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purekana CBD Coupon Code

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LeafLink – The Booming B2B Cannabis Platform That Drives Sales

ryan smith Leaflink

Ryan Smith is focused on streamlining the process of bringing cannabis cultivators, infused products companies, and dispensaries together. If you want your cannabis product to get into dispensaries you need to hear this interview.

Key Takeaways:
[0:59] – What is Leaf Link
[1:30] – Ryan’s background
[3:24] – How does Leaf Link work
[6:07] – What type of companies are using Leaf Link
[8:26] – Most common transactions on Leaf Link
[10:03] – What makes Leaf Link different from other platforms
[14:01] – Ryan talks about Leaf Link doesn’t touch the money in a transaction
[14:42] – How does Leaf Link generate revenue
[15:58] – Bringing attention to your product on Leaf Link
[19:10] – Ryan talks about sending samples
[21:35] – Ryan talks about the future of Leaf Link
[25:40] – Ryan answers personal development questions

Learn More at
https://leaflink.com/

Important:
What are the Five Trends That are Disrupting The Cannabis Industry?
Find out for free with this cheat sheet https://www.cannainsider.com/trends

Click Here to Read Full Transcript

Cultivators and infused product companies are always trying to get their products into more dispensaries, and dispensaries are always looking to sell the products that customers want. Here to help us understand how these parties can connect is Ryan Smith of Leaf Link. Ryan, welcome to CannaInsider.

Ryan: Hey Matt, thanks for having us.

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

Ryan: Today I’m in a very homey Airbnb in San Francisco. For the next few days I’ll bounce around between California, Colorado and New York a bunch.

Matthew: Okay. At a high level, what is Leaf Link?

Ryan: Leaf Link is a wholesale B2B management platform. We connect now over 1200 retailers across 5 states with more than 200 of the leading brands. Everyone from Incredibles to Dixie to Cheeba Chew to Kiva to Wana and they’re our clients. We provide two things, an online marketplace where they can communicate and purchase inventory, and an order management systems that sales teams use to process those orders internally.

Matthew: What’s your background before starting Leaf Link, and why did you start it?

Ryan: Sure, my background I went in as an undergrad in college. Started an investor relationship management platform for real estate. My family is in real estate in New York. I found there’s really an old school industry and we could build this solution for how general partners communicate to limited partners, so we launched that my senior year, raise a bit of capital, sold it to a public company back in 2014. Then I met my co-founder Zach, who was at LimeWire back in the day, previously at EBay, and we began investigating the space and seeing how we could support other amazing pioneering entrepreneurs building businesses.

Matthew: I think that’s a saying about general partners and limited partners. At the beginning of the relationship, the limited partners have all the money and none of the knowledge. At the end, they have no money and all the knowledge. Have you heard that before?

Ryan: I guess it depends on who you’re getting (2.27 unclear) to the general partner.

Matthew: I don’t know, that’s a saying I’ve heard before. I wanted to see if you thought that happens at times.

Ryan: Yeah, I mean, definitely it happens at times. It’s more than that, actually a pretty scary thing that’s happening in this industry particularly is people getting pretty wide eyed at any potential opportunity in the space. So, definitely people losing their wallets for not properly placing capital.

Matthew: You said you’re in five states right now. Could you say those states one more time?

Ryan: That’s right. We originally launched about 15 months ago in Colorado, then Washington. Now we’re also in Nevada, Oregon and California as well.

Matthew: The dispensaries and cultivators and these different parties could be doing this on their own, but it’s not the most efficient way or the best way and there’s some tradeoffs to try to do it that way. How does Leaf Link make that whole process better?

Ryan: The way we came up with Leaf Link was really by entering with no preconceived ideas. Zach and I flew out and we met with whoever would take a meeting with us, brands, amazing brands, cultivators, retail purchasing managers and just said, what are your problems. Tell us about them. We looked for patterns. We found that in the world a year ago, before we launched, a purchasing manager at a lean dispensary, in any state, is buying from somewhere between 20 and 50 brands every other week. In order to do that they need to manage PDF menus and emails. They send text messages with purchase orders, faxes sometimes.

Matthew: Oh, I hate that word! We got to stop faxing. What year is this?

Ryan: Exactly, but the industry is so just grinding away and trying to get everything done to grow, and people are not stopping and thinking, this doesn’t make sense. Why am I spending a day and a half a week placing orders when I can just do it. Zach and I thought we could virtualize all this, and that’s what we built Leaf Link to do. So now people can purchase from all those brands, live menus in one cart.

Matthew: The biggest benefit is, or I should say, it solves the biggest frustration for the purchasing manager. It makes that person’s life much better compared to the others. I mean, it’s solving a problem for the other participants in this platform, but you’re saying it changes their lives probably because they go from dealing onsie, twosie, did you get my message or did you get my invoice, did you get my purchase order to it all being streamlined.

Ryan: So what we found was—that’s where it started, and we just met with purchasing managers and we heard that story. Then we thought, let’s just follow the life of an order. What happens once it gets through that fax and text message to the sales team, and then we got there and we realized oh my god, they’re putting it on post-it notes and whiteboards and Google Sheets, and that’s how it goes from the sales team to the production team to the distribution team and accounting team. We asked some of the sales side companies, these brands whose names you know, what was the most sold product yesterday or what moved really well last week, and they would give you a subjective answer. “I think it was this particular product.” I said, you don’t know. How can you not know? How do you make a proper decision on what to build next? So that’s where we built the order management tools as well that hook in seamlessly into the marketplace.

Matthew: Okay, that makes sense. What are the categories of companies that are on Leaf Link right now?

Ryan: At Leaf Link we have this general theory for the industry, and we believe every month it seems to become stronger and more validated, but brands are everything. This whole world of mom and pop growers and these amazing pioneering entrepreneurs that were in the space, have been in the space for 5-10-15 years, they’ll always be that part of the market. But the companies that are scaling the fastest, that are creating product that touches the most people, that are raising capital are brands. Like any other industry, they’re packaged goods, they’re consistent, people can understand what they are each time. Branded products, whether it’s edibles, creams, THC infused concentrates, all that stuff, and some flower as well. Some of the branded products are where this industry is going.

