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The Cannabis Business Conference Where Everybody Will Be

cassandra farrington

Cassandra Farrington is the CEO of Marijuana Business Daily. It’s no exaggeration that everybody in the industry will be at this conference. Listen in to hear what you’ll learn, who you will rub shoulders with and how this conference can help your business grow.

Get $50 off your registration at:

mjbizconference.com/

use coupon code cannainsider50
in the next days and get an additional $50 of your ticket

Key Takeaways:
[1:22] – What is Marijuana Business Daily
[2:04] – Cassandra’s background
[5:20] – How has the Marijuana Business Conference grown
[9:24] – Cassandra reveals the keynote for this year
[11:42] – Cassandra talks about irrational exuberant areas in the space
[15:44] – Getting the most out of the Marijuana Business Conference
18.24 – Strategies for exhibitors
[20:30] – Cassandra talks about designing booths
[22:05] – Taking the conference’s crash course
[24:25] – Cassandra asks some personal development questions

 

 

Read Full Transcript

Are you looking to understand the cannabis business more, network and socialize with other cannabis business professionals and grow your business, the you’ll want to know about the largest cannabis business conference coming up in Las Vegas this November. Here to tell us about it is Cassandra Farrington, CEO of Marijuana Business Daily. Cassandra, welcome to CannaInsider.

Cassandra: Thank you so much Matt. I’m really glad to be here.

Matthew: Give us a sense of geography, where are you in the world today?

Cassandra: I am luckily at my home base, in my office in the Denver area. I have been on the road non-stop it feels like for about six weeks, and I’m glad to be kind of anchoring down for a few weeks before the big show hits in November.

Matthew: Yes, it is, it’s a very consistently nice weather. I really like it. What is Marijuana Business Daily? I think almost everybody in the industry probably gets your emails at this point, but for the people that are new that don’t, just tell us what Marijuana Business Daily is.

Cassandra: Sure, so Marijuana Business Daily is effectively the Wall Street Journal resource for and about the cannabis industry. It is a completely business focused and B2B tool that the industry has relied on for many years to just understand the development, the opportunities, the risks, the threats, the regulations, the changing business landscape as the cannabis industry has developed over the last several years.

Matthew: Yeah the threats, it seems like there’s more threats than anything these day, so I’m glad you cover those. What is your background? How did you get into this business, and maybe you could talk a little bit about Ann Holland, to give people a sense of context.

Cassandra: Absolutely. My business partner, Ann and I, are business to business media veterans. We both worked together at a newsletter publisher back in the day completely on the business to business side. So, it was an industry where, back in the day again, paper newsletters that you may have a 1,000 subscribers for your newsletter product, but you charge a $1,000 a year, it would be a very high end, really targeted publication to a very niche audience and you had a nice little business model there. You string three or four of those things together in the airline industry. Had different niches within that and roll it up under a common sales team or common publisher and you’d have a great business model.

That is what we set out to do, not in cannabis, but just in business overall and to translate that to the web. As we were looking for new things to launch into back in 2011, we noted here in Denver the emerging dispensary market specifically. Thought, well there’s a group of people who had a growing industry, who are figuring this out day-by-day. We can put together business resources for that group of people and help them do their jobs better and help them grow their businesses quicker. So, we set out to do that and everything else has followed from that method of idea.

Matthew: I actually followed your business partner Ann when she ran, I think, What Runs Where or Which Test One.

Cassandra: Which Test One. Exactly. Which Test One was one Ann Holland Ventures, so mine and Ann’s, one of our other launches that we had before we came into the cannabis space, and that was all about A/B testing in marketing circumstances. We had another one that was all about how to harness subscription website more effectively. So, think about pay walls or fan club websites, this transition to paid news on the web, those sorts of things. That was another industry we covered. Like I said, the cannabis space was our third. Let’s see what’s happening over there.

As this has grown, we’ve actually divested both Which Test One and Subscription Insider. They’re both off to better homes now. We unfortunately just couldn’t keep up and give those products and business lines the attention and love they deserved to be able to flourish themselves, while we were also doing this, because the cannabis space, as you know Matt, has just continued to explode.

Matthew: It has. Gosh, I was at your last conference and I just was shocked how big it had become. I had gone in 2014 in Las Vegas at the Rio, and it was a nice size then, but this last year in Vegas it was like a Guns and Roses concert. There were so many people. Not the same motif as a Guns and Roses concert, but the size of it. It was unbelievable, the floor and the exhibition, and we’ll get into that in a minute. Maybe you can tell us how large the conference was and how it’s progressed in the size to where it is now.

Cassandra: Our last event we had to stop allowing people to register when we hit 11,000 people, just right above that number. That was due to fire code at the Rio where the event was held last year. As you said, you were there, it was just wall to wall. We were getting to a point where people were just not comfortable in the space, and of course we want to make sure the people who are there harbor the experience. So, we did decide to limit registrations at that point. We’re moving this year to the Las Vegas convention center. So, not concerned about being able to let everybody who wants to participate come in the door and check out the show floor.

The show floor is also going to be significantly larger than it was last year. You mentioned, last year it was expansive and we had it in two different halls at the venue where we were at last year. We’re all under one roof this year, but we’re taking over the north halls of the convention center. There’s going to be 650+ exhibitors on the show floor with everything from grow lights to HVAC systems, to greenhouse construction. On the retail side from tracking systems to retail displays and design services on the extraction side. Infused products, everything from packaging to extraction machines and testing equipment. It’s going to be the full ecosystem of everything that goes into creating an end user product with cannabis material. Everything is going to be right there on that show floor.

Matthew: How would you say the conference is unique? One thing I’ve noticed is you execute very well. You have all the details taken care of. I know there is a ton, and good job on that. One thing I notice is the conference space and I think in general business kind of moving to this winner take all approach. I don’t know what the reason is, but there’s only one Facebook. You’ve really captured the business to business conference market, and everything seems to be moving to this unipolar world where winner takes all. Do you feel like that’s happening? What’s your sense there?

Cassandra: I think it’s natural within business, in any business landscape that there’s going to be a dominant player, and there’s no question that MJ Biz Con has become the dominant player. I think that we have earned that position simply through having really terrific, unbiased and well curing content. Having a great expo, as you said, with all the details taken care of, it runs smoothly. It’s a good experience for the people who are there. With trade show in particular, whether it’s an expo only type event or whether it’s a conference type of event, there’s absolutely a sense of critical mass that plays into that.

We live in such a virtual world today that at some point people do need to get together, if they’re going to be traveling to an event, if they’re going to be making that investing in being on-site somewhere, they want to be at that place where they know the most people are going to be who are going to be able to help them advance their own business activities to find the right partners, to scope out the right vendor for the next part of their business expansion. Whatever that is, they want to go to where the critical of people and businesses and opportunities are going to be. That simply has become into Biz Com.

Matthew: Who was the keynote speaker last year, and who is it going to be this year? I’m trying to remember. It wasn’t Ben and Jerry. That was 2014.

Cassandra: That was 2014. This year we’re having George Blankenship is going to be our keynote speaker. He is a business innovator. He has worked with Tesla, and with Apple and with many other forward thinking companies over the last many years, and is going to bring his insights into business innovation and industry innovation to the show floor here, to the show in Las Vegas. I’m very much looking forward to hearing how somebody who has been on the forefront on so many business advancements that have fundamentally changed the way our society operates.

When you think about Apple and the ways they have impacted not just computers, but how that has really flowed through our entire society and changed the way that we approach the world. I think that cannabis can be and is becoming a similar game changing and innovation industry. I think his intents are going to be very valuable. We’re also having, as a keynote this year, Jean Sullivan who is a noted investor in this space and was a noted Dot Com investor as well, and she’ll be talking about her experiences during the Dot Com boom and some of the parallels she’s seeing as the cannabis develops and some of the irrational exuberant that we’re starting to see here in the cannabis market. She has some words of wisdom and [10.57 unclear] and values for attendees, as people move forward in those landscapes.

Last year we had Penn Jillette, from the comedy duo Penn and Teller. Penn is a noted libertarian and free thinker himself. His comments were very much appreciated in terms of how people like him are influencing the conversation of cannabis in the general society. Not just in the United States, but globally as we see things change.

Matthew: You mentioned irrational exuberance there. There are areas that seem a little bit frothy. What areas are those to you in your mind?

Cassandra: The places where I see the most exuberance, absolutely the places where there are the most opportunities. So, I think California, as that market comes out, it’s obviously going to be huge. I think it’s going to take a little while to sort itself out. Right now there’s a lot of investment that’s just going into that space to try to seize opportunity, but I don’t know that there is very much risk mitigation going on right now. Now, I get that that’s difficult to do because we still don’t even have emergency legislation out that’s going to control things come January 1st, so how do you mitigate risk when you don’t know the landscape you’re going to be playing on. That’s absolutely a difficult question, but there’s definitely going to be some people who end up with the short straw in that market.

Canada, something of a similar situation. The amount of investment that’s pouring in up there is both heartening because it is a precursor of what could be possible if the United States legalized thoroughly and got their act together. The Canada marketplace is going to be a much more stable with full federal regulation, full federal legalization, which means you’ll be able to do banking and commerce and taxing and regulation across the entire federal landscape. That’s a great foundation on which to build a business that we simply don’t have here in the United States, but the amount of money that’s going into that market right now does not, I think, match the size of the Canadian market.

