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Expert Architect & Grower Reveals How to Design The Perfect Indoor Grow

matthew gaboury calyxking

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Matt Gaboury is head of Design and Systems for CalyxKing. Listen in as Matt describes the most high-tech and efficient grow rooms he creates. He also describes the grow room of the future.

Key Takeaways:
[0:59] – What is Calyx King
[1:57] – Matt’s background
[3:21] – Matt talks about what his work entails
[4:57] – Planning a cannabis grow facility
[11:02] – Biggest mistakes when planning a cannabis grow facility
[13:55] – Matt talks about technology in optimizing workflow
[16:53] – Matt talks about carbon neutral growing
[21:56] – Using intellectual property to help clients
[22:44] – Matt talks about mistakes amateurs make in writing SOPs
[23:31] – Matt’s partners
[24:24] – Grow room of the future
[27:34] – Pursuing a cultivation license
[28:52] – Matt answers some personal development questions
[33:20] – Contact details for Calyx King

Learn more at:
http://calyxking.com/

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The Five Trends That Will Disrupt The Cannabis Industry
https://www.cannainsider.com/trends

 

Read Full Transcript

How do you design a cannabis cultivation plan that does everything you need to optimize plant health and profit out of the gate? Matt Gaboury from Calyx King is going to help us answer that question today. Matt, welcome to CannaInsider.

Matt: Thank you so much for having me.

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

Matt: Today I’m in my hometown of Seattle, Washington.

Matthew: Very cool and I’m in Vienna, Austria today.

Matt: I wish I could switch with you.

Matthew: Before we dive in on everything you do, can you tell us what Calyx King is?

Matt: Yes absolutely. So, Calyx King is a seed to sale service provider. We are comprised of various different professionals who offer consulting and professional services related to the cannabis, primarily, production and processing. Our main focus is helping individuals in new and beginning marketplaces enter into the new regulated industry through application support, the creation of (1.29 unclear) and employee manuals, as well as what my primary focus is, which is the design, the permitting and the help facilitating the build of these cannabis production processing facilities.

Matthew: And I really want to get into the permitting and specifically the build too and doing that the right way, but before we do that, give us a little bit about your background. What were you doing before Calyx King and how did you come to get started in this?

Matt: Absolutely. We started Calyx King back in 2012. However, prior to that, I was always a bit of cannabis enthusiast. It’s something that’s been around into my life for pretty much as long as I can remember. From inception, my parents were very into cannabis as well, so it was something that has naturally passed along to me. I was an avid user for a very long time, and then I started growing very small scale, probably a little over ten years ago with this one tiny light in my basement.

From there I went back to school for architecture and almost immediately started applying those tools and tips of the trade to designing and building cannabis production facilities. It started off with my own basement by making that a more efficient design and me helping out a friend or two in their basement. And then that evolved into a smaller garage and then into a warehouse and then into some smaller, light industrial type buildings and then we’ve had the opportunity in the last five or six years to grow that in scale, to now have the opportunity to design about 2 million square feet for people around the United States.

Matthew: Wow. Now if we were to look over your shoulder as you work day-to-day, what does your work look like?

Matt: That would completely depend on the actual day, if you were a fly on the wall. It’s definitely a very variable schedule, depending on what’s going on in that particular period. At Calyx we’re very responsive to the rules and regulations that are being released all around the United States, and therefore our business is very much attuned to those changes. So as a new marketplace opens up, let’s say for example most recently Pennsylvania and Florida, we get a big influx of individuals looking for existence in those new states.

So a lot of times my day is dependent upon what is actually happening around the United States. But to kind of boil it down in basic terms, I spend a lot of time in front of my computer and using programs like Auto CAD and REV IT to help design and model these facilities. I’m a really big proponent of pre-planning. An ounce of prevention is worth a pound of cure. So we definitely spend a lot of time doing site visits and a lot of hands on with our clients in order to make sure that we design the best and most appropriate facility for them.

Matthew: When you’re starting to plan for a cannabis cultivation facility, can you give us a sense of how you’re thinking about it, what’s your top considerations and challenges are in your mind and maybe what lenses you’re using to think about it? Because I’m sure the way you’re thinking about it and the way someone who is listening to this right now are very different. So let us borrow your brain for a moment and just think about when there’s a new project. What are you thinking about when you’re thinking about the cultivation?

Matt: Sure. First and foremost it comes down to the site and the location, because no two sites are the same. No two projects really start off on the same design foot. So you really need to start there. You need to start with that foundation. The foundation isn’t really the foundation of the building. No pun intended. You’re looking at the environment conditions, it’s really important looking at the site characteristics, what the opportunities there are, what some of the limitations may be and that could be the actual site itself, the topography, the sun orientation.

In addition, something that I highly recommend people looking into is also your utility providers. What sort of power, water is coming to that site? What sort of sewage requirements are going to be necessary and what some of those permitting and code hurdles may be, because every site has a different building department and every building department is also slightly different in how they look at cannabis facilities. And then in addition to that, we also really like to start at the top level of the business strategy. So, no two cannabis businesses are exactly the same in what they produce, the strains that they grow and the methodologies that they use in order to accomplish that.

So, we really like to start with that specific business’s goals. For example, if your goal is to produce, let’s say, CO2 for vaporization and that is your main product offering, then the way in which you design that facility is going to be much different than if your main product offering is a high class dried flower product. And that’s going to come down and dictate the size of the space and that’s going to dictate the flow. That’s going to dictate a lot of different design elements. So, to wrap that back up, I definitely encourage all people to start off at the very macro level, whether that be the macro level of the site or the macro level of your business strategy and then reverse engineer your plan to make it appropriate for what you’re trying to do.

Matthew: Okay. So, that’s kind of stage one there, and then you kind of look at the limitations. You look at the foundation. You look at utilities, all those things. What’s your optimal cultivation facility look like? You’ve started with that as your foundation. These are all the things I need to know. I have to fill in all the blanks so I know what I’m dealing with and then how do you go about creating the after photo from the before?

Matt: Once you get a lot of those parameters and once you have quantifications on a lot of those elements that we just talked about, then you kind of have your playbook. And once you have your playbook you can start to design what is the most appropriate for those different conditions. Like I said earlier, that’s all going to depend on what you’re trying to do. And because as you and as a lot of the listeners are probably familiar with, there’s many different ways to go about skinning a cat when it comes to cannabis production. Even from the methodology that you incorporate, whether that be a greenhouse, whether that’s full outdoor or a highly tuned indoor environment.

So let’s say you go with an indoor structure, you’re in an environment where that’s necessary, or even a hybrid greenhouse. What I would then encourage people to do is look at the systems that are going to be associated with that because every building type has a different set of systems that work the best for that building. So for example, the HVAC or the cooling or heating system that you may put in a greenhouse is going to be very different than the system that you would choose to go into a building. And even within that building itself, depending upon that building’s insulation values, depending upon its materials and its finishes, that could also affect those systems too.

So starting off with what that angle is, then that helps you define what that ideal facility is. Other things that I really encourage people to think about during this part of the design phase is efficiencies in resources and efficiencies in movement. Those two things are very big when you’re starting that design process, because ultimately those are two things that are very difficult to go back and change in the future. So when I say that, it’s really looking at that design and how it’s laid out to maximize the use of your employee’s time, to maximize their use of their movement around the facility as well as, like I said earlier, to look at those resources as well, your energy usage, your water usage and look if there’s ways that you can reduce that through either implementing architectural elements like regenerating power or more efficient fixtures or looking at methodologies with your local county in order to reduce that.

So a lot of times they’ll let you do off peak hours to reduce your load. They’ll potentially have incentives for certain technologies and certain equipments that you may be able to put in, but all of this is required to be done first before you build the building. Like I said earlier, it’s really difficult to go back and change those things. So in order to create that optimal cultivation facility, having a little bit of pre-thought in design goes a very long way.

Matthew: Now everybody, not everybody, but most people coming into the industry are new. Maybe some people are listening right now that are creating their own grow facility or they’re going to be soon or they’re considering applying for a license and they don’t have an architectural background or just practical growing practice. If you were to kind of stack rank the number one, two and three mistakes that people make when considering how to make a grow facility, is it that easy to put them into buckets as the most common and second most common?

Matt: Yeah. We definitely see a few general mistakes that people go through, and I would say that the biggest ones are just the transitioning of scale. A lot of people now are scaling up from what I would say the hobby scale or the light commercial scale to something that’s more industrial. And when you go and make that jump there’s a lot that’s lost in translation. So I really encourage people to look into the different more industrial equipment that can be at your disposal when you get to that larger scale, and don’t hold on to those old concepts, because those old concepts are only at the small scale. As soon as you try to replicate that at the larger scale, you’re going to be losing a lot of efficiencies and you’re also not going to be capitalizing on all of the industrial scaled materials and equipment that are at your disposal then.

In addition to that I would say another big bucket that people generally fall into is not considering what the local code and permit restrictions are. Because every single municipality has a slightly different perspective on their building codes, nevertheless how cannabis is being perceived and how cannabis is being implied to those building codes, there is almost always very specific limitations, and that can be limitations to your site. That can be limitations on how and what you can build, and those are all things you need to be considering first and foremost. I’ve seen a lot of people go down a path of action that they thought that they could accomplish only to then be delayed and cycled by the code or the inspector because they didn’t properly look at the code and the permitting restrictions prior to trying to implement that design.

Matthew: Good points. So people, they might have two or three plants and they think oh I can scale up now to hundreds and it’s as different than riding a bike and then the space shuttle. So there’s all these ideas of plant management and managing a much larger amount of inputs and outputs that just change the whole game entirely. So people struggle with that when the scale changes. I can see that. I mean in terms of plant management, when you get into much larger grows, I mean is there anything interesting happening with the technology there? I’ve heard people use flood tables. I’ve heard where people have these rolling tables and little, not assembly lines, but the way that kind of tables work together to manage everything from trimming to watering to curing and so forth. Do you see anything like that in terms of optimizing the workflow?

Matt: Yes absolutely. It first starts off with that layout. So to make sure that you’re designing something that has the proper flow to it. I think that’s just drawn from general manufacturing principles. Looking at efficiencies that happen in Japanese manufacturing and drawing some of those principles in how the management structure is laying out not only the physical flow but also the management flow of those materials. And then some of that technology that really helps with that. You mentioned a couple of those. The big ones for me are a good ERP solution or good inventory management software.

When you’re at a small scale it’s really easy for your master grower to keep track I think of a lot of these things and I would say that most people who are at a smaller scale or a smaller commercial scale are doing a lot of these things either through their head, just keeping these notes internally or they’re writing them down on paper. It’s not as organized as is necessary for when you go to that larger scale. When you’re at that larger scale, and especially in these regulated industries, all the plants have to be tagged, all the plants have to be recorded and you have to very accurately manage that as that plant goes through its lifecycle.

There’s where having a software solution that can manage that and automate some of those things, I feel it is huge and really reduces a lot of that human error and a lot of that thrown in on your upper management. In addition, I think that there’s a lot of great technology that you can utilize within the rooms to reduce your employee output, as well as, make that management of a large group of plants a lot easier. One of the things that you had mentioned that I think is great are the rolling benches, rolling agricultural benches. We definitely recommend those, whether it’s indoor/outdoor greenhouse, because it maximizes your footprint and it allows you to get more plants into a smaller space.

In addition to that I think an automated watering system. So, whether you use an ebb and flow or drip system, some sort of automated watering system that you can reduce the amount of hand watering that’s necessary is going to be huge in reducing your employee costs. Because watering represents probably one of the largest operational costs once you get to a large plant count. And then in addition it’s going to enable consistency, and when you talk about some of the pitfalls of large quantities of plant management one of the biggest ones is consistency. Consistency in the amount of water each one of those plants gets, consistency in the amount of love each one of those plants get. So, by automating some of those systems, it gives your farmers more time to actually focus on plant health and plant maintenance.

Matthew: Is it possible to have carbon neutral growing?

Matt: I absolutely believe that that’s not only possible, but that should be something that we all strive toward. One of my personal passions is sustainability in cannabis. Right now we are just energy hogs because the profit margins are so high and a lot of these efficiencies there hasn’t been a necessity to have to find those or to have to utilize those. However, I think that there’s going to be big negative media backlash that’s going to be associated with all the power we use, and I think that anything that we can do to not only stifle that is going to help the industry in general, but it’s also going to help each individual proprietor reduce their costs. So I’m a big fan of trying to utilize any sort of sustainable or green methods into the growing facility.

The biggest, and it may sound to be the easiest, is really just making sure that your operational flow is as streamlined as possible. This goes back to what we were just talking about with an appropriate layout and design. If you can design that manufacturing process to be as streamlined and as smooth as possible, then you reduce a lot of your employee waste, and that’s the biggest one that almost any business can do. You don’t have to go out there and buy any expensive technology. All you need to do is really put a lot of thought into how your employees move around and handle your materials. Let’s say somebody has to take an extra ten steps every time they perform a task and they perform that task multiple times a day, then that ten steps could extrapolate to thousands of steps by the end of the year and that is thousands of minutes of wasted time and ultimately a less efficient facility.

So that first and foremost is just how you look at your employees and your employee resources. In addition to that there’s a lot of new, exciting technology and equipment that can be utilized into these growing facilities. I think one of the most exciting ones and one of the most easy is just all the new efficient lighting fixtures that are out in the marketplace. Conventionally, up until about five years ago, we all grew with either 600 watts, 1,000 watts HPS fixtures and it was quite typical to use 1,000 watt metal highlights for your veg. Now there’s a wide range of plasma, LED, induction, (19.17 unclear), all these different fixtures that have a very comparable par and lighting spectrum but have a reduced wattage. And they’re really easy to get, they’re really easy to switch out into your facility. They usually don’t require a lot of addition infrastructure because you’re actually using a lesser load. And addition to that there’s usually incentives or rebates being offered by a lot of the local municipalities to help reduce the initial cost for that business in going and purchasing those and implementing them into their facility.

Besides that there are all sorts of different, more effective and green strategies, whether that be the poly covering on your greenhouse or different feeding systems, different HVAC systems that are more effective. Another big one is renewable energy sources. So we’re definitely seeing a big push now for wind, geothermic, as well as solar renewable energy being implemented in these facilities. And then the last concept I like to talk about is called districting, and that’s basically using your grow facility to help aid your community around you. And what we’re seeing and what we’re trying to kind of design the wave of the future is instead of a grow facility that is pushed out into the perimeters and buffered away from everyone else, they actually start to implement these into more of a community environment where you could, let’s say, purchase on large solar array that powers maybe your grow facility during certain hours when the lights are on, but it can also power let’s say some apartments or some mixed use commercial areas.

You could also then share the heat, so the heat that’s generated, the excess heat that’s generated by your light fixtures could be shuttled over to let’s say your living areas, your living buildings and then used as radiant ambient heating throughout the facility. And then this whole acts as an ecosystem, and if that can occur, then reaching carbon neutral is even easier because then you’re not just alone by yourself at the single facility, but you’re actually sharing some of your responsibilities with your neighbors around you and there’s a lot of synergies that can happen to allow that carbon neutral effort to be even easier.

Matthew: Do you use any specific intellectual property to help your clients?

Matt: Yes, I think that that’s something that we’ve been developing over years is some specific IP that we have. A lot of that is specific to the growing methodologies. We’ve definitely developed what I think is a pretty unique way of production and processing that goes back to that manufacturing streamline that we talked about earlier. So we have just developed that process as well as the equipment associated with it into our own Calyx King package, so to speak. It’s not anything that you couldn’t go out there and get yourself. It’s more how you put all these different components together I think is the IP that we offer.

Matthew: In terms of creating standard operating procedures of SOPs, where do you see amateurs fall short in terms of thinking how a cultivation facility ought to be run?

Matt: I think a lot of times it is because people are trying to capture what they’re currently doing and not trying to theorize about how it’s done better. I think when you write SOPs that gives you the prime opportunity to do so. Part of SOPs is capturing what is currently happening, but like I said I think it’s this prime opportunity to expand upon that and to make it a more ideal situation. So I would definitely encourage people when they do write those SOPs try to think about how to better that process and how to then standardize that in a way that makes it for everyone.