The three buckets of clients that we serve are—the first we like to think about is industry leaders. Companies that have more than 50 percent of the market that they’re selling to every day, but they need some structure. They’re looking to grow into the next state, that’s the first bucket. The second bucket are companies that are not brand new, but they want to one day be in that first tier of industry leading 50 percent plus of the market they’re selling to, and they’re looking to create some structure on how their teams operate, they’re hiring new people. They want to understand their business in a more granular data level. That’s the second. The third is brand new products. We’re just launching, we’re putting out one or two skews, maybe five or ten, and we just want to tap into this community that we built on Leaf Link of active buyers that can notice your product. There’s really no other way. There’s a lot of invitations around advertising in this space, but there’s no other community as active in purchasing as that on Leaf Link. That third bucket is you can basically start from nothing, progress your way up to an industry leader and we have different tools that are valuable to each of those different groups of sellers.

Matthew: If you were to login to your executive dashboard now and look at the transactions that are taking place and what’s happening on the platform, what are the most common types of transactions we would see right now if we were looking over your shoulder?

Ryan: In terms of product types?

Matthew: What’s the most frequent type of thing you see between different parties on the platform? What’s the frequency of different types of activities?

Ryan: Each market is a bit different. In Colorado there’s been this explosion of concentrates. Branded concentrates are super popular. They’re all over the place. Lots of inbounds from concentrate companies wanting to get listed. That product is selling really well. We’re seeing some really ingenious, everything from gum to sparkling water. You pretty much name it and we’re starting to see these (9.12 unclear) products on the platform. It seems like the strategy of a lot of companies now is what—everyone is seeing baked goods. Gummies always do really well. What new can be created to change that experience for the end consumer, and those are the ones that get a lot of attention because it’s completely fresh and it’s exciting and different and something you haven’t seen before.

If you think about it from the retailer perspective, in a lot of these cities it’s crowded. There’s more retailers than Starbucks in Denver, and you need to find that new cool product to beat the person across the street that’s running a dispensary. How can you make yourself more competitive and that’s by having the great products that are Leaf Link for you to purchase.

Matthew: There’s a couple B2B platforms out there. What makes Leaf Link different?

Ryan: There’s definitely companies that have a similar goal to be what we are. A lot of them are ones that we hear about at conferences or on podcasts or interviews. When you go into the market and you speak to the brands that we work, the retailers that use us every single day, those names don’t really come up. I think there’s a lot of thoughts as to why that’s the case, but ultimately the main differentiator is people in this industry have been screwed over by companies, fly by night companies before. People are not paying for products that have been purchased.

Our differentiator is that we over deliver on everything we say we’re going to do. We execute endlessly on building this incredible platform that now has this general market acceptance and is in 80 percent of the retailers in Colorado, 70 percent of the retailers in Washington. That’s the main differentiator is that we do what we say we’re going to do. We do it really well, and we like to think that we’re leading the industry into this V2 of what cannabis will be as an example, this tech first industry example for other industries in the future.

Matthew: Let’s get into a little bit of the nuts and bolts of it. Let’s say I’m a dispensary purchasing manager. I jump on Leaf Link and I make an order of 1,000 units of gummy bears. What happens next downstream? What would I expect to happen?

Ryan: If you’re a dispensary in Denver, you would request an account with your license number that we would then check to make sure it’s in good standing with state regulatory bodies, and that’s the case in each state. Then once you’re approved for an account, you can login and each market in each state stands alone because obviously you can’t ship across state lines. As a Denver dispensary buyer, you’d login and you’d see all the available brands in Colorado with live menus, any deals that are happening for particular products, new products that have been launched. Then general community components as well around news that’s available to people that are active on the B2B side. Then you can shop products.

You can go to their menus. You can add different products from multiple brands and vendors to your cart, figure out the total expense, hit submit, and then all those orders are sent out to each of those individual brands, and you can then track the status of those orders as they’re accepted, packed and shipped. Just like on Amazon when you get an update that your package is on the way.

Matthew: Is there an estimated number of days that I would take or does that get communicated after the order?

Ryan: Like a ship date for example?

Matthew: Yeah. If I place this order for 1,000 units of gummies now, before I order, do I know it’s going to take 10 days or does that communication take place after the purchase?

Ryan: Since we don’t touch, grow or sell the product, we don’t touch the capital either, it’s really dependant on the brand and how these buyers—it’s the same notion they’ve always had. Some companies might list on their product and company pages how long delivery and processing times take. There’s actually a tool that allows them to update the buyer with the shipping date so they know, but generally we see most orders are accepted the day that they’re placed. Then depending on the location of the buyer it could take anywhere from one day to a week, I’d say. Unless it’s far off in a distant part of the state.

Matthew: You mentioned you don’t touch the capital, the money flow. You let that occur between the two parties. It’s not going into escrow or anything like that.

Ryan: That’s right. We want to be really respectful. There are great companies operating in this space and have been for a while, and they have certain ways of settling up, COD or using cash for example. Those are definitely challenges that we are keeping our eye on and things we’ll look to solve in the future, but for right now we want to stay hyper focused on creating this community and marketplace that people can communicate and place orders on in terms of handling the deliveries and stocking the product, touching the capital, they still do that.

Matthew: Okay. How does Leaf Link get paid? How do you generate your revenue?

Ryan: We right now charge a monthly fee for companies to be active on the platform. It’s free for retailers, depending on the number of brands, how many states they’re live in, how many brands they have. Those are the things that we use to judge what the payment should be monthly for them to be on the platform. I mentioned it’s free for retailers right now.

Matthew: Yeah, you got to keep the friction away from the buyers, the people pulling out their wallets. Good move. Let’s say the roles were reversed here and I have a new cannabis infused product, something interesting and fun. What would you do if that was your product and you wanted to jump on Leaf Link and put the best foot forward to get the attention of retailers.

