Leveraging Dispensary Data as a Competitive Advantage

cy scott CEO of headset

Cannabis businesses need to understand what is selling in dispensaries so they can make informed decisions.

Cy Scott, co-founder, and CEO of Headset.io delves into how to get this data and use it to make actionable business decisions now.

Key Takeaways:
– What is selling in cannabis dispensaries now
– How to properly use data to make informed decisions
– Why it is better to create a new market category than be a fast follower
– Insights as to how the market is evolving
– Career advice for entering the cannabis industry

>>> Get This Podcast With Cy on your iPhone or Android HERE

We also cover some cannabis items that are hot sellers right now.
Learn more at https://www.headset.io/

Cy’s Favorite Tools:
https://quip.com/
https://www.intercom.com

Cy’s Favorite Books
High Growth Hand Book
The Hard Thing About Hard Things

Read Full Transcript

As more and more capital floods into the cannabis space, it's becoming increasingly important to make data-driven decisions, to chart your course, achieve product-market fit, and ensure profitability. To help us understand how cannabis businesses are leveraging data, I'm pleased to welcome back Cy Scott from Headset.io. Cy, welcome back to Canna Insider.

Cy: Thanks Matt. I'm happy to be here.

Matthew: Where in the world are you today?

Cy: So today I am in Seattle, Washington, which is where we're actually headquartered.

Matthew: Okay. And I'm in Edinburgh, Scotland and I think it's about 40 and rainy here, so we probably have pretty similar whether, I imagine.

Cy: Yeah, very, very close. We're definitely in that time of year where it's a pretty cold, pretty gloomy.

Matthew: Yeah, except it's 3:00 here and it's almost completely dark.

Cy: Oh, my gosh, yeah. We get dark about 4:00, so we're right behind you.

Matthew: Okay. Okay. Now tell us what Headset is at a high level. You were on I think once or twice before and we talked about Leafly. And if anybody else wants to get a backstory on Cy and everything he's done, please check out past episodes. But today we're gonna talk about Headset. Can you give us an idea of what Headset is at a high level?

Cy: Sure thing. So Headset is a data and analytics company designed for the cannabis industry and we turn retail data into what we say is real time insights. So we look at a lot of retailers across a variety of markets. And we aggregate and anonymize all the transactions. And we paint a picture of what's going on in the industry. So if you're a product manufacturer, an investor in this space, or just an interested party into the cannabis industry, you can see the competitive landscape, really understand a brand positioning, and identify opportunity in the market.

Matthew: Okay. And so you were a co-founder of the popular strain and cannabis culture app and site Leafly. I know you exited that business to privateer holdings. And you've transitioned to become the CEO and co-founder of Headset. You're definitely an OG in this space. From your vantage point, how has the industry changed? I mean, let's say the last five years, what's your big...if you were to sum it up in a few sentences for people that don't understand where it's come and where it is now?

Cy: Sure, yeah. We started Leafly back in 2010 and it definitely was a very different world. We were based in southern California at the time and had access to a number of dispensaries. And we saw this proliferation of dispensaries happening. But when you'd walk into a shop, it was really a lot of dried flower and jars with labels. You didn't really know where it was sourced or if it was tested and so on and relatively simple. Packaged goods didn't really exist or maybe one or two at the time. And you fast forward to today and it's just unrecognizable. We're in a world with, you know, everything is a packaged goods, a good item in the cannabis space. You're seeing interest coming from, you know, not only people that have licenses. But we get, are asked about our data from, you know, traditional CPG companies or alcohol companies, finance companies. So a lot of people are interested now. So it's very different on the level of sophistication and interest.

I think another big difference is the number of states and countries at this point that have legalized. You know, at that time it was strictly medical in a number of markets like California and Colorado and Washington. But in 2012, you know, with the legalization, we saw this incredible wave of new markets opening up. So that's been pretty surprising, at least the pace of adoption. You know, we always knew that this was the direction it was gonna go. That was our, you know, thesis originally with Leafly. And we're surprised at actually how fast it is moving.