Matthew: What about your partners at Calyx King? What do they do?

Matt: I’m very fortunate to be partners with a very diverse group of professionals. We are comprised of some lawyers, operational managers, long time horticulturists. I run the architectural and design department in which we have two other trained architects, as well as several individuals from the construction and project management field. So, we are very fortunate to have a pretty wide spectrum of skillsets underneath our roof.

Matthew: You talked about some of the latest developments in technology for grow rooms, but what do you think the grow room of the future will look like? You mentioned districting, which is a unique idea I haven’t heard before. Is there any other vision you have about how the grow room of the future will look?

Matt: Yeah, I definitely think the grow room of the future in my perspective or what I would love to see is that carbon neutral grow room where you are using as little resources as possible, and it’s as automated as can be. So, we’re definitely seeing some very good advancements in that technology in order to accomplish that in the last, I would say, three to five years. And I really think that now it’s just the process of putting all that together and having the capital to do it right properly from the beginning. I think a lot of people getting into the industry are hamstrung and don’t have the capital that’s necessary a lot of times to perform some of these more expensive methods or purchase some of this more capital expensive equipment. But it definitely goes a long way and I think that’s the grow rooms of the future and the grow facilities of the future are becoming much more sophisticated. They’re starting with a lot more capital so they can accomplish these things. They’re not having to be revised.

They’re starting off with all the proper mechanisms at first, and they’re being able to then maximize that. So, my ideal grow room, and I’ll be a little more specific with it, my ideal grow room would be a system that is being cooled in a passive manner and heated in a passive manner. So, ideally that would be located in a geographic area where you could capitalize on geothermic loop in order to accomplish that. The grow methodology would be something that was without soil or without a soiless medium. So what my preference is is deep water culture and an organic deep water culture. So in an organic deep water culture setup you could use very little water and very little nutrients, so that reduces both of those loads.

Then this would be a facility that would be a hybrid. So you would be able to utilize the sun’s natural solar radiation. So it has a roof systems that has the ability to control its opaqueness. And then lastly, you would have an automated basically moving system so that your components are then automated on track moving through your facility. Therefore you’re reducing any sort of employee resources of having to transplant and then change those plants as they are going through that lifecycle. This is something that you see very commonly in really large agriculture with the moving bench system. So my grow room of the future you would be utilizing the very top pieces of technology from all of your different categories and seamlessly tying those together to have the most, in my opinion, efficient and effective room and production facility.

Matthew: That’s fascinating. If there’s listeners thinking about pursuing a cultivation license, what are the most important things they should do to make that happen, in your opinion?

Matt: Yeah, I think it’s going to come down to the individual state in which they reside, in which they are looking to get that license. And I say that only because all these different license processes are so different, depending on where you live. But once you actually look at that and look at what the specifics are for your local, then I would start to look at your site. I think your site is so important. I always tell people that it takes three things to really be successful in the cultivation side of things and that is you need the right IP and the right gardeners, number one. You need the right genetics and strains, number two. And then you need the right tools in order to accomplish that, number three. And your building and your site is your number one tool.

So you definitely want to put a lot of emphasis on where that is and making sure that that’s proper because if you don’t have that right tool, then you’re not going to be able to maximize your strain and your farmer is not going to be able to do his job properly.

Matthew: Matt, I like to ask a few personal development questions to let people get to know you a bit. With that, is there a book that has had a big impact on your life or your way of thinking that you would like to share with listeners?

Matt: Wow, you know, there’s a book. It may not be applicable to cannabis or to growing as some may expect, but it has been very influential in just the business management and the effectiveness for me and it’s a book called the Effective Executive. I think a lot of individual… and the reason I read this book is because what I see a lot, talking with people all over the United States who are interested in getting into this industry, it’s a lot of new business owners. It’s a lot of people starting a business for the first time or a lot of people looking to expand their business. One of the most difficult elements that I’ve seen people struggle with is just that management from general business terms and general business perspectives. The Effective Executive has been a very good book for myself to be able to tackle some of those general business ideas and to do things in a better sense and in a more effective sense as a manager of a corporation and a company.

Matthew: Yeah that’s a great suggestion. We could all use any advice there possible. Is there one thing that sticks out to you that you use often from that book?

Matt: Yes I think it is how do you properly attain your goals, and it gives some really good pointers. Especially about writing things down, creating succinct and smart business plans. Being able to isolate things, being able to not what I call chase butterflies, which I think a lot of people run into in this industry because there’s so many opportunities. But to really look at how to focus and target your efforts in what you want to do to accomplish your goals in the best way possible.

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

Matt: There are several tools that I use that are specific to the architecture side of things that are indispensable, but may not be as applicable just for normal people getting into the industry and those are some of the more architectural programs, Auto CAD REV IT. We do a lot with Bin Modeling, which I feel has definitely revolutionized our ability to plan these facilities. Bin Modeling is building information modeling, so it’s basically in the computer in a 3D environment. You are putting in as many parameters as possible. So, we actually like to create the whole building inside the computer. We put the actual mechanical systems in there and then through certain programs and algorithms, you can run simulations on your building.

So, you can run heating simulations. You can run your light simulations to see how that affects your insulation for example or your vapor barrier. And you can really start to find any sort of bugs or hiccups in the computer before you actually build it, and we’ve found that that’s been very advantageous in saving money in the field.

Matthew: Wow, so it creates a simulation of what the live finished building would look like and how it works.

Matt: Exactly, and it really helps too with testing concepts with a lot of things. One of the major architectural elements that we have been doing a lot of advancement on in the last five years is the HVAC and the environmental condition controls because there’s so many different ways to go about it. There’s forced air, there’s chill systems, there’s VRS and they all on paper do something very similar, but they all do it in a different way. So, it’s been really helpful, especially with that to be able to model these different HVAC systems into a building to see how that influences those interior environmental controls, as well as its impact on the electricity usage of the building or you can even structurally be able to model these things. So you could model your rooftop unit and that could tell you structurally what additional supports you may need and then what the cost associated with that is. So it just allows us to flush out a lot of those design concepts before actually having to put a hammer on a nail out in the field.

Matthew: Great, great information here Matt. I appreciate that. Before we close, can you tell listeners how they can connect with you and learn more about Calyx King?

Matt: Yeah, absolutely. You can find us online at www.calyxking.com. We have a contact form there through the website. We also have the contact information for all the different partners. If you have a specific question, you can contact one of us directly, depending upon our skillset, or just through that general info tab there on the website is easiest.

Matthew: Would you mind spelling the url?

Matt: Absolutely. That’s www.calyxking.com.

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

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The Five Disruptive Trends Shaping The Cannabis Industry Now

Interview with CEO of Cannabis-Infused Beverage Maker, Mirth Provisions

adam stites mirth provisions

Adam Stites knew he had to be involved in the Cannabis Industry. After talking with friends and selling his last business he dove in creating Mirth Provisions. Mirth Provisions based in Washington State makes infused beverages and a sublingual spray.

Key Takeaways:
[1:31] – Adam’s background and opening of Mirth Provisions
[6:40] – Picking cannabis-infused beverages as the main offering
[8:24] – Adam talks about the Washington cannabis market
[10:28] – Mirth Provision product descriptions
[12:47] – Adam talks about where product ideas come from
[15:33] – Adam talks about how data is used
[16:34] – Adam compares and contrasts the Washington and Oregon Markets
[21:18] – Keeping an infused beverage shelf stable
[24:39] – Innovation in in-store marketing using refrigerators
[28:19] – What do you need to get into the market
[29:29] – Pricing of Mirth’s products
[33:19] – Adam talks about the infused product market in five years
[34:45] – Adam answers some personal development questions
[41:00] – Contact details for Mirth Provisions

Important
Get your free cheat sheet, The Five Trends That Will Disrupt The Cannabis Industry here https://www.cannainsider.com/trends

Read Full Transcript

While flower continues to be the hottest cannabis item in Washington State, the infused products business is also getting traction. Here to tell us about how his company is thriving in Washington is Adam Stites, Co-Founder of Mirth Provisions. Adam, welcome to CannaInsider.

Adam: Hey, thanks Matt.

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

Adam: Sure. So, we’re actively executing a national brand expansion. We’re currently in Washington State. That was the first state that we started in, kind of proof of concept. We then expanded to Oregon and Arizona last year with our Drift Sublingual Spray, and we’re launching in California in July, which I’m proud to announce. We just signed that deal last week.

Matthew: Oh great. And how about where are you sitting exactly today? Are you in Seattle? Where are you?

Adam: I am sitting at our new Portland, Oregon facility. So maybe 45 minutes south of our Washington operation.

Matthew: Okay, great. And before we jump into everything that Mirth Provisions is doing in the Washington market and elsewhere, let’s hear some of your background and history and how you came to start this business.

Adam: Sure. So it really started in November 2012. I was with a group of friends in Austin, Texas. We happened to be watching the election results come in, and saw Initiative 502, which was the initiative to legalize marijuana in Washington State, come on TV. We started to see the returns even from the eastern part of the state that typically votes a little more conservative, and we said man this thing is going to carry. I mean they hadn’t even counted all the votes in King County, which historically has been very supportive of cannabis.

My mind just started racing, and there were some friends and maybe a few alcoholic beverages, and we started to say hey, what’s the opportunity here and when is the last time we had a $10 billion informal industry with no real brands, and what if we could do something in here that was truly different and better and to build a brand. That was kind of the genesis of the idea. When I got home to Portland I met up with two friends who had an agency here in town, (2.42 unclear), Andy and Peter, and I said, hey guys I’ve got this crazy idea. What do you think about this? We met at a coffee shop outside of their office. They were not totally comfortable discussing it in front of their team, but we kicked it off together.

We started with our own theories of what we wanted to produce in products. They helped us really introduce a quantitative and qualitative research to the market and what we thought what products would really be best. As a result of that, we arrived on beverages, kind of the intersection of where consumer desire was and where the market hadn’t adequately produced products of the quality that we thought folks would want. So, as a result of that, we decided to enter the beverage business and using some other contacts and friends that I knew was connected with a gentleman who was a former head of operations at Tazo Teas here in Portland. So, he had one Tazo’s formulation work, and then after Tazo was acquired by Starbucks, he also went on to do formulation work for Starbucks up in Seattle.

So, specifically if you’ve ever had some of Starbuck’s flavored teas, you’ve tasted some of Michael’s work. So, he was really a formative part of the initial product formulation and in getting our manufacturing plants set up. So that was the genesis.

Matthew: Okay. And how about your personal background and work career?

Adam: Yeah, by the way, I love this question because people that you run into in the industry it’s such a wide variety because really no one, unless you are growing in the medical space prior, came from the industry. So, it’s such a wide variety of backgrounds. I think I fit that mold a little bit. So, my background was in ecommerce. I founded a paintball equipment ecommerce site that we grew to become the largest retailer of paintball equipment on the internet.

Matthew: Nice.

Adam: Then we grew the business through other acquisitions, especially nichey, commerce companies, grew the business to about $10 million in revenue. And ended up selling the business in November of 2015. So, that was really my background, B2C, consumer marketing fulfillment. Yeah.

Matthew: Are you pretty skilled at paintball strategy?

Adam: Not as much as I once was. Really when I was active in the business the guys who were active always tried to get me to come out with them so that they could use me for target practice pretty much. They were a lot better than I was.

Matthew: Yeah, I’ve heard that story where some friends go out. Yeah, we went paintball and there’s one or two dudes out there that are like Rambo, and they just light everybody up and you’re done. Is that your experience? Were they using your equipment?

Adam: The sales staff had a background as tournament players, and they were quite good. I started much earlier and was much more modest in my abilities.

Matthew: It’s funny that you got into the beverage part of things, because when I moved to Boulder that was one of the first things that really sparked my interest is I saw some people around five or six in the afternoon or evening and instead of having a beer or wine, they busted out a cannabis infused beverage. And I thought wow, this is really crazy. Not only is this market segment going to really be popular, but it’s also cannibalizing alcohol, which is just a major, major seismic shift, and I couldn’t believe it. So, I think you picked the right pasture and that’s important.

Adam: You’re absolutely right. We’ve been seeing a lot of data recently come across talking about how industry analysts for the spirits industry are already starting to factor cannabis consumption into their forward projection. So, I think that says a lot, particularly when we’re seeing states that are collecting more tax revenue from cannabis than they are from alcohol. So, originally while Andy and Peter helped to refine the process and thinking about what consumers wanted, I’m glad we landed on beverage.

Initially the genesis of beverage was really my first experimentation. I was coming back from a cycling trip in central Washington. I was driving my 1983 Volkswagen Westfalia across the Cascade Pass, and if you’ve ever been in a Westie, you know those don’t exactly set land speed records. So, I had a lot of time to think, and on that drive started really thinking about the concept of a coffee product and infusing a coffee. So, as soon as I came home I grabbed my French Press, brewed up a pot, infused some cannabis that I had into a thick crème sort of base, and that was the genesis, kind of the first product. And suffice to say, when you can’t really lab test what you’re working with that initial brew was a little bit stronger than I anticipated. So, I went for a little bit of a nap that day, but it was the beginning of the concept.

Matthew: Where are we right in the Washington market holistically, if you’re looking at a 5,000 foot level?

Adam: So, at a high level we’re seeing tremendous growth in Washington. So according to BDS, and the last data we had was January 2017, sales were up 71 percent over January 2016. We’re happy to see that beverage sales were up over that, up 91 percent year-over-year. So we’re outpacing overall market growth, and I think what’s driving that Matt is people’s continuing… our expectations and our perceptions with regard to cannabis are maturing. So, two years ago when you walked in to a retailer or a dispensary you’d expect to see flower, and consumers came there to buy flower and now they’re seeing a variety of addition new novel products. They’re seeing how they can integrate this into their life.

Folks like me, my background, I was a marathon runner, a triathlete. I don’t necessarily want to smoke or vaporize cannabis. It’s just not my preferred method to enjoy the plant. So I think a lot of other folks are saying hey, I’m not going to buy a joint. I’m certainly not going to dab, but would I try an edible? Would I try a beverage? Would I try a sublingual spray that’s discreet and I can take anywhere. So, I think as people are willing to try these products, they’re saying hey this is for me. I like this and I can control the potency or my experience and that’s why I think we’re starting to see in these more niche categories, greater growth.

Matthew: Have you considered an infused paintball where you can medicate your friends and family from afar?

Adam: Whether they like it or not. I love it. I think there’s an opportunity here. We should talk.

Matthew: So, if someone’s just hearing about legal and Drift for the first time, your products, how do you introduce those? How do you summarize what they taste like, what the experience is like, what they do for you?

Adam: Sure, absolutely. So we’ll start with Legal. Legal is our line of beverages, and they’re an all natural, phenotype-specific beverage where we pair specific strain blends with natural terpenes found in fruit to create a consistent effect. So, that means whether you’re in Seattle or Scottsdale, you’re going to have the same effect of the product, because again we have a blended set of strains, which results in a certain ratio of cannabinoids in concert with the natural terpenes that we were very deliberate in the fruit that we use. Lemonine, Lemon, ginger. It’s a very calming, relaxing terpene in concert with the strain blends that we use, which are more of an (11.13 unclear), a little bit more of a heavy decarboxylation step up the CBN.

So, with all of our products we kind of began with the end in mind. What is the effect that we’re trying to achieve and how can we use natural products to achieve that effect. So, shifting over to Drift. Drift is our sublingual spray. It’s the ease of a vape pen without the smoke. It’s fast acting. You spray it underneath your tongue, and our patented formula allows you to feel the effect in just a few minutes. It’s precise. We actually ended up spending about five figures on the atomizer that it met the requirements of a volume measuring device set by the State of Washington. And what that means is each spray is 106 milligrams, so you can precisely dose yourself. There’s no guesswork involved and it’s discrete. You can take it anywhere. And the only thing that people know is that your breath tastes amazing and you probably have a little bit of a smile on your face in a couple of minutes.