Ryan: Starting off, not being on Leaf Link, a lot of the states that we’re in is really a disservice to your company. For example, if I’m starting a company and I knew that I could tap into 600 retailers in Colorado for example, just by paying a small fee immediately and I’m brand new, it’s the cheapest salesperson you could ever hire. Cheapest advertising choice. So, what I would do is hire a photographer, take amazing branded photos with beautiful layouts and come capture that really demonstrates what our mission and our brand is, and I’d spend time writing as well what the detailed description is. Thinking a lot about pricing, talk to customers about that.

Then put it on Leaf Link, and once it joins Leaf Link, with every brand that comes on our marketing team connects with their point of contact and we coordinate marketing blasts to the whole Leaf Link community, whether through the platform and/or through general email to let everyone know that there’s this new great brand. Matt’s ABC Products are now live, and Matt’s launching with a deal, you guys should check this out. Then what we tend to find and this is among the most exciting transactions that we see are great companies will always get deals because they are well known. When a company no one knows joins Leaf Link and they start getting sample requests or just straight up orders because they’re on Leaf Link, that is so exciting. We have a team slack where we all celebrate when small companies have wins because that to us (17.24 unclear) another entrepreneur’s dream to the next level, we love that.

Matthew: Yeah, that’s great. That’s got to feel good when that first one comes in.

Ryan: Yeah, it makes it completely real. One is million more than zero.

Matthew: You should trademark that. That’s a good one. How do merchants then, after they launch, get the attention on the platform? Can you advertise or how do you stay at the top of mind for the retailers once you’re in Leaf Link, if you’re trying to sell to retailers?

Ryan: We have a ton of programs, some virtual, some manual that we use to engage buyers and sellers. What we’ve found some of our clients actually doing on their own, which has been really affective, is they are sending information out to their buyers to let them know this is how we accept purchases. They put it up on their websites, they put it in their marketing material. We go to conferences now and people say they find us on Leaf Link. These are things that companies have just begun doing because they see the value, they see the transactions that they’re getting. It’s exploding for them and they see that they want to add fire to that or they want to add gas to that. That’s been a great tool for us.

Matthew: Did you say you could request samples on Leaf Link, if you’re a retailer and you like hey I just want to request a sample here. Okay, now is there any way to do that to make yourself stand out more than another, I mean include some other collateral besides sending a sample? Do you see that executed? Is there a spectrum on how well sending samples is executed?

Ryan: There is. The way samples work right now is you can request a sample of a product that’s available for purchase, but what we see a lot of companies doing is actually creating sample packs. So, instead of requesting product A, there is a whole pack that comes with information about the mission of the company and the pricing list and let’s say three to five products, just to give a complete picture of this is what we do, this is our mission. I think that’s been really affective for some companies to have these complete sample packs instead of just one product, just two products with the individually sample request for people to learn their brand.

Matthew: Where are you in the capital raising process right now?

Ryan: We got started back in 2015. We raised our first round of capital from investors and friends and family that we worked with previously on the last companies I had mentioned earlier. We closed a little over a million dollars in capital in 2015, December. That took us through 2016 and helped us tackle the Colorado market and the Washington market. About three months ago we closed an additional round of capital for another $3 million led by (20.35 unclear) and Casaverta Capital. Have some other amazing partners in there too like FIDO partners and Wisdom VC. We’ve total raised $4 million over the last 18 months and that’s what we’ll use to take down the next states that we’re conquering.

Matthew: If there are investors that are listening that are interested in keeping up if you’re going to be raising more capital, is there anything they can do to keep up on that process or just go to your website, what’s the best way there?

Ryan: The best way would be to shoot an email over to info@leaflink.com. It’s funny, we’ve actually gotten requests, people asking if we’re publically traded and things like that. Not just speaking to those kind of investors, but if there are people that are in the space and interested in getting behind a company that’s really in the way, then feel free to shoot a email to that and it makes sense to connect.

Matthew: Okay, what do you think we can expect from Leaf Link over the next one to two years? How do you think things are going to evolve and expand?

Ryan: Part of the success that we’ve had is how focused we are. This is the case for all companies in the in the industry, but you know companies that are focusing on so many things and trying to be everything for everyone, Leaf Link has no interest in doing that. We want to absolutely crush what our primary focus is, and that is to be a marketplace, a communication tool, a community for buyers and sellers in this industry and empower their businesses and that’s what we’ll continue to do. Fortunately there’s new states opening up every several months it seems that we need to be in yesterday.

So our focus is taking the model, the product fit that we have in Colorado, in Washington and now in Nevada, Oregon and California and continue that into the next states. The really exciting thing is that our clients are thinking the same way. That they’re opening new states and they need structure, they need process, they need Leaf Link. We’re working really closely with them to see—further that mission of helping them get to the next level. Staying focused on what we’re doing, not doing anything completely from left field until we absolutely own this. As a luxury of that success, we’ll look at the next product lines, tools that we can provide for our companies.

Matthew: One thing that I’ve noticed when I’ve gone into and talked to dispensary owners, quite a few and also going into grows that I talk to the growers, the growers always tell me they have some sort of unique process and formulation that makes their flower great. I think that’s great to be excited and have some methodology of what you’re doing. Then the dispensary owners always think that they’re doing a better job than other dispensaries. When you go to other dispensaries, especially a few in one day, dispensaries are as different as people. They can be entirely different in their processes, methodology and some execute way better or have a better experience and so forth. Is there anything generally that you think you can say about dispensaries that seem to execute well or seem to have good management? Any tips that you see looking from the outside as you go in and talk with them?