And probably the last thing I would say is, the amount of investment dollars or capital that's poured into this space. With Leafly, it was really hard to raise money. Not a lot of people saw the opportunity or if they did see the opportunity, they were hedging a little bit wondering if it's just a California thing or would only be medical. But you fast forward to today where you have, you know, what's going on in Canada and the number of states that have legalized. And you're seeing a big outpouring of investment dollars coming into the market, which is really great for the space. You know, it really helps these operators and groups like ourselves scale up pretty rapidly.

Matthew: Okay. And remind us how does Headset collect data? How does that mechanism work?

Cy: Sure. So we work with a number of retailers in a variety of markets. We connect directly to their point of sale system. We, in exchange, give the retailers a lot of great analytics about their own operations and including bench-marking data, once we have enough retailers on the platform. So the retailers are really motivated to better understand their operations, whether it's inventory carry, you know, sales trends, how their bud tenders are performing. And we make it really easy for them to dig in, whether it's top line numbers or really get down to, you know, a particular product and understand what's going on. The Headset interface is really good for that.

And then what we do is we aggregate all of that, all those retailers, in a particular market and we normalize the data. So when different retailers are selling the same product, we have to do what's called product coding or normalization. And then we can paint a picture of what's going on in the market from the skew level or the individual product level through the brand to the segment and category and so on. So it's all real time. Given that we're connected to the point of sale, so we can see on the platform, you know, what's happening. Right now while we're having this conversation and things are transacting, it's all getting normalized in the system and available for our customers.

Matthew: Just on the logistics of that, is that a difficult thing to get that all the information from the dispensaries? I mean, it sounds like it's or it's just a huge, huge, Herculean task. Is it or have you made it easy somehow?

Cy: It's definitely difficult. You know, we've tried to make it easier over the years. And there's a lot of things that we do like working with partners in markets that can help us get adoption, developing kind of growth hooks into the products themselves to make it easier for groups like vendors to invite retailers to the platform. So we've done a lot to accelerate adoption. But you know, when a new market opens up, we definitely, you know, have to reach out to the retailers, understand who the license holders are, start those conversations. So it does take some time.

And then once we do have the retailers, the product coding effort is pretty significant. We've also developed some pretty clever systems that can do it in real time at this point. But in a new market, you know, the machine learning, it doesn't have the training data it needs and we have to kind of train the system. So it definitely is a challenge. I think that, you know, we've solved it pretty well at this point. But, you know, lots of room to grow. And as new markets open up and in the US and even internationally, you know, we kind of have to continue that adoption, something like what we're seeing in Canada right now.

Matthew: Okay. So you started in your home state of Washington and then the second state was California.

Cy: Right. Yeah. The second state that we went live in was a Colorado and then, yeah, Nevada then California. California we just launched this year, you know, with the new adult use market. So, you know, it's been a little bit of a slow start for that market. You've probably seen a lot of the headlines with licensing issues. And then in July they have the new regulations on package size and potency, which required all new products to be put on the store shelves. So it's getting there certainly as a market. But we wanted to wait until things normalized a little bit before reporting on it, just given the volatility of that market. We have retailers in a number of other spaces, including medical markets, like Illinois, for example. But we're not providing the wider market intelligence service in those markets quite yet. But that'll be coming soon in 2019.

Matthew: Okay. When you talk to brands or businesses that are making decisions with your data, what kind of insights or aha moments are they having the first time they look at it that they don't expect?

Cy: Sure. I think a lot of our customers are the brands, the product manufacturers, the processors. And they really like to look at the data to understand the competitive landscape. So they'll look and, you know, identify some of their competition. They'll look at their competition's assortments or product mix and really, you know, be surprised on, you know, sales numbers for certain product lines that they carry. So I think that's a pretty big use case for us. When I ask about kind of like, you know, what type of aha moments or surprises to our clients, they also mentioned just the frequency of product introductions. Given the real time nature of the platform, we have a dashboard that is a new products dashboard.