Matthew: Right. I can see where you would really want that diffuser or atomizer to be precise because if you get that wrong it could be a different night than you expected.

Adam: True.

Matthew: So, how do you create products? Is it a whiteboard situation? You talked a little bit about how in Austin with your friends you were thinking about it, creating Mirth and so forth, but how do you actually arrive at something like Drift? Was there a light bulb moment, were you kind of riffing with people you know in the industry or how does that happen?

Adam: Here’s what’s kind of unique situation. I woke up one Saturday morning at my girlfriend’s house and I said we need to go to the brewing supply store, Whole Foods and a lab supply store. It kind of came to me one morning an idea to take an ethanol extracted cannabis, which was an aqueous solution. So it was suspended in an ethanol, and then be able to make a sprayable version of that. So, that was kind of the first generation of Drift that was just a random thought one morning. So, I think it’s part that random inspiration. It’s part I love going out in the field with our sales team and just visiting retailers and dispensaries.

I shut up and I let our team explain the product and it’s great to listen to our retailers and our dispensary partners. We’ve come to be very close with a lot of these retailers and they’ll tell us straight what they’re seeing in the market, what’s working. So that’s another element. Again we’ve gotten pretty sharp at using quantitative and qualitative research to give us additional feedback. We do Voice of Customer sessions on new products with folks to get feedback. So, also attend the cannabis shows, attend natural food shows. Just really exposing yourself to the broader market. I think that’s kind of the data end.

What bounds all of this thinking is really our desire to do something that’s different and better. We don’t want to be the me too guys. We don’t want to log into BDS or another analytics tool and say hey, what’s trending. Chocolate bars, we’re going to give them the chocolate bars. We just philosophically, we don’t see that we could add a lot. If we don’t see that we can add a lot of value in a specific area or with a specific product, we’ll typically stick out of it, unless we can say we can be the absolute best in the world with this product segment. Maybe we’ll look for something else.

Matthew: Okay. Interesting. You mentioned BDS and there’s some other market data companies out there that kind of aggregate the dispensary data, what’s selling and can give you some insights there. You mentioned, hey, chocolate bars are selling, we shouldn’t make chocolate bars, but a lot of people are saying hey we should or we should make gummies. Do you think there’s kind of a self-fulfilling prophecy in some of the data out there because people all kind of herd around these notions of what’s selling and then maybe they’ll say well I’ll just make a glow in the dark gummy. That will be my unique selling proposition and I’ll just get a sliver of this market? What are your thoughts around that?

Adam: You hit the nail on the head. It is you’ve got everybody who I think there is a tendency to skate to the puck, and we want to skate to where the puck is going to be. Philosophically we don’t think that the world needs yet another, as you mentioned, glow in the dark gummy worm. What we need is to say where’s the gap in the market? What is the use case for this product? How are people actually using it? Is it, hey, I’m off work, I just want to relax. Hey, I’m out with my friends and I don’t like alcohol. I want an alcohol alternative. How is it being used and how can we do something that’s really great. Our test is, is this something that we’d be proud to share with our friends and our family, from the ingredients, to the taste, to the effect. And if we don’t feel good about that, we have no business making it. So, I think if you create great product that you’re really proud of, the rest of the business has a tendency to take care of itself.

Matthew: Now when you look at the Washington and Oregon markets, how do you compare and contrast them in your mind?

Adam: So, we’ve been spending a good amount of time in Colorado and we’ve had substantive with a couple of potential partners in that state and also in Nevada. We’re looking for partners in various states to support. But I’d say that Washington is very similar to Colorado in the respect that it’s more established market. For the most part the regulators aren’t constantly changing the rules. And the kinks for the most part are worked out and that produces a more stable environment from a revenue standpoint. I think Oregon is a bit of a constantly changing regulatory environment.

There may be what, two years, behind Washington in having an adult use market. I hate to say that they’re an example of a bad regulatory environment, but if you have five months of revenue decline in a state, I mean, Oregon has not recovered from the revenue highs that it saw in the summer of 2016. I think that speaks to if regulators get too aggressive or they’re not mindful of what the effects are. This has started to affect tax revenue in the state. I suspect, and we’re seeing this as well, that the kinks are getting worked out, but Oregon is certainly a new environment and one where the constant change in regulations has produced an environment that sales have not come back to levels that we seen in 2016 and that’s especially stark when you contrast that with the sales growth that we seen in Washington and in Colorado.

Matthew: Yeah. It’s an amazing thing when the revenue is kind of their measuring stick. They’ll probably respond somewhat quickly when they see it’s going down. At least I’m thinking they will, because there’s no regulators or state politicians that really like to see that happen if they can avoid it.

Adam: And I suspect it will get figured out. Certainly the regulators are doing their job to make sure that we have a safe environment, which meets the requirements of the Cole Memo, which of course is a moving target right now with the Trump Administration and Jeff Sessions. We’re not sure what that’s going to look like in a few months. Hopefully we’ll have some greater clarity on that, but they’re doing their best to create a system that is a safe place for all of us to operate in, consumers and folks in the market and the industry. And I suspect they’ll have it solved within the next few months. We’re seeing stability start to appear back in the Oregon edible market.

Matthew: I have a theory that Trump is not going to be as bad as we’ve all feared for the cannabis industry because I think he looks at his presidency kind of like the ratings of the show the Apprentice, like his presidency is a show and he has to keep ratings up. It’s not popular among viewers to do anything nasty to this rising cannabis movement, especially when states have already voted with ballot measures. So I think there will be a moderation there. At least that’s my theory. I could be wrong on that, but I think he wants good ratings. So, we’ll see what happens. Go ahead. You have a comment there?

Adam: No, I hope you’re right. I agree if you play out all the pieces on the chess board, it doesn’t seem to be in the administration’s best interest to step in and go contrary to the will of, I guess now, 30 states and the District of Columbia, contrary to the will of those voters. Whatever they’d be prohibiting, what does that essentially look like? Do they want to create an environment where there’s not product safety? Do they want to create an environment where they’re taking tax revenue away from schools and firefighters and police and channel that money to essentially a failed state at our southern border? I don’t think the alternatives are good at all. So, I tend to agree with you Matt.

Matthew: I want to pivot back to your beverage Legal because I don’t often get an opportunity to talk with someone that’s making an infused beverage, and I want to kind of understand the nuances around that. How do you make a beverage shelf stable? I mean it’s important in an edible, but in a drink it seems even more complex to get the homogenous and shelf stable and all the different things that go in around it. Has that been a learning curve for you and what’s that been like?

Adam: Oh absolutely. I think it’s very easy to make a beverage, but it’s very difficult to make a good beverage. So, to give you an overview of our product, we have our Sparkling Pomegranate, that’s our sativa blend. We use the same three to five strains in that beverage. So, that’s an uplifting, euphoric, energetic sort of high. We have our Sparkling Rainier Cherry. It’s very much a focused, clear headed high. Our Lemon Ginger is the indica blend, which people describe as a body buzz, kind of a smooth, freeing head high. Our Cranberry CBD is a one to one ratio of THC to CBD. Our newest product is our espresso mocha, which is a cold coffee. It uses a sativa dominant hybrid, very mild uplifting, focus, great Sunday morning kind of chilling out working on the crossword, around the house, put on some jazz, that sort of vibe on the product.

So, those are the five flavors, the five effects. Kind of going back to your question, how do you prepare those and how do you make those shelf stable, obviously like any natural product, there’s a pasteurization. You have to heat the product, but the tolerances when you’re working with a natural product like we are, when you’re working with coffees, when you’re working with fruits it’s very similar to cannabis. You have the volatiles, the terpenes on fruit that can flash off early if you’re not very careful in your pasteurization process. Because we’re not introducing benzoates or other heavy duty preservatives in the product, we have to maintain and extremely clean manufacturing environment. Just the tolerances for any air in the product is much lower when you’re dealing with a natural product.

Matthew: Okay. Then, we talked a little bit about terpenes, but how about preserving those in the beverage over time? Is there any special considerations around that or things you had to discover about the terpenes in a beverage?

Adam: Sure. So, we have terpenes from two sources in our beverages. The first is from the cannabis itself, and any time that you introduce heat to the extraction or the distillation of cannabis there’s an opportunity that you’ll flash off those terpenes because their flash point, the point that they turn into the gas, is much lower than the heat necessary distill the other cannabinoids. So, that also applies to the fruit source of the terpenes. So, when you’re doing a pasteurization or you’re warming the fruit, if you aren’t mindful of the temperatures, you can flash off the terpenes, which affects not only the flavor quality of the beverage but also the functional nature of those terpenes in concert with the cannabinoids.

Matthew: Now you’re doing some innovative things with in-store marketing with refrigerators. Can you tell us a little bit about that technology you’re using there?

Adam: Sure. So, for several years we’ve had a custom wrapped refrigerators/coolers in the store.
When you come into a dispensary or a retail store, you’re going to buy a beverage, you prefer to have it cold as opposed to ambient room temperature. So, that has been a dramatic lift for us in terms of sales. We see anywhere between five to ten times the sales of those retailers who store the product in one of our refrigerated coolers. But we’re also starting to develop technology around LCD fridges. It’s pretty amazing technology where we can have an animated front cover to the fridge that describes the product, describes the effects where we integrate a lot of the videos that you can see on our website for the consumer in the store so they can learn about the product.

We’re also starting to experiment with some even more cutting edge technology on our in-store displays and coolers. Cameras that can see the consumer, can determine the age and the gender of who is standing in front of the cooler and could dynamically shift the content based on who is standing in front of it. We can log that information in terms of who is standing in front of the cooler, the actions that were taken, whether the fridge was opened. So these fridges are almost like your smartphone where they’re connected via Wi-Fi or internet back to us where we’re aggregating this data. How many times was the fridge opened, looking at the potentials of sensors or pressure pads within the fridge to augment the data that we receive from a BDS or (26.20 unclear) .io to make sure there’s always a product on the shelf and to be able to react to quicker to out of stocks, as well as just understanding who is your customer.

That is a question that I can’t really answer. I can tell you what my anecdotal experience is, but with this sort of technology integrated in the fridge, I can tell you in any zip code what day of the week, who the consumers were and for how long they interacted with one of our coolers.

Matthew: Wow, that’s amazing. I’m so glad my home refrigerator doesn’t market to me as I pass by with Drum Sticks and chocolate cake. I’d roll away down the street if that happened. Okay, wow, that is really cool. That’s amazing. So do you take that data to dispensaries that don’t have a cooler and say, hey look what can happen if we put a cooler in here?

Adam: Absolutely we do with our base coolers. The cool thing is when you’re in 400 stores you can do trials of different sorts of point of sale, and with the access to real-time data that we have with some of the analytics providers, can very quickly ascertain the effect of any change in point of sale. And once we have a demonstrated proof of concept we can scale that out across the network of stores that we sell in.

Matthew: Do you think it’s prohibitively difficult for new small entrants to get into the infused products business if they don’t have capital or haven’t raised capital, I mean? You’re a smart guy with a background in a lot of different skills in marketing. Can you really just come in with a good product and make a dent or has there got to be a lot of different skills brought to the table, besides capital; marketing, formulation, creating brand equity and so forth?

Adam: So, I think if you’re going to go into a highly competitive, developed, large segment of the market, you probably need to have capital. You need to have a team to the extent that you have a product that’s truly different and better, that makes it easier, but then you have another challenge, which is communicating to the market why it’s different and better, which is kind of the space that we fell into. People come to a dispensary, they expect to see flower or they expect to see a vape pen. The other products are kind of new to the consumer and then onerous is on us, as the brand owner and the manufacturer, to communicate the benefit, why it’s different and better.

So, really to the extent that you’re producing something that is different and better, I don’t think you have to rely so much on scale of operations and being the low cost producer and spending the most on marketing, than if you in a larger but more competitive product segment.

Matthew: Okay. Now, we haven’t gone over pricing. How much does Legal the drink and Drift the sublingual spray cost?

Adam: So, in Washington a 10mg Legal we price it to retail between $4 to $6 a bottle. So, we really want the brand to be accessible to consumers who haven’t tried it yet. We’ve seen in stores some of the data show a consistent growth in units per sale. So, we believe what’s driving that are consumers who are okay hey, I’ll try this. If I have a good experience, I’m going to come back and buy a few more. So, that’s our 10mg product. In Washington we sell up to 100mg product. In Oregon it goes up to 50mg product. So the price does increase as the potency does. Our Drift sublingual spray, I would say an average retail is between $30 to $40 in Washington State. That’s a 100mg product, 1.6mg per spray. And it comes in our Wind River Mint, which is our sativa, our Cinnamon Springs which is our hybrid, and our Lemon Chamomile, which is our indica blend.

Matthew: Those sound like great flavors, really do. How do you arrive at the cost a product should be and how do you position that with dispensaries then so everybody is making money and everybody along the food chain is happy? Is that a difficult thing? You’re sourcing your materials and your inputs and you want to make a profit, you want the dispensary to make a profit, but you want the price point to be attractive to the end consumer. So, what are your thoughts around that?

Adam: Sure. So, we know we have to live within some bounds of reality in what a consumer will spend in a given market. So, we think our product is substantially different and better. Again, thinking about Legal, the fact that it’s all natural, the fact that it is phenotype strain specific, that we’re really deliberate in terms of the fruit that we use to create an experience. That’s a much different total experience than hey it’s X mg of THC with red dye #40 and root beer flavor.

So, we think that that product can command a premium price versus that theoretical root beer product. That being said, we can’t be so dramatically higher that the consumer says hey, I see the value, but I’m not willing to pay twice as much as an example. So, we kind of began, what is it, IKEA begins with the price and works backwards. So we recognize that there’s a range in pricing that we can be at. We have different products that are at different price points and we try to be in the competitive range of pricing but never the low price leader. We really try to differentiate as opposed to one price. We differentiate on our ingredients and ultimately on the effect and the experience that the customer has.

Matthew: Yeah, you know, it’s never a good idea to compete on price. It’s like a race to the bottom then because there always seems to be some market participant that says, well I’ll lose money for my first six months. It’s like their strategy to get in and there’s always those ankle biters that are going to do that. So if you compete on price, you may be competing with someone that’s willing to take a loss as part of their strategy and that stinks.

Adam: Yeah.

Matthew: High level question here. What do you think the market for an infused product is, specifically in the Pacific Northwest, I mean you’re expanding, but that’s where you’ve started? What do you think it will look like five years from now?

Adam: I think we’ll see the continued decline of flower. And I think you’re going to see people gravitate to specific brands. I think right now no one has their brand of product that’s their go-to brand in the same way that maybe there’s a certain vineyard that you really like or there’s a certain type of beer, that you know, I’m a (33.49 unclear) guy. I don’t think folks have self-identified to brands yet, but I think that’s going to happen in the next few years. And for us that’s really the opportunity where we like the opportunity for people to try our product and say hey, Legal is my go-to, I love that Cranberry CBD. So, I think what we’re going to see in a larger sense in the market is continued development of unique and novel products, and I think that’s a positive. I think to the extent that people get away from the only view of cannabis is rolling a joint. It removes some of the stigma and I think that’s a positive thing for our industry.

Matthew: Adam, I like to ask a few personal development questions to help listeners get to know you a bit. With that, is there a book that has had a big impact on your life or way of thinking that you would like to share?

Adam: Sure. So, probably what stands out the most is a book called Blue Ocean Strategy. And the idea behind Blue Ocean Strategy is you don’t compete in red oceans of blood, which are based on competition and at a lowest price. And it essentially says, create something that’s different and better, that doesn’t directly compete with anyone else in the market. And so philosophically I think that sits well with us, and we don’t think the world needs another me too product. The world needs creative people who are making products that are different and better.

Matthew: Right, if there’s a Coke and a Pepsi, be Dr. Pepper.

Adam: Sure or become (35.37 unclear).

Matthew: Yeah right, right. Good points. Is there a tool, web-based or physical, that you consider vital to your day-to-day productivity?