Ryan: Dispensary is a company. It’s a retail location, one that sells other products, whether it be liquor or clothes or a pharmacy. Our though is there’s no reason why the standards in this industry, if anything they should probably be higher than other industries just because of the product that’s being sold and the regulations that exist and the legislation that we need to be respectful of. The companies that do the best are typically the ones that have either figured out their mistakes or have experience running retail locations previously and they know there’s great tools we can use, tools like Leaf Link for purchasing product. There’s amazing POS systems that we can use that will create standardization on how we check customers out, how we’re managing our inventory, how are we communicating from different locations, because now we have a lot of these companies that have multiple retail spots. So I don’t think it’s all that different, but the ones that we know are doing the best and the ones that seem to be moving the most product as well are the ones that are in it, because they realize the challenges are similar and if anything higher they need to build some of the structures out as any other retail store would. The ones we know and what it can’t be really is unfortunately it always just be a bunch of friends and a family running a shop. That’s tough. It’s good to get more experienced people that have done it before or something similar before, and use that skill to better serve your customers.

Matthew: Good points. Ryan I like to ask some personal development questions to help listeners understand who you are as a person. With that, is there a book that has had a big impact on your life or way of thinking that you’d like to share?

Ryan: Less a book, I’ve been all about podcasts lately. Maybe like a similar concept but quite the audible listener too, but one that I’ve been listening to every day, and no offense to present company, but every day when I wake up I listen to an episode of How I Built This. It’s on MPR, and they profile all these amazing entrepreneurs and challenges that they’ve faced. To see the patterns similar to the way we see patterns around both what we both think as a solution. I really enjoy that. It gets me—I’m already pretty high energy and revved up for the day, but further excited to just get out there and continue to build Leaf Link.

Matthew: Do you have any other kind of daily rituals or morning rituals you do to help get yourself in the set for the mood in the day?

Ryan: Yeah for the last couple months I’ve actually been swimming every day when I’m on the road early in the morning. It’s a nice removal from just everything like constant emails or Slack or calls to just think a little bit and zoom out and how we tackle the day and thinking about things differently, or (26.56 unclear) enough to make the right decisions longer term because we are in it for the long term. That repetition, that quiet is great.

Matthew: Is there a tool web based or otherwise besides Leaf Link that you consider really valuable to your day to day productivity?

Ryan: Two that we use every day. One is Slack, which I don’t know if I love or hate. Have you used Slack?

Matthew: I’ve used it yeah, and I don’t know if I love or hate it either.

Ryan: I get the idea. It’s like death to internal email, which is a cool idea, but I also wonder is there a point of just too much communication. Do you get lost and just sucked in to this world of endless messages, but I’ll put it on the list that it’s a helpful team because we are a distributed team across five different states. So it’s a good way to keep everyone up to speed on what everyone else is working on. The second tech tool that we use is Inbox by Google. It’s not the same thing as Google Inbox. It’s basically a email client that allows you to snooze, remind, check off emails effectively as to do tasks, and it’s great for sales. It’s great for managing relationships because you can remember to follow up with people if they haven’t responded back to you. It pops back up into your inbox. Inbox by Google is great.

Matthew: That’s a great suggestion. I haven’t heard of that one.

Ryan: Check it out. It’s actually Google knocked off another great competitor. They just did a so much better job and it’s a great tool.

Matthew: Ryan in closing, how can listeners learn more about Leaf Link and connect with your company?

Ryan: Best way is to go to www.leaflink.com. If you’re a retailer, join right away with your license number and we’ll approve you usually in a matter of minutes, once we verify your license, to begin purchasing. If you’re a seller, send us your email through the website or at sales@leaflink.com and we’ll also get back to you very quickly. If you’re in Colorado, Nevada, Washington, Oregon or California, we are live in those states, hundreds of retailers on the platform in each of them, and excited to continue working with great companies.

Matthew: Ryan, thanks so much for coming on the show today and educating us. I really appreciate it.

Ryan: Thanks Matt. Appreciate you having us.


Lower your Cost of Cannabis Cultivation

armando suarez of Grodan

Armando Suarez from Grodan shares growing wisdom garnered from years of working with indoor produce farmers who have to grow their crops at 50 cents a pound or less.  Listen in as Armando shares this wisdom to help you grow more efficiently.

See footage of rolling tables we talked about in the show
https://youtu.be/PyZ-kYfXymA?t=43s

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

Key Takeaways:
[1:07] – What is Grodan
[1:26] – Armando talks about how he got in the cannabis industry
[2:12] – Grodan’s flagship product
[4:28] – How does fertilizer interact with rock wool
[8:06] – Armando talks about bringing costs down
[12:02] – Why cannabis growers pay more than vegetable growers
[13:23] – Armando talks about ideal drip irrigation system
[16:23] – Bad habits of growers
[23:29] – Mixing air into the grows
[26:49] – Balance between natural light and supplement lighting
[28:40] – Armando talks about growing in vertical spaces
[33:37] – What are rolling tables
[36:36] – Clipping tomatoes to wires
[40:10] – Armando talks about cultivation in the next 3-5 years
[42:49] – Armando answers personal development questions

Click Here to Read Full Transcript

Implementing best practices in the grow room is getting more important as competition increases in the marketplace. Here to give us some cultivation guidance to both new and seasoned grows is Armando Suarez of Grodan. Armando, welcome to CannaInsider.

Armando: Howdy everybody.

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

Armando: Well, I live in upstate New York in beautiful Ithaca, New York. It’s very close to Cornell University, which is supposedly one of the best agricultural universities in the country.

Matthew: Yes, it’s supposed to be very nice up there. Home to Ithaca College and Cornell both.

Armando: Correct.

Matthew: What is Grodan at a high level?

Armando: At a high level Grodan is a company that makes cotton candy with lava.

Matthew: Okay, we’ll get into what that means and why it’s good for plants, but I want to ask you a couple of other questions first. How did you get into this industry? How did you get into helping cultivators?

Armando: Well, my first job ever was in a nursery. I was just 15 year old, and it was to grow pansies for decorating cities. And from then I took a bachelor in Agricultural Engineering and Farm Management. That’s how you start and then you stay in the farm, and here we are.

Matthew: Now what do you mean exactly when you say “Cotton Candy with Lava in It,” because people are going to be what does that mean, and how does that help plants. Let’s talk a little bit about the flagship product of Grodan, what it is and why it’s important.