So as soon as a new product sells in the market, it gets flagged and displayed on this dashboard and you're seeing upwards of 10 new products a month, you know, depending on category, depending on market which is pretty, pretty frequent, very frequent. It's like if you're in a grocery store and if you walk down the cereal aisle and you saw 10 new cereals, you know, every month it would be a pretty surprising. But in the cannabis industry, just the pace of growth, the pace of new brands coming to market, everyone's trying new things, new form factors. It really does surprise people when they see, you know, how many products are being introduced at any given time.

Matthew: Now let's go around some of these geographies where you collect data. Can you tell us some of the most popular products in the biggest markets you monitor?

Cy: Sure. You know, I would say kind of in general a lot of unit sales go to more inexpensive products, which is not that surprising I suppose, but things like single grand prix roles that might be, you know, under $10 retail price. You know, seemed to move a lot of volume in kind of a variety of markets. And every market is a little different. Although, you know, most markets have, you know, roughly 50% of market share goes to flour based products or just flour, I should say, you know, roughly 10% goes to edibles and so on. But I think that yeah, unit volume you're seeing, you know, a lot of inexpensive products, whether they're throwing at the checkout or point of purchase or people are just going in, you know, to buy them because they're relatively inexpensive. We do see that with things like prerolls.

But then when we look at kind of revenue and total dollar sales, some surprising things are like in Washington, the state of Washington, I'm the number one selling product by revenue is actually a topical. It's a THC and CBD based topical. It's, yeah, it's a higher price point item. I think it retails for around $50. So that does attribute to it, but it is pretty surprising given the top schools are relatively small market share. But this particular product just seems to really resonate and that's kind of what you're seeing in the news and the news cycle and people talking about CBD, whether it's hemp-based CBD or THC and CBD. There's just more and more interest in things like that. So that's pretty surprising when we saw that.

Matthew: Okay. And I understand you have some demographic data on California. Is there anything you can tell us about the demography of California cannabis consumers?

Cy: Sure. So we get demographic data from loyalty programs or in medical markets. We're able to see, you know, gender and age and we can overlay that across any transaction data we have. So it does give us a good sense of what's going on in the market. So it's a little different than getting demographic data from something like a survey. We get it from the actual customers at the location, so nothing identifiable. No, I'm what they call PII or Personally Identifiable Information. But with gender and age we can kind of paint a nice picture of what's going on in the market. I think in general, you know, what I would say about, you know, California, some interesting trends as we're seeing a lot of growth in the generation x or the baby boomer share market increasing. When the market started, it was a lot of, you know, millennials.

So a younger demographic for whatever reason, maybe more has a higher acceptance rate of cannabis, more willing to go to the stores. But we're seeing that market share of the generation x and the baby boomers continue to climb. So I think that just kinda shows it's getting more and more normalized. Cannabis is not some fringe product anymore or just something for a younger audience. So that's pretty exciting and integrate trend. You know, when we look at a gender breakdown, it's still skewed towards the male gender. When we look at male to female, it's still about two to one. So you know, 66% of sales going to men and about 33% to women. You know, that's relatively flat that it's like an aggregate, but there are certain segments where a women purchase products a bit more than men. Things like topicals for example, where you're seeing a little more of like a one to one ratio. But when we look at an aggregate, it's about two to one. So you know, we continue to watch that and we can layer those over different brands and different products, which is great for our customers to kind of understand when they look at marketing campaign opportunities or how they position their brands. Kind of knowing the demographic data is critical.

Matthew: Yeah. I wonder how that's gonna turn as there's more beauty and wellness focus products in dispensary's. I mean there is some wellness products already, but just to kind of more, more general, more people coming in for that reason. It should be interesting.

Cy: Exactly. You know, I think that we're gonna see it normalize like any, any industry where you're going to see a little more of a one to one ratio. You're gonna see a broader mix of audience as far as age groups and I think that much like alcohol, you know, people are buying it, whether they're baby boomers or 21 years old. Cannabis will be the same mix once things kind of settled down and it continues to normalize, which we see happening every day.

Matthew: And any initial comparisons between Canada and the US? I know there's a lot of things different. Something's the same. Any thoughts about Canada? How do you think about it when you think about in terms of the purchasers purchase and they're different from US consumers?