Adam: You know, I think probably going back to a book. I read this ten years ago and I still use the principles. It’s Getting Things Done, by David Allen. It’s very tactical, but I’m still using what I’ve learned in that book. Also a big fan of Sandbox for email management, reminders, follow-ups, that sort of thing. It could be a bear if it’s not managed.

Matthew: Yeah, so what does Sandbox do for you?

Adam: So, Sandbox essentially can keep track of emails that you’ve sent that people haven’t responded to. You can BCC a reminder and say Friday at Sandbox.com and it will send you an email Friday morning asking you to follow-up on something. It will automatically sort your email into things that are not a priority. You can do a separate box. It doesn’t distract you with promotional emails. It will segment that and separate them.

Matthew: Very cool. And Getting Things Done, I read that book a few years ago and enjoyed it too. And the one thing I keep top of my mind is open loops where I don’t want to… open loops is this concept that there’s this background chatter of decisions we have to make like what’s for dinner. Do I have to get my oil changed next week? How about this or that? All these different things that we have to take some action on at some point and trying to close open loops so our mind has more bandwidth, because as much that doesn’t seem like those are important things, our mind is still kind of thinking about them in some way and there’s this churning going on. Is there anything else from Getting Things Done that you use day-to-day as your most important go-to tools?

Adam: Yeah and in the concept that you just described. I think it’s described as mind-like water in Getting Things Done, which is to the extent that you can take all these things that are floating around in your head and put them on a list. You pull them out of your head, which means your head is then available to be totally present and work on things that matter, as opposed to worrying about what you’ve forgotten. So, I agree there’s some general philosophy and that’s solid. Other elements that I like do it, drop it, delegate it. If you can do it in under two minutes, do it. Drop it, which is throw it away, don’t deal with it, or delegate it to someone else and ultimately defer it. So if it’s a project that you do have to do, calendaring it or tracking it somehow to make sure that it gets done. It’s a healthy way to deal with when you’re looking at a big inbox or a bunch of emails.

Matthew: So, then you use Sandbox to say email me about this in 30 days and then it’s out of your mind.

Adam: They number one way I use Sandbox, and this happens all the time, you’re working with someone on a project and they have a deliverable in a couple of days or next week. Hey Adam, I’ll get back to you on Thursday. So I’ll just CC that or BCC it to Friday at Sandbox.com with a little not to myself, have I heard back from Robert, and if I haven’t, I ping him. I follow up. Everyone else on our team is using it. It gives the impression that we’re on the ball over here and I guess we are, but the software certainly does a lot of heavy lifting.

Matthew: Now you raised some capital at the ArcView Group. Can you tell us about your experience there?

Adam: Sure, yeah. So, at RT we oversubscribed in November 2016 and even after we raised the round, I went to the next few ArcViews just because the folks that you meet there and the connections you have and the relationships you build are so valuable. I really like the format. I like the folks who are involved, and it’s something that I’m going to continue to attend, even though we’re not actively raising a round right now. We are looking for partners in various states to have the exclusive on our product where they become our licensee or our specific bottler in that state. So it’s just been a great environment to meet with our current investors and then also speak to folks who are prospective licensees or partners in other states.

Matthew: Do you want to throw out which states you’re looking for partners?

Adam: Sure. Again any of those 30 states that have a legal adult use or recreational program are potential licensing partner plus the District of Colombia. I guess, I think D.C. is a little behind, but most notably right now Colorado, Nevada, Massachusetts, really any other state that has a current medical program in place.

Matthew: Okay. Before we close, can you tell listeners how they can find Mirth Provisions and pick up some products or find you online?

Adam: Sure, yeah, www.mirthprovisions.com, and my RTH provisions.com.

Matthew: Awesome. Well Adam thanks so much for coming on the show today and educating us. We really appreciate it and good luck to you and with Provisions.

Adam: Hey, thanks a bunch Matt.


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The Five Disruptive Trends Shaping The Cannabis Industry Now

The Royalty Investing Model is Heating Up in The Cannabis Industry

marc lustig cannaroyalty

Marc Lustig CEO of CannaRoyalty joins the show today. While other industries have benefited from royal investments this is something new to the cannabis space. Listen in as Marc details the benefits of royalty investments for both investors and entrepreneurs.

Learn more at
http://cannaroyalty.com/

Key Takeaways:
[1:16] – What is CannaRoyalty
[2:05] – Marc’s background
[4:07] – Royalty investing and how CannaRoyaly fits in the investing landscape
[7:08] – Marc talks about the timing of CannaRoyalty
[8:52] – Timing on big investments in the cannabis space
[10:16] – What do entrepreneurs get from a royalty operation
[11:59] – Marc talks about his investments
[15:29] – Marc discusses managing investor expectations
[18:35] – Do current policies make investors nervous
[20:54] – Marc talks about how much capital they deploy
[24:59] – Marc talks about characteristics of a strong brand
[26:02] – Marc answers some personal development questions
[31:54] – Contact details for CannaRoyalty

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

Read Full Transcript

Matthew: Hi. I’m Matthew Kind. Every Monday look for a fresh new episode where I will take you behind the scenes and interview the insiders that are shaping the rapidly evolving cannabis industry. Learn more at www(dot)cannainsider(dot)com. That’s www(dot)cannainsider(dot)com. Now here’s your program.

Cannabis is getting sophisticated in borrowing the playbook from other industries such as mining and oil to create licensing revenue streams for investors. Here to tell us about it is Marc Lustig of CannaRoyalty. Marc, welcome to CannaInsider.

Marc: Thanks for having me Matt.

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

Marc: I’m in Vancouver today. That’s where my home is, but it’s also convenient given all the assets that we as CannaRoyalty own, that are either in Canada along the west coach or in the pacific west coast of the United States.

Matthew: Yeah it’s a good thing to be up there. If you’re down there, down in the states, you’re a semi outlaw. You don’t know what’s going to happen. It’s a roll of the dice to be in the cannabis business still. So I think you’ve picked a safe harbor.

Marc: True enough.

Matthew: So what is CannaRoyalty, for people who are unfamiliar with this type of investing vehicle?

Marc: CannaRoyalty is a company focused on aggregating strategic assets in the cannabis sector, which looks to create royalty structured returns for its shareholders. A royalty is like a hybrid of equity and debt where the royalty holder is paid a percentage of the sales or income of the investee company.

Matthew: Okay. So, I’m familiar with royalty, just not in the royalties, just not in the cannabis space. I’m a big fan and believer of some of the precious metals royalty companies like Franco Nevada and Silver Wheaton and been following them for a while. So, this is kind of taking playbook from another industry and applying it to the cannabis business so I’m anxious to unpack that, but before we do, can you give us a little bit of a background on yourself, both personally and professionally, and how you got into this business?

Marc: Sure. So I have graduate degrees in business and science, both from McGill University. I spent the first part of my career in the pharmaceutical industry at Merck. The next 12 years I worked in capital markets in North America and Europe. I was always focused in some way on healthcare and life science companies. In 2014, with the passing of federal medical cannabis legislation in Canada, I founded a private company called Cannabis Royalties and Holdings Corp, because I saw an opportunity to create something different than the standard Canadian license producer model that a lot of your subscribers would be familiar with.

So my thesis was that cannabis is a healthier alternative as a recreational product than alcohol or tobacco. So it can compete head-to-head with those types of products in that market, but the real upside to me and over and over that, which is already very attractive, is the unlimited upside that I see that can come from cannabis as the plant, which has never really had a chance to be researched or have had a chance to have modern, technological research applied to it. So when you start talking about the therapeutic advances of cannabis what’s where to me you see a lot more upsides. So the combined opportunity was really what drove me to found Cannabis Royalties and Holdings Corp.

Matthew: So before I mentioned how the precious metals industry and even the oil industry does some royalty operations. Can you explain and give some context on royalty investing in terms of how they do it and then talk a little bit in terms of how exactly CannaRoyalty is in the royalty space? Kind of compare the two but also get a context and a background.

Marc: Absolutely, and I think it’s the right context to provide, and by the way CannaRoyalty previously the private company being Cannabis Royalties and Holdings Corp was very much structured off of Franco Nevada. And so it works the same way in the mining or energy sector as it’s been working in the cannabis sector, although there are some differences obviously. For the company receiving the financing as a royalty it’s non-dilutive equity, and usually doesn’t have the same encumbrance that a debt would. For that same mining company or energy company, which is producing, let’s say, an ounce of gold or a barrel of oil, part of the sale of that product in the future is paid out to the investor in the form of a royalty.

So instead of that underlying company paying a dividend to its equity holders or paying an interest rate to its debt holders. The form or payback to the royalty investor is a slice of the sales or net income of the underlying company. The key variables are the same for all of these examples, which is what is the underlying health and reliability of the underlying business? What is the royalty rate itself? What is the term? So for how long is this royalty transaction going to play out? It can be a very short term or it can be in perpetuity. And what is the security that underpins the actual royalty should things not go as planned?

So from all of those perspectives, it’s identical investing in the cannabis sector as it would be investing in metals or energy-based royalties. The key difference would be really just a function of the period of time that we’re in. Mining and energy businesses are very well-known and have been being invested in for hundreds of years. Cannabis, not so much. So the fact that people are still reluctant to invest in cannabis for a variety of the different stigmas that we’re all aware of or because of the fragmented legal paradigms that exist between even Canada or the United States or other jurisdictions, there’s not a usual flow of capital that you would typically see from investors into the underlying companies, and that’s actually where CannaRoyalty has benefitted and played, I think, a very important role.

Matthew: And why is now the right time? I don’t recall coming across any other cannabis royalty firms or investment vehicles. Why did you feel now was the time to take the plunge?

Marc: Well, I mean, it’s really been two years. So it was first started in late 2014, but it’s still the same point, which is that to me it’s absolutely ideal. The timing is perfect because on one hand you have all of this growth and innovation of completely new products and new markets, but on the other hand, as I was sort of mentioning earlier, that access to capital has been constrained by the realities of the cannabis sector, whether that’s legally or because of stigmas that exist. So you have a thirst on behalf of entrepreneurs to access capital, but you have an unusual situation where that capital, either because banks won’t lend to the sector or because unless maybe you’re a Canadian licensed producer and you’re public, in which case you can’t access capital, the rest of the companies that are really just starting out or that are new or may just not have the experience in terms of raising capital are finding it difficult and that’s the gap that CannaRoyalty is looking to fill.

Matthew: Marc, is now the time to make really big investments in the cannabis space before the dust settles? I think there’s a lot of investors or potential investors listening that are thinking hey, I want to kind of wait until there’s more public companies where I can get more competitive analysis and real good information. All the ducks have to be in a row for some investors, but there is a certain amount of opportunity in an opaque market. Would you agree with that?

Marc: I mean, I believe it’s absolutely ideal. You know it’s the classic risk reward paradigm. But I believe because of the growth and progress in this sector has really just started, that you’re able to reduce that risk at the moment without commensurately reducing the return profile. So actually the opacity of the market is also helping a company like CannaRoyalty. I like to think that we give investors access to deals that they wouldn’t have a chance to gain access to on their own. And so from the perspective that these opportunities exist and they need capital yesterday and we’re there to provide what I think is an elegant structure in a non-diluted way to the end entrepreneur, it really gives our investors that exposure to a diversity of assets in a structure that I think is smart and also provides a lot of upside.

Matthew: And so for the entrepreneurs out there listening, what is the benefit to them in a royalty model? Why would they be interested in working with CannaRoyalty or another royalty operation? What do they get?

Marc: I think it’s a couple things. First of all, at a very basic level a royalty is non-dilutive to equity. And so if you’re really starting a business and you need capital badly, a lot people who are entrepreneurs end up regretting that they sold off so much of their company at such a low valuation only to see it flourish and them not own nearly enough of it as they would have like to. There’s also the aspect that debt carries with it, especially bank owned debt, would carry with it a lot of conveyance and a lot of restrictions that could limit their business.

So a royalty I think sits as a very nice alternative to both of those aspects. Over and above that, now I will talk sort of specifically about CannaRoyalty. I think that our model and our effort to be a partner with our investee company has played out very well. So not only are we providing a royalty financing but I think we’re providing a lot of other strategic advantages to our investee companies. We have every interest in making sure that our partners succeed. And to the extent that our platform gets bigger, we’re able to provide our partners with access to new markets or to other professional services perhaps where they wouldn’t have had access to those without us. So I think that the royalty model, especially from CannaRoyalty, provides an entrepreneur with a lot of flexibility and a lot of support.

Matthew: Can you tell us a little bit about some of the investments you’ve made today?

Marc: Sure, I mean, in a short interview it’s tough to sort of pick a few. I would summarize it by saying that we own parts of companies doing medical research in Canada such as (12.12 unclear), which is focused on the treatment of concussions using cannabis therapy. We own a part of a company in Canada called Anandia [ph], which is a leader in the area of genetics lab and testing expertise. We own real estate and infrastructure in Washington. We have a royalty on a processing and extraction facility in Oregon. We own a big cartridge company in California that’s doing exceptionally well. We currently have five of our own fully owned cannabis brands in the area of edibles, skin care line, animal health and various vaporization formulations that are our own proprietary brands.

We’re also in the process of closing a large investment into a leading distribution company in the state of California what we’re very excited by. I mean, in summary, we have 24 separate and unique investments. I would actually see this growing to more than 30 by the end of the year. In total we dot the map of Canada, the United States, Puerto Rico and I see us doing deals in Europe and Australia as well in addition to other states, particularly in the northeast like Massachusetts and Maryland are the areas that I see us adding deals to.

Matthew: Okay. And what’s the typical or average size of the investments?

Marc: The minimum investment that we’ve made of that 24 would be somewhere in the order of a half a million dollars. The largest would be about $5 million, exactly $5 million to date. The size of the investment is growing as we’ve grown. There are opportunities that we’re looking at now that are in the double digit million dollar investment range. And so I would say that the investment size is growing. There’s not a particular number that won’t work. Obviously it can’t be too small anymore because it won’t really have the impact that I think the platform now needs to keep growing, but generally let’s call it between a million and $5 million.

Matthew: Okay. And so, you mentioned the U.S. and Canada. Are they equally divided in terms of investments or are you a little bit heavier in Canada at the moment?

Marc: No. We’re probably heavier in the United States, at least by a number of assets. We are in the process of adding a fairly significant Canadian asset to that mix. Like I said, we’re also looking in some new states to add some U.S. assets, and in addition to that, I would expect by yearend to have other deals done, certainly one in particular in western Europe.

Matthew: Now let’s switch gears a little bit to investor expectations. How do you manage the expectations of investors in terms of the returns they can expect and anything else that they might expect?

Marc: Well I think a big part of it is first of all pointing out that we’re a public company. So in Canada we’re listed on the CSC under the ticker of CRZ. In the U.S. we’re listed on the OTC market under the ticker CNNRF. With being a public company we obviously have a number of disclosure obligations. And so financial reporting and compliance is a major part of that. In addition to that, I mean, our website I think is an excellent source of information for our investors specifically. Our business plan is dynamic in the sense that if we currently have 24 deals and we’re moving up to 30 deals, that can generate a fair amount of opportunity to communicate with our investors as to how those deals are doing or obviously the closing of any new transactions.

I think as a result of that, people either have or are going to start to get a pretty good feel for first of all, how we’re generating results or revenues or income. And then in addition, how they can think about what the return profile may look like from various of our investments or developments in our underlying assets.

Matthew: Now how does that work when you make an investment in a company that is in a state that’s not that friendly to out of staters like a Washington comes to mind?

Marc: That’s a good question. I mean I would point out first and foremost, the very highest criteria priority, from a criteria perspective, is compliance. So if there’s a state that we can’t invest in because of what you’re talking about, residency for example, then we don’t. Clearly that’s the end of that discussion. In Washington, the way that we structured our royalty transaction is that we actually finance the acquisition of property and equipment for a tenant who is the license holder, who is a Washington resident. And then in that sense our royalty structure looks and feels very much like a rate, as a way to work within the Washington legislation.

As you’re well aware, different states have different paradigms and so I think one of the advantages of CannaRoyalty has been to figure out in which states we can invest and then within that, which structures we can invest in compliantly.