Armando: Basically the health of a plant is very determined by how healthy the roots are. Back in the 50s a company in Denmark was doing experiments on how to make rockwool, which is actually lava that was poured into a spinner to create fibers. Normally those are used as insulation, as you can probably guess. And they were for glues to make it hold its shape to go in between the rafters. One of the glues they tried was a mitigated disaster. It attracted water. It retained water. Can I mention that if you put insulation that gets wet, well your house is going pile - and melt into a pile of mold within six months.

So they threw it on the back of a factory and never to be looked again. Except that across the street there was a crazy greenhouse grower. He realized that grass was growing on it the next year, and that’s how Grodan started. They had their eureka moment, you know what, plants seems to actually like growing in this stuff.

Matthew: And it likes to grow in there because (A) it attracts and retains water, but is there any other characteristic besides the moisture attraction?

Armando: The more important factor there, it’s not that it attracts water, it’s that it actually rewets once it dries. So, one of the biggest challenges when you talk about growing media is not to wet it initially. It’s to actually rewet it once the plant is actually taking the water out. And rockwool seems to be one of the ones that rewets easiest, and because it rewets easiest, you actually have fairly good control of the amount of water that is going to be in that root zone.

Matthew: What about fertilizer? How does fertilizer interact with rockwool?

Armando: That is the other advantage that they found out is that it does not react with fertilizers. Most other medias, in fact, the lowly soil that covers most of the Earth actually retains fertilizers, and it will eventually compete with the plant for the molecules. In the case of rockwool, all those molecules and fertilizers are actually are available.

Matthew: That’s interesting. So, in your mind it’s the ideal starter growing media would you say.

Armando: Well, it’s very good because it’s clean out of the factory. Nothing could have survived the process of being melting into lava. Is it the best one? I believe so, but I’m a little biased.

Matthew: Okay, right. Now let’s look at the way - you talk with and work with a lot of growers that are outside of the cannabis industry and a lot that are inside. Let’s look at, for example, vegetable growers. They can produce their product at anywhere from $50 a pound or more or less, but that’s much lower cost per pound than a cannabis grow.

Armando: $50 a pound, I wish.

Hi CannaInsiders, sorry to interrupt the interview here, but just wanted to let you know that I meant 50 cents a pound here, not $50 a pound. Now back to your program.

Matthew: How can cannabis growers get there? What are they doing differently than the produce growers?

Armando: Well first the produce growers are not getting $50 a pound. They’re getting like 50 cents a pound, which illustrate why it is important to choose a system that allows you to remove all the little inefficiencies that are going to occur in any operation. Operational efficiency is really important for these guys, and they have eliminated pretty much every little thing that makes them waste one second here and two seconds there and three seconds over here and one second over there. All those little inefficiencies when you start calculating them over 1,000; 5,000; 5 million plants becomes really really big dollars really really quick. By removing them, you achieve survivability of your business when you have profit margins that are razor thin like the veggie guys.

Matthew: Right, so 50 cents a pound, the guys who grow and girls that grow cannabis right now their forehead’s sweating a little bit just thinking about how cheap that is compared to what they get. Let’s just say roughly a $1,000 a pound. There’s some that make $1,200. There’s some that make $800, but let’s just say $1,000 a pound, but they want to bring their costs down a lot. Do you have any specific examples around drip irrigation or something similar where listeners can try to visualize ways they can bring down their cost structure so they can be more competitive, and also actualize more profit.

Armando: Yes. For example, cost efficiency is the use of rockwool in a lot of the largest vegetable greenhouses, are switching to rockwool because they don’t want to be dealing with any bulk material. Bulk material require machinery, requires containment, requires washing the pots, cleaning the pot, moving the pots, getting in and out. So the lighter you can do the substraight and the more self-contained it is, which is the case of rockwool, because that’s that whole point of having tried the glues in the first place, was to actually be able to get in and out as quick as possible in the greenhouse. For example, the cost of setup with their plant is reduced to just a couple of dollars, while you look at pots that are used with any bulk material in it. In fact, that includes also rockwool as bulk material. Once you include labor in it, you’re approaching dangerously already $10 per plant.

Matthew: Yeah so, this is case in point. You’re saying look at your process holistically and every variable that goes into each one. It’s not just about hey I’m growing in pots. It’s like, hey you have to get the pot there. You have to make sure it’s clean, and then you have to clean it again and all these different things. Every input into that step and then every output. What are some other variables and steps you think that cannabis growers should be looking at in order to bring down their cost structure?

Armando: Substruct is a very very small one. One of the big ones, the big ones I see are really aimed in the cannabis market in the U.S. It’s really fertilizers and light. For most growers in the greenhouse, light is essentially free, depending on what geographical area we’re considering. For example, I see a lot of operations going up in the deserts, and they’re going inside, which makes absolutely zero sense. With all that light free, it makes no sense because that would be your biggest electricity cost, by far. You really look at as lighting in dark places where electricity is cheap. For example, in the Northwest there it’s an (10.56 unclear). So you see it really depends on the geographical area. Now on the fertilizers, yes. Pre mixes are something that really comes from the dark side in the retail mentality. You cannot be paying what these guys are paying for fertilizer.

Matthew: What would be a better way? How do you make sure you get great fertilizers at reasonable prices?

Armando: Well you buy from your Ag supply, and you make the potions. I call making them, preparing potions, yourself. To give you an example, an average vegetable grower is paying about 4 cents per gallon of irrigation water. The cannabis growers are paying about a dollar for that same gallon.

Matthew: Why are the cannabis growers paying so much more? Are they subject to marketing hype or what is it?

Armando: In part yes, I think there’s a lot of marketing hype. There’s a lot of legacy. It’s like that’s how the market grew, and most of these guys are actually new entrants in the market that have little agricultural knowledge. They think that yes, they’re putting magical potion in the water and that makes the plant grow. Guess what? That potion is nothing magical, and you can actually make it yourself.