So, where I think where people are looking, and I think this is an interesting angle of the Canadian marketplace, is Canada is quickly becoming an international hub for cannabis commerce. So, the Canada issue is not just about Canada, but it’s about Germany, and it’s about Australia and the Caribbean and other import/export markets and transborder, crossing the border with an IP that’s being developed up in Canada, things like that. So, there’s a lot going on and a lot of opportunities out there. Just always make sure you know what you’re doing when you’re up to foreign money.

Matthew: Yeah, I definitely am concerned about the cost of cannabis just going down quite a bit in California, once that engine really starts running and people that are running into that now, it’s like the top 1 percent of the people into automation and agriculture on a large scale that put in a ton of upfront investment are really going to be able to do things at scale that the small and medium guys just won’t be able to do. So, that’s one thing I worry about.

Cassandra: It is, it is a concern. Ultimately we are talking about a commoditization, a commodity market for an agricultural product at base level. Now, I think that the cannabis industry would be more benefitted by pursuing more of a consumer package goods model, rather than thinking of it necessarily as a commodity. Take Corn Flakes for example. Corn is a commodity. Corn Flakes is a consumer package good, and you so you can brand and charge more and market corn flakes very differently than you can a bushel of corn. So, thinking of it that way I think would be a good guidance for cannabis entrepreneurs.

Matthew: Yeah, I think of Tiffany’s also. Diamonds are a commodity in a sense, but the blue box from Tiffany’s is something that has real brand equity.

Cassandra: Absolutely, and that’s the way that we need to be thinking about things that are in this space.

Matthew: So, what’s the best strategy to get the most out of the conference in your opinion, especially for newcomers?

Cassandra: That’s a big question because the show has gotten big and it can feel intimidating, especially if it’s your first time at a cannabis event. So, the first thing I would say is, especially to newcomers, understand that this is a real business environment. This is not a consumer festival. Don’t feel like you’re walking into a smoke tent, something like that. This is a trade show like any other you’ve been to in whatever industry you’ve come from. If you are a newcomer, I highly recommend coming in a day early, on Tuesday the 14th and attending the Marijuana Business Crash Course. That even on Tuesday will be a smaller conference type activity that will really help you get centered in what the cannabis industry is, what it is not and help you understand what you want to be doing over the next three days of the show, what other conference sessions you want to attend, what exhibitors you really want to target to go visit, what kinds of people you want to meet over the next three days.

Then beyond that I would just say make sure that you have studied the conference agenda. Make sure that you’ve looked at the show floor. Have a plan going in as to this is what I want to do and what I want to get out of this show. I think it’s a really great idea to bring a common with you, especially if you’re looking to get a sense for the entire scope and scale of the marketplace. You may want to go talk to each and every one of those 650+ exhibitors in which case you really are going to need more than one person walking that show floor and having those conversations and understanding what all of those people are about.

Matthew: One little tactic I use is that it gets so overwhelming to meet so many people so quickly that when I meet someone new and plan on following up with each other just to take a selfie of you and that person together and when you email them say, hey this is me and you. Oh, right, I do remember you.

Cassandra: That’s a great idea. I love it.

Matthew: Thanks. How about an exhibitor? What can an exhibitor do to get the most foot traffic attention and how can they talk with people? Do they need to have an escalator pitch ready to get out what they need to get out and see if there’s a match and if not, move on to the next one? Do you have any strategies around that?

Cassandra: Absolutely. We start, all of our exhibitors take advantage of the retrieval systems that are included with their Show News, with their show packages. Every batch you will be able to just scan a badge and capture somebody’s information, make a couple of notes about it. So you can quickly capture those good leads that are going to be walking by your booth. You absolutely need an elevator type pitch, and you need everybody who is working your booth to be using it consistently, so that you can quickly go through and screen for, all right this is somebody that we want to be talking more to. Is this somebody we should then talk to more right now, or do we want to grab this person’s information and have them go on and reach out to them quickly next week or the week after.

It’s going to be a very busy show floor. There are going to be tons of highly qualified leads that will be walking by each and every one of those booths ready to make investment decisions and will be at MJ Biz Com to scope out which vendor or which partner they’re going to go out with. So, that’s the conversations you need to be prepared to have and that everybody in your business needs to be prepared to have. Beyond that, comfortable shoes. These are going to be some really exciting days and long ones, so make sure that you’ve gotten enough sleep and are ready to take this head on.

Matthew: Yeah, great suggestion there, and definitely having a team where one person can always be at the booth, because I know sometimes it’s just exhausting, so people take breaks, but then you go by their booth and there’s no one there. So, they’re missing out on some business. One question I have for you is let’s say I’m an exhibitor or considering making a booth, but I’ve never made a booth before. Is there any vendors or design firms or companies that you recommend that a listener reach out to in terms of creating a cool booth?

Cassandra: Sure. We have an entire exhibitor’s services manual that we provide to all of our exhibiting companies that has all of that information in there, tons of ideas, tons of vendors to reach out to to do those things. Our exhibit service company that we work with is Freeman. They provide those services. There are also lots of independents that work in the exhibit space. Lots of people come into the cannabis from another industry and have relationships with people from previous industries that have worked trade shows before and can capture those opportunities.

Then if you are more of a complete new entrepreneur startup activity, there’s tons of suggest in that exhibitor. So, this is mainly to make sure you use those documents that you have available to you. In addition, this year we’re about to release some exhibitor videos that we’ve put together to help our exhibitors walk through the last few weeks before the show, making sure that they have everything that they need ready. Make sure you have these checklists taken care of. Make sure you’re ready with your elevator and here’s a great way to staff your booth and those sorts of things so people can really take advantage of the opportunity of exhibiting at MJ Biz Com.

Matthew: I just want to circle back to the crash course for a second, because there’s a lot of people who have attended that who are listening, but then others that are considering hey, is that right for me. Can you just talk a little more detail about what you learn at the crash course?

Cassandra: You bet. We start about 10 o’clock in the morning with a cannabis industry overview, just sort of laying out the opportunity that is in front of you if you’re considering entering the cannabis marketplace. Then we go through, here’s a quick primer on cannabis itself. Here’s what it does. Here’s what it doesn’t do, those sorts of questions. Then into each of the major niches; cultivation, retail, infused products and how to put primer on all of those. All of these sessions include time for Q&A with the audience so that you can make sure you’re getting your questions answered, all of the contact information for all the speakers is included.

Those experts that we’re putting up on stage who have walked the road that the newbies in the audience are walking right now, they know who they can reach out to. It says, all right this person has been in my shoes and can answer my question. After we run through the niches, we go on with legal and accounting and banking, cash management, financing, both getting financing for your business, as well as deploying the finance into the cannabis space, if that’s what you’re angle is. So, this is about six to seven hours of just here is the quick download of what the cannabis space is and what the opportunities are, and that really has helped people their feet under them as they head into the rest of the show, meeting people. It helps them understand the lingo and know what things when they hear about them in the sessions later.

That crash course in fact has really helped us elevate the content that we’ve been able to put into the rest of the conference, because having given the new people an opportunity to get that base knowledge, we can then take that other conference to a 2 or 1 or 3 or 1 level. That really attracts and appeals to a much broader audience and helps the entire industry advance in that way.

Matthew: Great points. Let’s pivot to a couple personal development questions. Is there a book that has had a big impact on your life or way of thinking that you would like to share? It doesn’t have to be in the cannabis space or business space. Anything is fine.

Cassandra: I’m an Alabama girl, strangely enough. Back in the day I grew up in small town Alabama and one of my favorite books of all time has always been To Kill a Mockingbird. I read it when I was not quite Scott’s age, but I was a little older than that, but I read it when I was still fairly young. It had a big impression on me back then. Every time I go back and reread that book I’m just reminded of how important it is to be a good human, first and foremost, no matter what else happens. It’s just so important in personal development and personal happiness to be sure that you’re doing the right thing for people and with people first and foremost. That has in fact carried through to my business philosophy, they way that I run my company here. Ann and I set out in the early days to help people do their jobs better and run their businesses better. That philosophy has carried through to the way that the team here at MJ Biz Daily works. I have always wanted to create a place just where people enjoy what they’re doing. They feel successful about it, and they enjoy who they’re doing it with. Those things are all things that come out of To Kill a Mockingbird.

Matthew: Classic book. That’s a great book. I escaped Hurricane Matthew last year and went into Alabama for a couple of weeks just spontaneously. Driving all around through Birmingham and through the rolling hills and everything, and I was really impressed by it. I didn’t know what to think of Alabama, but Birmingham was really fun and interesting and there was a great farmer’s market there on Saturday. That whole scene I think is, I don’t know, like a merging America. People just don’t talk about it.

Cassandra: It is. Alabama is a great place to be from. The people are so warm and friendly. I have very near and dear family and friends still down there. I love being able to say that I’m from Alabama, even though in the cannabis space it does raise an eyebrow or two.

Matthew: Because Jeff Sessions is from there right.

Cassandra: Exactly. Jeff Sessions is from there. It is on the short list of states that will be last to legalize, which I agree with. I get it. I grew up around that environment, and I understand where those people are coming from. It’s just a, honestly and this is kind of a departure to politics and the drug war and all that sort of thing.

Cassandra: Indeed.

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

Cassandra: We are actually experimenting and looking at several things that will enhance our reader experience with MJ Biz Daily and their web experience when they engage with that, as well as the conference experience. There is so much new and emerging conference technology that’s coming out from chat bots to app based systems, to things that you’ll actually be able to experience on the show floor this year at MJ Biz Com. I think it’s that amalgamation of technologies that we’re going to be able to tap into as the show and as MJ Biz Daily and as the cannabis industry continues to grow.