Matthew: What does the current federal policy do to the risk in your business? I’m thinking particular in the United States. I mean, are you getting questions around Jeff Sessions being the Attorney General in the U.S. and does that make investors jittery at all? What’s your sense there?

Marc: Well absolutely current U.S. federal policy or whatever that is going to look like could present a risk to some of our U.S. assets. There’s no other way to say that. I mean, to be clear, we’re only invested in businesses today where state legislation supports the cannabis sector. We go a step further than that, which is that we don’t directly grow or distribute cannabis ourselves, so we don’t own any licenses directly.

We’re providing elegant financing solutions to companies that have IP or brands or different solutions for the cannabis sector. So we, as I said, focus on the compliance within the state and within the structure. Our hope is that either because of significant job growth or the obvious tax revenues or the economic stimulation that the cannabis sector is providing , in addition to the strong public support that you see across the United States, that there will be positive unification of federal policy with the state policy. I mean, even Jeff Sessions, a lot of the things that we think that he’s pointing out as being concerns, we share those concerns, whether it has to do with the transportation of cannabis across borders or whether it has to be getting higher restrictions around the young people who shouldn’t be taking cannabis, restricting the access to young people having access to cannabis.

I mean a lot of those things make very good sense. So our hope is that the federal policy aligns with the state policy and preserves the right of the state legislation to conduct its cannabis policy. I mean, clearly in other jurisdiction, such as Canada or Europe, where we’re particularly seeing a lot of opportunity, the federal policy supports the cannabis sector. So the risk there is minimal.

Matthew: And how much capital are you going to deploy? In other words, when do you stop investing? I mean as more capital comes in, do you find new opportunities, or how do you think about that?

Marc: I mean, we’re seeing more opportunities today than ever in the two and a half years that we’ve been CannaRoyalty. The opportunities today are more exceptional than we’ve seen. We have a number of different sources of capital to be able to provide bigger and bigger deals, whether that’s either internal funding or external. I mean, to date we’ve invested approximately $30 million. We’ve raised approximately $45 million to date. So we have ample capital to go and execute a number of new deals, which is obviously what we’ll be doing.

I mean it would be easy to stop investing and sit back and collect all the various streams of return from the investments that we’ve made to date and wind things up, except our view is that we’re taking advantage of a unique period of time in the sector right now where the growth and innovation is rampant. And we have a model that I think supplies the capital in a way that gives our investors exceptional return potential at a time, as I mentioned earlier in this discussion, other investors, whether they’re equity investors or debt investors just haven’t gotten around yet to being there. So we look at it very much like a land grab, if you will, where we can put these assets together still at very good valuations and eventually that will end. The market will become more competitive, certainly when federal legislation does change and you do see pharmaceutical companies or tobacco companies or alcohol and spirits companies coming into this sector. It will make the competition for the assets that we’re currently aggregating much higher.

It will make the asset values a lot more expensive, and that may be the time where we would be in a position to debate whether we should continue or not, but for the time being we see this as a really open field with a great model, and again being able to provide our investors with a lot of exposure to deals that they just wouldn’t be able to get access to on their own.

Matthew: Do you think as more competition comes in and the spirits companies, tobacco companies, pharmaceutical companies come into the picture and they have obviously access to capital, do you think you would find yourself becoming less generalist and more focused maybe on a couple different verticals within the cannabis space, instead of being across such a broad spectrum?

Marc: Absolutely. I mean, at that time I think our company would create a very nice solution for any of those larger companies. Having said that, our focus is very disciplined. I mean if you were to really synthesize down the types of investments that we have in our portfolio today, it would really come down to research, IP, intellectual property brands and delivery devices would be the areas that we’re most focused on. So we don’t and have not yet invested in any broad based cultivation play. We’ve stayed away from some of the more general aspects of the cannabis sector that we think are at risk of commoditization. And I think our focus will only continue to get refined in the areas of brands and devices and things that can sustain and increase their value as more product development and innovation happens within the sector.

Matthew: You mentioned brands there. What do you think the characteristics are of a strong brand that has enduring brand equity?

Marc: Well first of all, I think that it’s protection in the sense that it can’t be copied or made easily by anybody else is probably the highest end of that spectrum. Beyond that it really has to do with the impact at the customer level or patient level, whatever the case may be. And all of our products, we’re most focused on quality and effectiveness. And so to the extent that we’re able to provide that for our customers or the patients, we think that that’s the most enduring quality behind brand equity.

Matthew: Yeah, building the protective moat, as Warren Buffet likes to say.

Marc: Exactly right.

Matthew: Okay. So Marc this is a time when I like to transition to some personal development questions to give listeners a sense of who you are. With that, is there a book that has had a big impact on your life or your way of thinking that you would like to share?

Marc: Sure, I mean, I’m very big into climbing, mountain climbing. I’ve climbed some of the bigger mountains in the world, whether it’s in Africa or Asia. Later this year I’ll be climbing in South America. So particularly books about climbing, especially Everest, which I have not climbed and probably won’t get around to in this lifetime, but particularly books around Everest and probably the significant thing The Assent on Everest by John Hunt, have been the greatest diversions for me from a very busy business and personal life, but also very strong inspirations for one of the things I really like to do.

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

Marc: I’m pretty old school. I can imagine that a lot of the people that you interview would have a really sexy app on their phone or computer or something. I hand write a list every morning of all the different ideas and action items that I need to follow through on every day. What doesn’t get done on one day starts the list for the next day. I’ve become sort of paranoid about leaving things undone on that list. So unless I get them crossed off, it’s a good way for me to start a new day to make sure that things get followed through on. So I would say that’s probably my greatest tool for my own personal productivity, but again it’s in the dark ages, but I’m comfortable with it.

Matthew: You know, there’s something to be said for the tactile sensation of a physical list where you don’t have to turn on the glowing blue screen to get the answer. So I can understand that, and there’s satisfaction in crossing it off.

Marc: Yeah, that’s right.

Matthew: One last question. You being a Canadian, do you find the only difference between Americans and Canadians is that Canadians are just a little bit friendlier? Remember we’ve got a lot of potential investors listening.

Marc: That has not been my experience. I think that North Americans generally are very friendly. I just spent a week in Europe where I can’t really say that was the case where I was in Europe. I happened to be in Germany, and I just think North Americans generally are very friendly. I lived in Europe for four years, in London, where certainly the European perspective is that there’s a significant difference between Canadians and Americans, but myself being Canadian, but having a lot to do and basically spending half of my time, if not more, in the United States.

I’ve got so many friends and so many people that I really enjoy and like who are American that I’ve sort of seen through any of those perceptions that there is a difference. I look at it as one large convent, and generally I’ve been lucky because I think everyone’s been quite friendly on both sides of the border.

Matthew: That’s good. That was a great answer. We should put that in a political case study for how you conflated those two together to appeal to your investors.

Marc: And if we’re speaking offline, I know a lot of assholes in Canada. So I don’t really see it the same way.

Matthew: One thing, my cousin fishes with a lot of Canadians, and back when cannabis was illegal, he did comment that he said, it’s cheap for us to buy beer, but in Canada it’s cheaper for them to buy pot and it’s expensive for them to buy beer. I though oh, that’s kind of interesting.

Marc: BC Bud, which I’m sure you’re well aware of, has been as prevalent here in Canada as (30.19 unclear), which are the two large beer companies, like Canadian fixtures. But BC Bud, if it weren’t for the fact it was illegal, it would have been just as prominent as either of those two brands.

Matthew: Now, one last question before we close. Do you know what the national sport of Canada is?

Marc: Since you ask and because of how you asked it, I’m going to guess that it’s not the normal ice hockey, which would be the easy answer. I’m going to guess it’s Lacrosse.

Matthew: Oh, he’s right. That was good. I was hoping to trick you there. I thought you might go for that… what’s that game where you push the large thing across ice. What’s that called, where they roll the huge thing and then they have a little duster in front of it and it’s going on the ice.

Marc: Curling.

Matthew: Curling, I thought you might say curling, but you got it right. It’s lacrosse.

Marc: Our roots are based in native as anywhere else. Really it’s all about native settlers and lacrosse was the game of choice. It’s not that much of a stretch. I don’t even know, as a separate topic, whether you call curling a game. If someone does, I would like to understand how they justify that sport I should say, but anyways, glad I got that one.

Matthew: Yeah. Good. Well, as we close, can you tell listeners the best way to learn more about CannaRoyalty?

Marc: Absolutely. As I’ve mentioned, I think our website is extremely informative and dynamic, and being updated regularly, especially for a company that’s generating as many different new developments as we are. So that website is www.cannaroyalty.com. There is a way for anyone who visits that website to be added to our corporate investor relations distribution list, which I would say would probably be the starting point for anyone who is looking for more information about CannaRoyalty. Once you’re on that list, like I said, you can expect as a shareholder to get fairly consistent updates. I mean we generate a lot of developments that I think keep the investor or prospective investor or even interested cannabis enthusiasts in the loop on different things that we’re working on.

Matthew: Great. Well Marc, thanks so much for coming on the show and introducing us to this topic of royalty investing. It’s really something of interest to me, and I think this sector is only going to grow as the whole industry grows. So good luck to you.

Marc: My pleasure Matt. Thanks a lot of having me and congratulations on your show. I can tell you I get a lot of cannabis related media or reporting for different types of services, and I think yours is at the top of the list.

Matthew: Alright, can’t hear that enough. Thanks Marc.

Join CannaInsider For FREE & Receive
The Five Disruptive Trends Shaping The Cannabis Industry Now

Savvy Cannabis Investors Pivoting to Markets Beyond North America

anthony wile cannabis colombia

Anthony Wile is the founder of The Wile Group. The Wile Group International is a value-added venture capital firm focused on powering private investment opportunities. Anthony talks about the cannabis landscape and why he is investing in South America cannabis companies.

Anthony has a keen eye for trends and has been remarkably prescient in predicting large tectonic political shifts and business opportunities.

Learn more at:
http://wilegroup.com/en/

Key Takeaways:
[1:24] – Anthony’s background
[4:04] – Status of cannabis legalization investments
[14:56] – Anthony talks about when the conversation around cannabis changed
[21:17] – Anthony gives examples of cannabis legalization unfolding
[26:12] – What role will Big Pharma and Big Tobacco play in cannabis legalization
[32:10] – Who do the government regulators really protect
[37:45] – Anthony talks about equatorial locations being ideal for cannabis cultivation
[43:00] – Why is Colombia ideal for cultivation
[52:37] – Flower to oil trend over the next five to ten years
[1:00:17] – Anthony compares and contrasts Canada and Colombia’s cannabis market
[1:05:29] – Anthony talks about block chain technology
[1:06:23] – Anthony answers some personal development questions
[1:14:29] – Anthony’s contact info

Important:
What are the 5 trends that will disrupt the cannabis in the next five years?
Find out with your free cheat sheet at https://www.cannainsider.com/trends

Read Full Transcript

As the walls of cannabis prohibition continue to fall around us, many of us assume it was the grassroots will of the people that made cannabis legalization possible. However, there are many that see cannabis legalization in the world in general through and entirely different lens. One of those with a different lens on cannabis and the world is our guest today, Anthony Wile. Anthony has a unique and refreshing perspective on a variety of topics from politics to international cannabis opportunities. Anthony, welcome to CannaInsider.

Anthony: Thanks Matt. It’s a pleasure to be here.

Matthew: Anthony, give listeners a sense of geography. Can you tell us where you are in the world today?

Anthony: Well I live in Toronto, Canada, and I also live part time in Medellin, Colombia. Those would be the two primary areas of living, and also from a work perspective, the majority of my time and energy has been spent in the country of Colombia for the past few years, and I anticipate it to be similar moving forward for quite a long period of time.

Matthew: Can you give us a little bit of a background on yourself, both personally and professionally?

Anthony: Sure. Well, I grew up in Canada, and went to a university, studied business, all those things and graduated and went on to work. Spent a few years working in the Canadian financial industry with a couple of the larger banks, investment arms. Before moving on to establish my own brokerage operations internationally, which at that time took me away from Canada at a fairly young age. I was about 26-27 years old when I became a non-resident Canadian and started living internationally and focusing on developing business opportunities abroad. That transitioned into a lot of different avenues, I guess you’d say, over the years, in terms of living and work related situations.

I’ve done business in many countries around the world, in Asia and Europe and South America, pretty much all over the world. And lived in several different countries over that time, with my wife and children. We’ve spent a fairly international, I guess you’d say, we’ve had a fairly international life experience. I don’t anticipate that changing so much. However, it’s always been reflective of where in the world I see or perceive financial trends to be emerging . That would be trends with sustainability over a mid to long period of time. Where we as a group, business group I’m referring to, felt it made sense to try and get in front of such trends, and then where in the world from a top down perspective, it made sense to be much like in the cannabis industry today.

We’ve identified Colombia, as a country that would be among the top, and in our case, our opinion would be the top choice destination for building business opportunities. So destination and living arrangements and business arrangements for me and my family and my business associates has always been driven by where the best opportunities are to develop ideas over time. We are a private equity group, primarily, who spread ourselves not too thin. In other words, we get involved with no more than two or three ideas over a five to ten year period, and we put our time, our money and our energy behind those efforts. In other words we’re all in when we get involved in anything that we’re involved with.

Matthew: You were one of the early voices talking and writing about cannabis legalization investment opportunities. Where are we today in terms of the cannabis legalization investment story, particularly in terms of internationally?

Anthony: Well, we’re very early. If we were going to use an analogy, I guess I would say we’re somewhere in the early part of the first inning of a ballgame. This industry has a lot of curves to straighten out in terms of regulatory synchronization, standardization of products. On many levels, there are a lot of issues to be addressed and a lot of stakeholders with different perspectives that need to be listened to, that need to be brought into the fold when straightening out those curves in order to get adoption by a greater portion of society.

At this time, you can certainly see there’s a lot of regional development occurring in countries like Canada, for example, which you have to put at the forefront of innovation in this space. I would say Colombia is very quickly now moving in that direction as well, based upon their regulatory and legislative maneuvering. Then at that international level, if you look at what the WHO and UN and other related bodies, NGOs and others are doing in this conversation at this time and how they’re helping to shape the future of where this is going, it is truly an international discussion and one that will require international support in order for this industry to become a global industry that rivals what you see with any other heavily regulated industry, such as spirits, alcohol, those sorts of things.

So there’s a lot of change, a lot of turbulence in some cases, and a lot of uncertainty that comes with that. You really need to step back a little bit I believe and pause. In an article I wrote in the Globe and Mail about a year ago in Canada, that’s one of Canada’s larger financial papers, and in that article I cautioned investors at that time to take a step back. It doesn’t mean you can’t make money in the marketplace off of the emotionally charged environment that often accompanies early trends or emerging sectors. No different than what we saw with technology stocks in the 1990s, but that emotional, in some cases irrationality can be very painful when regulatory and legislative changes occur that can dramatically effect revenue projections or other related concerns that should be of a concern to any investor who are looking to invest on fundamentals.

At least from our perspective as a group, we’re interested in being involved in developing businesses that are fundamentally sound and are looking to the future, planning as best as possible with knowledge and real-time information, and think with the trends, where they’re headed. Not necessarily what they’re doing today in any given marketplace, whether it be Canada or Uruguay or wherever it may be, but looking at the global synchronization and what that likely will lead to, and we think most investors who are looking for their capital they deployed in situations that will be standing tall post-fallout of whatever happens. It happens in every trend you’ve ever seen in history. There’s always a bubble. There’s always emotional instability that leads to that bubble as irrational investors run into whatever story sounds the best today, tomorrow, with very little due diligence. That’s an historical fact.

I mean you just have to go back and look at any of the big bubbles over time, and most recently you can take look at the tech stock industry. You can take a look at gold in 2006-2007. There’s many recent opportunities for analysis of said activity, but again there is opportunity out there. I think it’s just a matter of letting the global community and the regional governments that are part of that global community to work together to try and shape legislation that will allow for this industry to truly take root in a way that is sustainable over the long haul in all aspects. Not just from a profitability perspective, but environmentally and socially.