Matthew: How would someone go about making it themselves if they’re used to buying the expensive stuff?

Armando: That is actually quite a steep learning curve. In fact, I attribute the fact that very few of them have taken that step in that direction because of that. Essentially any guy that is graduating from an agricultural university should be able to prepare potions.

Matthew: Okay, so this is like the NPK, the nitrogen, phosphorous and so forth?

Armando: That’s correct.

Matthew: Just getting that right and then what about creating an ideal drip irrigation system? How would you design that?

Armando: Actually that’s a very nice segue into irrigation system. Most of the time what I see with cannabis growers is that they have not step into really getting a hard look at their fertilizers, because every time they tried a different type of fertilizer, and they were trying more efficient irrigation system, boom, immediately they were clogging. It’s two components of the system that actually married together, they have to work together. If you’re putting anything in your irrigation system that is going to even have the hint of flocculating and making any type of gunk inside the line, yes you will forbid yourself the usage of real dripper irrigation, and foregoing all the efficiencies that come with automated irrigation and cheap fertilizer.

So, the first one is yes. You will have to choose the fertilizer that will not precipated, that will not create any deficit, because otherwise you cannot do an irrigation system with it. Plants are going to grow beautifully, but again it’s the mentality. Okay, now you’re a business, now you need to control costs. Your biggest bang for the buck is right there.

Matthew: Okay, so when you say it clogs the irrigation system, do you mean the nutrient part particulates build up.

Armando: Yes. So basically drip irrigation is created with the mentality that you have to put the water right on the roots of the plant in the slowest manner possible, while you’re still providing for the needs of the plants. Because you need to go very slowly, the passages that you’re using, which are the drippers, are very small holes. Anything that can go wrong and clog that tiny hole is going to clog it. So, the way to design it is always keeping in mind that you need to move water slowly, because moving water fast or moving a lot of water or pushing water very hard through a pipe is actually expensive. If you move it too slow, you get the nutrients clogging the lines. So, it’s a balancing act between those two.

Matthew: Is there any kind of bad habits you see amongst growers that they would be wise to change?

Armando: Many of them. The most egregious one that I see, and it’s very related to irrigation and fertilizer use, is these guys are chasing ghosts that in the big picture matter very little. For example you see a lot of growers literally manipulated. They’re focusing so hard on maintaining their ph stable, or literally holding a very precise number in ph. No, no, no, it needs to stay at 5.5, and you see them wasting mental resources and fertilizer resources, money resources, time resources in to trying to keep in line that number, which in the big picture is really not that important.

Matthew: There’s going to be some people listening that are going to say, what does he mean ph is not important.

Armando: Ph is important, but basically in nature plants work within a wide ranges of ph. I would say pretty much anything between 5.2 and 6.8, you are right about where the plant works perfectly. You will see very differences in performance within that range. Let me put it bluntly to you. You prepare a bucket of fertilizers. You let it sit right there. Just the bucket sitting right there, and you go and measure ph probably every half an hour for 24 hours and the ph is going to fluctuate. It’s going to go up and down, because you’re talking about systems that are not static. You are talking of systems that are very dynamic. Particularly when they get large they move very slowly in every direction. So you’re going to have ph fluctuations, whatever you do. No matter what you do. If the ph goes from 5.3 to 5.6, I wouldn’t even worry about it.

Matthew: Okay, that’s good that you bring that up because there’s probably a lot of people that will be relieved that might be doing that and why bother. Is there any other ghosts that they’re chasing where they’re obsessing about details that have a much wider range of success than maybe they think?

Armando: No, what I see a lot of them pursuing also snake oil. It’s a very snake oil prone market. Where, I don’t know, any company comes out with a new thing and it’s like, oh we need to try the new thing. Hold on guys, are you really sure. When you’re in retail, when you were doing (19.36 unclear) in your closet there were six plants. Yeah I can see the attraction of likely doing that. I would actually do that too. Now that you have a business with 6,000, your decision need to be a little bit more machilvalian. They need to be more money oriented instead of just is this product, even if the product works by the way. Some of the products out there absolutely work. They’re fantastic, but is the product—If I’m spending a dollar applying these products, am I going to get a dollar back or am I going to get less than a dollar back, or am I going to get more than a dollar back for applying that product into my crop. And see them not having that mentality yet.

Matthew: Where do you think that—is there a specific geographies in the U.S. or Canada that you see people fall prey to chasing ghosts or maybe thinking their circumstance are unique?

Armando: Yes. Colorado.

Matthew: Colorado, okay. One thing I see, and since I’m not a cultivator I can be a little more objective about it is that I talk with people and they say, well we’ve got unique practices that are different than in the industry and that allows us for bigger yields and a special artisanal growing, best practices, and they all seem to say that. They don’t realize that everybody thinks that. It’s kind of like a home brewer that’s like here’s some additional steps I take to make my brew stand out. There is something to that, but I think it’s perhaps less than they might think. There’s less impact from it. What do you think?

Armando: Absolutely Colorado.

Matthew: Colorado. So, the mistakes they’re making there is they’re not adhering to best practices in Colorado.

Armando: Well what happened is that Colorado was the first one to legalize rec, as well as medical. And a lot of new entrants in the market were pulled out from many other states. For example, I remember being in Florida just the week where they actually legalized rec in Colorado. I literally saw the growers in Florida packing and leaving for Colorado. So Colorado got an immense amount of new people that did not know what the hell they were doing. It’s just a consequence of being first, I think, more than anything else. For example, by contrast when you look at the growers 15-20 years ago, the few growers that you could actually get into their grow 15-20 years ago in California, those were hardcore.

Matthew: Hardcore in what way?

Armando: In every way they were hardcore scientists. They were hardcore. It was very criminal activity 20 years ago. So they were very secretive. They were very focused. They were very good growers. The new entrant is really not that great of a grower.

Matthew: How about mixing air thoroughly into the grows? What are some best practices you can give us there about getting the air mixture right?