I’ll make another comment about technology and especially with cannabis. I’ve been thinking about this recently that I think there’s two key reasons why the cannabis industry has been on the growth trajectory it has been. There’s no question that it is become an economy, an industry that has gotten its legs under it, much more quickly than any before it. I think there’s two good reasons why. Number one is the fairly obvious, consumer adoption issue is that this is a product that people have been using for a very long time, and the only thing that’s stopping them from using more of it is access and legal status. The other reason why, beyond the fact that we don’t have to convince people here’s this new thing try this, people have already tried it and they know what it is and they know they want it. So, we don’t have that consumer adoption issue.

The other thing that we’re working with that no other industry has ever worked with before is that this is the first industry after the Dot Com boom. This is the first industry that has been created on the back of things like seed to sale software and Big Data harvesting and analysis and communication systems that are far more effective than they’ve ever been in the past. I think that the way that technology has fueled the cannabis industry is only going to continue to expand and then export back out into other mainstream industries.

Matthew: One thing I wanted to ask you about is the statistic about most businesses failing is really high, but when I look your and Ann’s track record you have a really good success record. What is the formula there? Do you try to get into emerging businesses that have strong profit potential, add value and then provide something back to those people? Is there a formula that you kind of follow?

Casssandra: To some degree there is. When we launched our products we always looked for an industry that was growing at 7 percent or more per year, that had a certain number, a critical mass of businesses with employees. So, not just some little entrepreneurs, but people who were making payroll, who felt a sense of obligation to I have to make sure my staffers get paid this week, because that has a different level of commitment to it as an entrepreneur and therefore staying power. Then a few other things. Yeah, we did follow a check list as we went through that, but I do think that it comes back to this sense of helping people do their jobs better.

If you give people a sense of comfort that not only are you a trustworthy source, but you are one that’s invested in your success, they will in turn invest in more success, and give you back what you need to be able to help them. It becomes a very positive and virtuous cycle that has really fueled our activities.

Matthew: It’s like a karmic snowball.

Cassandra: It is. It’s a good way to live life.

Matthew: Well Cassandra, thanks so much for coming on the show today. Can you give out your website and let people know how to register as an attendee or an exhibitor?

Cassandra: You bet. Actually our exhibit hall is completely sold out, but if you’re interested it is… but if you’re interested in being part of MJ Biz Com next year or in a future event, by all means reach out to our sales department sales@mjbizdaily.com. You can register for the show at www.mjbizcon.com. For your listeners Matt we have a $50 discount available if they just use discount code CANNAINSIDER50. They’ll be able to get an additional $50 the sessions and exhibits price of the registration. If they register before October 19th, the price is $200 off sessions and exhibits, $100 an expo pass. So, if they get out there and get their registrations here in the next week, then we’ll be able to save them even more money that way.

Matthew: Great. Well, Cassandra, thanks so much for coming on the show and educating us. We really appreciate it.

Cassandra: Matt, I really appreciate the time

Deep Dive into Cannabis Oil Extraction, Filtration and Distillation with Jim Makoso

jim makoso lucid oils

Jim Makoso is the co-founder of LucidOils.com in Seattle. Listen in as Matthew and Jim discuss the most important business and health aspects of cannabis oil extraction and distillation.

Key Takeaways:
[1:07] – What is Lucid Oils
[1:36] – Jim’s background
[9:27] – Jim talks about modifying extraction machines
[12:33] – Distillation versus extraction
[15:23] – Why extract with ethanol
[18:30] – Jim talks about the filtering process
[21:47] – What is fractionation
[23:16] – Jim talks about terpenes
[26:57] – Preserving terpenes & flavonoids during extraction
[28:57] – Jim talks about product creation
[35:57] – Jim answers some personal development questions
[42:12] – Contact details for Lucid Oils

Learn more at:
http://www.lucidoils.com

Important:
What are the five trends that will disrupt cannabis in the next five years? Find out with your free report at https://www.cannainsider.com/trends

 

Read Full Transcript

As edibles and cannabis infused products gain traction with consumers, more individuals and business owners and growers are looking to understand cannabis oil extraction. That is why I’m pleased to have on the show today Jim Makoso, cofounder of Lucid Oils. Jim, welcome to CannaInsider.

Jim: Hey Matt, thanks for having me. How are you today?

Matthew: I am great. Thanks for coming on. Give us a sense of geography. Where are you in the world today?

Jim: Actually right now I’m back here at home. My home right now is in Belleview, Washington. We do quite a bit of traveling for our work, but I have a couple days. I try to take a couple days every month to be at home, kind of get my house in order before going back on the road.

Matthew: What is Lucid Oils?

Jim: Lucid Oils is kind of a concept. It’s a brand, a consumer brand of Lucid Labs, which is really our parent company and that’s what we own. Essentially Lucid Labs/Lucid Oils is a licensing, branding and equipment design company focused on the cannabis industry.

Matthew: I want to get into that in a minute, but tell us first about your background and how you came to start Lucid oils.

Jim: My background, in general, I come from a finance, investment banking background, specifically , I studied economics and business finance in school, but took a departure from that several years ago when a friend of mine contacted me, who lived in Seattle at the time. I was living in Miami, and invited me to come out and see what was happening in the cannabis industry from a business standpoint. I’ve always been an enthusiast and consumer for personal use, but once I came out here to the West Coast, I started a company, a vaporizer company called Vuber Technologies. Shortly into that, having that business, we had the priviledge of selling that company and using the proceeds to start Lucid Oils back in 2015, back in January of 2015. Once we kind of got into the cannabis space specifically and had an idea of what was happening in the extraction world, it was a no brainer for us to hop in, figure out a business model and a plan that would work for us and start doing some business.

Matthew: That’s a big contrast from Miami to the Seattle area. Have you missed the sunshine of Miami, or do you like being in the rainy Northwest?

Jim: I’m from New York originally, so you hear all the stories, being from the East Coast, about the rain in Seattle, the software guys, so being a little bit more passive, aggressive up here. What I will say is when I first moved here the guys that I was investing with in that vaporizer company, they kind of sat me down and had a real conversation with me about how I needed to tone it down from my East Coast bravado of being loud. Too clean cut. They told me, let your beard grow, let your hair grow. This was when I still had hair before we started really working hard. Let your hair grow and really kind of breathe in the Pacific Northwest and understand the culture and that would enable me to do good business out here, and they were absolutely right.

The West Coast it’s a completely different vibe, specifically the Pacific Northwest. Yeah, it was a change, but what I can say now, living up here for four years, coming up on four years here in January, is this is by far one of the most beautiful parts of the country that I’ve ever been to and had the privilege to live in. Now I know what it’s all about. See, they tell people it rains here so that they’ll stay away, because they don’t share at all with anyone.

Matthew: Yeah, it is really beautiful up there.

Jim: It’s interesting. Being that we’ve been in business coming up on three years officially with products on the shelves for two and a half years here in December, it’s been quite the ride and currently we still have a very small team. When I say startup, let’s just call it a small business in terms of revenue, but a startup mentality still. Meaning, we wear all the hats we need to wear in order to get our business done. Kind of our motto is there’s four of us from an ownership standpoint that have a stake in this business, and there’s three of us out of the four that actually are carrying out tasks. One investor who is passive and he gets the reports quarterly and that annual report of how we’re doing.

So, what we focus on is leveraging our partnerships, which we have several in different and then as well on the equipment side in order to get done the day-to-day tasks, and we handle more of the macro stuff. My typical week and then month really is I’ll be in any number of states. Usually two weeks out of the month I’m in Nevada working on our Reno licensing deal where we work with a company called Greenleaf Wellness to produce all of the oil products that come out of that relationship to distribute to various recreational dispensaries throughout the state with a focus on our core customers are really in Las Vegas. It’s a really big bolstering market, and so I go down there two weeks a month just to kind of manage the team. We have two hired employees that are full time down there in our partnership that kind of run the lab. Then either myself or one of my partners are down there on the weeks I’m not.

So, that’s two weeks out of the month. On the other two weeks of the month, one week is usually spent with any number of laboratories installing and training people on how to use the equipment that we’ve designed. We work with a company out of Maryland called BR Instruments, where my business partner who is an engineer, redesigned one of their systems with help, but redesigned one of their systems to specifically work with cannabis distillation, to work with cannabis as an input and distill it using their system. That company originally was a petroleum and essential oil equipment manufacturer where they were creating these specific customized systems to fractionally distill petroleum, new petroleum deposits so that a company could then build a huge still based on those deposits and essential oil companies that were focusing on specific essential oils.

So, when we came in we used their equipment. My partner had redesigned it for our applications and we partnered with them to do that. So, now we go as a part of that relationship, a part of that partnership. We do, we install those pieces of equipment when people buy them, and we train them how to make what we call a lucid quality of oil and certainly that’s been very lucrative for us over the past year. So, one of the other two weeks that I have available, that’s exactly what I’m doing. I’m out there installing, meeting people and educating them on how to make better quality oil using our equipment.

Then that fourth week out of the month, typically, I’m pretty active in the business development side, either attending trade shows anywhere in the country, in some cases outside of the country. Continuing to build some existing relationship where maybe we haven’t gotten to a contractual step yet, but we’re in the conversation, bouncing around some letters of intent and other types of paperwork, and really landscaping the market. In the existing markets we’re in to see maybe where we can be more efficient. That’s kind of what my month looks like. So, I’m very happy to say, since I have a difficult time sticking to one task at a desk 40 hours a week, I have the flexibility in my current role here in my company to do any number of things in a given month. It’s structured, generally, but it allows enough flexibility where the scenery is always changing, but we’re always working towards one specific goal, which is increasing our footprint in this landscape and improving the quality of the products that we put out and helping others to improve the quality of the products that they’re putting out.