Matthew: I think you’re definitely right about the bubble aspect of cannabis, especially cannabis stocks, but it seems like they’re kind of blowing up into micro bubbles and popping and then blowing up again into a micro bubble and popping. I’m still waiting for the huge bubble. Maybe it just needs to be federally legal in a bigger market like the U.S. at some point before that happens. I don’t know, but I’ve been kind of watching that with interest. Also to your point about narratives, how we as humans become kind of aligned with a narrative and then assume that narrative is right. Over and over again I’m thinking tech stocks in the late 90s and then the housing flipping going on in the mid 2000s and whatever will come next. It’s kind of the tulip mania of the decade.

Anthony: I couldn’t agree with you more, and to add to your point. What you said at the first part of what you just mentioned here about New York and the U.S. To me this is as obvious as the day is long that this industry… when I said earlier that it was in the early phases of development it truly is. When you look at the global commission for drug reform and who the people are that paint that tape, in terms of the members of that commission, you’re talking serious names in global politics, from the upper chambers of finance and business. These are not small people, and the essence of what they’re driving towards and what they’re pushing towards, with a lot of support from a lot of governments, especially those governments in Latin America, is to see a wholesale change in transformation and the way the war on drugs is dealt with and to go in the direction of legalization and control channel distribution.

When you look at New York and you look at the United States I could care less what happened with Donald Trump and the charade of Hillary Clinton and that whole thing in the recent election, but I was certainly paying attention to what was happening in Massachusetts and in California and those different states that were voting for legalization. And when you see a state like California, I think it’s the fifth or sixth, I can’t remember the exact number, but largest economy in the world voting in favor. Of course that’s contrary to federal legislation in the United States. I mean how much longer can this, and I’ll use the terms again, charade continue in the U.S. with federal prohibition when you have 22 percent, as of today, of the population living in cannabis legal states, and somewhere north of 60 percent living in states with some form of cannabis legalization, medicinally or otherwise.

I mean there’s a point here where this changes, and I hear a lot of people talking about Donald Trump’s choices for this or that and how that will affect the industry. And I look at this as a very simple matter. It’s dollars and cents and Donald Trump is a business person first and foremost, more than he is an evangelical do gooder, if you will. Not to say that there’s anything wrong with evangelical do gooders here, but the point is that is not him, and the reality is is that this is a business and a business decision and all they have to do is you look at Canada north, and you say Canada is in the middle of going through a legislative policy implementation program here to legalize their industry, and that’s going to be forthcoming, and when it does, does anyone really think that the United States under Trump or anybody else is going to want to see dollars heading north for the weekends and otherwise to access cannabis from states that border Canada, and that’s a big border, that don’t’ have cannabis legal states at that time, or the cross-border loss of capital from one state to another.

How much longer will you (11.54 unclear) their ski resorts suffer under the pressure of Colorado ski resorts picking it up from the millennials and otherwise who choose to go there because they can enjoy legal cannabis at the same time. I mean, it has an effect on many different stakeholders that some point in time, and I would suggest sooner than later but we’ll see, over the course of the next two or three years, I’ll be shocked if we don’t see a change in regulatory policy at the federal level in the United States. And it’s also not going unnoticed in New York. If you talk to any investment bankers in New York, they see what’s happening in Canada. They see the enthusiasm that the public has for these cannabis stocks, if you will, and Wall Street doesn’t like to be missing out on let’s say revenue opportunities. That’s just not their nature.

So there’s a lot of pressure, a lot of pressure to come that will in my opinion lead to a opportunity for companies to access capital in New York. I expect at that time Wall Street will do what they always do, which is drain every last ounce of sweat, blood and tears out of the trend, like we saw with tech stocks, and that means that this first inning warm up that we’re seeing in Canada will likely become replicated in the United States, and probably taken to heightened levels of enthusiasm even more so than we see here north of the border today. So for a lot of reasons, mostly due to just the realization that today there really isn’t a lot of speculative activity feeding the general market. Gold is fairly stagnant. It has it’s days. It’s up, it’s down, it’s a little sideways. Oil is relatively, let’s just say deflated, at least in terms of investor speculative interest.

Also because of its low levels of pricing today has affected people’s appetite for alternative energy at related issues. So on technology spot you wouldn’t call that a trend. You don’t have a lot of competing trends in the marketplace for investor speculative capital, and the only real bright spot you can see on the horizon, and that is showing itself to be very bright, is this emerging cannabis sector trend, and we’ve been writing about this now for, I don’t e even know now, three and a half years or so, from a macro level perspective, dealing with these sorts of issues, and that’s also what led us to decide to get into this industry and then of course the next question was how did we get in and what was the best way to position ourselves for what we believe was sustainable long term approach that would yield the kind of returns that we would be looking for in anybody who tends to listen to what it is that we’re talking about.

Matthew: A few years back you correctly saw there were voices from the power centers that were starting to reframe the conversation around cannabis. Can you tell us when you first started noticing that conversation around cannabis changing, and what in particular made you feel that cannabis prohibition was ending?

Anthony: Well, I would say that there were a number of things that added into that. There’s not a light switch that just flipped on at some moment in time. I will tell you though, it’s kind of funny, the first time that anybody mentioned to me anything to do with cannabis I got a phone call from somebody that I had gone to the university with and hadn’t talked to for years. I think they came to me through my LinkedIn account or something, and said, what do you think about taking a look at a cannabis company opportunity.

That might be four years or four and a half years ago, and I said, geeze I don’t know what you’re talking about. I have no interest in cannabis. I really didn’t give it any thought at all. And over a period of a month or two and whatever it was after that, I started to notice more and more information coming out about cannabis. I just thought of it as some radical subculture movement that was in the process of evolving, that would never get any real traction or find any support passed a certain level. And then I started really digging into it. We have a fairly deep group of talented researchers that work with us on an ongoing basis and we started getting into this and saying let’s take a look and really see, is there anything behind this?

It started to smolder a bit, is what I’ll say, in our minds. A little bit of smoke started to generate and before too long we started to realize there’s something to this. This isn’t just a bunch of guys that have been growing in their basement, trying to knock on some doors and get some low level municipal government people onside and all that sort of thing. Of course all that happened too, but at the same time, wow, there’s quite a serious push here happening around the world. Many of the larger think tanks and brain trusts that have been pushing this forward, and credit to them. I mean, they’ve done a great job, I mean, in terms of moving the Hegelian dialectic, in this case, moving those posts very quickly. More quickly than most would have thought, and myself included.

I didn’t expect things to move necessarily as fast as they’re moving in this regard, but it became very obvious that there were extremely powerful financial hands behind it, and I would go back to that Global Commission for Drug Reform. When I really started looking into that, and looking into some of the financing that was happening behind some of the larger policy organizations that were really pushing, I mean global policy organizations, and then started having some meetings on a personal level with government leaders in Latin America, which fortunately I have some very strong relationships at the higher levels of politics, that enabled a better understanding as to where the real stakeholders’ interests were and what the thoughts were on an international level, which included having meetings in Geneva with several people who have a great deal of knowledge of what’s happen within the UN and the WHO and other organizations such as this, so that we could get a really firm grasp on we thought at least became the outcome.

To make it very clear, we went into this analyzing this trend and what we thought might occur with the attitude, as we always do, let’s find the holes in this, and let’s see why we shouldn’t as because we weren’t doing anything really at the time, why we shouldn’t do something, which is how we always approach things is looking for the negatives, looking for the holes in the story or the reasons why there fundamentally isn’t as much soundness as it may appear on the front side of the painting, if you will.

What we found was that the brush strokes were actually much deeper and much crisper and much better than we had anticipated they would be. We discovered that not only is the trend very much alive, but this trend seems to be fairly unstoppable, and there were a lot of reasons for it that became quite clear over time. And today, clearly what we can all see is that the train has left the station, that preverbal saying, but it is the case, and it’s moving quickly, and it’s moving at an international level. Anyone that was at the (19:17 unclear) in New York last April, which we did attend, and had a lot of very good feedback, good meetings. What we do know and we continue to have active conversation.

We have lots of people involved with us in Geneva, who are actively involved in what we’re involved with, and we try to stay on top of everything that is happening that could affect anything to do with legislative policy or standardization related issues, any of these sorts of matters, which are critically important to understand in this industry from an investment point of view and to manage your investment portfolio accordingly.

So that is what I would say. To answer your question, we saw that there’s a lot of significant power at an international and regional government level. And from international business men and women whose voices more than matter in the global conversation of where things are headed in any industry. So this industry is not one that we would subscribe to as being driven necessarily from the grassroots entirely, but we would certainly give a large amount of credit to the grassroots as well and what they’ve done to push this conversation. Because without the grassroots support, we probably wouldn’t see anything close to what we do see today. So I wouldn’t make it an all or none scenario. I would just say it’s nice to see that it is something that has the attention and the support of the necessary components that it will require and has required in order to advance the conversation and the direction that it will continue to move in our opinion.

Matthew: To many people cannabis legalization is happening as a response to decades of pressure from grassroots activism. What you’re saying sounds like you’re attributing much authority to those in positions of power. Do you have any more accessible examples of other situations similar to cannabis legalization unfolding?

Anthony: Wow, that’s something I haven’t thought about. I mean, I guess, no I don’t off the top of my head. An example that’s a direct parallel to this, I mean, first of all it’s hard to find a direct parallel. The only thing you can really come up with where you an existing industry that is black, if you will, that is turning white, I mean you’ve got to go back 100 years ago to the end of prohibition. Most markets of course, even the tech market of the 90s, I’ll even go back further than that. I remember in the cellphone industry, in the dawn of the cellphone industry when the presentations were being given and people were raising capital for it and there were hundreds of companies that were startups trying to become the next big cellphone company.

There were people that would be in the room that would ask the question of who would ever want to carry a telephone around like that. It’s true, but in the moment in time, I mean, it’s a viable thing to think about. Historically speaking, I mean you see where we are today, sounds ridiculous, but at the frontend of any trend that involves new technologies or innovations or whatever it may be, you first must do a market assessment as to what the potential market size of those products may or may not be, and that’s the first buy in that any investor has to have before your numbers of what your percentage of potential possibility of market share might be.

So in this case though that’s not the case at all. Everybody knows that there is a live and booming global market for black market cannabis, and that there has been one for many many decades. That’s a totally different situation than dealing with any new market that might come along. So to give you a parallel that could be even close to that is difficult. The one thing that makes this such an explosively powerful market from an investor point of view, I’m talking emotionally again, is the fact there is no need for a water cooler discussion or an explanation about what is the product. You say what the product is, and immediately okay, I get that. I mean, we understand what it is. That’s perfect.

That makes a very simple, easy, mass marketable trend, if you will, for Wall Street or Bay Street or any street that’s involved in the financial markets to gain investor interest, and you don’t need to convince anybody that that market is a very profitable market. Again I would go back to the fall of prohibition and say that much like that era, you have a lot of regulatory oversight that falls into play. You have a lot of synchronization of efforts that come into play. Just look at alcohol. Why is it when I get off a plane in Prague or in Canada or wherever it might be, any city in the world practically and I want to buy a bottle of spirits; vodka, rum, whatever it might be, why is it that they’re all pretty much capped out at about 40 percent? How did that come to be? Was it somebody just wrote it down and they all agreed?

The answer is no. These things, these standardizations occur over time, and it occurs with all kinds of input from all kinds of people and party stakeholders or otherwise; social, political, all those things. That’s the same kind of process that we haven’t really started really yet to any great extent, getting to in the cannabis space. So as we move forward, what I see is simply that there’s an industry here that has obviously garnered the support of very large hands, lots of investors around the world. There should be caution flags. I believe more caution flags than less along the way for people who are paying attentions. At the end of the day just like in cell phones, just like in technology stocks, just like at the end of prohibition, you’ll have a few large hands that likely will be predominantly in control of the market, just like you had with most things in the world, if you look around. I mean, that’s just the way it is and likely that will be the way it is in this industry as well.

So there’s money to be made and on the speculation that that’s what you’re looking for is just to speculate, chances are you can buy and sell and do fairly well in the emotionally charged environment in which we find ourselves today in what you see, for example, Canada. At least for our perspective, again I’ll come back to the fact that we’re more interested in being one of those few that are left standing longer term. That’s the objective, that’s where the real long term multigenerational wealth and value will be created.

Matthew: One of the trends I see as potentially happening is hybrid medications of cannabis or a compound of cannabis with the tradition pharmaceutical. What role do you see Big Pharma and Big Tobacco having in the cannabis legalization landscape over the next few years?

Anthony: Well I see a dominant role. I think your question about the pharmaceutical industry, I agree with you 100 percent. There’s a lot of people out there that actually believe that cannabis is going to change the way that the world works when it comes to what is medicine and how medicine is distributed, all those sorts of related issues. I would argue that that is fool hearty and I would suggest that cannabis will fit to the way that the world has structured itself, with respect to how medicines are dealt with, regulated and distributed and otherwise. And then you just take a look at who controls the majority of what fits on the shelves when you walk into a pharmacy somewhere to buy your medicines or your doctor prescribes it or whatever it might be. And what you find, of course, are that there are again what I mentioned a few minutes ago. There tend to be a fairly small number of very large corporations at the end of the day who dominate the landscape in any given sector.

In the pharmaceutical industry it’s no different. If anybody really believes that some little tiny company out of wherever it might be is going to boot Pfizer or Roche or any of these other companies off the shelf anytime soon in extremely valueable markets, I think that’s kind of a fool hearty thing to believe. I believe what you said, and I agree with that entirely, there will be pharmaceutical companies who will pull certain molecules from the cannabis plant and utilize them as part of the makeup of existing drugs, in many cases.

I mean if you look at a company that has seven years left on a patent for some specific medication that cannabis may be able to be beneficial in that particular sector, that market, that niche, if you will, it’s clearly in their advantage to reformulate with slight modifications and file a new patent around the new modification. The trend in the pharmaceutical industry is towards more of a buy it bio-pharma make-up. I mean, that’s obvious as well. That’s factual. It has a lower period of time to get to market for the new products. It’s less costly, but still very costly, and that’s the other issue here.

I mean, at the end of the day the FDA, DMA, Health Canada, all these different organizations, some of us may know what regulatory democracy is, and regulatory democracy, for those who don’t know, is really built on the shoulders of those large corporate interests that dominate the landscape in any given sector. The regulatory hurdles that are put in place are, yes, they appear to be very onerous for them and for anyone else in the industry, but the reality is they’re really putting barriers between themselves and anyone else who would try to become competition to them because they can handle the financial costs. They have the ability through their consultants and their lobbyists and otherwise to move things along through the process.

They also have the ability to make sure that other things don’t get moved along through the process that could be a threat or otherwise. So I don’t see anything changing in the medicinal marketplace, with respect to who it is that’s dominating the shelves or the prescription pads of the medical community at large, but I also, back to your point again, do see the pharmaceutical industry recognizing the power that comes from harnessing some molecules, CBD or THC or whatever it might be, from within the cannabis plant and incorporating it into some of their existing formulations or perhaps developing entirely new formulations. Definitely I would not be betting significant amounts of capital on companies that were professing to be the new drug company in the game.

If they are fortunate enough to take something far enough, I would suggest eventually if it’s a big enough market and there’s enough money in it, they’ll be swallowed up by that large pharmaceutical company anyway, which is typically how that works. And those are big homeruns. If you’re part of one of those, by all means, fantastic, but at least I know from our perspective, we’d be more interested in supplying the molecules than trying to develop the formulations ourselves.

Matthew: You had a great point there about how the regulators operate. It seems like the regulatory bodies in the U.S. government are not so much there to protect the consumer as they are to protect certain corporate interests. Perfect case in point would be the electronic cigarette industry, which recently the FDA said, you have to go through millions of dollars of jumping through hoops in order to bring your electronic cigarette to market and who does that leave standing? Only the companies that can do that type of thing. It wasn’t a simply submit that your liquid is not toxic. It was you’re going to have to jump through these huge hoops, and the only people that can jump through those huge hoops are the huge players, and the huge players are the ones that the big tobacco companies that can afford that no problem, and then all of a sudden it kind of turns into this olic-opoly. Sometimes I hear people say well, I won’t try this or that drug because it hasn’t been approved by this government body. And I just think to myself, gosh, this government body is not there to protect you. It’s there to protect these corporate interests, and the corporate interests make it look like they’re doing it for the good of the people is through this body. Do I have that totally wrong, or is it true somewhere in the middle?

