canada that do, you know, sell large amounts of product legally, like, this is what they've been noticing. And, you know, if that's the case and that ends up being true for a lot of cases and people are getting relief on that then, you know, it would be amazing if we could divert, you know, 50% of the opioids that are going to market and replace those with cannabinoids which are more safe and less addictive. And then, like, it seems like a lot of the cause of the opioid crisis is because of like, you know, pretty generous prescribing of opioids where if you have like, you know, just some mild pain, maybe then you're getting prescribed an opioid and you don't really need it. But it's there if you want to use it, but if we can prescribe a cannabinoid in that case and have, you know, similar kind of relief for a lot of those cases, then we only need to prescribe opioids in the very extreme cases where they will be more useful than a cannabinoid. But pain is also a very complicated disease and it's hard to, you know, develop anything that just treats pain. Yeah.

Matthew: Yeah. Especially, you know, Tom Petty just died and they said, I don't know if you saw that but it looked like he had some opioids in his body and so forth. It's pretty much the same type of situation as Prince. And it's like, wow, how much of this is going on and it's just a huge, huge problem, so I hope it gets resolved. Now, tell us, Kevin, where are you in the investing process or raising capital, should I say? Where are you in that process with Hyasynth?

Kevin: Yup. So we did our second seed round at the end of last year in November and so with that wrapped up, we haven't opened a new round yet, but we're setting this up and thinking about, you know, what that's gonna look like and who we want to bring on our investors. And so we'd be looking at maybe in a few months or towards the middle of this year to open up for another round of funding and by that point, you know, we'd be looking at a larger series, a kind of round that's we're really, you know, bringing products to market and scaling up.

Matthew: Okay. Now, if there's accredited investors that are listening that are interested in investing, is there a way they can reach out to you or Hyasynth in general?

Kevin: Yup. They can just write to me directly or write to the, I guess we have a generic email address which is info@hyasynthbio.com and that goes to someone on my team if not directly to me. It goes directly to me now because that's how we're a small company and I'm the one that receives those emails, and but otherwise that's the fastest and easiest way for people to reach out.

Matthew: So that's hyasynthbio.com?

Kevin: That's correct.

Matthew: Okay. And, you know, there's a lot of...you're a young guy yourself, do you mind me asking how old you are?

Kevin: Yeah. I am 26.

Matthew: Yeah. Well done, kudos to you for hitting the books and making all these happen at such a young age. I was not a 26 thinking this seriously about stuff. So how about interns? I mean, there's a lot of young people that are really interested in getting involved in this industry and maybe they're saying, "Hey, it's still early in the year 2018, is there a way I could intern at some place like Hyasynth Bio or do you look for interns in the summer or at any time?" Are you only drafting from like the McGill University area there in Montreal, or is there anything that you could say around that?

Kevin: Yup. So we're still figuring what we want to do this summer if we want to bring on summer interns this time around or not. But at any given time, like, people can send us any notes to that same address and we'll keep it in our hiring logs and when the next opportunity for hiring comes up then it'll get busted out to those people. Or if we do find, you know, specific people that we really want to bring on, maybe not right now but maybe in the nearest future, then it's always good to have that Rolodex lined up so that we're not, you know, we don't have to go out and do a lot of promotions for our own recruitments. And in general, it's great to just hear from people and hear about what their interests are and always happy to connect. Yeah.

Matthew: Let's pivot to some personal development questions. I like to ask a few personal development questions to help listeners get a better sense of who you are personally. With that, is there a book that has had a big impact on your life or way of thinking that you'd like to share?

Kevin: Yeah, for sure. There's a few that are out there that I came to mind and a few that are in the same category. There's one that's called "Future Perfect" from Steven Johnson and then also a book called "Abundance" and a book called "Bold" that are from Peter Diamandis and Steven Kotler and a few...have you read this one?

Matthew: I've read all of those.

Kevin: Okay, cool.

Matthew: They're great.

Kevin: Yeah. So they're super interesting just because it's, I mean on one hand they do subscribe to the...they're intense like, you know, hype of a lot of startups and a Silicon Valley kind of thing which there's pros and cons to that sort of logic. But on the other hand it is proposing like very different ways of thinking about starting business and solving problems and using what's available to you in more unique ways and embracing that we do live on a very connected planet which means that, you know, if I wanted to tomorrow, I could do a face to face, like, video call with somebody in India and figure out how we're going to, you know, supply the next big medication for disease areas there for example, and that's like perfectly reasonable to say like right now but that was not, it's just not possible, like, you know, 10, 20 years ago or it's like much weren't heard of, and it's...on the topic of cannabis, it's also really interesting to see a lot of different kind of companies, like, I mean, you've heard Modern...it turned up Modern Meadow, thinking about...yeah, Meadow MD on your show, and there's HelloMD which is another company in California, it's dealing with the interesting stuff, and websites like Leafly and Lyft who are creating communities and promoting and creating these networks where you can find places to buy products or get reviews, and even though it's still kind of legal, this is the world that we live in. It's like this is how connected we are. And there's a lot of stuff where you can learn and embrace by using these kinds of technologies. So those books, I think are really, really interesting for that.

Matthew: Yeah. I really, I would say "Abundance," I read "Abundance" first then "Bold" and they really had an impact on me in terms of getting across how poorly our primate mind understands exponential growth and that after a period of not growing in an exponential way there's all these technologies that are coming together at once that are going into this hockey stick moment where they're just growing exponentially because exponential growth curves are kind of tricky. They sneak up on you. At first, they just look, you know, a little bit like linear growth but then all of a sudden it's, you know, 2, 4, 8, 16, 32, 64 and it's just going straight up like a rocket ship and, you know, I think we're starting to see some of that with the fields you're in, you know, also a 3D printing, also AI. They're all coming together at once and people are, kind of, they're lulled into a sense of complacency because they're thinking, "Oh, I've heard about AI here for a decade or two and nothing has really changed." And then in the next five, seven years, it's, you know, it's gonna level industries that we thought would never change are gonna be gone, just gone.

Kevin: Yeah, exactly. Yeah, and it's amazing, it's great to have people think more in that way, I think overall and whether you're an entrepreneur or if you're running like, you know, Fortune 500 company it's important to, you know, embrace like this is what technology allows us to do and we can use technology in so many different ways to solve our problems and, you know, the...like, the examples that they give you sometimes are like Airbnb and Uber and stuff where it's like, "Okay, now, if I had this car and some spare time I can go and drive people around and make money off of it and that's just a very simple piece of software that does that.

And now, with, I guess the other weird thing that's coming up is the cryptocurrency scene which I don't want to get to in depth about, but that's kind of its own weird and interesting technology scene that aims to somewhat revolutionize how financial transactions might be done. And that, you know, we'll see what that looks like in the next like two, three years.

Matthew: What's funny is that even before a company like an Airbnb or Uber could potentially go public they could start to get disrupted by a blockchain company that says, "We do Airbnb but as a blockchain token and we've disintermediated Airbnb, they're making 15% profit, let's say, let's take that down to 1.5% and all participants in the ecosystem would get the value from that instead of it being so lopsided to an Airbnb or Uber."

Kevin: Yeah, for sure. Yeah. It'll be of interesting to see how that unfolds. I mean in the end to some extent with those cases it is still software that has to drive it and some of these has to pay for, I mean, the service maybe and for some kind of validation but, yeah, it will be interesting to see, you know, what sticks around and where we are in the hype cycle and I guess, you know, maybe we are at the peak level of hype for this kind of stuff and then it'll dry up in the next year and then come back again with more real stuff. But it's at least, you know, it's worth paying attention because it is kind of different and it is probably, you know, maybe to some extent this is how my parents or grandparents felt when the internet came out where it's like the internet is now a thing and they can, you know, look at websites and get all this information suddenly and it kind of changes how people run businesses and do all kinds of stuff. And in the next five years maybe you'll be that kind of person where you're like looking at cryptocurrencies and its suddenly, like, everything uses cryptocurrencies for some reason and you don't fully understand it or you get into it now and then maybe you're part of that technology that grows very quickly. Yeah.

Matthew: Yeah. It's definitely interesting. I feel like there's a lot of hype around it, but there's no applications that everybody is really using yet but they're...except where I'll say the ICO market which is how a lot of entrepreneurs are starting to raise capital where they'll put out a smart contract and people can send in some cryptocurrencies to the smart contract and then when the contract executes tokens for that company, which could be considered like shares, are sent back to the wallet that sent the cryptocurrencies in and you essentially become like a shareholder in whatever companies doing that capital raise totally disintermediating Wall Street, which is really interesting. And that application is live now and people are using that, but I don't see a lot of other applications yet. But a lot of promise about what's to come, who knows how long that'll take, but this is definitely a rabbit hole.

Kevin: Yeah, it is.

Matthew: That could go down deeply.

Kevin: The only other thought from the standpoint of, I mean, thinking about currency in general and how in some, let's say, developing countries, the currency can also be, you know, extremely volatile and I know that it's always been a proposed, maybe hypothesis or ideas has been tossed around that. You know, these countries that do have these highly volatile currencies can actually adopt cryptocurrencies instead and then reduce the amount of, you know, fraud or other issues that would be causing this kind of volatility in their regular currency and then overall improve, like, the situation when it comes to the value of the currency and how that relates to other currencies and the value of, you know, the products and so on.

And those are, you know, those kinds of cases will be interesting to see if, you know, those come to real life and we can look at these kinds of cases being like, "Okay, now, this is something that did have a really big impact for a lot of people."

Matthew: Yeah. Well, how about, is there a tool web-based or a physical that helps you with your productivity that people might be interested in?