Cy: Sure. Canada is an interesting landscape. There are some nuanced differences between what we see in the US, particularly given that it's run by Health Canada and they started with their medical cannabis program out there. The product form factors are limited to only flour and oil. And oils in Canada as is almost like a tincture. And so you don't have things like vapor pens, concentrates, you know, a lot of the form factors that we see in the US. And so that's a big difference. I think another thing that's quite different is the number of brands that are out there. There's a, you know, a fat 100 LPs which are the processors in Canada. And they have, you know, a number of brands underneath each LP. But I think that the brand landscape is relatively limited compared to something like Washington where, you know, there's hundreds of brands out there.

And so that drives some nuance. And then I think purchasing is different as well, depending on the province. You know, you see a lot of these provinces run by the provincial liquor distribution boards. And so they're actually responsible for distribution, but also for sales to the end consumer. For example, in Ontario, everything is sold through the Ontario cannabis store. There are no brick and mortar shops. It's all ecommerce-driven, so you go online, you order and it gets shipped to your house. And it's brick and mortar will be coming later on in the year where in the US, you know, everything is brick and mortar. In California, there is some ecommerce, I kind of say that with quotes around it, given that you can go online, purchase products and then it actually gets delivered to. So it's more of a delivery service. It's not kind of like traditional ecommerce, like the Amazon model. So you know, we're still working on collecting a lot of that data. We worked with a number of private retailers. Right now we're talking to a lot of the liquor boards right now to get access to the transactional information.

Some assumptions we can make, we think that the age breakdown is gonna be pretty different because there's less of a barrier to entry to going into a store. I think that, you know, there's still a bit of that stigma. There's still a bit of a fear of walking into a cannabis retailer. People don't wanna look like they don't know what they're doing and it can be a bit overwhelming if you ask any new consumer that goes into a cannabis shop for the first time. They're just overwhelmed by these different strains and different products. And so going online, doing research, checking out, I think it's a lower barrier to entry so we're probably going to see an older demographic purchasing products. And then the product mix, you know, it's gonna obviously be very significantly flower-driven just based on the number of products that are on the market right now.

In oil is a small amount of market share, especially given what we see for like oil type products in the US. So, you know, it's early days, again, kind of like California, it's a bit of a rocky start. You know, we're in November here, tail end of November. They've been online for about a month. We're hearing about supply chain issues, you know, people not getting products, a lot of private retailers not being able to open up. But it's not uncommon from what we see in other markets. So we kind of just have to be patient, hang in there and see how it unfolds and hopefully, you know, in the US we can learn a bit about how they're successful up in Canada and then bring some of that ideas down here, including things like the ecommerce model, which is pretty exciting.

Matthew: So you've dispensaries that are customers, you have brands that our customers. Who else is the ideal customer or prospect for Headset where they want this data and it helps them grow their business?

Cy: Sure, sure. So in addition to the brands, the product manufacturers and the dispensary's in the cannabis space specifically, we see a lot of distributors that are interested in being customers or our customers, as they look for brands to target for their distribution work. You know, you can go onto a Headset and if you are a distributor and you wanted to identify the top performing brands to potentially carry as part of your distribution network, it's pretty quick to go in and see who's performing really well in the market. So distributors subscribed to really understand that.

You know, more recently some very exciting trends for us here at Headset our end for the industry I would say at large is just more interest from the financial sector. So a lot of hedge funds investors in this space that are becoming subscribers, really looking at the data, you know, as they make investments, that's a good way to do a due diligence on a brand, a to see how they're positioned in the market. You know, a lot of brands will say, how are the top brand in the market or our brand really resonates with consumers and most likely it does. And it's good way to double check in Headset to see, you know, how are they positioned? What are the competitors look like and so on. So a lot of financial sector clients coming in.