Anthony: Well, I’m not going to comment on any industry specifically like in terms of names or whatever, like Big Tobacco, whatever, but what I will say is I think you’re 100 percent right. And again, regulatory democracy works in all industries, whether it’s banking. It doesn’t matter what the industry is. Those barriers and, I’ll call it, the wickets you got to go through to get to the post, using a croquet analogy here, is that if they really are designed to be difficult. Politics, and you just look at the political system and how the political system works and where the money comes from that elects the politicians and where the special interest groups, who has the lobbying power in all industries.

The industries themselves fight for more and more regulation, not less, because they can afford it. They design it in essence by lobbying and putting the pressures in the right way to get the end results you’re looking for, and it doesn’t matter what the industry is, whether it’s automotive or whatever it may be, those rules, regulations and the overall structure is designed to protect their Holy Grail. That’s human nature. When I say human nature it’s a reflection of human nature. I’m sad to say that. I’m certainly not someone that’s pleased, as a free market thinking libertarian, to say that that’s a good thing. When you said, and I agree with you, that there are many people that say I won’t take this drug or I won’t do this because it’s not legal, it hasn’t been approved. To me, that’s a sick mindset.

It is just the way it is. It’s the way people have become, through fear mostly, the fear of the unknown and the safety and the assurity the governments and related regulatory supposedly are able to provide and are there to provide. They buy into that, and it’s something that has become universal across the board. So, it doesn’t matter what we’re talking about, whether it’s global warming, climate change, all these different issues. Fear is the number one means through which people have succumbed to the regulatory power and the almighty state as the protector to ensure that whatever it is that they’re doing, if it’s been approved, if it’s legal, if it’s got the seal of blah-blah-blah, that I must be okay.

Coming back to this discussion, I would suggest that one side is reality and one side is perception. Perception oftentimes drives reality, and the perception of the public supports this structural system, so therefore it exists and it is able to continue to be beneficial to those who are the enablers of the system.

Matthew: Right. And not to bring up global warming, because it’s such divisive topic, but no matter what side of the global warming debate you’re on, if that can be a centralized and taxed event, then there’s people that can benefit from it. So whether you believe global warming exists or it doesn’t, the solution that’s proposed will benefit certain parties over others and maybe not create a solution that anybody finds useful, but just takes more taxpayer money into a cul-de-sac where you never have any actual results you can do anything with.

Anthony: You’re right, sorry to cut you off there, but I just want to say something. Global warming, it doesn’t matter whether you believe it’s right or wrong. It doesn’t matter what your beliefs are, partially right, partially wrong, however you want to view it. The reality simply is again, perception. What is the perception generally speaking? And you can go to your child’s grade four play at school and you’re going to see the polar bear falling through the icecaps. I mean, everybody is being indoctrinated, whether you agree or not, with the global warming discussion.

So you should deal with the perception being the reality because that is what we need to deal with, and when you get back to the regulatory hurdles and those wickets of croquet that you need to get through to get to the ultimate stake, at the end, by having a strict and heavily regulated environmental and social, we can go into that too, that’s another aspect of social responsibility and all those other related philosophical, if you will, areas of concern these days corporately. All of those wickets just bring that bar, that entry bar, that competitive bar and they put it higher and higher and higher so that again, the bigger, more better financed, systemically inbred, if you will, companies, who are dominating the various sectors, are never going to really be of threat of losing their Holy Grail. And even if they ever did, though really poor management or just being badly organized and operationally inefficient business, at the end of the day, due to the fact that they have such an important social role in society, in terms of employment or otherwise, they’re going to get bailed out. Whether they’re an airline, whether they’re this, that or the other thing, the governments just will not let their friends in need ever suffer, because the governments work for their friends in need.

Matthew: Yes, that’s true. You talk about equatorial locations being ideal for large scale cannabis cultivation. Why is that?

Anthony: Well it’s very simple. Forget cannabis for a moment and let’s just talk about flowers and the flower industry and much of the vegetative industry that we all rely upon for many of the things that need a natural life cycle and the right climatic conditions to be ultimately the more competitive environments to grow things in. You look at the equator and the countries around the equator, especially in the more stable regions of the world, politically and economically, like for example, Colombia and neighboring countries, Peru, Brazil, Ecuador, those regions. At the equator you have a natural 12 on and 12 off light cycle.

You have environmental conditions to go with it, climatically speaking, that provide you with, in some cases in certain locations, not all locations are equal at the equator. Clearly there are some that are too hot, some that are too high in elevation and therefore too cold, and there are some that are just perfectly conditioned and in the right elevation, with the right mix of temperature and other related factors for producing large scale flower production, regardless of whether it’s cannabis, chrysanthemums or whatever it may be. And on the equator, you have for example, just take Colombia itself. Almost 20 percent of the world’s production of cut flowers comes from Colombia. Over 80 percent of the cut flowers purchased in the United States come from Colombia.

Why not California? Why not Florida? Well, the answer is because they can’t produce as competitively, from a price point perspective and from an environmental perspective as well. That’s a whole other issue, but they can’t compete with that environment. You can’t replicate it. It is what it is. When you go a few degrees north or a few degrees south of the equator incur greater costs, electricity and otherwise. So when you’re dealing with ground zero being the equator, and for most people maybe they don’t know this, but flowers in order to go in and cannabis now, we’ll go into cannabis, like chrysanthemums, it’s almost identical in that respect. They require 12 on, 12 off daylight to night light or night time hours of an environment of such. So 12 hours of light, 12 hours of darkness. Now that is your perfect conditions for natural flowering, the flowering process.

So the only thing that you’re really dealing with power or electricity for, on a very low supplemental basis is the first three or four weeks during the vegetative state when you are not looking to flower yet the plants. When you’re just taking them from seedling to the desired height level and then of course literally turning off that very little bit of supplemental light that was used to trick the plants into maintaining themselves in a vegetative state and then you allow nature to do its job. So when you’re dealing with that sort of an environment there’s a natural reason, pardon the pun, why Colombia takes, as an example. Ecuador, as well, is a very dominant country in the flower industry. Other countries in the region are also obviously active in the region.

Together though, between the Dutch, Holland who provide a lot of the genetics and a lot of the background material that’s necessary in the flower business. I mean of course the Dutch, everyone knows how big and powerful and important they are in the global flower industry, but the Dutch in Colombia, I mean it’s like a highway system that’s been developed over 30-40 years here. Those two countries work together like a Swiss watch. Half of the greenhouse operations that I’ve visited, at least for example in the country of Colombia, have a great deal of direct or in some cases a little more arm’s length type of relationship with Dutch companies.

So when you look at that the Dutch, then why don’t they do it all in Holland? I mean, for the same reasons. They understand that there’s much better economies of scale and gains to be gotten through large scale production in countries that are equatorial positioned. It really comes down to cost and having nature do your job. And in a world that’s consumed with the consumption of naturally produced and environmentally friendly products, and when you can do it at a lower cost, those are almost no brainer decisions to make as to why you would be there. Like I said, the flower business is a multibillion dollar a year industry and why aren’t they growing the flowers that are supplying the United States in Florida and in California, instead of buying them from countries like Colombia, who supply 80 percent of flower market for cut flowers in the United States. It’s because they can’t compete economically at all, not at all.

Matthew: Okay so, you mentioned Ecuador, you mentioned Colombia. You don’t spend time in Ecuador. Why is Colombia specifically ideal. I mean I was there over the summer time, I really enjoyed it, both culturally, weather perspective, food, the people, very clear form of Spanish is spoken there, so it’s easy for a Gringo to pick up on relative to some other places in Latin America. Why is Colombia so compelling to you as a country?

Anthony: There’s a lot of reasons. First of all, I’ve been living and working in Colombia for 15 years. Everything you just said I agree with, and I would even bold it. Most people out there, I think the misconceptions that surround Colombia, once you’re there it’s kind of laughable. Look, that country is poised for nothing but growth over the next foreseeable future, many years in my opinion. I like what’s happening on the political front. I think we’re going to continue to see progress made in that country. I think everybody wants to see peace. It’s just a matter of what the final shape of that peace process ultimately is, and it’s a learning experience for all the parties involved politically.

When I look at that country I see a country that has proven itself to be the dominant leader in the flower industry in South America. It’s the country that has the most support financially from the United States for a couple of decades. It is the battering ram, if you will, against communism and leftist policies in Latin America. It is the more capitalist country, and America’s best friend in Latin America. So you’ve got a country that has an infinity. For example, for Americans, there is not a backlash against Gringos, if you will, that you would experience in other countries in Latin America.

Look, I’ve been in them all and extensively. I’ve done business in a lot of countries in Latin America. And for me, Colombia offers the best mix of all that is necessary to be able to truly dominate in this industry. Why not Ecuador? Well Ecuador, it’s interesting. Ecuador has the potential to be an important player in the global cannabis industry. I wouldn’t discount it, and I wouldn’t discount the potential for that country to proceed, but what I would say is Ecuador doesn’t have nearly the level of international stability in terms of what people perceive is necessary to invest large amounts of dollars in the country. It has shown leanings that have been more in the direction of Venezuela at different times over the past several years.

It doesn’t have the level of free trade agreements or the number of free trade agreements and established economic ties with other nations that, for example, Colombia does, which virtually has free trade agreements in pretty much every Western country, all of Europe, Canada and the United States, all over the world and has developed industries and particular an industry that’s relevant where you have the workforce. I mean (45.45 unclear) the Association of Flower Growers and Exporters in Colombia has about 130,000 people underneath that organization that are workers represented by the association in the various flower growers operations in Colombia. This is not small. I mean, it’s massive. When you look at the infrastructure and the experience, technological innovation this is not backwards production in Colombia. These are like the Mercedes and the Portias of the car industry.

They’re operations work with incredible precision, with planning and procedures and environmental issues, all those issues that we all talk about. These guys are leading in those areas. So you’ve got an industry with all the expertise, all the knowledge that’s necessary, excellent universities that are there to work in tandem with companies that are developing in this industry. And you’ve got ease of international trade. You’re sitting in a country that has two and half hour flights to Miami. Direct flights to Europe. I mean you have ease and accessibility and both coasts covered; Pacific and Atlantic. The only country in South America that has that. So you can ship products by ocean freight or otherwise, and that’s what happens across the board.

Colombia is in the middle of a boom infrastructure-wise that is really designed to connect. It’s all the rural regions that have in some cases have been suppressed because of economic investment due to their FARC involvement or other less than savory organizations that made it difficult for business to grow in some of these areas, very fertile areas. Areas that have lots of promise to develop agriculture or other related industries, but it’s the largest infrastructure development program in Colombia. One of the largest ever to occur in Latin America. All of the ports, airports, highway systems, road systems to improve transportation.

So the amount of money and the amount of resources that are going into that country is really quite impressive. And the foreign investment protection and other related issues to give investors the comfort that their money is safe in that country, they’re all in place at an international level and otherwise, you really have a perfect mix of environmental, social, climatic conditions and otherwise for this particular industry. Let’s not forget that Colombia has certainly got a past with this plant that isn’t new. I mean you go back to the 60s and the 70s, it was one of the big three out there in the world, as far as its reputation is concerned, as a high grade, high quality cannabis production region.

I would suggest that the only reason it didn’t keep pace with the rest of the world, maybe in terms of its legacy in that regard, not that it was a good legacy by the way, so let’s not call it that it was. So I’m not trying to put a positive light on that. I’m just simply saying, and I won’t use the word indigenous because I’m not so sure what an indigenous strain is in cannabis, unless you go to the Himalayas or what have you, but I would suggest that, there are strains that have been there for a hundred years or more that have been cultivated. So, now I guess you would call them somewhat native strains, and there are hundreds of them. It’s a treasure trove to be discovered of opportunity in strains with that country.

So with the support coming in, also internationally from the post peace process agreements that have been struck with different governments to support the transformation of Colombia in these areas that need the help and the support, there’s about a billion-three dollars worth of capital coming in. United States I think is $450 million. European Union is three or four hundred million Euros or whatever it is, but the point is it’s a lot of money and these very same countries are very unlikely to put up doors that bar products coming from Colombia in a legalized, international environment for trade, which is forthcoming in cannabis without any doubt. And as that, it does occur, at least I believe and we tend to believe, those who are working with us that Colombia will receive a great deal of empathy and that the doors will be opened, because there’s no country in the world, none, that has suffered as much as Colombia in the war on drugs.

There’s no country that deserves more for its people and for the country itself if there’s going to be a legal scientific and medicinal marketplace developed around the world, and for these products to move around the world, there’s no country that deserves more the opportunity to participate to help rebuild and to help ignite these areas that have been so dramatically effected through the war on drugs. That’s why Colombia is it.

One more thing I would like to add to this about the equator. If you look at the equator and draw a line around the world that would pick up a map or take a look, what you’re going to see quickly is, and you can just put an X over the nations in the South East Asian marketplace, because they’re pretty heavily Muslim populated. The Muslim countries are not buying into this industry at this time. Look at the Philippines, I mean quite the contrary. There’s lunacy, what’s going on in that country with respect to how they’re dealing with the drug issue. So none of those nations over there at this time make any sense from a developing of this business perspective. If you look at Africa, you’ve got a couple of countries that are trying to get their feet on the ground and grow and develop themselves from an infrastructure perspective to compete in the flower industry.

Forget about cannabis, but just the general flower industry. Over time you could see some of the African countries developing themselves in this industry as well, but today they just don’t have what it takes to literally plug and play and get going, where only a couple of countries really do that are positioned like that. Again that comes back to Latin American nations and Colombia is the obvious leader in this discussion, when you put all of the issues on the table.

Matthew: So to kind of crystallize your thesis here, are you saying that in the beginning, we’re in the beginning chapters, beginning innings here, generally a lot of people aren’t going to make money in the first few innings, but like all industries, as they mature, we’re going to move to lower cost producers who can do things in mass and scale and bring down their cost dramatically, wherever that is in the world, it’s going to move into a slightly more commoditized phase and perhaps even then get away from the flower itself and maybe start getting into oils, as looking at it cost per milligram or something like that, milliliter of oil. Is that the general trend you see happening over the next five to ten years?

Anthony: Those are a lot of specifics but yes, generally speaking it is. I’ll go back to Colombia again, and I don’t know if you know this or not, but just yesterday the Colombian government, President Santos signed the decree that now paves the way for and sets forth the rules of the road for the industry. This is the cultivation side, and that just happened, literally. So this industry in Colombia I can tell you has been designed around with an only oil focus. There is no ability to produce flower for the purposes of end supplying flower. That is not the industry at all in Colombia that they can complete. A complete approach towards standardized oils, extracts and related products that can be made from said extracts and products.

We firmly believe that that is the future of the industry. Anyone that really believes that you’re going to have the support of the world and World Medical Association and the subsequent medical associations and thus there the doctors who do definitely take a strong lead from their associations and as a peer group would not endorse and will not endorse on rolling up flower and smoking it. The carcinogenetic effects and otherwise that have affected the tobacco industry and of course will affect the flower industry. Carcinogens are carcinogens. It doesn’t matter whether you’re sitting next to a fireplace and someone’s making a fire and you’re inhaling them or whatever it might be, they are dangerous and they are extremely unhealthy obviously, without getting into that. We all know why, and it’s just a matter to what extreme they really are causing all those damage, cancer and otherwise, but we do know that they are horrible for our health, and they are not something that will be endorsed.