Kevin: Yeah. That's a good question and it's a, I've experimented with all kinds of different software and what is good or is not good. I mean, I can't really pin it down as like one thing that I do all the time that improves my productivity. There's the usual, like, business software tools that people use nowadays like Google Drive and Slack and those are fantastic, and various CRMs. I mean, the thing that's out of all of these that I think is important to take home when it comes to thinking about productivity is to get plenty of food and rest and to make sure that that's not like something that you're losing and I think you're definitely more productive when you're well rested and well fed and that's a lot of, you know, what if early entrepreneurs like myself gave up, like, first is like, "Oh, man, I got to work really hard, got to step up all night and then skip breakfast to get this thing done so that they can, you know, push this to next semester or whatever."

But actually, yeah, that's the message that I would leave it with that after doing this for a few years now. It's like, okay, people talk a lot about that kind of thing as being like, "Man, these entrepreneurs, they don't sleep, they don't eat, they just like work super crazy." It's like, well, actually, you know, try sleeping and eating and making sure that that's covered and then also focus a lot on your work. And that's better than...

Matthew: Good points. Let's just cover the basics, right, sleeping and eating. We don't do that very much. I always I'm like, "Maybe there's an app or some software that can make me superhuman. I can edit my genes and then I'll be able to stay up all night. I can work twice as much.

Kevin: Yeah. There's all this stuff in like, I mean, some people talk about this stuff in cannabis because it's also like, you know, mood modulators or the caffeine pills and these other things that are out there that you can try out, too, and I have some friends that will 100% vouch for that as like this is the key. But I haven't done too much of that and I definitely had my sprees of drinking too much coffee and that doesn't really work for me in terms of productivity so, yeah.

Matthew: Me too. I've done the same. Well, Kevin, as we close, tell listeners how they can reach out to you one more time and find Hyasynth Bio and connect with you.

Kevin: Yup. So plenty of different ways, our website is hyasynthbio.com. We've got a blog there that should be kicking up and becoming more lively in the next few months, so keep an eye for that because we do want to talk about more science and more of the community around this stuff. And then you can always write to us at info@hyasynthbio.com and that email goes directly to me for now and that might change whereas, you know, or hopefully that will change because maybe we just get too many emails that I can't handle them all. But for now, it goes to me and people can ask me questions and usually, I have time to answer for, yeah, just a few minutes answer your questions. So that's what I'll say.

Matthew: Do you think you could grow baking in your lab with yeast? I think that would be a hit, CBD baking.

Kevin: CBD baking, that would be a really great Saturday morning breakfast, I think. It's...we'll see. I'll have to write to them, Fitbits [SP] and they will open a collaboration or something like that.

Matthew: I think that should be the top priority for Hyasynth Bio, boom.

Kevin: Yeah. Baking is on the top list for some of these companies that are doing this meat stuff actually. That's a true statement.

Matthew: Well, Kevin, thanks so much for coming on the show and educating us. We wish you well in Montreal with Hyasynth Bio and stay warm.

Kevin: Yeah. It's been fun. Looking forward to hearing from the listeners and, yeah, I'll keep you posted.

Creating Custom Cannabis Oils & Terpene Blends at Home

nicole wicker oblend

Nicole Wicker is the co-founder of Altopa which makes the Oblend. The Oblend device is the size of a K Cup coffee machine and sits on your countertop. The Oblend arrives with modular ingredient packs that allow you to create the perfect cannabis oil vape cartridge, tincture, topical and more.

The Oblend was awarded the innovation award at this year’s CES event in Las Vegas.

Key Take-Aways:
– Transferring expertise from the pharmaceutical industry
– Raising capital
– Creating a unique benefit for customers
– Difficulty with hardware products
– How to use the Oblend and home

Learn More at:
http://www.oblend.com/

Important:
What are the 5 trends disrupting the cannabis industry?
Find out with this free cheat sheet at
https://www.cannainsider.com/trends

Read Full Transcript

Matthew: Entrepreneurs are sprinting from the traditional pharmaceutical industry to cannabis, bringing their expertise in capital with them. Here to tell us more is Nicole Wicker from Altopa, maker of the Oblend, a 2018 CES Innovations Award honoree. Nicole, welcome to CannaInsider.

Nicole: Thank you, Matt. And honestly, I'd like to state, for the record, that I am a huge fan of CannaInsider.

Matthew: Oh, thank you. Give us a sense of geography. Where are you today?

Nicole: Well, I'm based in Raleigh, North Carolina near the Research Triangle Park area. However, I spend a lot of time in Seattle, Washington where our company, Altopa, is headquartered. Right now, I'm actually in Florida, meeting with several potential investors and a few large organizations outside of the cannabis industry who reached out to us after they saw us at the recent CES show in Vegas.

Matthew: Okay, that's great. I'm glad you're out of the cold down in Florida. That's a good thing. It's been so crazy there. Okay, so, tell us a little bit, at a very high level, what the Oblend is so people can understand.

Nicole: Okay, the Oblend is the world's first home dispensary. It is a countertop consumer device that mixes and dispenses precise amounts of botanical oils, essential oils, and therapeutic herbal extracts to mirror pharmaceutical standards. And with the Oblend app, consumers can find, customize, and create a variety of products within minutes.

Matthew: Wow, okay, so that's a lot. They can do a lot here.

Nicole: Yes.

Matthew: So what does the O in Oblend stand for? Is there...?

Nicole: Oh, we get that question a lot. So, I'll say just like our company's philosophy and tagline, which is every body's different. The O in Oblend stands for whatever you would like for it to stand for. Most people associate the O with oil since the Oblend cartridges contain botanical and essential oils.

Matthew: Okay, I'm gonna say the O stands for optimal. Boom.

Nicole: Nice. Great, I love it.

Matthew: Okay. But I'm gonna dig more into the Oblend. But first, let's get a little bit about your background and why you started Oblend in Altopa. What were you doing before?

Nicole: Oh, okay. Well, I spend my first 12 years with Ernst & Young in a special group called the ES Group or the entrepreneurial services group. In that group, we identified small companies with large market potential and large growth opportunities. And together with the company's management teams, we had strategy sessions and plan out their short and long-term growth plans and decide whether ultimately it was best to position the companies for an IPO strategic role of competitive buyout plan or an exit through an acquisition. Then we devise the plan and execute it. This was during the late '90s. And if you recall, it was the dot-com era. So most of those companies went public through the New York Stock Exchange or NASDAQ or even the TSX. Then, I transitioned over to the private sector and became the controller and eventually CFO of a few companies. The first company was called SmartPath, which we grew and sold to a company called DoubleClick.

Matthew: Sure, heard of them.

Nicole: Most recently, I was the CFO of an FDA-approved medical device company called TearScience, where we developed and launched a disruptive diagnostic and treatment device for dry eye disease. While I was with TearScience, we navigated through the FDA process, obtained FDA approval, raised over 150 million, grew from 18 employees to over 250 employees in a very few short years, and commercialized our products throughout the US, China, and Canada, Europe, and a few other countries. We were named the fastest growing company in North Carolina for the years 2011, '12, and '13. And recently, TearScience was acquired by a little company called Johnson & Johnson.

Matthew: Oh, okay, wow.

Nicole: So, after I left TearScience, I get approached by many CEOs with great ideas, and I was deciding what my next move would be. So, Matt, the CEO of Altopa, about two years ago, approached me with the idea of the Oblend. I thought it was a great idea. But quite frankly, I knew nothing about cannabis. It was very intriguing to me. So I started researching and attending the conferences. And the one conference that really wowed me was the Cannabis Science Conference in Portland, Oregon. And I sat there for three days and listened to researchers, physicians, people from universities stand up on the podiums and present their clinical studies and efficacy in using cannabis to treat various medical conditions. And that was when I decided that we could really help a lot of people by bringing the Oblend to market, and joined the company as co-founder and CFO.

Matthew: That's great. So, DoubleClick I think was later acquired by Google, and then Johnson & Johnson acquired the Dry Eye. Just out of curiosity is when someone has dry eye disease, are both eyes dry or just one?

Nicole: It's typically both eyes because it's a function of your Meibomian glands blocking up. And that's usually because of lack of blinking.

Matthew: Okay. I lived in the RTP area for nearly 10 years, and there's really a ton of innovation going on there that's really amazing. So I think Silicon Valley obviously steals the show, but it's pretty cool what's going on there as well.

Nicole: Yeah, yeah, RTP is a close fellow. And I don't know if you heard that Amazon is thinking about having RTP as its East Coast headquarters, which is the exciting.

Matthew: Oh, wow, that would be the exciting. The tagline for Oblend is dispensary in a box. What does that mean exactly?

Nicole: That is an interesting question. So, according to Wikipedia, the definition of an electronic dispensary is a dispensary designed to ensure efficient and consistent dispensing of excipient and active ingredients in a secure data environment with full audit traceability. A standard dispensary system consists of a range of modules, such as manual dispensing, supervisory, bulk dispensing, recipe management, and interfacing with external systems, and might dispense much more than just medical related products like alcohol, tobacco, vitamins, and minerals. When we applied for the CES Innovation Award, and they did not have a category for us since the Oblend is the world's first portable home dispensary. So the definition meant what the Oblend does.

Matthew: Okay. And there are different ways that the oil can be dispensed out of this machine. Now, just...I wanna give people a visualization of how big this is, is this like the size of like a drip coffee maker? I mean, what's the size?

Nicole: Yes. It's about the size of a Keurig coffee maker, and it's designed to sit on your kitchen countertop.

Matthew: Okay. Okay, that helps. So you have this K-Cup size machine, and it dispenses oil, and the oil comes out in what ways? How is it delivered?