Matthew: Maybe you can talk a little bit about distillation and why you felt the need, you and your partner, to modify the machine. What were the machines on the market not doing that you felt like you had to modify a machine with your partner in Maryland, extraction machine?

Jim: That’s a great question because we get asked that pretty often by guys when they see the system that we co-developed with BR Instruments. Back when we first started, when we were first doing the research, before we had officially launched our company in January 2015. Back at that time there was really only one company putting out this product and they called it The Clear. It was these guys out of California. They were using what they call a short path distillation system, which is still very commonly used today. It was more of a high school chemistry or college chemistry set. Very effective in the right hands, and the guys had started that. Really smart guys, very well respected throughout the industry, known for continually pushing the quality of products. A guy out of Boston who ended up in California, who is a chemist, a guy by the name of Chris Baroni [ph], really started distilling cannabis initially in scale for production purposes, and he was using a short path distillation system.

You see many people still using short path distillation systems, but at that time we were using that and we had contracted with a PhD in Organic Chemistry who recommended the BR Instrument system. Keep in mind, before we used that no one in the industry had purchased one for the distillation of cannabis. So, it was, as yet, unproven. So, we kind of took a chance, and the reason being is their system featured a software component that allowed you to record the data of your run in 30 second increments, but all of the data required in order to do good data analysis, but more importantly to be able to repeat that process consistently by taking note of temperatures, pressures of different cuts, or what they call fractions, as you were distilling. That to us was something, as guys that didn’t have a science background, my partner is more of an electrical engineer and my background being finance, it was important for us to be able to capture that data.

Once we got that piece of equipment, it took us a pain staking month and a half to dial it in and we ran through thousands of grams, several kilos of oil, before we kind of figured it out. So, as you can imagine, that was probably in our business the most stressful time, because it was unproven. We spent lots of money on all this equipment. We had a new relationship that was getting restless with our inability to produce the quality of the oil that we had promised, but once we made it over the hump, we realized we had something special and the rest is current if you will.

Matthew: When you talk about distillation versus extraction, can you talk about what those terms means and how they differ and overlap?

Jim: Yeah, absolutely. In a real basic way, distillation is not extraction. Extraction is removing specific compounds from bio mesh or from a plant or from some type of botanical. Removing or extracting the specific components that you want using some sort of solvent or some process, typically a solvent. When I say a solvent, the most common ones in extraction in cannabis are hydrocarbons, that’s your BHO, your butane, your propane and other hydrocarbons. There’s ethanol, that’s another common form of extraction, that’s your alcohol. Then there’s CO2 extraction. Those are the solvent based, most common forms of extraction.

Distillation is what we would call a refining process. So, once you’ve extracted that material using one of those extraction methods, you’re going to put it through a number of processes. Generally most people will filter it in one way or another in order to remove or refine that product down to an even higher concentration of purity with less contaminants. Distillation is one of the final steps that you’re seeing people utilize in order to really purify the product to a higher level to specifically isolate those compounds which typically you wouldn’t be able to get out in any other way, unless you use some type of chemical liquid, liquid separation.

Typically the process is extract that material, create what they call crude oil, take that crude oil, filter it in any number of ways. Once it’s filtered, refine that crude oil in the distillation process in order to really isolate the cannabinoids from all the other compounds. Of course there’s additional steps that people are implementing now to isolate cannabinoids from each other, but that’s kind of the flow, the process flow. Once you’ve grown your product, you extract it. That will pull out the cannabinoids and maybe some contaminants. Once you have that crude oil, you filter it in order to separate a majority of those contaminants. Then once you’ve filtered it, you distill it in order to isolate cannabinoids from everything else.

Matthew: What do you think about extracting with ethanol in general? People know about this, they’ve heard about but they perhaps don’t know that much about it in detail. Why would you want to extract with ethanol versus some other medium?

Jim: The thing with extraction is the method of, or the solvent that you use to extract typically is based on one of two or three factors. Depending on where you are extracting, and let’s assume you’re doing everything by the books and you’re licensed either medically or recreationally in a state that allows it, typically the regulations of that state will be restrictive in terms of what you can and can’t use as a solvent. For instance in Northern California it’s very difficult for them to use ethanol as a solvent, so they have to use CO2 or hydrocarbon. In some states, and in some countries in fact, like in Canada for instance, hydrocarbons are frowned upon. Not only because they’re so called dangers because they have a very low boiling, so they’re in a vapor at room temperature and ignite with a very small spark, but also because it’s very difficult to get all those hydrocarbons out of your extract, once you’ve extracted.

Ethanol or any of the other solvents, it really is dependent on the product you wish to produce as well as where you’re actually carrying out your extraction that will determine what’s the most effective method. We like ethanol specifically in our process primarily because most of our products right now are just distilled products. In other words we’re taking that crude oil, filtering it and distilling it with 95 percent of all the material that we extract, because that creates our Lucid quality oil, and of course in Washington because we work with an edible manufacturer and as it turns out, distilled oil produces a very high quality input oil for edibles. It doesn’t have taste. It’s really high in purity and it’s easy to work with.

The ethanol that we use specifically is food grade, 200 proof ethanol and what we find is that if you extract with ethanol, with the right parameters, you can produce a really high quality product in terms of being able to get a full spectrum extract, but simultaneously pulling any water soluble or chlorophyll or any water soluables, plant proteins, waxes, lipids. If you’ve done the math and all the extraction the right way, it’s very efficient in that it will pull 92 percent plus of all the cannabinoids available in a very short period of time, while leaving behind the water soluble. So, that’s why we use ethanol in our process. We’ve dialed our process in to be very effective with that solvent.

Matthew: So, extract, filter, distill. That’s the process. You extract with ethanol and then you filter. What is filter, before you go to distilling, how do you filter specifically?

Jim: Filtration, there’s still a huge differing school of thought, a huge amount of difference in the school of thoughts on filtration. Most people generally agree you want to get lipids and fats out, unless you’re putting it in to a chocolate edible or something where you can leave a little bit of the lipids in there, even though we don’t recommend that. The filtration though, generally, people are trying to accomplish really one thing. That is remove as much of the non-cannabinoids, non-terpenoids, non-flavonoids from the product as possible, while maintaining the integrity of those products, meaning add the least amount of heat so you’re not degrading any of those compounds, but remove as much of those contaminants as possible.

So, when you say specifics about filtration, depending on who you ask, that’s going to differ. What we generally will do with all of our samples is filter it with several different micron filters to remove solid particulate that maybe is picked up in the run. Our typical ethanol extraction process where we have five micron filters on there as it is, so we’re pulling most of the solid material out. Five microns is a very small size. Then we’ll run it through… we’ll concentrate that by removing a lot of ethanol from those runs to get a concentration bat size, meaning anticipated cannabinoids in that solution is about 2,000 to 3,000 grams with a 7 to 1, approximately, ratio of ethanol to anticipated cannabinoids. Once we have that ratio, we’ll then go filter it with a pretty common process that people are doing.

We’ll scrub it with a specific type of carbon, then put it through several filter media, different types of compounds to remove the carbon and to pull out a little bit more of the color pigments before we take that. Reduce it all the way down, by removing all the ethanol solution where you are left with a crude that has been filtered and is ready for distillation. The filter media is going to differ from person to person and differ from product to product. Someone who is, per se, looking for a full plant extract, they’re probably not going to filter that very much. They’ll filter it through some filter papers to remove solid mass. They’ll remove all the solvent and then that’s what they would consider a full plant extract or RSO is what you’ll hear it commonly referred to, [21.15 unclear] Oil, but full spectrum, full plant extract is really what that is. You’ll do the least amount of filtering there. For our purposes to produce distilled, high quality oil or let’s just say distilled oil, we put it through a pretty rigorous filter media in order to remove as many contaminants as possible to get to that raw cannabis oil.

Matthew: Can you tell us a little bit about fractionation, what that means and why it’s important?

Jim: Real high level, the fractionation, you’ll hear that term often. All it really means is taking specific fractions while you’re doing extraction. There are some companies that have, as a part of their CO2 systems, the ability to fractionate. Generally they’re fractionating by removing the water compounds in one fractions, the terpene compounds in another, the cannabis compounds, the cannabinoid compounds all in one fraction, but the idea is you’re separating the plant into individual components. In the process of extraction, you’re separating your terpene content from your cannabinoid content.

In the context of distillation, what people are trying to do is separate even further your terpenes and terpenoids from your cannabinoids and some people are trying to go one step further and separate cannabinoids from each other. The idea of fractionation is just separating the compounds or groups of compounds into smaller and smaller units to get higher purities.

Matthew: Can you talk about terpenes a little bit, because we’ve got a lot of new listeners. I want to make sure they understand what terpenes are and why they’re important and why you’re taking so much care in positioning terpenes properly?

Jim: Terpenes, that’s really kind of a loaded word in the industry right now. People are starting to realize that terpenes first of all, you will find them in all botanicals throughout the plant kingdom. They are responsible for the smell, the smell of the plants. From pining and pine trees, which are also cannabinoids, terpenes are the same throughout the plant kingdom. They’re just responsible for at least initially to our sense of smell, the smell of the plants throughout the plant kingdom, and they serve a number of functions. Some of those functions are to protect the plants, some of those functions are byproducts, etc. Terpenes, as they’re related to cannabis, the same terpenes that you’ll find throughout the plant kingdom are the same terpenes that you find in cannabinoids. There are no, at least to my knowledge, there are no terpenes that are unique at this moment that we know of to cannabinoids. You can find them in other plants. Maybe one day somebody will disprove that or maybe there’s someone out there now who can disagree with that, but in general all terpenes throughout the plant kingdom are the same.