And then also a CPG or Consumer Packaged Goods. So I think given the changes in Canada, um, I think this is really what's driving a lot of bats is, it's giving a lot of traditional CPG companies a bit of a safety net to be able to look at the cannabis space as an opportunity for growth for them. So they're subscribing to the data to better understanding of form factors, the type of brands that seem to be resonating with consumers as CPG companies that, you know, like make topicals or make lotions of looking at, well, what is the impact of CBD-based topicals on my business or maybe they're an alcohol brand and you're looking at making a dealcoholized beer that has cannabis instead. You know, you wanna look at the beverage market beverage segment and see how they're performing.

So that's been pretty exciting trend of just this wider audience of parties that are interested in the type of data we have. And I think, again, it's just really good indication for this industry, you know, it used to be very much, you know, Canada's Canada, Canada's the only cannabis operators, but now there's a lot of interest coming from outside. They're not customers per se, but also the media, the media and the press is very interested in our data. You know, we work with them like we just did an analysis for a group on Green Wednesday, which is right around the corner of the day before Thanksgiving, which we've seen is the second highest sales day in the year, right behind 420. And so the media is very interested to kind of back up some of their assumptions about the market or as a position a certain claims about the market. They can look at our data and, you know, back it up with numbers. So it's kind of our audience currently. And, you know, it's really exciting to see the growth there.

Matthew: Let's talk about the data a little bit more. So if there's an optimal way to use the data and then there's an optimal way. So if I were to jump into the data right now, let's just say hypothetically, gummy bears showed he's very popular and vape pens should it be very popular. I'm a new brand, I've just raised some capital and I wanna make a vape pen or a gummy bear because they're selling well. So I, you know, I'm kinda, I'm just following the market saying I, you know, I wanna sell what's selling. But it doesn't necessarily tell you everything and it might not be the best bet because it doesn't take into account brand loyalty. If I buy a gummy, I'm only gonna buy them from this one band brand or they have a really strong loyalty or it doesn't tell me if the market's flooded with vape pens, were there so many choices. I'm just gonna go with what I went with last time because I don't. I have decision fatigue. So let's say we don't want to do that. We wanna stay away from the me too stuff. What can you say about creating a new category or a new sub category? So, for example, a, perhaps a dissolvable gummy or a hangover type refreshing and revitalizing vape pen that can perk you up after a late night. How do you feel about this idea of creating a new category or a new subcategory?

Cy: Sure, sure. I think Matt, you need to go into product development. Those are some good ideas actually. Yeah, totally. You're absolutely spot on. I would say that, you know, there's still plenty of opportunity and things like gummies and vape pens, by no means is the market I'm settled. By no means are the players that we see today gonna be the players that are the brands that will last 100 years from now on. But you're absolutely right in that it will be very competitive. So if you make a new company, you put it on the store shelf, you're gonna really one. I mean, to even get the store shelf space is getting more and more difficult. There are so many brands now that there's finite retail space, these retailers have relationships with these product manufacturers at this point. And it can be really hard for them to swap out a company that has known sales for your gummy unless you can really differentiate it and whether that's through price or form factor or some positioning in the market.

So, you know, there's still a lot of growth and things like gummies and vape pen, still a lot of opportunity, but it is potentially gonna be a challenge to go in and fight head to head with some of the groups that are there have made headway, whether that's through their brand loyalty for the consumers that they now or just working with retailers to convince them to even carry your product. So yeah, moving into a new category or subcategory or developing a new segment is absolutely something that we see happening. We like to joke that it's like people are throwing everything at the wall to see what sticks because we don't really know. And so you know, if you can consume it, you can probably infuse it with cannabis in some manner. And so there's, there's plenty of opportunities for the hangover type of product or a dissolvable gummy or a chewing gum that's, you know, low dose five milligram or what have you.

And we do track hundreds of sub categories and there's some that are, you know, pretty funny and pretty interesting, that are surprising I would say that are out there. So yeah, I would definitely encourage that. You know, consumers are looking for new form factors or retailer might be more interested in carrying your product if it is something that they don't currently carry. And it's a Greenfield is wide open. You can go out and not have any competition in that space.