Nicole: Okay. So the Oblend works similar to the printer ink cartridge model in that the Oblend contains dozens of cartridges filled with therapeutic herbal extracts, such as CBD, CBN, limonene, myrcene, fish oil, turmeric, Echinacea. So the consumer will use the Oblend smartphone app and search for and find crowdsourced and export-sourced recipes. Then they can adjust the ingredients, and within minutes, create personalized products with a push of a button on the smartphone app. If they like it, they can save it and share it with their friends or share it with the Oblend the community.

Matthew: Okay, I get this. So it's this K-Cup sized device and you put in modular ingredients, and then you put in a recipe and out comes the exact medicine or elixir that you want. But there's a thing I don't understand. Where do you get those modules to put in the Oblend? Would it be at dispensaries? Some are at dispensaries than some that don't contain cannabis or THC. They would be available elsewhere. Where will you buy those?

Nicole: Okay. So when you purchase an Oblend, it will come with the prefilled cartridges. And there will be 23 prefilled cartridges, and there will be an empty slot in that if you would like to go to a dispensary and purchase one of our cartridges filled with THC, then you would have the option to do that. So as you blend your recipes, you will be depleting your ingredients, and your smartphone app will notify you when you're getting low on certain ingredients. And you can choose to order those cartridge replacements directly from us, and we can just mail them to your doorstep. And the only cartridge that you have to actually go to the store for is the THC cartridges.

Matthew: That is really clever here. So I could see something where, you know, my mom has arthritis, and she buys the Oblend, and she's looking for a recipe for arthritis. So she goes to a dispensary, gets the cannabis oil module, plugs it in, all the other ones are in there. And then she looks up a recipe. Maybe a lot of other people have a similar situation. She looks up, "Oh, this recipe for arthritis has a bunch of reviews. It seems like it's the most popular. I'll start there." And she just, like on an iPad or a phone or something, just says, "Make this recipe," and then it just does that wirelessly. Is that how it works?

Nicole: Yes, yes. So every time she would create a recipe, the Oblend always dispenses in very precise and consistent blends of these therapeutic extracts. However, with the Oblend, she can choose to create a variety of products. So let us say that she is looking for symptom relief from her arthritis. In the morning, she could insert a cup of tea in the Oblend and choose that recipe for arthritis. But she may decide to add additional ingredients to help her wake up and focus like myrcene and the limonene and pinene. And then in the afternoon, she could choose to make a lotion to help with her arthritis. So she would put her lotion underneath and choose that same recipe, but she may decide to add in a little bit more CBD, turmeric, and curcumin to help with her inflammation. And at night, she could, using the Oblend, choose that same recipe, create a tincture with the Oblend and decide that she needs something to help her sleep through the night. So she may wanna add some CBN and linalool to help her sleep.

Matthew: Wow, that is pretty cool. I can see why there's so much interest around that. And it sounds like it's done in a user-friendly way where I don't have to know about the chemistry or anything going on there, just the outcome I want and the ingredients I want.

Nicole: That is correct. We are trying to make it as simple as possible for the users. However, if the users want to be a chemist, then they can dig deeper and they can research the different ingredients and medicinal benefits and choose to create their own blends.

Matthew: Yeah. Well, I just wanna dig into this a little bit more because vape cartridges are just so popular right now, particularly in Colorado, in California, but still other places too. So with the Oblend, I can put in an empty vape cartridge, come up with whatever recipe I want, maybe high CBD, high THC, high in certain terpenes, like you mentioned myrcene or limonene, and then it fills up my vape cartridge right there on the spot. And then I can just put that into a vape pen, is that right?

Nicole: Yes, yes, that is correct. So, you would just insert a vape. Another thing interesting about the Oblend is if you can create very small amounts of vapes, and we call them micro-vapes. So let's say a certain strain helps relieve your inflammation, like Blue Dream, and your friend prefers Girl Scout cookies. Well, you could each replicate those strains using the Oblend. And again, adjust it for the effects and the flavors that you would like. So instead of carrying around vape that you purchased and don't really like, and spend a lot of money on, it's allowing you to create little micro-vapes and adjust them over time so you have the perfect blend for you and your body.

Matthew: That's great. And then can you just save one as a favorite if you kind of arrive at your optimal one so you don't have to remember all the different variables that you created when you were creating your blend?

Nicole: Yes, absolutely. So in the face of the Oblend app, there's one area that says My Favorite Blends. So if you know the blend that you like in the morning and the afternoon, when you're going out with your friends, when you're going to sleep, it would be underneath My Favorites. And you just bring it up and push Blend It, and you'll have it within minutes.

Matthew: Okay, that's great. That is really a compelling offering. So when you were at the CES show in Vegas, formerly called Consumer Electronics Show. This is the huge, huge thing you see on the news where there's just tons of people and robots and all that stuff. That's what CES is. And I heard the electricity even went out for a little bit, ironically, where everything is electronic. But tell us kind of the reaction there and what people were asking about and what your interactions were like there in CES.

Nicole: Well, it was my first time at CES. So I was walking around with my eyes wide open. It was an amazing experience. Some of the coolest products were in sleep technology, custom fragrances. Really, personalized health is trending. I believe that people are coming to realize that the one-size-fits-all model doesn't necessarily work when it comes to their health. People are finding out more and more about the differences between men and women's needs or age differences. And they're looking for ways to customize their daily health regimen. Many of the benefits that pharmaceuticals offer can be matched cheaply and safely with botanical extracts.

Matthew: Yeah. Now, what do you see as being the most popular mixes in the Oblend that don't include THC or cannabis of any kind because, you know, this show, there's a focus on cannabis, but there's a lot of things you can do without cannabis with natural essential oils and things like that. I mean, I know when I get sick and I just can't shake it, I'll do a little bit of oregano oil and drink it even though it feels like it's burning my insides out. It usually is kind of like a nuclear herbal bomb, and it seems to work. I mean, it could be psychosomatic. I don't know, but is there any kind of blends that you think will be really popular that just simply won't have anything to do with cannabis at all?

Nicole: That's a great question. So, the reason why we went to CES, we won CES's Innovation Award for one of the most innovative products commercializing in 2018. We were not allowed to include cannabis in the application. In fact, our original application did include it, and they called us back and asked us to remove it. They liked our technology so much that they gave us the Innovation Award for a non-cannabis consumer device. And the award that we received was in the biotech fitness and health category. You can use the Oblend to make personalized nutraceuticals, perfumes, lotions, culinary oils. We were approached by a number of companies from large industries at CES, such as fragrance companies, cosmetic companies, Big Pharma, tobacco. And even the gaming industry expressed interest and partnering with us, and they really like the Oblend.

Matthew: Yeah, this kind of reminds me of like a first-generation version of something you'd see on Star Trek where stuff's just made for you. I really like the way this is going. I've worked on hardware products before, and there's a lot of challenges. It takes time to iterate when you're dealing in the world of atoms instead of...has it been more challenging than you originally anticipated when you came over from the pharmaceutical industry?

Nicole: It's always challenging when you are trying to develop a device that has never ever been created before. At TearScience, it took us twice as long to develop our products, and that was my expectation coming over to Altopa in the Oblend. But what's great is every time we reach a challenge, a technical challenge, it gives us an opportunity to file another patent application, right?

Matthew: Mm-hmm.

Nicole: So we have built a beautiful patent portfolio. At this point, we have filed 26 patent applications. We've been granted one patent. And we have extended our patent protection throughout the world.

Matthew: Okay. Tell us a little bit about your team. I mean, you've gotta have a lot of diverse experience here. You've got wireless technology. You've got a physical product. You've got essential oils. You've got delivery mechanism. I mean, you got a lot of different moving parts here. Who are the different players on your team that is helping to create this vision?

Nicole: Well, we have Matt Wilson, who was the...he's really the visionary, and the one that thought of the Oblend. He is our CEO. I'm the CFO. My background is, if we heard it, Ernst & Young, technology, and healthcare industry, FDA industry. Most recently, we brought on our COO. His name is Brent Poole, and he has experience with Ernst & Young as well. What's even better is Brent was one of the first employees of Amazon, and he was in charge of building out their international supply chain and in charge of inbound customer service. We just hired an individual named Jeremy Sackett, who was the founder and CEO of Cascadia Labs in Oregon. And he built and recently sold Cascadia and joined our team and our lab facility, which is located in Oregon.

We have a great VP of software engineering and technology. This individual worked for our COO, Brent Poole, for a company that Brent started called Mindbloom, and that was a health and wellness technology company. They grew that and sold that to a company called Welltok. So Jon Collette is the person that created the app that went along with Brent's company, Mindbloom. And Jon's in charge of developing our app as well. And the list goes on and on. Pete Crawford's in charge of our supply chain. He was the CEO of Lunchbox Alchemy, which is located in Oregon, great, great company. And we're continuing to build a great team that has the experience in the cannabis industry, the technology industry, and the healthcare and health and wellness industry. And we have all built companies and successfully exited them. So we definitely have the team in place that can execute the plan.

Matthew: Yeah, this seems like a great product for the market. This is the perfect example of the "Blue Ocean Strategy." I try to talk about this. It's a great book, but there's a lot of entrepreneurs listening and not listening to that are simply going after "me-too" type of products in the cannabis space. And I think that's gonna be harder and harder to do because everybody's gonna have to drop their price. And they're all gonna be offering the same thing in the market, wants unique selling proposition if you wanna have high-profit margins. So, you have to add a compelling benefit. And this is a really compelling benefit for consumers. I'm really interested in this. I'd like to have one. And I know that investors are probably saying, "Hey, this is great. There's a revenue component here." The cartridges, you know, they might be a proprietary fit or something like that where they have to come just like a K-Cup. So what's been the response from investors who are looking at Oblend? And I know you went to Arcview. Maybe you can tell us a little bit about that.