Look, when you get into that part of it that’s one obvious. The other part of it is simply the standardization and governments, regulators like to standardize. It’s just part of that whole regulatory wicket structure we just talked about. And so you can’t standardize flower. It’s just impossible to be specific, but you can standardize oil. You can standardize it and you can refine it to specifics to meet whatever those standards are and in some cases it’s companies to set those standards. That’s another point is the UN and the WHO and these organizations take their lead from private sector. They don’t sit in a box and say these are the new rules, now go do this.

What they do is they work together to pay attention and monitor and in some cases participate in the planning side of thesis, the things that may work and may make sense, but then it’s up to private sector to take those forward. And it’s always good to have the international organizations and the powers that be, if you will involved in the planning side of any of these sorts of standardization movements, but those standardizations, once they’re proven out to be able to be carried forth and they’re tested, subjectively or otherwise and all of this data and research and the necessary peripheral support that is required in order to endorse or get behind, structural changes or standardizations in the industry. As that all occurs, that’s when you’ll see these industries become more in sync and the move towards certain types of ways of producing and what you’re actually producing become commonplace.

Now in Colombia the government has recognized that that is the future of the industry, and we think that they’re dead on right with that. And as a result, they prohibit anything to do with the production of cultivation of cannabis, unless it’s for the purposes of manufacturing it into standardized oils and at a very high level. So you’re not going to see an industry develop in that country that reflects the Cheech and Chong days of the seventies. You’re just not going to see it. We’re going to see something here that is leading the world from a technological and innovative perspective and one that maintains its bearing and its focus at all times in that direction.

Matthew: Your emphasis on the standardization of oils has my wheels turning about once we have standards in place that maybe international community starts to look at is hey we agree with these standards. Does that open the door then for creating derivatives options, futures, swaps and those type of things on oils where I can say hey, in three months I want to buy this grade of cannabis oil at this price, and someone will sell it to me, allowing for businesses to have some predictability in their input cost and so forth and hedging and so forth. Do you see that happening and if so, do you think that would happen in a place like Colombia or more in a finance center like London or New York?

Anthony: Well I certainly see it happening, and I also don’t see it happening in Colombia. I mean production yes, and the ability to participate in that market, yes, but I believe those are New York, London and other related financial centers, and it will happen. I want to clarify one thing here. There’s a difference between just saying oil, to this standard oil, to that standard and then of course branding and what premium oils or subpremium oils look like. I think molecules are much easier to regulate in such a fashion and to design financial instruments around, such as for example, CBD, the molecule itself or certain other molecules that could be commoditized in such a way.

Hemp oil could be very easily commoditized to meet certain standards. And then yes, you can deal with oils in that way of all types but there will always be… if you believe that there will eventually be, and I’m one that does, I’ll fall into the Richard Branson camp on this one, that eventually we will see, much like with wines, much like with other types of things, that there will be an adult marketplace and that it will reflect stories. It will reflect history, that it will reflect local passions of the vineyard and venture who is making these wines and whatever it might be. That becomes your branding. So those are not something that I see as commoditized products that would fall into that camp, but I do see general oil. Oil that could be used by companies that are making beverages or whatever it is, finished goods producers that need to be able to ensure that they can access oil at a certain price so they can plan properly in developing their end products.

I think it’s an important part, as it has been proven in any business, in any sector that there are people willing to facilitate that futures market, if you will, for the provision of said raw material, if you’re viewing it as raw material. Finished goods will always be a marketplace I believe for well-branded, well-marketed and well-positioned products, consumer ready products that probably won’t fall necessarily into that camp, but there’s a large market that will. So yeah, I agree with you on that 100 percent.

Matthew: Good point. I think the hemp oil or hemp in general does seem a better candidate for that. Less of a focus maybe on terpene profiles and so forth. So yes, I agree with that. Now I want to pivot to Canada. Just give us a snapshot of what you think is going on in Canada. Maybe contrast it a little bit to the United States and Colombia and your general thoughts and feelings about the Canadian market in terms of cannabis.

Anthony: Well, I would be happy to do that. I think there’s going to be several companies in this country that will do very well over the long haul, and I believe that those are the companies that are savvy enough and recognize that the best way for them to develop their businesses is to have a hybrid structure. One in which cultivation, the low cost, environmentally friendly cultivation can occur and does occur as part of their supply chain in countries like Colombia, for example. Because if you look at the oil market, that’s going to be, and it is, becoming quickly the focus of most companies in this business who see where things are headed. The question then becomes what’s the cost of that end product going to be for me.

If your cost structure is 50 or 60 or whatever it is, times more expensive for that feeder stock cannabis, the flower itself that’s needed to make the oil, your entirely uncompetitive against the guy next door who decides I’m going to source my flower that has been processed to a certain point into oil, and I’m going to bring in that oil and I’m going to then fine tune that oil in my facilities for my domestic market and supply the domestic market and focus more on the finished goods side of the equation. Focus more on the end products and developing that oil into whatever it is that fits for their given market.

There is where you’ll see, I believe, the strong survive. I think those who fight against that and are determined to anchor their cultivation strategy in a country that is just not climatically suited, other than seasonally, for large scale production of cannabis, I think they’re the ones that will fail. The ones to me that make sense are the ones that will look abroad, will strike the right distribution relationships, the right partnership kind of structures, bring in that oil and then finish there.

That leads to another topic which is this nationalization wave that’s sweeping across America and in many countries. There is much to that. No one is suggesting that it’s an all or none in a country like Colombia or Ecuador or any other. I mean you can build a factory, a high quality CGMP processing facility in any country and the costs are going to be relatively the same with that facility. You can make it a smart building in Canada, you can make it a smart building in Prague. You can make it a smart building wherever you want to make it, and your cost of human labor, when you’re talking about a scientifically driven and medicinal grade facility, it’s going to be the same more or less wherever you are. There’s not going to be any dramatic effect on your bottom line cost when you’re dealing with that level of expertise. You’re going to pay for what you get and get what you pay for.

So you need great human resources to really run the type of business we’re referring to. So what I would suggest is likely to occur over time is that you will have producers, if you will, who are going to focus more on their end of the marathon where they can really take for their domestic markets and for other markets as well where they’re also involved to do the finish goods processing. Then you can see, for example, a situation where you can have a Canadian company that is able to brand the products as long as they meet WTO rules and regulations for what must be done in order to meet said capability for marketing something that’s a made in Canada product, but you can have made in Canada products that have a certain component or certain amount of the processing in finished goods manufacturing occurring here, employing high quality jobs with nice wages and all those things and let the lower cost, so to speak, cultivation activity, which means a lot in these other countries, in Colombia and these sorts of countries where there’s immense poverty, which doesn’t go unnoticed at the UN level as well I would add.

That’s also a big part of the thrust of what they’re always willing to support, are countries that are helping lift people out of poverty and create employment. Well this type of employment in countries like Colombia where the average monthly worker is making $400-$500 a month working really hard and very productive people. Obviously you can’t compete with those sorts of numbers when you’re talking about labor. But that all adds in to the finished cost of the cultivation. So I see a finished goods marketplace where Canada and the Canadian companies that are smart and strong have aligned themselves to be able to access the components of the supply chain that they just can’t compete from a cost perspective in their domestic markets, and hybriding that into their existing structure and that’s where I see the market going.

I think the other ones I will say will be great shorts at some point in time in the future. Today I wouldn’t short any of them because as I said earlier in the call, there’s a great deal of emotional enthusiasm behind what’s driving this Canadian marketplace at this time.

Matthew: Before we close, I have a couple more questions for you. What do you feel about block chain technologies in general like Bit Coin, and do you think there will be any overlap or disruptions maybe to the financial industry or other industries, including cannabis with the block chain?

Anthony: Well I’m for any form of competing currency. I’m a person who has spoken out against, what I call, the manipulative control of our monetary systems for many, many years. Therefore I support any efforts that compete and bring private industry initiatives to the table, and I would suggest let the market determine for itself what they would choose to use or not use as a form of trade or savings, wealth protection, what have you. And if that includes in some way, shape or form being part of the cannabis industry or otherwise, great. But other than that, I really don’t have much to say on it.

Matthew: Okay. I like to ask personal development questions to help listeners get a sense of who you are personally. Is there a book that has had a big impact on your life or way of thinking that you would like to share with listeners?

Anthony: Well the book that would have the most impact on me would be the first, what I would call, real book that I wrote. And that would be because that was a learning experience that involved reading many books and spending many hours with many great thinkers who I respect a lot. But outside of my own personal experience, and that book is called High Alert, for anybody who wants to look for it. You can find it around the internet or what have you.

Harry Brown was like a father to me. Harry Brown, I don’t know if you know who that is or not, but he was a New York Times number one best seller. He ran for President of the United States twice as a Libertarian. Just a tremendous person, wonderful person. That book, How I Found Freedom in an Unfree World, is timeless. Anybody who picks that book up and reads that book and can say that it didn’t affect their lives, either didn’t read it or they’re lying. I mean it’s a fantastic, fantastic book and I would urge anybody to read it.

There are many great thinkers and many great books that I’ve enjoyed reading over the years, and I’m an avid reader. I love history, and I like in particular to follow free market thinking history and read more Libertarian and an Austrian economic type of material. It certainly has inspired me and helped frame my way of thinking and how I look at world markets and trends and what’s evolving in front of us. So that would be my answer to your question.

Matthew: You know there’s a lot of people that don’t have exposure to Libertarian philosophies that listen to the show. We usually get people that fall into kind of the left/right paradigm that don’t have… and we’re kind of cattle chuted into being either for the red team or the blue team, and we don’t hear alternative narratives, and I think you have a really good way of sometimes stripping away the hype from topics and looking at actually what’s going on behind the scenes. If you were to kind of, maybe in a few bullet points, just kind of talk about what that philosophy is for people who are familiar with it, because sometimes I think the way it’s portrayed in the press is that Libertarian philosophy is this fringe, weird thing. And in many ways, I mean, the founding fathers of the United States were much closer to, I would say, the classical Libertarian philosophy, Austrian economics than modern left/right paradigm.

Anthony: Well you’re 100 percent correct. They were. And modern left/right is, again, it comes back to that whole structural system. Even our political system reflects a two-choice system or a few choice system. In this case, two, which is replicated around the world. But look, it’s really quite simple. Libertarian philosophy is I guess you would say socially liberal and conservatively fiscal. Meaning that Libertarians believe you should stay out of your bedroom. It’s none of your business what I do with my life, as long as I’m not bothering you, leave me alone. It doesn’t have anything to do with disrespect for morality in its essence of you shouldn’t murder, you should do this.

Of course not, everyone understands there are rights and wrongs in this world. Libertarianism just leaves it up to us individuals to be personally responsible and bear the responsibility for your actions, whatever those actions may be. But to be responsible for the decisions that you make and whatever those decisions are they affect me and my body, and whatever I choose to do in this world, they’re mine. It also has a lot to do with the… that comes back again to, the ability to use whatever you choose to use as currency. I mean, if I choose to trade my cow with you for your horse, I should be able to do that without somebody standing in the middle and taxing me on that transaction, or someone else demanding that I actually use dollars to make that transaction so it can become a taxable event.

Currency, the way the monetary system is structured, the infringement across the board on our civil liberties, all of that runs counter to Libertarian philosophy. Libertarians believe in living together in harmony, but living and allowing and respecting your right to be who you want to be, whoever that is. You may say something I totally disagree with, but that’s your right to say that. You’ll find yourself extricated from social circles because if your opinion is one that is offensive, people just will stop associating with you and you will find you will suffer through the realities of human interaction. You don’t need that people regulate, for example, hate speech. I would rather know, by the way, if somebody has something to say that I consider for me at least offensive morally, and that’s again to be derived I believe by your own self what you define as your own morality, what you’re willing to accept and not accept.

At the end of the day I would rather know what people are thinking. Maybe we wouldn’t be in such a situation as we are today with “this terrorism thing”. If we knew more about what people actually thought rather than trying to regulate people to keep everything in their minds and be bottled up and create your free speech zones in certain places where you’re allowed to talk under monitoring and powers that be oversight. I mean it’s all ridiculous. So Libertarianism is focused on transferring more power to the individual, less power from the state and really respecting that the government’s role on behalf of the collective should be to protect those civil liberties. That also leads to the big discussion about war.

Again, if you start with the individual and the right for an individual to live their life the way they like it, you may not like how I live my life. I may not like how you live your life, but I’ll respect your ability to do so. You respect my ability to do so. And the big thing about democracy, and America is a Republic, so a constitutional republic. So people should stop calling it a democracy. That’s a bastardization of the reality of what the founding fathers created, and a democracy works counterproductively against the individual because 50+ a little bit of a percent can choose to enact rules, regulations and otherwise that run against my interests, and that is completely anti-libertarian on its face.

When you look at wars around the world clearly we all know we need to have as group, as a country, as a people, wherever we are, however we’re centralized and whatever nation we are, that we need to have the ability to protect ourselves against those who don’t respect civil liberty and individualism, and therefore a strong defense is your best offense. But when we start becoming the soothsayers of democracy all over the world, the ones running around trying to impose what our views now are of how others should live their lives and what they’re doing, whether we like it or we don’t, and of course that’s the we don’t like it side of the equation. Opposing governments and all these other things that have happened around the world. All we’re doing is running it further and further away from what the founding fathers of the United States created when they created the Constitution of the United States. And libertarianism is much closer to the realities of what the Jeffersons of the world and others thought, felt and believed. Very intelligent people, when they drafted what they drafted and subsequent documentation around that era that protected our liberties and gave us the blueprint to maintain a high standard of living on an individual level with a collective relationship that really set rigid boundaries on where the government began and where it ended. So that’s my answer to your question.

Matthew: Well, that’s great. I think this will be something a lot of listeners perhaps has never been exposed to or heard anything like you just mentioned before. So I appreciate you giving that information. Is there any way that listeners can follow you online or keep track of what you’re up to?

Anthony: Yeah they can. I don’t charge for anything like this. So whatever I do publically-wise. I post, generally speaking, up to a website called www.anthonywile.com. I don’t do this often. I’m really, quite frankly, very busy. I stopped publishing basically about a year and a half ago more or less on a fairly regular basis. I still do pieces once in a while for Huffington Post. I’ve done a few and different papers around that are interested in the cannabis story because it’s mostly about that that I’ve been writing. However, I’m also involved in real estate development in Colombia and other grassroots private equity kind of things on a personal level. So we do do some of that.

Occasionally I’ll write or do a show like this about those sorts of topics, and I do love by the way discussing issues and it’s a passion but it takes time to really love that and live that passion. I’ve had the pleasure of doing that for a lot of years and now it’s just as I say. I’ve just become so occupied and so busy with what we’re developing in Colombia, and I want to make a disclaimer here because I think it’s important. I do have a very large financial interest in Colombia with a company that is licensed. I won’t say its name because it’s not necessary, but I just want to make it clear so there’s no misconceptions out there. I do have a financial interest and I think I’ve given the reasons why I like and in our group at least at (1.16.15 unclear) why we like Colombia a great deal in this space. So a disclaimer on that. But www.anthonywile.com would be the main place I would say for that. In the future there will be… there is something we’re building now as a new platform for Colombia focused publishing by the way.

So it’s a business related publishing effort, and when that surfaces in the next couple of months, I will take a chief editorial role with that voice for sure.

Matthew: Well, Anthony, thanks so much for joining us on the show. Again, that website is www.anthonywile.com and the book is High Alert. I assume that’s on Amazon?

Anthony: Yes, I think so. I’m embarrassed to say. I’ve written a few but I don’t know. But if anybody wants to find a copy of that, you can download it from www.anthonywile.com. I believe it’s there for free. I think there are four or five books that I have written there that you can pull down and again there’s no charge for that. I’m pretty sure they’re there. You might also find them at the www.thewilegroup.com. That’s a business that I’ve recently transitioned to, a new corporate branding, but the site is still live, and that’s just called www.thewilegroup.com. And at either of those two sites, all those books I’m confident are available for download. As I said, I haven’t looked at them in a while.

Matthew: Well Anthony, thanks again and good luck to you in both Canada and Colombia.

Anthony: And good luck to you, and thanks for the invite to be on your program. I think what you’re doing is fantastic and you’re providing a great educational service to your listeners and congratulations.

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