Matthew: I gotta think it's gotta be harder for dispensary owners to just deal with coming in and triaging these opportunities of all the different people wanna be on their shelves. It seems like it's probably more important now to be vertically integrated where you're, you know, you're controlling your whole supply chain if possible because you know, you really don't have any sway unless with the dispensary owner unless customers are asking for your product by name. So some tough challenges there maybe for certain brands and things that don't have brand recognition yet, but I'm sure the creative ones, we'll jump that hurdle with ways we kinda just talked about there. So any interesting partnerships or things coming up you wanna talk about?

Cy: Sure. We've got a lot actually coming up by the end of the year. So this is, I guess we've got about a month left in 2018, so I would say stay tuned for some exciting news there. You know, what's really exciting is these partnerships are with groups that are non-cannabis vertical operators that are coming into the market given kind of the new landscape with countries like Canada legalizing. You know, they are very similar to us in the market intelligence space. So some exciting stuff to talk about soon, but a little too early to announce. So stay tuned, watch for the PR to land before the year's out.

Matthew: Great. And Cy, I get emails everyday from college students, professionals already in the workforce and they wanna transition to the cannabis space. And I give kind of general information, but sometimes I feel like I'm not giving enough value back. Do you have any examples of a candidate or someone you saw that made a transition into the industry successfully that maybe you could highlight to tell people, you know, just an example of how it might be done successfully?

Cy: Sure, sure. Yeah, I think again, not to keep picking on Canada, but we've been spending a lot of time up there. We have an office in Toronto at this space at this time. And what's really exciting about Canada has given the, the lack of the federal overhang. Like in the US we have the issue of it being a schedule one substance. So it kind of precludes a lot of people from more traditional industries jumping in just because of the risk or potential risk. In Canada, you know, that that doesn't exist as much. And so at this point, you know, in Canada we work with a lot of the LPs, the brands in the space and it's, it's interesting when you're sitting across the table with some of these large, large brands, whether it's the canopies of the Afri is or they were ours. The other side of the table is full of people that come from a beverage alcohol. So a lot of the beer companies, the Molson Coors of the world and they've jumped over and we kind of joke like, who, I don't think anybody is left in Canada and making beer at this point. I think everybody's jumped into cannabis.

So I think that, you know, a variety of experiences in that world, whether it's alcohol, whether it's CPG, I think is very beneficial to the cannabis space. I'm also seeing a lot of operators like project management, you know, people that are used to, you know, fine tuning operations. I think that in this industry, operations is kind of a huge opportunity because a lot of the cannabis product manufacturers, you know, started as, you know, growers or, you know, had a recipe and now they're scaling up and looking at, you know, multistate operations and they need support to be able to do that. But, you know, that's through my lens and kind of the world that we're in. I would say that, you know, no matter what you do, I think there's a huge opportunity in this space for you. It's just finding the right company to jump into.

Then I would encourage everybody to do it. I think that, you know, given we've been in it for eight years at this point, which, you know, eight years is some time, but in cannabis years it feels like forever. And another eight, I can only imagine, you know, where we're gonna be or you know, actually have trouble imagining because I think it's gonna be so much beyond what we're seeing today. So, you know, I like to say there's never been a better time to be in cannabis. I've been saying that for probably the last five years. So, you know, it continues to get better and better, but I think that now is definitely the time to jump in.

Matthew: Yeah. And I feel like the risk is largely gone, whereas a few years ago still felt kind of like phrase this is a little bit risky. You leaving something behind. Now it's just, I feel like that's gone. You know, the launch sequence has been initiated in this thing is taking off.

Cy: I think when we started, yeah Leafly, you know, we would always caveat when I would explain to neighbors or friends, you know, I would say, or even family are in the cannabis space, but we don't touch the plant or we're just data.

Matthew: You upon it. No, no, no, no, no, no, no Jack, no, I'm not. I pass on grass all the time.

Cy: Or look at the app, you know, it's this mainstream app because I think there was a lot of that stigma and people are afraid to have things like a cannabis on their resume. But today I think when you say, you know, I'm in the cannabis industry, people look at you with a bit of jealousy, like, well, how do I get in, you know, this, I wanna jump in, where do I go? And I think it shows that you're forward thinking and uh, you know, ambitious and risk taking. So yeah, I totally agree with you. It's definitely normalized at this point.