Nicole: Arcview was a great experience for us. We raised our first round of financing mostly through the Arcview investors. I think it was back in 2016 and early 2017. We closed a series seed equity round of 1.4 million. And then currently, we are raising a 5 million Series A round. We have filled 2 million of it and we're looking to fill an additional 3 million. I think for investors, some get this right away. And the ones that know that we're not just building a company that has recurring revenue, we have filled a lot of patents. We have a great team. Is the picture is much, much larger than that? We are building a database that's gonna be full of information that's gonna be very valuable one day. It's going to be valuable for identifying successful formulations. It's gonna be valuable in advancing cannabis science and patient recruitment. It's gonna be value in knowing how to deploy your marketing dollars and boost your ROI. It's going to valuable in knowing where to direct your future R&D cost. The data is huge, and it's the foundation of our company. Beyond that, we can expand vertically. We can go into other industries. We can license our technology. There's a lot of meat behind this company.

Matthew: I can see that. My mind is already thinking about all different directions it can go. So that's incredible. Then what do you think the unit's gonna retail for here, and when will it be available?

Nicole: We are gonna start shipping units in the summer of 2018, which is really right around the corner. We are going to have a list price of the Oblend of $949, which includes the cartridges filled with the ingredients. Right now, we have a presale campaign going on. If you sign up for our presale campaign, you get 50% off of the list price. So that would be a price of less than $500. And as I said, the list price is 949. So ultimately, our price will come in somewhere between 500 and 949. But we want everybody in this world one day to have an Oblend.

Matthew: Okay. Okay, so if there's any accredited investors out there listening that wanna get involved, how can they reach out to you?

Nicole: They can go to our website and fill out a form and check the investor box, and we will definitely reach back out to them. If they're really serious about wanting to invest in the company, they can always email me, and my email address is nicole@altopa.com.

Matthew: Cool. Now, let's pivot to some personal development questions here, Nicole, so people can get to know you a little bit better. Well, you talk about some heavy business stuff here. Let's lighten it up just a tich. As a tich my mom would say. Do you know how much a tich is?

Nicole: I do not.

Matthew: Two tiches make a tad. These are Midwestern slang terms that I grew up with and I just [inaudible 00:32:15] knew what a tich is, but it's definitely not a pharmaceutical, you know, exact measurement. So with that...

Nicole: A pinch.

Matthew: A tich.

Nicole: It reminds me of my mom's, a pinch of that, a pinch of this.

Matthew: Yeah, it's close. Is there a book that has had a big impact on your thinking or way of life that you'd like to share with listeners?

Nicole: Yes, there is a book. I recently read a book called "Exponential Organizations" by Salim Ismail. And do you know what an exponential organization is?

Matthew: Something that's growing at a nonlinear rate, an exponential rate, is that right?

Nicole: That's right, that's proportionately large, at least 10x larger rate compared to its peers because it's using new techniques and leveraging accelerating technologies. So it's basically thinking big and find, create, or align yourselves with companies that are exponential organizations, and some examples are Google, Amazon, Apple, GE, Microsoft, and Cisco.

Matthew: Okay, cool. Is there a tool web-based or otherwise you consider vital to your productivity?

Nicole: I would say currently, that would be Google Analytics because Google Analytics is giving us an enormous amount of information about who is visiting our website, what they're looking for, and how they are getting there. But I will also say that the two big tools that are vital to this company are use of artificial intelligence and machine learning because we're building this company to maximize the value and the customers' overall experience. So as we build the Oblend platform, we are building machine intelligence into the foundation of all of our systems. It's really the foundation of this company.

Matthew: Do you use like an off-the-shelf AI from like IBM or anything like that or you're just building it as you go with your own technology or how does that work?

Nicole: Unfortunately, I am finance, so I cannot tell you all of the details, but we're really excited about it.

Matthew: That's great. This is really interesting stuff, and I wish you all the best, Nicole. As we close, can you tell listeners one more time how they can find Oblend and your presence online?

Nicole: Yes. To learn more about the Oblend, you can go to our website, which is oblend.com. And you spell it Oblend, oblend.com. And you can find out more information about the Oblend and you can also sign up for our presale campaign.

Matthew: Great. Well, Nicole, thanks so much for coming on the show today and educating us. This is a really, really interesting product. I've been wanting to get you on the show for a while. I'm so glad I did because this is really a breakthrough. So, good luck with everything you're doing and keep us updated.

Nicole: Yeah, yeah, thank you. Good luck to you, too.

Creating a Cannabis Accessory Subscription Box

natasha irizarry

Learn how Natasha Irizarry risked it all to ditch the rat race and move to Colorado for her cannabis accessory subscription business StashBox.

Learn more at:
https://getstashbox.com/

Key Takeaways:
[0:56] – What is Stash Box
[1:12] – Natasha’s background
[11:40] – How big is Stash Box
[12:49] – Natasha talks about transferring her corporate skills to Stash Box
[14:05] – How do you choose who to market to
[16:29] – What are the most popular products
[19:39] – Natasha talks about keep customers engaged and excited about Stash Box
[24:07] – Natasha’s advice on raising capital
[29:34] – Natasha talks about what she would do differently if given the chance
[32:06] – Natasha answers some personal development questions
[36:51] – Contact details for Stash Box

Important:
What are the five trends disrupting the cannabis industry right now?Find out with your free cheat sheet at https://www.cannainsider.com/trends

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Today we’re going to hear from an entrepreneur that builds her cannabis related business despite many obstacles and challenges and successfully transferred her skills from the non-cannabis world to the cannabis world. I’m pleased to welcome Natasha Irizarry, Co-founder and CEO of Stash Box to the show today. Natasha, welcome to CannaInsider.

Natasha: Hey Matt. Thanks for having me.

Matthew: Give us a sense of geography. Where are you in the world today?

Natasha: Today I’m in Denver.

Matthew: Okay, but that might change at any moment.

Natasha: Tomorrow.

Matthew: What is Stash Box? Give us a very high level summary of what Stash Box is.

Natasha: Stash Box is a monthly subscription box that matches cannabis consumers with products and brands that they’ll love.

Matthew: What were you doing before Stash Box and what made you start this company?

Natasha: Man, I guess before Stash Box I don’t know. The last thing I really remember is high school, which is crazy. So, high school happened, and then I had to grow up quick. I had five little sisters. I was the oldest girl. I wanted to rebel. So, around the time I was 22 I got pregnant, had my first kid, and said to myself, can’t be a bartender forever. I was doing some graphic design stuff on the side, and decided to go for a more corporate role in financial services as a designer.

I got to jump into my web design and user experience career, which is what I did before this, at a senior level and I was very fortunate to be able to work my way up through some different financial services companies with some of the best user experience teams in the country. After that, I had a couple more kids. I went and worked at O.K. Cupid in New York City as a product designer around monetization and data. Then my mom got sick. Well, my mom had been sick so I left O.K. Cupid, went back to Charlotte eventually. And all while I was doing that, I was starting this little side hustle with my ex-boyfriend D.J., who’s my co-founder.

That’s how Stash Box was born. We were kind of lonely. We didn’t have very many friends, but we had a lot of knowledge about weed products for some reason, probably because we smoked weed. Then we were just thinking why don’t we use what we know in user experience and design and product development and bring that to the cannabis industry. So, Stash Box was born. In May 2015 we shipped out our first boxes. I moved back to Charlotte in July of that year.

Then the cannabis startup world is the only thing on my mind. I’m following every. I read Steve DeAngelo’s book. I’m reading everyone’s blogs. I completely immerse myself into the cannabis industry. At the time I was a writer on Fivver. So I would spend my time writing $5 articles. It took forever. Keep in mind this is completely (4.08 unclear). It took forever, but what it did is it allowed me to learn about the industry as fast as I could because I was doing all of this cannabis writing for all these ramp companies. Then I applied to Canopy Boulder.

I was hesitant because in the cohort right before me. There was another subscription box, Ganja Boxes. I don’t know if they ever had a box, but they were in the cohort right before me. I was gonna apply. I was gonna apply to that cohort, but I didn’t because I wanted to move home to be closer to my mom and my family. So, I wait, and I’m like, you know what? I’m just going to try to build my company up to be the best that it can be, to make it so that Canopy really can’t say no to me. I want them to want me to be a part of their portfolio because I know that I’m gonna figure this out, so I applied.

I was like, I don’t care if the competitor was in the thing before. I don’t care. I love my competitors. Let’s merge. So, I apply and I’m waiting and I’m waiting and Christmas passes and the cohorts start at the end of February and I’m freaking out. I’m like, oh my god. What the hell’s gonna happen. I’m packing all these boxes. I’m in my apartment packing up all these boxes with D.J. They’re Christmas boxes and D.J. forgets to put the inserts in the box and we had gift wrapped them. So, we had to unwrap them all and rewrap them, which is fine. Lesson learned.

I’m like damn, I really want to focus on building the business part of this. I really hope Canopy gets a hold of me. Then Christmas passes, then New Year’s passes, then I’m like you know what? I’m just gonna email them. So, I started emailing and poking at them and checking the platform for Canopy. I’m checking every hour. Come on you guys, you’re killing me. I have three kids. I have to move my whole life and time’s a ticking. But at the same time I’m working for Allstate leading a redesign. This $8 million project redesign. I’m working full time on top of Stash Box and my kids.

So, we’re in January and it’s like mid-January and I’m hanging out with D.J. one night and my dad calls me and he’s like, hey your mom just died. I’m like, fuck. I’m sorry, can you believe that?

Matthew: That’s okay we’ll leave it on there. It’s real.