They’re essentially a naturally occurring hydrocarbon based on a combination of what are called isoprene units. These are the building blocks of terpenes and terpenoids. Terpenoids are compounds related to terpenes which may include some oxygen functionality or some rearrangement, however the two terms are often used interchangeably, but terpenes are isoprene units that are naturally occurring hydrocarbons and terpenoids are terpenes that include some oxygen functionality in the rearrangement as molecules. So, terpenes are responsible for those flavors and tastes. Flavonoids are to a lesser extent in that group, and they are exactly as they sound, flavor units that you’re finding inside of the plants. They generally don’t have a smell but do have a taste.

The reason why they’re such a hot topic now in the industry is because science has proven that an interaction between terpenes and cannabinoids are what create the effects that people are familiar with that give us the psychotropic and physiological effects that are either beneficial physiologically or giving us that high, what they call high or a psychotropic sensation. It’s a combination and an interplay between terpene molecules and cannabinoid molecules and flavonoids working together in what they call an entourage effect to give the efficacy that can be recreation or what scientists are figuring out, the medicinal in treating specific ailments.

Matthew: How do you take special care during the extraction filtering and distilling process to preserve those terpenes and flavonoids to make sure you get the desired outcome? Is there any steps you take that might be interesting to listeners?

Jim: For us we just tell everybody who is in extraction and anybody who is interested in it generally in this topic. From an extraction standpoint, as soon as you’re adding heat to any of those compounds are changing, and conforming into their longer chain cousins or completely different molecules all together. Heat is the enemy of terpenes. As you add heat or just oxygen to these compounds, they’re changing to different versions of themselves and different compounds all together. Typically what you’ll find is that when people are extracting material with the idea that they want to preserve the terpenes, they’ll be doing it as cold as possible and a vacuum if possible, and they’re using things that are very… where they have very low vapor pressure meaning that their boiling points are very low.

A great way to preserve terpenes is using hydrocarbon extract or using hydrocarbon as a solvent. Even CO2 are getting really good at extracting terpenes using CO2 in an initial step with lower pressures. In our process we extract the terpenes before we even extract the product, the cannabinoids themselves. So, there are different steps that you can implement, but the idea is you want to be cold and you want to be pretty gentle on the pressure side.

Matthew: We’ve talked about how the terpenes and the flavonoids help create the aroma and flavor and so forth, but how do you create a flavor and a taste and sensation and experience that you consider optimal? You have arrived at well, if we have this terpene/flavonoid/cannabinoid profile, this is what’s ideal for us?

Jim: That’s a great question. The interplay of physiological effects and creating a product are unique. Cannabis is not a compound like Advil or Tylenol where it’s really just one compound. Cannabis, as people think of it, is the interplay of hundreds of compounds working together to give us an effect. So, two things are at play when we are looking at product creation in a general sense. One is who is going to be consuming this product, and what is the desire effect? Because each person is different, when they consume, how they consume, their body, specifically, their metabolism. In general, every single person’s reaction to a plant could be completely different. We can say in a general sense, seven out of ten people should get this reaction, so that’s how we try to formulate our products.

This specific topic of effect versus formulation or formulating a product for a specific effect is something that everyone in the industry who creates a product is trying to understand as we speak, and this is being studied right now at a scientific level, and that is what specifically, what compounds, what combination of these compounds, cannabinoids and terpenes will produce a specific effect. That’s a very very tough thing to approach as a product maker, but you’re starting to find that people are at least using cannabinoids to start to create products, specifically for an effect. I’ll just give you a quick example.

Let’s just talk about on the recreational side. CBN, which is a degradation product of THC. When THC has been exposed to enough oxygen and light it changes its components. Some of the molecules, molecular bonds move to different positions and you get what most consider a degradation compounds. It’s CBN or Cannabinol. That compound, which is a degradation compound of THC, is generally know to be sedative in nature. So, if you’ve ever smoked really really old weed or your consumers have smoke really really old week, typically it will make you a little sleepy, give you a little couch lock, but give you the heavy eyelids, and that’s because some of that THC in there is converted to CBN.

What some people are releasing is these CBN products where they’re purposely degrading material or taking old material and increasing the temperature and closing it to light to get a higher compound, a higher concentration of CBN and putting it out as a product. That’s just one example, but generally speaking, that is what people are trying to do now is figure out ways that these things interplay with the average consumer to create a tailored effect.

Matthew: When you’re designing you your customer terpene profile are there any undesirable things that you can pick up in the process if it’s done incorrectly. Particularly, you see novice people or people that are just starting out do?

Jim: Yeah, well generally speaking, let’s look at the case of a vaporizer. Most people are introducing terpenes into their oils so that they’ll work in a vaporizer. Most people know what a vaporizer is, but if you don’t, it’s similar to like those e-cigarettes that you see people have out there. It’s essentially a heating element that heats up that oil to a certain temperature so that it will turn into a vapor so that you can inhale it. It’s not smoking, it’s vaporizing. It really is the vapor of those compounds that you are inhaling and that’s why when you exhale it it doesn’t really leave much of a residue like a smoke, unless you have very high volumes of it.

In the case of a vaporizer, people are adding terpenes in order to thin out their oil in order to make it work in a vaporizer. The issue with that is because terpenes are hydrocarbons, if you have such a high amount of those, sometimes that will lead to some people look at a hypoallergenic reaction to it. They’ll sneeze. They’ll have the itchy throat, and that’s because when those terpenes are reacting with that vaporizer it’s a chemical reaction that’s happening at that point of contact, increasing that temperature to a very high temperature and changing those compound, those terpene specific, into something else. You get this situation where people are adding more terpenes than probably what’s necessary to be there, definitely more than what’s naturally occurring in the plant, and you get this kind side reaction.

There is no idea as to what the long term effects of these types of things are going to be. I’m sure at some point in the near future some of these studies will begin. I know one scientist at least that’s already studying the vapor from various different vaporizer cartridges, but generally speaking, terpenes in general are hydrocarbons, and you find them in all types of products on the shelf that aren’t cannabis products. What we’re seeing now is that people are starting to become, as product makers, are starting to realize that is, like food manufacturing, there is an unlimited direction that you can go in in creating these products. Not only edible products, but all products for consumption.

In any case where you are adding any compounds to something that’s going to be consumed by human, via smoking, vaporizing, eating, applying topically, you just want to take a really close look at the combination of the compounds you’re putting in there and making sure that they’re safe for your consumers.

Matthew: Jim, let’s pivot to some personal development questions. I like to help listeners get to know you a little bit more on a personal level. With that, is there a book that’s had a big impact on your life or way of thinking that you’d like to share?

Jim: Yeah, there is one book that has a big impact on my way of life and my mentality. This might be a surprise to many, but the Bible. I’m a man of faith. I try not to press it on anybody else, because I fail a lot as an individual. I’m a human, but I definitely apply my life at a personal level. I try to live up to the standards that are found in the Bible. That’s a sense of morality that my parents instilled in us, and above everything, that was always the most important thing they tried to imprint on our lives. In my case, and several of my siblings, it stuck. I fail of course a lot as a human and as a Christian man, but that’s certainly the standard that I try to live to.

Outside of that from a professional standpoint, surprisingly the Art of the Deal, which I’m not a big fan of Donald Trump, but that book in specific there’s some really great stuff in there. In general, I would just say anybody who’s looking to do anything professionally or otherwise, reading in general, stimulating the critical thinking parts of your brain by reading something that’s academic or reading something that’s fantasy. In general, that’s just going to help keep your brain sharp and the ability to think and imagine. I find that reading in general, just for anyone, is just a good way to keep your brain very active and for a creative person, reading something that is imaginative that stimulates your imagination is just going to be good for your work.

Matthew: How about a tool? Is there a tool that you consider vital to your productivity?

Jim: Absolutely, and it has been ever since I’ve been a professional. I use Microsoft Excel basically for everything. For all analysis, for all backend, anything from a business standpoint, be it evaluating pricing in the market, I use Excel. In a smaller way, the market is pretty fragmented at the moment, so state-to-state there are different rules that apply in different access to information. For instance, here in Washington I use a tool called Headset, which was actually started by the same guys who started Leafly. I use Headset to review information about the market, market trends, growth, contraction, pricing and Headset is a great tool for that here in Washington, but that’s not a tool that’s readily available in other states yet, even though I know they’re making a push in Colorado and California.

Excel is like my go to software tool that I use for everything, and of course here in Washington, Headset, the piece of software equipment that provides real-time data on pricing and market trends is another great tool.

Matthew: Yeah, Headset is a great tool. We’ve had Cy, a cofounder of Headset, on the show. That’s definitely something. How do you use that Headset, just so other people can understand that data. What kind of insights does it give you as a business owner and someone in the extraction community?

Jim: Yeah absolutely. Well, the great thing about their software is they’re so well-respected in the space, not only here in Washington, but in the space because they created Leafly, which is one of the most well-know apps and companies for cannabis in the space. So, they’re very well-respected throughout the industry, but that specific piece of software what it does is it provides a real-time, day-to-day metric of what’s happening in the industry. So, I think of it from my trading days, similar to a Bloomberg terminal, which is giving you the feedback of all the pricing and the bid asks throughout the stock market on a specific security, stocks, bonds, etc., but the Bloomberg terminal is like the tool that everybody was using in order to have an idea of what was going on in the industry.