Matthew: So Cy, at this point in the interview, I like to ask a few personal development questions to help listeners get a better sense of who you are personally, and you're gonna get a couple extra because it's just because it's you.

Cy: Fantastic.

Matthew: So here we go. Is there a book that has had a big impact on your life or way of thinking that you'd like to share?

Cy: Yeah, you know, I read a lot of I guess nonfiction certainlyand fiction, but I'm a pretty avid reader. I think reading is just the best, fastest way to learn from a lot of smart people out there. You know, some that I guess kind of where we're at today, you know, a more recent book that really has been resonating with me enormously is the ''High Growth Handbook,'' by an individual Elad Gill who's a very well known startup individually has been in Silicon Valley for a number of years. But there's something about this book, at least for the point of our businesses in. So, you know, we're in this kind of inflection point going from early stage to growth stage.

It's kind of where you've got product market fit, you know, you've got a validated product, you have customers and you're now it's all about kind of scaling it up and all of the things that that entails, hiring new people, you know, dealing with dynamics internally, you know, things like fundraising. So I think that that one seems to be just kind of like a playbook for where we're at right now. I wouldn't necessarily recommend it for everybody if you're just starting a company. It's probably not totally relevant. I think it's a good window into your future. But for where we're at right now, it's like every chapter it's like written just for me, I feel like, so it's called ''High Growth Handbook.'' I would really recommend it for anybody in the startup world. You know, additionally, a good startup book that I recommend that is recommended by probably everybody is ''The Hard Thing About Hard Things.'' You know, that...

Matthew: By Ben Horowitz?

Cy: Ben Horowitz exactly. That one is I think also a good kind of reality check, you know, this is not even our second startup, myself and my cofounders, you know, weekly being the early certainly, but we had a number before. And to say it's a hard thing is an understatement and I think it's a good way to kind of brace. So you're not surprised by a lot of things. So I definitely encourage that. You know, so those two books are great if you're kind of in this world and I'm currently reading ''Blitz Scaling'' in the messy middle. ''Blitz Scaling'' is Reid Hoffman, so the founder of LinkedIn and it's really about just kind of scaling your operations up quickly to get that market share and just the best practices to do it if there are any best practices that also. So a lot of kind of startupy businessy books, but it's kind of nice to have just to kind of help guide us through it because even though we've done it before with Leafly, you know, it's a different business with headset, different dynamics in the market and so new challenges all the time. So having books like that are invaluable.

Matthew: Is there a tool besides Headset that either you or your team use that helps with your business or productivity?

Cy: Sure. You know, we're all concentrated more or less than in Seattle with the exception of our Toronto office in some field reps essentially in markets like California and Colorado. So we definitely like using Slack, which is a communication tool. You know, I'm sure most companies are used to using that. You know, to keep everyone on the same page, I would encourage operators to develop kind of not a Wiki for say, but some sort of knowledge base where people can share their information in the organization, whether it's documentation or just project management. So we use a service called Quip that's Q-U-I-P. We really like that. It's kind of like Google drive, very similar but a little more bells and whistles to make it easier to communicate, to have kind of more dynamic documentation.

So that's been pretty helpful for us to keep everybody on the same page, especially as we scale up, you know, you kind of lose a lot of that tribal knowledge and the organization. You can't ask everybody for everything. So if you can go to one place and kind of figure that out, that's been great. But I can go on and on. We'd like to use a tool called Intercom on the platform. Intercom is great for customer engagement. It really gives us a good sense of well, one, it's a great way to connect with our audience, so if someone needs some help, they can just jump on Intercom and start messaging us, but it also provides us some great analytics on usage of the platform so we can kind of identify, you know, who's a power user of the platform, who hasn't logged in a little while and really helps us with things like customer retention and just really understanding our customer base. So those are some three tools, top of mind, you know, there's probably hundreds of others that we use certainly, but, you know, those are three of the big ones that really helped push everything forward.