Natasha: I’m like oh my god. So it’s 9:30 at night. My dealer had just come by and got me my weed, and I had rolled two joints and I was about to take a bubble because it was a really hard day. I think I had my head shots or something that day and it’s always stressful. That shit’s always stressful. I’m like, oh my god. So, I leave D.J. at our apartment with my kids and I go to my parents’ house and it’s night. It was awful. It’s awful. Just letting you know, it’s two years ago to the day almost. January 12th was her deathaversary, as I call it.

Matthew: I’m sorry to hear that.

Natasha: This is something that has changed me so much and I think for the better. So, I get to my mom’s house, and keep in mind I have all these sisters. I have five little sisters. My mom died of an accidental opioid overdose. It’s a real thing. It’s a real problem. And she also had interim COPD and emphysema, but a couple days before that my grandma had died, her mom, so, it was like a double whammy to our family. I’m basically emotionally crippled. I can’t do anything. I can’t get out of bed. I come from a really close family. Anyone that knows me knows. I brought my whole family into this industry.

My dad is the head of distribution here (8.44 unclear). I bought 14 people to Denver. It was a big thing. So, I’m like, I looked at D.J. and we have got to find out about Canopy. I emailed Canopy a pretty firm email. I was like, D.J. we can’t tell them my mom just died. We can’t tell them. That’s a risk. We cannot tell them. A couple days later we find out that we made it in, and I’m pretty sure I had video. I recorded some videos of this. We got in and I just remember looking at D.J. and being like, I don’t know how I’m going to do this because my mom just died, I’m the oldest girl. I have to move away from my whole family and everything I know to come to Boulder in winter.

We do it. Three weeks, I tell my dad, I’ve got to move to Colorado. I need your help. I tell my children’s fathers, I need your help and all of my extended family, I really need your help. They have all been the best support I’ve ever had. I’m so lucky, because of them I was able to move across the country and go to Canopy and go through Canopy. In Canopy I was working full time. I can’t tell Canopy that I’m working full time for Allstate leading redesign, and I can’t tell Canopy that my mom just died.

Pitch practices for Canopy were on Tuesdays night and my mom died on a Tuesdays night. Every Tuesday I was just fucked. The whole cohort will laugh after they hear this. They would laugh because I’m talking I would in full on dramatic tears, and they had no idea because I didn’t want to risk it. We started getting really close with Mason at Canopy. He was in our cohort with We Grow and we were there all day and all night. We had so much fun. We were building our companies, hustling, being entrepreneurs. It was fantastic. Because of that, you know the Canopy story, you build relationships. You get funding and then you go. Long story short.

Matthew: Let’s get a sense of how big Stash Box is now. How many employees you have, how many customers you serve and things like that.

Natasha: We have five employees now. Six if you count part-time. I’ve actually learned a ton in the last two and a half years, which is because mostly Canopy and my hustle. So, we have five employees at Stash Box. And we have thousands of customers. We are partnering with brands as well as consumers. So, we are now able to take what we’ve learned, data-wise, in our company and we’re able to provide brand solutions based on that data.

Matthew: You mentioned working at O.K. Cupid, which is a dating site right? Okay, you have O.K. Cupid. You’re pretty involved in UX design. How do translate those skills over to Stash Box for optimal effect?

Natasha: It’s all the same. It’s the same in cannabis and Stash Box as it is at O.K. Cupid, as it is at any of the financial services places I worked, the same as AllState. It’s about people. When you think about cannabis consumers, try to think about the demographic of a cannabis consumer. I think that that is becoming a real problem for startups and other businesses in this industry is that if the demographic for cannabis consumers, everybody, then how do we find and penetrate the right target market?

Matthew: That’s a tricky thing. How do you figure out who… do you have an idea who your customers are and then sometimes they’re different than you thought or there’s more than one group and how do you speak to them each individually? How do you go about doing that? How do you go about creating an experience with the box that you feel like delights each of these demographics or the primary demographic?

Natasha: We ask them questions. So, we ask our customers, so our Stash Box subscribers, questions about their lifestyle. Now, depending upon how they answer these questions, they’re matched up with products and brands. So, if we learn that there is a 28 year old woman who consumes daily, and let’s say she’s fairly active on social. We’re gonna send her feminist related products like there’s these vagina rolling papers that are coming out. That would be perfect. We would send her a black bath bomb that has CBD in it. It’s endless the things that we would be able to send her based on this lifestyle data that we get.

Because of how she’s answering these questions, we can go to brands in any industry, not just cannabis, and say, we have this person who would be perfect for your product and she’s active on social. She talks about the substance she gets in her box. She comes back and she rates and reviews. So, because of all this, this is all data, I just know how to take that data and keep applying it to my product because that’s my background. That’s what I did at O.K. Cupid. That’s what I did basically everywhere I worked is analyze data, look for the outliers. Whoa, that’s interesting, that’s an interesting fact. And test it. If it’s a web app, build interfaces. If it’s a retail location, move your store around. There’s a lot of different things that you can do to test based on the data that we have.

Matthew: Is there any products that seem to be consistently popular across the board?

Natasha: We recently changed how our subscribers build their box. Before the box was $30 a month. They paid $30. They got a variety of stuff that we picked for them. Now subscribers can subscribe for as low as $1 per month. They build their box based on different price points of a box. So, they can choose from a few dollar items. Each price set has a mystery item. We’re able to do all these tests. Funny enough the things that are performing the best are hot sauce.

We’re the only people who sell this hot sauce called Pot Sauce. It’s not medicated. It isn’t just delicious. A detox company makes it. I think it’s great. Our subscribers love it. We actually have a subscriber that got pregnant that comes back to buy this from us. She emailed us and she was like, I have to unsubscribe to your box, but… I’m like you know what? Absolutely. Here’s a discount. Yeah, so we’re able to find these things, like a hot sauce. So, what we’re learning, people who smoke weed like to eat and they like to cook. They go hand in hand.

So, we’re able to go back to brands like the Pot Sauce and any food brand and say, we have these people who are really active on the munchies. The (Scrup) Waffle was another big hit. It’s like this little waffle, wafer, sweet treat. It’s so good. I think you can get them at Whole Foods. The brand that we had is Belgium Boys. I know that on some maybe United Flights or something you’ll get a (Scrup) Waffle. Belgium Boys is the brand that we had, and they are so good. They are so good. I am guilty. I probably ate a whole box of them.

Matthew: I got to find these now. Sounds like a good little munchies.

Natasha: The munchies are our popular items.

Matthew: This is an interesting business you’re in. I mean, there’s a lot of businesses or business owners listening they’re like gosh, I wish I had a subscription box. It’s the best business to be in. When it’s going well I’m sure it is, and then other times there’s attrition and you’re losing people and you’re like, gosh how do I keep people engaged and how do I have retention. How do you create that surprise and delight and what are you trying to do to keep retention and keep people engage? That surprise item sounds like a good way to do things. Is there anything else that you do?

Natasha: We kind of theme each box each month. I have a designer on staff. Her name is Jamie. Known her for ten years, plus. She designs each box every month. Every month we sit down and we’re like, how would this feel? How do we want people to feel when they open the Stash Box? We start there. For person, you know, you can’t make everyone happy and we don’t. We don’t make everyone happy. But we eventually do, because if someone were to reach out to use and say, I’m unsatisfied with your product, then we’re going to go through the steps that it takes to figure out… we want to learn how we can make them satisfied with our product. A few times we’ve run into fulfillment issues because we did fulfillment in house. So, to resolve that we’re outsourcing fulfillment and it’s so good.

Matthew: Is there companies that do that? Just pack and ship type… pick, pack and ship. Is that what it’s called?

Natasha: They do fulfillment for Walmart. They were like we’re looking at cannabis companies. And I get a lot of calls like that. We’re looking at cannabis companies and we want to test the waters with yours. Because we’re not a cannabis company. We don’t ship cannabis. We ship ancillary products, accessories, gifts, gift items, munchies. Nothing with cannabis in it. So, we’re like a safe spot for these brands. I’ve read a lot about a few distributors getting raided because of paraphanalia. So, it’s actually kind of comforting that these bigger companies that work with companies like Walmart are willing to work with companies like mine because it kind of broadens my dream for my exit.

Matthew: Where are you in the investing process or the capital raising process? Do you have multiple investors or bootstrap? How does that work?

Natasha: I got our initial investment through Canopy Boulder. So they invested $20,000. And then we went through Canopy Boulder. I met privately an investor who fulfilled our pre-seed round of $150,000. Then that same investor fulfilled our seed round in November of that year with a million dollars. Now we are still using that million dollars to keep our company going. So, I would say that we’re bootstrapping, but it’s not technically bootstrapping.

Matthew: You don’t think you’re bootstrapping.

Natasha: Yeah.

Matthew: So, you say you had one investor that like what he or she saw and then just continued to invest more. So, that’s a good sign.

Natasha: He’s fantastic. He’s invested in a few more ancillary brands. We were looking at raising a Series A. I’m thinking maybe this time next year. I have a lot of things I need to polish up. The process of grief in my mom has really taken a toll on me as an entrepreneur. I didn’t have the ability to focus. Now time has passed and therapy has passed so the ability to focus is there now so that’s good.

Matthew: Is there any advice entrepreneurs or would be entrepreneurs listening that are saying hey I’d like to raise capital? What kind of questions do investors ask, and how should I be prepared?

Natasha: Investors ask… you can’t really predict it.

Matthew: Yeah, they’re probably all different.

Natasha: There’s a lot of different kinds of investors. There’s the investors that want to know the return. There’s the investors that want to know your financials. There’s the investors that are going to go through every little piece in your history. And then there’s the investors that are going to meet you and say, I can tell just by meeting you that you’re somebody that’s worth investing in, and you’re going to get it done. I think it’s worth waiting for the right investor for you.