Similarly Headset is like a software, a piece of software that is giving you a real-time snapshot of what’s happening in the industry. So, for somebody like myself, a finance guy who is analytical in nature, to be able to landscape the industry and take raw data and create my own dashboard, create my own visual way to review that data in real-time, for me just provides me a snapshot of what’s happening in the market and allows me to anticipated kind of the direction the market is going in, in terms of pricing and consumer preference. So, for anybody who is serious about doing business in Washington it’s an essential tool to know what’s going on. Let’s say you’re not as plugged in to the market as I am where I have plenty of salespeople and plenty of business owners in different parts and aspects of the industry where I can call them up and get an idea of what they’re experiencing in their business, let’s say you didn’t have access to all that and you were entering the market for the first time or you’re from out of state entering the market, Headset will provide you with a real-time analysis of what’s happening in the market.

Of course, quarterly and annually they put out a report that’s all pretty and really well-written that kind of gives you that snapshot. It provides you with that information in real-time, daily. So, it’s an essential tool for anybody in Washington who is serious about competing in this space. Now, Washington is very very competitive market and that tool definitely allows to have the advantage when pricing and when looking at the market from a macro level.

Matthew: Very cool, thanks for sharing how you use that. Jim, as we close, can you tell listeners how they can learn more about Lucid Oils and connect with you?

Jim: Yeah, absolutely. Well, you can connect with me, you can shoot me an email, jimmy@lucidoils.com. If you have any questions about the industry or questions specifically about equipment we’re working on, questions about markets we’re in, feel free. I’ll tell everybody, use me as a resource. You can also connect with me, I do a number of the shows throughout the year where I’ll go and educate people on extraction, usually macro, real high level, just to give people an idea of what’s going on in the space. A part of my talk I usually focus on industry trends, what’s happening, the hot topics. This year you can catch me at, the remainder of the year I’m doing one more show in November in Las Vegas called the Marijuana Business Conference and Expo.

I’ll be hosting a panel on extraction and future trends in technology. On that panel will be A.C. Braddock, Eden Labs, Brian Abernathy, the CEO and Cofounder of Extracted Labs Refine Seattle, one of the biggest extraction companies in the country, easily. Then also on that panel will be one of my good friends, a colleague from Buke, Kelsey. She is a chemist by trade. She’s a Masters in Chemistry, but she’s the top rep for Buke here in the states on the West Coast. We’re going to have some great minds on that panel and we’re going to be discussing future trends in technology, so anybody who is in Vegas who plans on being at that show, you can come catch me at the panel. Then of course I’ll have two booths at that show with two different partners where you can come and take a look at some of the equipment and some of the tech we’re working on there in Las Vegas. Outside of that, you can catch me on Instagram, or at least my company, @LucidOils, as well as on Facebook, Lucid Oils, and then of course my website, www.lucidoils.com.

Matthew: Well, Jim thanks so much for coming on the show today and educating us. We really appreciate it.

Jim: Hey Matt, thanks for the time and anytime you need any more information on that front from me, you know how to reach me, but I’m a big fan of your show and I appreciate that you’d have me on it.

Integrating Chatbot Technology Into Cannabis Businesses

mason levy

Mason Levy is the founder of WeGrowapp.com an immersive chatbot technology that allows anybody to become a grower by asking questions to a bot. Listen in as Mason discusses how this technology will be woven into more cannabis business models in the future.

Key Takeaways:
[0:50] – What is WeGrow
[1:18] – Mason’s background
[2:26] – What is a Chatbot
[3:51] – Businesses using a chatbot
[4:46] – Experiencing the We Grow app
[7:26] – Mason talks about the Swivel engine
[9:13] – Mason talks about a couple of use cases
[12:30] – Mason talks about metrics
[13:41] – What is a net promoter score
[18:37] – Mason’s entrepreneurial journey
[21:34] – Mason discusses his ArcView award
[22:58] – Mason answers some personal development questions
[27:15] – Contact information for Swivel and We Grow

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

 

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

Reducing Electricity Cost in your Grow By Supplementing with Natural Light

jonathan cachat ccv research

Jonathan Cachat PhD walks us through how to dramatically reduce electricity costs in indoor grows using The Dynamic Supplemental Sunlight.

 

The Dynamic Supplemental Sunlight (DSS) cultivation system is a hybrid-lighting approach to indoor cultivation facilities, using both full-spectrum, natural sunlight and supplemental artificial lights, to drive photosynthesis and healthy plant growth. A hybrid-lighting approach with resource efficient design represents the optimal way to save on production costs while producing high-quality, premium flowering plants.

Key Takeaways:
[1:01] – Jonathan’s background
[3:37] – Jonathan talks about his LSD research
[6:11] – Microdosing LSD
[9:58] – Why bring natural sunlight into indoor grows
[11:18] – Jonathan talks about how the technology works
[13:26] – How do the costs differ from an indoor grow
[16:59] – How are the plants responding differently
[18:46] – Jonathan explains how to carry out light deprivation
[21:44] – Does the height of the room have to be changed for the tubes
[22:57] – What roof alterations need to be made for the system
[24:13] – How does the sunlight affect the temperature of a grow room
[24:45] – What type of cultivation facilities benefit from this lighting
[29:03] – Jonathan answers personal development questions
[32:15] – Jonathan’s contact information

Learn more at:
http://www.ccvresearch.com

Important: What are the 5 trends disrupting the cannabis industry?
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There is a race on to remove the most expensive inputs that make growing cannabis costly. One of the most expensive inputs is lighting and electricity. Dr. Jonathan Cachat, PhD of CCV Research, is here to tell us how to bring more natural sunlight into indoor grows using cutting edge technology. Jonathan, welcome to CannaInsider.

Jonathan: Thank you Matt. It’s a pleasure to be here.

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

Jonathan: I am actually on the beautiful shores of Lake Erie in Cleveland, Ohio.

Matthew: Jonathan, before we jump in to your research, tell us about your background a little bit. How did you get into this industry?

Jonathan: I have a PhD in Neuroscience and Psychopharmacology. I received that from Tulane University down in New Orleans. While I was doing a Post-Doc at the University of California at Davis in Northern California, right next to Sacramento, it was about the same time that the California legislature was implementing and extensive framework or regulations for the medical market there. So, my educational experience in drugs, brain and behavior, which is what psychopharmacology studies, allowed me to join with the flannel shirts of the cannabis farmers coming down from the Emerald Triangle in the state capital, and sort of serve as a voice of reason or at least a scientific background to help the legislatures understand. It was really facilitations between outlaws and regulators, as those outlaws became businessmen.

Matthew: Did you do anything interesting with psychedelics while you were there in California?

Jonathan: Yeah. During my graduate research, we had a license from the DEA, so we were able to study Schedule I though IV controlled substances. So, Schedule I where most of the psychedelics are and cannabis. While it was easy for me to get psychedelics and perform research, you can find those papers on the internet, getting cannabis was a really big issue. It took many months, rather than a few days. So, really jumping into the cannabis industry as well it was pretty clear to me that if there was any additional insights to be gained about how the plant relates to human wellness, that research could be performed faster in a consumer market, rather than the current university system in the United States.

Matthew: So, you studied the effects of LSD on mammals or animals or what exactly?

Jonathan: It was zebra fish. Zebra fish are… the best way I can relate to you exactly what species it is is a species of glow fish that you can find in pet stores. So, that’s a Zebra Fish with a jellyfish gene to make it glow.

Matthew: Well, I’m very interested in this topic because I think psychedelics can be very dangerous if put in the wrong hands or something that doesn’t know what they’re doing, but in the right environment they can be incredibly powerful. Can you tell us a little bit about that research with LSD?

Jonathan: It’s always interesting as a psychopharmacologist to hear how the public and the politics refer to “drugs”. To me they’re all just compounds. So, just them you mentioned sort of a danger. What’s the danger? When it comes to LSD and it comes to cannabis there really is no documented overdose danger. So, while I will agree with you that as we’re at this point with cannabis legalization, I’m sort of skittish to bring the discussion of psychedelic legalization to the forefront, but in many ways LSD is just as safe as cannabis in terms of you’re not going to overdose from it. You’re just going to have to have a safe environment to do it.

Matthew: I’m sorry, I’m just fascinated by this. So, you gave LSD to some fish. How did they react to it?

Jonathan: We were modeling effective disorders, so anxiety and depression, as well as addiction, which is exactly how we had to frame it to the National Institutes of Drug Abuse in order to get the grant money to study it. What we were modeling was essentially if we can induce alcohol withdraw or opiate withdraw in the fish, how do they behave. Generally what they did was swim to the bottom of the fish tank and remain there. Then when we looked at their physiological measure they also were releasing the stress hormone cortisol. We knew that that behavior was linked to a high anxiety state.

So, when we gave them Prozac and other drugs that are serotonergic antidepressants they would swim at the top of the tank. So, that was pretty clear cut for what we call anxiolytic drugs that eliminate anxiety and then anxiogenic drugs which increase anxiety. When it came to the psychedelics, this includes LSD, psilocybin, PCP and DMT, ibogaine, the behavioral profile varied widely and it wasn’t clear that it was inducing anxiety or reducing anxiety. What was clear is that their exploration of the fish take was dramatically increased.

Matthew: What do you think about this phenomenon of microdosing LSD that’s kind of popular in Silicon Valley right now with the tech community?