Matthew: Well those are great. I got two more questions for you. You've given me a lot so far, but we got two more to go. So I'm gonna ask you a Peter Teal interview question. What important truth do very few people agree with you on as it relates to the cannabis industry or all in general?

Cy: Sure. That's a tough one. I think that I'm tough one. That's probably why it's a Peter Teal question. You know, I think, I guess I would have said, you know, that the cannabis industry is something like any CPG industry will turn into that. You know, I think that I, you know, at this point I would say that probably a majority of people would agree with me on that maybe a couple of years ago less so. I think when we were starting Headset, I think that. You know, people were questioning or would question is there really a need for that, you know, sales are always up and to the right with cannabis in. Do people really need that level of data. Or you know, maybe more recently or since the beginning of headset, you know, our operators sophisticated enough to look at numbers. And I would say that, you know the truth is, yeah I do believe that they are sophisticated enough or they do recognize that they need to look at numbers, whether they're a mom and pop a hole in the wall store. That gets enough information out of our daily email summary that comes out to them every day based on their operation or if they're, you know, wanting to dig into their inventory to identify the performers, you know, I would say that these, these operators do look at the data and you'd be surprised you don't need to be a multistate operator with a staff of 100 and having analysts full time. There are people in this space are pretty much everybody in the space recognizes that that data is important.

And know if that's just a big sea change that's happened with the era of big data and metrics and analytics and you know, I think something in the water, people recognize that, but they wanna stay competitive. They need to stay ahead of others. And so looking at the data is important. And so I think that would be the truth that people, few people agree with me on that, you know, even the smallest operators need good data to drive their businesses, which is very much true from what we see from our customer base.

Matthew: Last question Cy. If you had to go to a dispensary this week and purchase $100 in cannabis products as gifts, how would you spend the $100 and who would you give the gifts to? Don't have to give names, just relationships.

Cy: Sure, sure. Yeah. Certainly can't give to myself, I assume. So I think it's a great question, particularly for this week or you know, given that we're moving into the Thanksgiving holiday here in the US and in green Wednesday as it's coming to be known as such a popular day for sales. I think kind of in the lens of this week, I would purchase most likely and edible, probably some, a low dose product, something, you know, five milligrams per serving or even less and something with a really nice packaging, really great brand positioning in the market. And I say that because I would take it to, you know, Thanksgiving dinner where, you know, potentially I'm gonna meet some new individuals and you never know their opinions on cannabis. Most likely they're, they're pro-cannabis. But it's a good way to introduce people to the market without, you know, to kind of de-stigmatize a bit where they can see a product that looks like something that they would purchase that at whole foods that they can try without any risk of consuming too much cannabis or having something to potent, and, you know, really, uh, hopefully to help change their mind. So I think that that's the route I would go. So probably an assortment of edible products, low dose things like mince, things like single serving cookies that, you know, come a nice packages that I think would resonate with a Thanksgiving dinner crowd.

Matthew: Good. Very portable stuff. I like that exact. Cy, as we close, tell listeners how they can find out more about Headset and learn about the data and the services you offer.

Cy: Sure, sure. So head over to our website at headset.io. You can learn about the different products that we have, whether it's Headset Retailer. Insights, which is our market data product, and a headset bridge, which we didn't really get into, but it's pretty interesting if you're a product manufacturer. We also published a best seller lists that's refreshed daily, so it's the top 10 products in the markets that we do track by category. So if you wanna dive in and see, you know, who are the top 10 pre roll or what are the top 10 payroll products in Nevada today, you can go and see that it headset.io. We also published some great industry reports that are, you know, a few pages. We kind of do deep dives and different segments. The most recent one we did was beverages report before that we did a Canada analysis and assortment analysis of who the players are, what the product mix looks like and so on. And so I'd encourage you to check that out. Those are free, um, and kind of give you a great insight into the type of data that we collect and how we can use it to help our customers drive decisions.

Matthew: Well, Cy, thanks so much for coming on the show and educating us and I wish you all the best the end of this year and into next year.

Cy: Sounds good, Matt. Thanks for having me again. Appreciate it.

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