I was never comfortable with the financials. I needed to go and get outside help with financials and that’s fine. I know product is not in development like really really well. So, probably just as good as somebody who knows financials though. So, being able to hang on and keep moving forward through the hard parts, because it’s gonna get hard. You’re going to run out of money. Your employees are going to quit. Crazy things are going to happen. Just be ready to expect them because what investors are looking for is someone who can take whatever and make it more. So, just keep taking shitty things that happen to you and make them more.

It takes a lot of discipline. I was reading something the other day. This company did a survey of 1,000 entrepreneurs about what makes them successful. In it, it said that entrepreneurs spend 25 percent of the their time by themselves and that’s a lot of time. I feel like when I first really dove into startup and Canopy and stuff like that the feeling that I felt more than anything, especially without my mom, was loneliness. Many things stem from loneliness, addiction especially, alcoholisms. These things stem from loneliness and as entrepreneurs if we can kind of hack ourselves, that 25 percent of time that we have alone is so precious. It’s our solitude. That’s our 25 percent to make whatever magic we can in our company magic. So, we should take that 25 percent and not feel guilty about spending it on work. I guess that’s what I would have to say. This shit’s hard, it’s hard, but it’s fun. It’s going to be okay if you just stick with it and you stay true to yourself.

Matthew: Yeah, and there’s really no rules. That’s kind of hard for people that are like I need a direction. I need someone to provide me direction. There’s some from a mentor or something like that, but mostly it’s on your own just trying to make things work, finding ways that’s going down path that aren’t well paved and just figuring it out. You have a high McGyver, as I call it, which is just kind of putting it together with duct tape and a fishing line and dental floss and a piece of gum. Let’s try this, now let’s try this, now let’s try this.

Natasha: It’s funny that you say that because it takes a certain kind of person. I think anyone can do it. Honestly I think anybody can do this. But I’m going to have to disagree with you. I think that there are rules and it’s the hardest rules. As an entrepreneur, as somebody especially in the cannabis industry, you have to always do what’s right, and sometimes doing what’s right is the hardest thing in the world. That builds your character. I feel like in the cannabis industry especially, what makes it different from the tech industry that I was in before is that everyone has had to deal with the black market. So, everyone’s had to build these relationships and kind of prove themselves to be a decent human. I just think that if you’re good and you do good and if you fuck up, you own up to it. You just do what’s right then you’ll be fine.

Matthew: Now if you could wave a magic and start your business all over again, what would you do differently and what would you still do the same?

Natasha: I think that I would do fulfillment way sooner. I would outsource it way sooner for sure, hands down. It’s so funny because Mark (Nautally), who’s a partner at Canopy Boulder, he would always just hound me about logistics. He’s one of my mentors. I talk to him weekly. He was like, how are you going to handle this. I’m like, I just am. I was so naïve. He was laughing at me basically. He was like, Natasha, no. So, lesson learned, lesson learned, Mark Nautally and he knows he was right. I would have definitely have done it sooner. The same, I think that I would… there’s so many things that I would do the same, but what do I want to say? I would definitely say that I would have raised the same way.

Matthew: Would you name your company the same? Would you keep it in the same location?

Natasha: Yeah, Denver is cold. It’s freezing outside right now. It’s colder than Charlotte. I really like the industry here in Colorado and I think that Denver’s great. Yeah, I’d keep that stuff the same. I’d keep a lot of it the same. I’ve learned so much so fast. I can’t complain.

Matthew: Natasha, I’d like to ask a couple personal development questions to help listeners get a sense of who you are personally, although you’ve shared quite a bit about who you are personally. So, that’s good to get that color and context around that because a lot of times there’s just this kind of gloss over and then my business was successful. It’s like, what was that blah, blah, blah part and you gave us a lot of color around that and I appreciate that honesty. Is there a book that has had a big impact on your life or way of thinking that you’d like to share?

Natasha: I read four books a week. I would say the one that has stuck out to me the most, gosh, I’m going to go with some nonfiction here. Originals is a really good book. Originals is really good.

Matthew: Yes, I’ve heard of that. What did you like about that?

Natasha: It just tells you the no bullshit way of all the things, all the disciplines that you have to have and how other people in history have had those same things and how the feelings that you feel, you’re not alone. So, that’s a really good book. Actually Mason still has that book of mine. Yeah.

Matthew: Mason Levy if you’re listening can you get that book back to Natasha please.

Natasha: He knows. I would say another, and this is a really good way, if you’re like oh my god I have no idea what the hell I’m doing with my company, this is a good way to figure it out. It’s a book called Traction. And old employee of mine told me about this book and it changed who I was as a manager and as a leader in my company because that transition of funding and hiring people, it’s hard to have employees. It’s so hard. This book really helps you. It’s like a no bullshit easy read. It’s good.

Matthew: Is there a tool, web-based or otherwise, that you consider vital to your productivity?

Natasha: I would say my planner and my schedule is vital to my productivity. I would also say that my self care is vital to my productivity. So, if I don’t workout and I don’t write, if I don’t do those things with that, 25 percent of my time is spent alone. If I don’t take that time doing something that keeps my mind completely busy, then I don’t feel like I’m very productive.

Matthew: Is there any tools that you use to kind of digest the data that you’re acquiring about customers or demographics or any tools you use for quick mockups or user interface design and things like that?

Natasha: For the data stuff I use Excel. I’ve been messing with some Google stuff a little more. I’m having some fun with Google Sheets, but if you really want to have some fun, go play with Google Data Studio. It’s super easy. You can sync up your Google Analytics to it and you can just mess with and see what kind of data you can pull out. It’s really fun. Another app I use for data is (35.22 unclear). It’s a lot of manual work still. So, there’s a lot of MySQL commands and some code that goes into it. One the UI/development side, I would say for design I use a mixture of Adobe Creative Suite and an app called Sketch. Sketch is a math-based app that is pretty cheap, and I say it’s for UI based things. So, if you an entrepreneur and you want to do quick mockups, I would get Sketch, if you have a Mac.

And there’s a web-based tool called Invision. That is great for showing off prototypes. So, if you do your mockups in Sketch, you can automatically sync it with Invision and you can create tapable and interactive mockups. So, if you’re building an app and you don’t want to code it but you have some mockups done, you can make it easy to demo that way. So, there’s a few tools.

Matthew: Okay. Well, Natasha as we close, how can listeners learn more about Stash Box and find you online?

Natasha: Well, we’re all over social. Instagram is @getstashbox and our url is www.getstashbox.com. I try to tell people to not forget the get because if they go to www.stashbox.com they’re going to meet Stash Box the band, which I love.

Matthew: Wait a second, I know I know one of their songs. I’m thinking of Matchbox. I ruined it. What does Stash Box the band sing? Any songs we recognize?

Natasha: They’re a small band from Florida. So, no.

Matthew: Well, Natasha thanks so much for coming on the show today and good luck with everything you’re working on in 2018. We wish you the best.

How Beneficial Bacteria & Microbe-Rich Soil Create Thriving Cannabis Plants

peter saavedra

Peter Saavedra from Soil Balance Pro educates us on the incredible impact bacteria have on your cannabis plants.

Fun Fact
Did you know that terpenes are created from the feces of bacteria? Learn more in this fascinating episode.

Learn more at
https://www.soilbalancepro.com/

Key Takeaways:
[1:08] – Peter talks about his businesses
[1:57] – Peter’s background
[2:49] – The underappreciated microorganism
[5:18] – Setting up bacteria processes
[7:34] – Peter talks about Compost T
[10:45] – Peter talks about how bacteria affects terpenes
[17:26] – Getting the right combination of bacteria
[20:53] – How humidity affects different bacteria
[23:16] – What are microbes
[27:12] – Top reasons people use Soil Balance Pro
[30:28] – Peter answers some personal development questions
[33:46] – Contact details for Soil Balance Pro

Important:
Want more information on the latest in growing tips and tricks
Sign-up for our grower newsletter here: https://www.cannainsider.com/welcome

Read Full Transcript

In everyday life we often place the most importance on things we can see, feel and touch, but what if one of the most important factors to creating healthy cannabis plants is something we can’t see. That is why I’ve asked Peter Saavedra on the show today to discuss bacteria and microorganisms and how they impact cannabis. Peter, welcome to CannaInsider.

Peter: Matt thank you so much. I’m grateful to be here.

Matthew: Give us a sense of geography. Where are you in the world today?

Peter: Today we… our company kind of roots is in Phoenix, Arizona. So we’re in the southwest. We’re not getting hit by the cold too much.

Matthew: Yeah, gosh it’s brutal out there. Tell me more about your business Soil Balance Pro, Kind Roots and whatever else you have going on.

Peter: Well the product itself, Soil Balance, is a wetable powder and it contains over 60 proprietary strains of Rhizobacteria or actinomycetes. So, we’ve collected all these different microorganism strains from around the world. The product also contains strains of commonly found microorganisms like bacillus subtilis, trichoderma and we have 12 species of VAM and ectomycorrhizal symbionts.

Matthew: Wow that’s a lot of science there that you threw out. We’re going to have to unpack that in a second, but tell us a little bit about your background first and what made you start Soil Balance Pro and go down this road of micronutrients?

Peter: Thank you for that questions. I’m a sustainable agriculture consultant. I consider myself a soil specialist. I’ve been studying soil microbiology, soil physics, soil chemistry for the last 20 years with some of the most renowned organic cultivators in the world. I’ve been working for a long time to help make USDA organic what it is today and get that traction and help these guys really be able to cultivate with nature. That’s a little bit about me.

Matthew: Let’s kind of set the stage and frame your knowledge here. What are most cultivators and cannabis enthusiast not fully appreciating about bacteria, microorganisms and how that affects their plants?