Jonathan: I would say, safely, as if not to confer the wrong message to your listeners, that it’s a very interesting area right for research in that the psychedelics are probably the best tool researchers have in the toolbox that will allow them to probe cognitive functions and consciousness in the human brain. So, it’s interesting when you think about microdosing and LSD because it’s already a microdose compared to any other substance that most humans consume that are measured in milligrams. This is measured in micrograms and nanograms. What I guess I’m saying is we don’t really know at a physiological, neuroscientific level exactly what’s happening in your cerebral cortex when the molecule of LSD is introduced. We just understand that it pulls back the shades of pre-conception in terms of seeing things for the first time and having a new look at things without the enculturation and what you’ve been taught to think or the modes of cognition that are related to your cultural upbringing. It pulls those back and allow you to look at a problem in a new way, and in fact make connections between divergent information or knowledge where connection wasn’t apparent before.

Matthew: Well said. What would you consider a normal adult dose or a typical adult dose and then a microdose? I’m not letting you off the LSD topic here Jonathan.

Jonathan: Generally we were giving the Zebra Fish, and this is pretty big for the Zebra Fish at least, but 250 micrograms of LSD. That’s a huge dose for humans. How we discuss it pharmacologically is essentially what’s the threshold dose. The threshold dose is about 30 micrograms for LSD, and that is the first noticeable cognitive effects or change from it. So, I would assume that we’re somewhere between 30, 40, 50 or less than that, so 30, 40, 20 in terms of microdoses, because I don’t think you essentially want to feel it. I’m not exactly too sure if there are people out there measuring these things in clandestine labs and giving people exact dosage or potency, analytical results. Hey, maybe we’ll look forward to discussing the next big industry being the emergence of psychedelic testing labs as the industry comes online.

Matthew: Gosh I hope so. I really think there’s a lot of promise there. Also as a footnote, just anybody interested in this subject, there’s a great Netflix documentary about DMT that Jonathan mentioned, dimethyltryptamine, I believe it is. It’s DMT, The Spirit Molecule. If you like documentaries and have Netflix, that one is really good and worth watching that explores some related topicality there. You’re at Tulane in New Orleans, kind of the hub of debauchery and then around all the clean sunshine biking people in Davis. Was that a big contrast to jump between those two places?

Jonathan: Not really. It was also considered AG land up there. I’m originally from Ohio in the Midwest where we have soybeans and corn primarily. No, while I miss New Orleans and love it dearly, it was sort of a move back to home for me.

Matthew: Jonathan, I know you’re going to tell us how to bring natural sunlight into indoor grows, but can you tell us why somebody might want to do this to begin with.

Jonathan: Most simply, plants prefer natural sunlight. That’s the light that they have evolved to thrive under. More complexly there’s three general aspects of light that you’re looking at when you’re growing cannabis. The intensity of the light, the spectral quality of the light and the photo period of the light. Of course any grower will tell you the photo period is related to flowing in cannabis. Intensity is most directly related to yield, but it’s that spectral quality and spectral composition is what leads to the finished product in terms of taste and smell, or at least the biggest influence on it. So, by replacing the spectrally empty HPS lights with the full spectrum of the natural sun, you are able to grow a more complex and more diverse and rich product like those seen in the outdoor coming out of the Emerald Triangle, but you’re able to do that indoor and not have to fight with the chaos of the natural environment that farmers have to deal with on a daily basis.

Matthew: So, that’s why somebody would want to do it. How does it work exactly? Tell us how this technology works to make this happen.

Jonathan: The main component is made by a company called Solatube out of Southern California. They’ve been in the business of tubular daylighting devices for about 20 years now. What they offer over the competitors in terms of bringing in sunlight into our space is they have the highest light efficiency transfer. It’s a fancy way to say they’re the best at bringing the purest and most sunlight into the space as possible. That’s achieved through a few patents. Namely on a reflective material called Spectral Light Infinity, which is actually made and manufactured and formulated at a molecular level to be as smooth as it possibly can, and reduce the amount of light that scatters each time the light hits it and bounces off.

Matthew: You mentioned the light bouncing off. How much light is lost as the sun bounces around the tube on its way into the grow, to the plant?

Jonathan: With the Solatubes up to and the Spectral Light Infinity lining, 0.7 percent is lost per drop. So it’s less than 1 percent, meaning that there have been several installs for example where Solatube has ran these tubular devices underground into mines that have that have a flood risk. So, you can’t have any electrical lights down or else you’ll electrocute all your miners if it floods. So, they’ve run them as far as up to 100 feet underground with 9-90 degree angles in them, and there’s still appreciable sunlight at the bottom of the diffuser down underground. It really is the best way to transfer sun where you need it to be, and there’s no other products on the market that can do it as well as the Spectral Light Infinity.

Matthew: Let’s run through an example. Let’s say you have a 25,000 square foot grow. How would the setup cost with supplemental sunlight like you’re describing differ from a traditional indoor grow?

Jonathan: I want to compare the equipment here. I think it’s probably worth mentioning too at this point that the use of the Solatubes is just one component of the sun grown indoor system. It’s a way to sort of think about a lighting control mechanism. We have the Solatubes that capture and transfer the sunlight. We have a grow room intelligence system that measures the available sunlight both inside and outside. Then that is directly linked to our artificial supplemental light. So, the full system is sort of an automatic balance between the amount of available sunlight coming in and the amount of artificial light we need to compensate in order to keep our intensities up so our yields are still met.

In terms of just the lighting equipment alone, generally if we’re talking about 25,000 square feet, a theoretical approach to these costs where it’s just based on equipment. There’s no volume rebates or anything like that, and there’s also no energy efficient rebates given to the growers who are switching from high energy to low energy, it’s about $50 a square foot for the HPS systems in terms of the lighting equipment. For the DSS equipment it’s about $35 more, around $85 per square foot for the DSS system.

Matthew: That acronym, DSS, just describe what that means for everybody again.

Jonathan: DSS is sort of a way to conceptualize the notion that I just explained, Dynamic Supplemental Sunlight, in that the system dynamically balances the sunlight with the artificial lights.

Matthew: What kind of savings could a grower or business owner expect, having that Dynamic Supplemental Sunlight, as opposed to just LED or traditional grow lights indoors?

Jonathan: This is the sort of shift in the balance of the equation. There was an increase in the initial capital costs, but your operating costs, let’s say, roughly are about $45 per square foot if you are doing the electrical load for the HPS lights and the HVAC. For the DSS system that brings in the natural sunlight we’re looking at about $10 a square foot. So, annually and HPS we could consider one this size to have about $1.1 million in annual electrical costs. Whereas the Sungrown Indoor System comes in at around $300,000. So we’re looking at a savings of approximately $800,000 a year.

Matthew: Wow, that’s massive.

Jonathan: It is. I have talked to so many operators out there who have $100,000+ monthly electrical bills, and I feel their pain, but I feel like they also sort of are feeling the crunch of wholesale values decreasing and they’re looking at their $100,000 a month electrical bill saying how are we going to make this work for another two or three years.

Matthew: Interesting, okay. That’s good to know. How do you see plants responding differently? You mentioned plants responding differently with the supplemental lighting. You mentioned that it’s the sunlight’s ideal source of energy for plants, but we’ve got kind of a hybrid system going with the sunlight bouncing through a tube, coming out to the plants, and the LEDs or traditional lights. So, those two working together, what kind of behavior have you seen the plants exhibit?

Jonathan: Right, and I’m glad you characterized that at a behavioral level because previously we were talking about molecular levels and terpenes in cannabinoid production, but at a behavioral level it’s perhaps the most evident, but also one of the most interesting. We had time lapse cameras inside all of these grow rooms when we were doing the initial R&D. First it was do the plants even grow underneath these lights. Once we saw the time lapse videos where the sun would come in through the tube in the morning and the plants’ leaves would wake up and then track and follow with the sunlight as it moves through the space, that was a pretty clear indication that the plants liked the sunlight that was coming through.

Perhaps more interestingly, we haven’t really probed this much further yet, we noticed in the second round of R&D, in terms of facility design, that the LEDs would flip on maybe at 7 a.m. and there’s not a large amount of sunlight coming into the room at that time, but once we got to 9:30-10:00 a.m., the sun started taking over and the LEDs dimmed down. What was interesting, just scrubbing through sort of the daily time lapses, is that it almost appeared that later in the flowering period the plants had sort of trained themselves to wait to wake up until the sunlight came through. So, we would have these weird scenarios where the lights would come on, remain sort of leaves down sleeping, but as soon as the sunlight came in, they all just jumped up with joy immediately and just started tracking with the sun. So, there might be something there, but I’m not too sure about the cognitive abilities of plants at this point.

Matthew: Now what happens if you need to make the room go dark? How can you carry out light deprivation in this type of environment?

Jonathan: There are butterfly dimmers that Solatube has designed to put inside of these units. You’re able to automatically just open and shut them, and when you do you’re blocking out 99.8 percent of any of the sunlight coming in. So, it’s perfect for [19.05 unclear] capable, and in fact it’s much easier just to flip a light switch than it is to be pulling tarps over and across. Also worth noting too, the technology to capture the sunlight, besides the dimmer, there are no mechanical parts. So, when you’re trying to balance the financial equation you have things in there like semi-annual or annual bulb replacements. There are no bulbs. There are no bulbs to be replaced. The maintenance these units need is a spray down with a hose, depending on how close you are to the ag fields that are kicking up a lot of dust. The dimmer, it just sits right inside and being the only mechanical part, that perhaps is where you could have additional costs, but they are very well built and replacing a dimmer isn’t a big deal, nor is it really a big cost.