Armando: The air mixture in the air, or the air mixture in the water?

Matthew: Let’s go with both.

Armando: Let’s start with the air. That’s kind of the obvious one. Absolutely. The air needs to be clean. CO2 which a lot of people see it as a thing you do on the side. Let me remind to all of your listeners that CO2 is actually the (24.03 unclear). All the little stuff that you put in the water are the vitamins. The real nutrient, the only nutrient that plants use is CO2. So, such in the mix, having CO2 in the mix. I at least have an idea of what’s happening is very important. Of course the king of all limiters in every growing system is the humidity in the air. Plants grow better when they’re warm, but you cannot get too warm, if you’re too humid, otherwise you suffocate your workers and you suffocate your plants eventually. So the air makes the environment of the canopy is absolutely critical in the success of it.

Now a point that is less, a road that is less traveled by many growers is actually paying attention of what is happening in the gases that are actually in the solution. So, in irrigation, the water temperature, and I’ve seen a few instances where that has become a problem. Either the water was too warm or that the water was too cold. In the case of the water being too warm, it was always an oxygen problem, which that’s why I asked the question, is this the air, in the solution the air in the air. So yeah, oxygenation of the water is one of those next step things where we don’t know yet much about it, but we have strong hints that it’s one of those what you don’t know can come bit you in the butt when you least suspect it.

Matthew: What about electricity in terms of you stated your preference and obviously it’s ideal to be having some sort of outdoor greenhouse in a sunny place. How much electric light should be used ideally versus sunlight, and what is the ideal versus practical here, just so people can get a sense of how much electrical light versus sunlight they should be using in different circumstances. Because sometimes it’s a possibility and sometimes it’s not. Sometimes you might live in a place where a greenhouse could be outside, but they’re not getting enough light. How do you arrive at the right balance between natural light and then some supplement?

Armando: It really has to do with the need of the plants. So it’s the idea situation and the ideal building is really the one that provides the best for the maximum performance of the plants. Site choosing is actually of primary importance here. Because depending on where you build a grow, it’s where you’re going to be able to put a greenhouse or to put a warehouse or put a combination, which is a greenhouse with supplemental lighting. So, in a place that doesn’t get too cold, a greenhouse with supplemental lighting is probably the one that is going to bring the biggest bang for the buck.

Matthew: Do you see that happening a lot where people have greenhouses with the supplemental LEDs or traditional lights?

Armando: Well, I’m kind of just one of those finicky crops that are (27.54 unclear). So it’s very reactive to the amount of light that you put on it. So most of the people building real greenhouses. Hold the thought on real greenhouse. If they are building a real greenhouse, they are generally putting supplemental lighting to it, because you’re never away from a cloudy day, even in sunny places.

Matthew: How do you see the produce growers using vertical space different than the cannabis growers or what tips could cannabis growers use from the produce growers on vertical space?

Armando: To be fairly frank with you, I think it’s boondoggling both markets.

Matthew: Okay, why is that?

Armando: Again, it’s when you start running the dollars that matters. Even on the veggie side, most of the vertical farmers—when you start scratching the surface you actually find that they’re very good at raising money from venture capital, but the system is actually highly impractical and not very productive. I would seriously caution many of the cannabis growers of the perversion that is being created by vertical farming on the veggie side, which I think funnily enough it’s a provision that actually comes from the cannabis side.

The only ones that were using lights inside a building for many years were of course the cannabis growers. Now a handful of lettuce growers have caught on to the fact that you can do that in a warehouse, and yes you can grow profitable lettuce, but when you start running the numbers, yes, you can grow profitable lettuce inside a warehouse, but you can grow it even more profitably inside a greenhouse. So, yes you may be in a situation where you’re very good at raising capital. You can get $20 million to build a grow, and then suddenly you’re going to have a greenhouse grower that is going to build a greenhouse five miles down the road and is going to hand your ass to you. That’s what these guys need to start looking at is from the point of view of business. This is not a static market. This is changing really quick.

Matthew: Yes, and that’s a concern I have. I mean, particularly in California I had to see so much supply coming on in the next year or maybe 18 months, and I think cultivators aren’t thinking about that as much. I mean, yes there’s a large population. Yes, it’s legal. More people will be consuming it, but there are really some cultivators that are coming on at scale, big scale, that are going to be flooding the market with cannabis. I want to make sure that people that are going into this space have some sort of unique cultivation ideas, or at least aren’t going into it with what the reality is in mind.

Armando: Well, the argument is that a lot of these guys coming out in scale from greenhouse or from field are not going to match the quality of the indoor growers, which I believe it’s true for now. Notice the for now is the big caveat here. So many greenhouse growers, high tech greenhouse and low tech greenhouse, are not yet getting the quality that allows them to compete with the indoor growers, because the indoor growers just been doing it for 15-20 years. So of course they’re (32.24 unclear). Let me tell you, they will figure it out.

Matthew: Also you think about northern California, let’s say Mendocino County, the weather up there is good enough where people can grow outside and without a greenhouse even. I’m not saying that’s legal, but I just think that is something to be considered. They probably have to supplemental water and fertilizer, but still it’s outside and they don’t have to condition the air at all.

Armando: That’s way cheaper.

Matthew: Yeah, way cheaper. I don’t know, I’m concerned about it for all the people that are rushing into it with certain assumptions about how much profit they’re going to make, and there’s just going to be a huge deluge of supply. So, I’m hoping that people can think, hey what if this only half as profitable as I think it is. Can I still make money. That’s what I’m trying to get people to think about. The operational efficiencies like rolling tables, which maybe you can introduce this topic of rolling tables. What are rolling tables? What’s a good way to think about using them to make a grow operation more efficient?