Peter: That’s a really good question. To break it down, to actually give people some insight as to microorganisms and what maybe some cannabis cultivators are undervaluing about what these guys can do for their systems is to really look at the microorganisms themselves as givers and takers. So, if we can isolate the microbial world into that fashion it will help us really understand how important these guys are. Let’s take a look at the takers.

People call then pathogens. The takers, what those guys do, is they actually will just take from the plant so that their needs are met, so that they’re fed and they have no repercussions of the health of the plant. They’re just simply this organism that’s there that is constantly trying to feed themselves and their offspring so that they’re sustained and that they’re healthy. They have no repercussions, again, for the total system so the plants begins to die because those organisms are starting to take so much just for themselves so that they’re alive.

The givers, adversely, they understand that their long term survival and that of their species is contingent on what they can give, what they can create for not only themselves but to keep that plant healthy because they understand the longer that plant’s alive, the longer that they’re going to survive. So they understand that the more they give, the more they’re taking care of their future species and those yet to come. I think the biggest thing that cannabis cultivators can decipher in that message is that if we’re able to utilize what’s naturally within us as humans to give to the plant and give them the correct life and give them the correct biology, that’s going to ensure a healthier, a more productive, nutrient dense commodity and medicine that they’re giving to the community.

Matthew: A cultivator they are saying wow this is important. I need bacteria, the right kind of bacteria for my plants, but how do I get it? How do I go about setting a processes to make sure that I’m getting the proper bacteria in the proper amounts in the proper spectrums? How does that occur?

Peter: That’s been the challenge for most cannabis cultivators and just growers period throughout history. The advancement of bioproducts in this industry has been in a holding pattern for so long because of the proven efficacy of their chemical counterparts. We’ve got the advancement of all these MPK and nutrient products and those are great, but to actually quantify the correct strains that are necessary, the correct strains that have co-evolved with this plant in nature to keep that system healthy has not necessarily been quantified as of yet by modern day science.

So, growers are now realizing if I grow organically, I’m going to get a much denser smell because my bacteria is at higher levels. So, that’s kind of what we’ve done with Soil Balance. We’ve tried to take guesswork out of which strains that this particular plant necessitates. Because all plants have co-evolved with microorganisms in their natural habitat. Just like humans have co-evolved with our microorganisms in our digestive system. When we take that plant out of its indigenous soil or its indigenous environment recreating that biology has been a big challenge for cultivators or growers around the world. So, people have tried to do it with Compost T and different microbial inoculants, but again the advancement within the industry has been a little bit behind.

So, what we’ve done is we’ve started to look at microbial combinations. I think that’s where the industry needs to begin, to be honest, is not looking at what a microorganism can do on its own, but what they produce in combination that will make them effective.

Matthew: I’m somewhat familiar with Compost T. That’s where you take different kinds of soil and organic materials, put it in a bucket of water and then add oxygen bubbles to it. Is that correct? Can you describe what the benefits of that is and if you think that’s a good idea.

Peter: There’s pros and cons to that. Obviously I’m a big fan of compost. That’s what I’ve been doing for a lot of years and making a quality humus compost is important, an aerobically produced compost. But as in all natural mediums one of the disadvantages to compost is that… I wouldn’t say it’s a disadvantage but it’s a part of the natural system. You have givers and takers in those mediums. So, sometimes if a compost is not completely decomposed, and I’m a compost master and I can’t get compost to be completely decomposed, so you’re going to have pockets within the soil aggregates of anaerobic or pathogenic organisms.

So, sometimes when you brew that you could be incorporating strains of powdery and downy mildew, bultritus, (8.25 unclear), pithium, all the bad organisms that are in that natural soil system and you could by putting sugars and stuff in it, you could be increasing a cold. So that’s how some people by trying to do the right thing and put good organisms in there could actually be hurting their crop unbeknownst to them. And sometimes not, depending on how that person creates their Compost T which can take a lot of work to do it correctly with the proper aeration, with the proper food sources and most importantly the proper materials. It can be a huge advantage to the crop.

So, you really have to educate yourself on the proper way to inoculate. So, what we’ve kind of done with Soil Balance is take out all those pathogens and just isolate all the beneficial so that that scenario is eliminated from the cultivation practice. And that’s what a lot of these microbial companies have done. They’re just taking the good ones so that way people aren’t unpurposefully infecting their crop.

Matthew: Right, so if done wrong, you could be multiplying the thing you don’t want so you got to make sure you do this in the right way. But you can’t ever entirely eliminate pathogens can you? You can just minimize them to the smallest effect possible. Is that right?

Peter: Yeah that’s exactly right. Scientifically speaking the pathogens are a natural part of nature. There’s just gonna be pathogens in all natural mediums. So, what the idea is is to get those colonies to subclinical levels. So, what that means is getting those pathogens to a point where they can’t really gain traction or they can’t really gain competency. And how you do that is by over populating them with the good guys.

Matthew: Okay that makes sense. There’s a lot of talk about terpenes and everybody wants to understand terpenes better and terpene development. First can you remind listeners what terpenes are and then second how bacteria affect terpene development?

Peter: Terpenes are a compound that is found inside to the trichome, which is the frost. For those who don’t know what a trichome is it’s kind of like the white frost that develops on the outside of the flower. The terpenes are actually responsible for the plant smell, the plant’s flavor. In some ways I think that they are… there’s the terpenes. There’s phenyl and flavonoids production that’s in that compound. Terpenes are also what gives the plant its efficacy in helping people as well. They’re a pretty unique compound.

The soil balance probiotics, the organisms that are unique to our product they produce a plethora of metabolites. So these organisms that I’m talking about they produce a bunch of what are called secondary metabolites. I think I should explain that first before I go any deeper. So a secondary metabolite from an microorganism is kind of like an earthwork casting. So a microorganism will eat something and then its waste gets turned into what’s called a humus and it can be all kinds of different things. So different microorganisms can create different types of water secondary metabolites.

Some people call it waste. Some people call it micro pee or poo. It could be thought of it in that way, right. So it’s that little single celled organism’s waste. So what our organisms do, the combination of them, they produce a variation of these metabolites. Not only in the soil but on the root surface or what’s called the rhizosphere. This is how we create terpenes. So, among all the compounds we produce three plant hormones and those are called indoleacetic acid, nafolinic acid and gibberellic acid. So these are hormones, right. And these plant hormones are then taken up by the plant root and transferred throughout the root, the stem, the leaves and the flowers.

The probiotic microbes found in Soil Balance produce compounds that stimulate the natural production of plant protective phytoalexins or terpenes. So, to make that really simple, that was pretty heavy technical stuff. So, what this means for example on cannabis sativa, the probiotic microbes push the plant to produce homes and secondary metabolites that stimulate and increase the THC synthase enzyme and CBD synthase enzyme. These are the natural enzymes found in all cannabis plants that produce the oils and the terpenes. So essentially your CBD and your THC are being produced by the plant and inside that those secondary metabolites, which that plant is producing, is from your terpenes.

To kind of go off on a little bit about what the Soil Balance is doing. In our extensive field data from this 2017 season we unequivocally established that the addition of bacteria or soil balance increased and stimulated all of these biochemical pathways and the hormonal effect grew the Soil Balance plants by 40 percent larger than the non-treated plants. So the flowering heads actually contained more oil bearing trichomes. And so not only will microorganisms increase the plant’s defense mechanism, but the correct biology can do what fertilizer is doing too. It can help the plant grow much larger.

Matthew: That’s fascinating. So, getting these microorganisms and bacteria in the right proportions, the right amount is essentially like giving the proper environment and fuel for the plant to get as full as possible expression.

Peter: Yeah that’s absolutely on point. And with genetic expression, that’s an interesting statement that you made. Because, for instance, a hemp plant. A hemp plant is genetically predisposed to produce low THC and high CBD output, versus a female plant which could be genetically predisposed to produce higher THC than CBD content. So, what microorganisms are proving is that again the one specific to Soil Balance that we’ve isolated, they are reducing THC in hemp plants and increasing CBD oil exponentially by over 40 percent, we’ve found.

Then in the female plants we’re seeing THC levels of 30 percent. Much higher than the average THC level that you’d find in maybe a 20 percent plant. But we’re also seeing a much higher terpene percentage in the female plants than some of the male plants as well. So, it’s just a unique thing that yeah the microorganisms allow that plant to really hit its full genetic potential.

Matthew: So, let’s say I’m a cultivation company, maybe a business owner actually a cultivator or both listening to this. What are the first steps they should take to ensure they get a broad spectrum of bacteria that’s going to help their plants?

Peter: Again, yeah, that’s a good question. I would say bacterial combinations, I don’t want to say that we’re the only company right out right now that’s looking at different microbial combinations, but one of the things that I think is there’s so many different ideas and concepts around how to properly get the correct biology. First off, if you’re growing medium doesn’t have the right strains, adding the right food or molasses or this or that is never going to inoculate or increase strains that were never there in the first place. So, you really have to find products or different microbial inoculants, amendments at have a diversity of different strains.

Again adding in compost, if you’re very careful, can be a good thing. Adding strains from crop residue, which microbial strains that live on the leaves or animal feces, microbial strains that live in an animal’s intestines are not going to be as conducive to your root development as maybe strains that you can get from natural soil. So, I hope that what people begin to do is where we started 20 years ago and start isolating strains of microorganisms that live on the roots of plants. That’s a whole technique in and of itself to be able to take these isolates and them play together nicely and put them into a stable form. That’s what we have done with Soil Balance. There’s a lot of good microbial inoculants out there.

You want find those products that are regenerative on the rhizosphere and that’s been one of the caveats with microbial inoculation to this point and why a lot of growers say that they don’t see any efficacy with these types of products is because a lot of the strains that they’re putting in, like from and animal intestine, are not going to survive in that harsh environment so they need to keep continually reinnoculate. Whereas a Soil Balance product, type of product, you’re going to actually have regenerative microbes that will reproduce on the root because that’s what they were born to do. They live and sustain their community on that rhizosphere.