Matthew: What’s the experience like to open a dimmer of a totally dark room? Do you feel like Bruce Almighty parting the clouds, “Let there be light”.

Jonathan: Exactly. Like that, or it’s sort of like you’re standing underneath a Super Mario Brothers tube and you’re ready just to jump up into it. It’s seeing and feeling really is believing in terms of the Sungrown Indoor System. So, sort of been discussing this with industry people for several years now. I’ve come to realize that what people sort of imagine in their heads when they hear the system being described wildly varies. When you see it in person for the first time everybody sort of invariably was shocked and said, this is way more simple or less complicated that what I had originally thought. I thought there was going to be bells in this, there’s bells and whistles.

Then the most sort of true testament I think is when you do stand underneath this sunlight that’s brought into the room it’s really sort of an unusual and alarming feeling, because you feel the sunlight. You can feel the sunlight, but it’s not a feeling of sunburn. You associate being out in the direct sunlight at the beach with some sort of element of I’m burning slightly. When you’re inside these rooms you can feel the sunlight and recognize that it’s sunlight, but you don’t feel like you’re getting sunburnt. That’s why I say seeing is believing.

Matthew: What about the height of the room? Does that need to be different to accommodate the tubes?

Jonathan: The height of the room can be variable. We started with eight feet. We’ve gone up to ten feet in terms of the roof structure. Generally the facilities that we’re specing out now have a room height of around 12 to 16 feet. Generally the biggest variable that effects the cost of this system is the distance between the ceiling in your grow room and the ceiling in the building that your grow room is in. So, to run an extra extension tube length all the way down, that can affect the price of the system, but like I was mentioning earlier with the cave example or the mining example, it won’t really affect the performance that much. In terms of how far the grower prefers to have his lights above the canopy of the flowering plants, everybody has different rules of thumb. Everybody has a different approach. Really what we’ve done a CCV is work with the growers and work with the builders and also the business guys to balance a system that meets their needs in particular.

Matthew: How many holes would a grower need to make in the roof, and what does that entail, that process?

Jonathan: I think it’s sort of an old adage. The more light you can get in the better it’s going to be. It proves true. Really when we’re designing a system custom built for any facility we max it out in terms of what’s the max density of tubes that we can theoretically model on the roof space. So that gets us an idea of how much maximum sunlight we can get in the space and perhaps more importantly, how the sunlight moves through the space as the sun changes its position in the sky. Of course from there we have to pull it back. It’s a balance at that point between the structural integrity of the roof and the amount of sunlight that we can bring in.

So, I work with structural engineers or the project’s general contractor to find tha6t proper balance based on what type of building they’re growing in, what type of roof structure is there, what state they’re growing in. So, it’s hard to give you a specific number of how many holes you would need in the roof because it’s all really dependent both on your floor plan, your location on the globe, and the building that you’re in.

Matthew: What does the natural sunlight do to temperature in a room or grow room?

Jonathan: That is a good question because it’s another sort of negative of having the high intensity discharge to the HPS lights in the room. They generate an enormous amount of heat, but then has to be sort of fought or reduced by your HVAC. So, regular skylights bring in natural sunlight. So, what you’re used to seeing, sort of the square design with the plastic cover on it. Those will transfer the IR wavelengths that are the heat generating wavelengths of the sunlight. What makes Solatube different from their nearest competitor is that they have technology built into the product that absorbs that infrared wavelengths and then dissipates before it even gets a chance to get into your rooms. So, they have the best light to solar heat gain ratio of any skylight product on the market.

Effectively what that meant, we had an enormous Grownetics grow room monitoring system in all of these R&D units. So, we had very granular data on temperature in particular. There was no discernable or significant measurable heat gain that we could notice while we were performing and developing the system.

Matthew: Is there a rule of thumb in terms of what types of cultivation facilities can benefit from this supplemental lighting? I’m sure there’s people listening saying, is this a fit for me or how would I know or anything like that.

Jonathan: I think it’s best to characterize growing with HPS lights as a twilight industry in that most reasonable cultivators, while they may have come up into the game by growing with HPS lights, they understand that that ship has sort of sailed, and it’s on its way across the horizon. So, they’ll agree that a hybrid lighting approach to cultivation is where the future is at. So, really any hybrid lighting approach by definition is one that incorporates natural sunlight with the artificial light. So, there’s great progress in Big AG and even in cannabis in terms of finding the right balance of LEDs to greenhouse, in greenhouses. It’s sort of the same process with the Sungrown Indoor System. The difference between the Sungrown Indoor System and a greenhouse in terms of hybrid lighting approaches to cultivation is essentially because we’re growing in a contain, you can just think of it as a Yeti cooler. The ability for the cooler or your indoor to withstand massive or drastic changes in the outside ambient temperature is far greater than what can be provided in a greenhouse situation.

Matthew: What’s the lowest hanging fruit here in terms of geographies? Is this any place with the sun? What about your home state of Ohio? Where’s the best geographies that can use this technology, this dynamic supplemental sunlight?

Jonathan: Yeah, it’s interesting. So, at face value the total savings annually that you’re going to receive is directly correlated with your average annual days of sunlight. So, places like Southern California, Desert Hot Springs, Arizona and New Mexico where they have 300+ annual days of sunlight, that’s of course where you’re going to see the most dramatic reduction in your electrical lode. What about places on the East Coast? First noting on the East Coast that while in Ohio we’re able to grow cannabis outdoors, we not have as long of a season as out in California, it can still be done, but the regulators on the East Coast are generally more concerned about security and the sort of not in my backyard approach to cannabis cultivation. They don’t want to see it. They don’t want to smell it. They really don’t want to know about it.

So, in that situation your forced indoors. So, any savings that you can get, any time that you can shut off those artificial lights, you’re saving money. So, while they’re not going to see reductions that are 75 to 80 to 85 percent reduction in their annual electrical load that you would see in Southern California. The idea of saving 50 to 60 is still pretty appealing when you’re trying to balance the sheet here on the East Coast.

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

Jonathan: Yeah, so, E.O. Wilson is a Harvard biologist. He wrote a book called Consilience. I wish I could remember the subtitle. I think it’s called The Unity of Knowledge. The Consilience: The Unity of Knowledge where essentially he calls for the unification of information. A sort of cross pollination between academic disciplines as sort of a fruitful area of discovery. I think reading that book an undergraduate has really sort of pushed me to understand and try to apply different approaches from different academic disciplines or different professional disciplines and see if there’s any value in what they’ve learned and how it can be applied to whatever I’m working on. I guess I would just encourage people, it’s sort of diversity and diversity of thought is the foundation of insight and discovery. So, by reaching out and looking at different things that might not be related to exactly what you’re working on, you may find the answer that you were looking for the whole time.

Matthew: Is there a tool that you consider valuable to your day-to-day productivity that listeners might not have heard of?

Jonathan: I’ve been doing a lot of writing lately, a lot of helping people with applications, and so there’s a new tool that I’ve been using to keep an eye on not only my spelling and my grammar, but sort of my prose. There’s a plugin called Grammarly where you can do your word processing in the Grammerly app or you can just copy and paste it into the app. It’s tests for things beyond the, like I mentioned. You’ve used the word therefore 60 times in this document. You might want to consider another word. It’s sort of beyond just spell check. It’s like you have a human proofreader there on call and on demand. It’s Grammarly.

Matthew: That’s a good one. I’ve used that too, and I really think that’s a great plugin. It’s free for most people I think. I use it in Chrome, like a Chrome plugin.

Jonathan: Right, yeah.

Matthew: That is a good one. Final personal development question. Did you ever take LSD while you were giving the fish LSD? You can tell me because it’s just you and me. It’s just you and me. You can tell me the truth.

Jonathan: I can neither confirm or deny any of that, and I will say that the DEA does not mess around with inventory control and trackability. Same is sort of true with the cannabis industry and cannabis as well. Not only was I the one in the lab managing and sort of directing that, but we had undergraduates come through as well. When you have different people coming into a lab that has controlled substances you really need to take it seriously because there’s not only… I mean in addition to the criminal charges, you’re going to lose your ability to pursue what the research that you built your career on so the risk benefit analysis doesn’t really weigh out.

Matthew: Okay, good answer. Very professional. Jonathan, in closing how can listeners learn more about you? Throw out your website and tell us how we can connect.

Jonathan: So the website is www.ccvresearch.com. It’s a good place to learn more information about the Sungrown Indoor System and how to get in contact with us. On social media platforms as well it’s just @ccvresearch and of course I’d be happy to connect and discuss things on LinkedIn as well. My last name is Cachat.

Matthew: Just for everybody listening that’s C-C-V like Charlie, Charlie, Victor Research. Jonathan, thanks so much for coming on the show today and educating us. I think this is really the beginning of a huge change from almost all electric indoor grows to supplemental like you’re doing. A move to supplemental and a move to greenhouse too, I think those are two big things, and this race for a lower cost of production that we’re already starting to see happen, especially in Colorado right now as the price falls on wholesale part of cannabis.

Jonathan: Right, exactly. It’s a pleasure to chat and that’s exactly the point that I try to emphasize to everyone is that you can see your profit margin shrinking, and the days of black market without any compliance costs or paying, maybe you pay for an attorney, but idea for paying for an accountant and a marketing department and a website team and a social media team, they’re dramatically decreasing wholesale value of cannabis and you’re increasing cost of production. You really have to consider more resource efficient ways if you’d like to stay in business and definitely last well into the future as this industry settles down from the onboarding startup stage.

Matthew: Well put, thanks again Jonathan.

Jonathan: Thanks Matt.

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