So for somebody to do it on their own they’re going to have to really set up the right laboratories to isolate these strains or they can get some soil balance. There’s some other really good products out there that are kind of cutting edge. So, I would say combining those and really seeing how that effects your total system is going to be appropriate at this stage to enhance the quality. As we’ve now found quality, smell and whatnot in the cannabis plant is indicative to the diversity of your biology. So, it’s an important part of the system if you want to redefine your industry with quality.

Matthew: What about a grower, let’s say in Washington State, versus a grower in Nevada? One is a very dry climate and one is a very humid climate. Do they have to look at different strains of bacteria to deliver to their plants or is it roughly the same independent of the humidity of the environment.

Peter: That’s a really good question. That will kind of take you into the land race conversation. If you look at native plants in Africa or different areas of the world. The organisms that they have naturally co-evolved with proliferate and regenerate at certain timeframes. So, let’s say if you take that same strain and you plant it in… you take it from Africa and you plant it in Washington, the strains in that particular soil are going to be different than it’s naturally used to to produce the same type of terpenes that it needs.

So, to quantify that at this time with the advancement of our capabilities and technologies right now, there’s a lot of people out there that are kind of diving into this, but it’s still so underdeveloped to be able to again quantify the actual strains necessary for that particular plant strain in that agro ecosystem. Because some of the strains that it necessitates to produce limiting a certain terpene that that strain needs might not be there in the soil and that’s really how it’s going to produce a high amount of lemmining. Now the seed itself will contain a lot of the biology that particular plant needs in it as it grows, which is how those terpenes are created in the first place, but again having the correct strains in the soil to kind of signal that plant hormonally to create the correct terpenes is something that we’ve had a breakthrough on and we hope that others will follow that suit and really try and find the correct microbial combinations to get the best cannabis plants for our patients.

Matthew: Now we’ve discussed bacteria in depth here and I feel like we probably want to just take a step back and just discuss what microbes are exactly, because most people listen, like myself I feel like I’ve memorized this term in high school chemistry or biology, but I just don’t exactly remember exactly what microbes mean and why they’re important. Can you rewind there and tell us what microbes are?

Peter: Yeah, and it’s funny that you say that. The connotation that most people get when they hear about biology or microbiology they’re like, oh man I got a C in that in high school and it sucked and I don’t want to go back to it. I don’t even want to know about that stuff. So, it has this real bad connotation to it from our youth being forced to sit at a desk and learn biology that we had no idea what the hell they were talking about with all these different terminologies and stuff, but to kind of take you on a journey with that microorganisms are just this whole unseen world that encumber almost everything that we touch that we are.

If you think about life force, the vital life force that has created us and created so much of our world on this planet that we’re on, a lot of it is due to microorganisms which are a single celled living organism with a consciousness and the ability to do things on their own. Just like we have the ability as humans to tune into the energies of this world and all the different frequencies that come through us, so too do these living organisms that we can’t see. And because we can’t see them, we think that they’re not there. It’s interesting, even 100 years ago doctors didn’t believe that bacteria could transfer from one human to another. I mean, that’s how recent this whole idea of biology is to our world, but microorganism live on our skin. They live in our mouth. They live on us. We are filled with, I think, seven pounds of bacteria.

A lot of our bacteria is very similar, believe it or not, to the soil. So the soil has so many different types of strains and that’s where we found all of our strains is from naturally occurring soils in different parts of the world. So if you think about it, human beings and soil have very very similar bacterias. So, if we continually decide to kill that bacteria within ourselves, within our soil, that these microorganisms that are so important that are creating all these, what I talked about earlier, the secondary metabolites, which is what a microorganism does. That’s why they’re there. They’re there to take care of us. They’re there for our immunity. They’re there to give us a lot of our brain function, our enzymes, all these things that make us us. When we think about boring biology think about that trip.

How important a microorganism is as this tiny little creature that we can’t see that has this intelligence to do all these beautiful things for our plants, for us. I mean the microorganisms create terpenes. Think about that gift that these guys are giving us. If you want to know what a microbe is, a microbe is creating a terpene. A microbe is actually eating something and its waste becomes a terpene and that terpene goes to children with seizures. So, that’s what a microbe is. That’s what a microorganism is, to get down to it.

Matthew: That is really interesting. I never would have thought about that. Microorganisms poo and then creating the terpenes that stop seizures. That’s a great connection. If you had to boil down the top one or two reasons that cultivators are coming to you and looking at Soil Balance Pro, what would you say the top one or two reasons or they’re situations they’re trying to fix or make better?

Peter: What we’re doing with Soil Balance is we’re giving top growers an edge on their quality. So, one of our growers Poo-e-labs, they just won the 2017 Emerald Cup for highest terpene concentrate in a vape pen. That was a big deal for us because we definitively proved that bacteria does enhance the amounts and the profile of terpenes. So, what Jeff over at Poo-e-labs said, he said, listen your product, the bacteria, that’s why we won the Emerald Cup, period, hands down. We could not have won it without you guys and we’re so grateful and we want to shout it from the rooftops that your product did this for us because we would have never had this type of quality.

So, again, once people start to realize that bacteria creates smell, that’s just what they do. When we as humans, when we work out and we sweat we create a smell. And so too is the case for plants. So, I guess growers are now coming to us because they’re seeing more frost. That’s the basic thing. They’re like, wow we’ve never seen our plants look like they just got snowed on like that, and we’ve been growing this strain for 30 years. So, what we’re doing is we’re taking the best growers and we’re giving them that extra edge to take it to the next level.

We had guys that were at 20 percent THC. Now they’re at 28, 26 percent THC and they’re like, it’s because of the addition of the bacteria. So, organic cultivators have known this for a long time that bacteria is conducive to a high quality, stinky, beautiful, nutrient dense bud. You get that biology you get a lot of health in there. So, people are coming to Soil Balance and buying our product now because they want to redefine their own… the market is becoming so saturated with commodity and all these different products and so many people getting in. So those in the know understand that microbiology is such an important aspect to cultivating a very very high quality, potent strain. That’s where Soil Balance is giving them that edge.

Matthew: Gosh, this industry is evolving so fast. It’s amazing. I was so grateful for the ditch weed I got in high school and now it’s like this is some really next level Elon Musk cultivation topics we’re talking about here.

Peter: Yeah, well it’s the future. It really is. I mean, the future of this industry is actually working with nature. We’re cultivating a natural plant. Yeah this is pretty heavy stuff. I like the conversation.

Matthew: Peter, I want to pivot to some personal development questions to help listeners get a better sense of who you are personally. With that, is there a book that has had a big impact on your life or way of thinking that you’d like to share?

Peter: Yeah so, when I was younger I would just tear through books, as a lot of people in their 20s do, but probably the biggest book that I could say shaped me in a lot of ways that helped me remain humble and try to help me be a better person was The Book of Dal. I don’t know if I would consider myself a Dalist, but it’s a philosophy and it’s basically centered around balance and having compassion towards a beautiful and perfect system. In place of taking from that system, really understanding the balance of it, being a part of it and giving what we can with all the gifts that we have as human beings to have this consciousness, to have this ability to love, to be loved, to have our intelligence and utilize that to improve. Not improve a sacred system but be a part and give in a balanced way to a sacred system.

Matthew: That’s interesting. I had an audio book, a Wayne Dyer reading the Dal to Chang. He did a different reading every day for a year. I thought that was such a fascinating concept and way of looking at the world, particularly the passages about water and water is this humble force that always seeks the lowest level, yet it’s so powerful in its humility. It was just the continuing references to trees and water and stuff. I thought that’s pretty interesting stuff.

Peter: Yeah.

Matthew: Is there a tool, web-based or otherwise, that you consider important to your productivity?

Peter: Well I mean the greatest tool, honestly, the greatest tool that I think we as humans can learn from and understand and utilize, the most advanced technology on this earth I believe is nature. I truly and firmly believe that. If we can actually get to a point of consciousness within ourselves to understand that nature is Earth’s most advanced technology, I think we’ll all be in a much better place.

Matthew: Yeah, good points. I was listening to a gentle speak and he was talking about why we should get rid of the idea of sustainable and move to regenerative because sustainable just keeps you where you’re at and regenerative is to get us back to where we were in more of a natural system. I thought that was an interesting concept. Like sustainable is not an option.

Peter: Sustainability is a beautiful mindset and it is a mindset. It’s not really a product or a way. It’s a mindset, sustainability. And regenerative is working with nature and giving to it.

Matthew: Peter, this has been really educational. Before we close, can you let listeners know how to find you, find Soil Balance Pro and connect with you were you are?

Peter: Sure. Our website is www.soilbalancepro.com. You can purchase our product there. If you use a code COMPASSION right now we’re really trying to have people get the feeling that it’s time for balance. It’s time for balance in our environment. It’s time for us to become much more interconnected. That’s one thing I’m loving about the cannabis industry is that the cultivators that I’m meeting they’re so tuned into their plants, they’re so tuned into the energy and the frequencies and the vital life force that their plant gives out. So, they’re a beautiful example that our company wants to support and just be of service to. Because these guys are tuning into the right things. So, yeah, you can kind of get a feel for that and what we’re doing with these microorganisms, these givers at www.soilbalancepro.com.

Matthew: Thanks for coming on. I’m definitely going to be thinking about bacteria for the rest of the day and their impact on the world around me that I see. So, thanks for educating us and I encourage listeners to reach out to Peter if they’re interested in this topic and to learn more. So, thanks again Peter and have a great 2018.

Peter: Thank you Matt

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