Armando: Well the rolling table is really a consequence of growing indoors. Either in a greenhouse, which is where they come from, or in a warehouse where their benefits are incredible. The role of a rolling table is that you basically only have one aisle that moves between table to between table. That way you occupy the maximum amount of space inside that square footage that you actually paid for it. So, when you build a greenhouse or when you build a warehouse the square footage that you build is a sunken cost. The lamps that you put or the greenhouse that you have are already also sunken cost. So you want to maximize the use of them as much as possible. By that is you minimize the aisle space. However, if you build a place that has no aisle, well you cannot enter and work into your crop. So, that’s why you build tables that can move, and then you only have one aisle that moves to table to table.

Matthew: How could you paint a picture of what that looks like for someone that’s never seen it before?

Armando: That’s an interesting question. Well, most of these growers are very used to those 4X8 tables that they put on rollers. It’s basically the same type of tray or table, but instead of being 4X8, it’s 4X100. You have six or seven of those literally slammed together in a greenhouse. When you need to start working between two tables you just move the one table to create the aisle. You enter that aisle where you do your work on both sides of the aisle, and then you close the aisle and you open the aisle between the next two tables. I have videos by the way of that.

Matthew: Actually that might be a good thing. If you have videos of that, maybe I can put that in the show notes for people to take a look at some examples of rolling tables where if they want to get a look.

Armando: Basically those are actually standard equipment in ornamental greenhouses, which are the vast majority of the greenhouses in the U.S.

Matthew: You gave me an example earlier when we were talking offline about tomatoes and how to save time clipping them to wires. Can you introduce what you meant by that and what cannabis growers can take away from that idea?

Armando: Again, it’s bringing back the idea of the operational efficiency. In tomatoes, the tomato vine is a very long vine that is 40-45 feet at the end of its life. So they hang that vine with a string from a cable that is at the top of the greenhouse. Every week they’re going to lower that cable to basically lower the vine to where you don’t have to get onto a 40 foot ladder to harvest the tomatoes, and then you always have tomatoes at the height of the worker. It used to be that the way to tie the tomato to the twine was to tie it literally to wind the twine around the tomato vine, but you can see that when you unhook it, and you run the twine around the tomato stem, well it takes what? Two, three, four seconds in the operation. Nowadays most of the growers are not twisting the twine around the stem because it takes about four or five seconds per plant. Instead they’re doing a clip.

Now when you look at the cost of the clip, let’s say the cost of the clip is one cent, but now instead of spending five seconds doing that operation, that operation takes one second. So you gain four cents in that operation. You gain four seconds in that operation. Now imagine you have tomato greenhouse that is one million plants, which is right about most of them are, one million times four seconds. That’s 4,000 seconds. That’s 4 million seconds sorry. Four million seconds, that’s a lot of man hours.

Matthew: Right, that’s a lot of plants. That’s a lot of plants for sure.

Armando: Yes but that’s the thing is when you start calculating by large scale things. Every little operation where you can get a second here and a second there, and that’s a really large amount at the end.

Matthew: Yeah, and that’s the point I think, even if you don’t have a million plants, if you have 1,000 or 100, you could pretend hypothetically. What if this hundred or thousand plants I have, what if it was a million? What would I have to do differently to increase my efficiency. It’s a good mental exercise to get you where you need to go and where to be thinking.

Armando: Yes, and that’s a mental exercise that every grower should actually do themselves in their own operation. There is always room for improvement, and that is part of the job of a grower is to actually improve that.

Matthew: As you look out the next three to five years, where do you think cultivation for cannabis will be? How will it have evolved to increase operational efficiency in your mind?

Armando: I think that’s the million dollar question. I may make a lot of enemies with what I’m about to say. I see a lot of the market going into extracts. If you’re really going to extracts, the difference between outdoor and indoor is academic. Most of those extracts are going to come from outdoor crops, as soon as they are legal. Depending on how the legal map looks like, most of that production, which is probably going to be the bulk of the cannabis market, is going to be outdoors. Now the market for flower, for smokable flower, there will always be that market. The indoor grows are going to become completely and absolutely niche where only very small guys that do very specific niche products are going to survive. All the rest is going to be greenhouse.

Matthew: That’s interesting. It definitely is congruent with a cannabis investor we had on the show a few months back, Anthony Wile, who is moving his production facilities for PharmaCielo. Him and the CEO have everything down in Colombia, because they think it’s the lowest—it’s the ideal place to grow and also the lowest cost. So they’re starting with the end in mind. They agree with you. That’s where the market is moving so they’re putting all their cultivation facilities down there. It’s really interesting to see other people are starting to see this and think this. I guess what you’re saying is you can be a low cost producer and grow outside, or you’re going to really need to have some compelling reason why consumers should pay more for your high cost grow. That could be a terpene profile or who knows what, but there’s got to be some reason. Is that what you’re getting at?

Armando: Absolutely.

Matthew: Okay. Armando, I like to ask a couple personal development questions to give listeners to know who you are a little bit more. With that, is there a book that’s had a big impact on your thinking or way of life that you would like to share with listeners?

Armando: Not on my way of life, but it would be certainly a book that every grower out there should have on his shelf.

Matthew: Okay, let’s hear it. We got to know.

Armando: Hydroponic Crops from Howard Resh. That book, which is probably an 800 page (43.15 unclear) that you can bludgeon some people to death with, is probably all you need to know about hydroponic crops.

Matthew: Okay, very good. I haven’t hear that suggestion before. It’s great. Is there a tool, it could be a web based tool or a physical tool that you use daily or weekly that you consider valuable to your productivity that you would like to share?

Armando: Yes. It might come completely out of the left field for most people. I would suggest to most people that one of the greatest tool ever invented is a pen. Take notes. If I would suggest, actually buy a nice pen, not just any pen.

Matthew: What’s a nice pen to you, like a (44.15 unclear) or what.

Armando: No that’s too nice. That’s too nice. Yes I actually use fountain pen to take notes, because the connection that your soul is directly connected to the point of that pen. And the notes that you take from a computer and the notes that you take on paper with a pen actually have a great difference in quality.

Matthew: That’s interesting. I noticed there’s a lot of different kinds of learners out there. There’s some people that process information much better when they’re hearing it. Then they write it out in notes. There’s some people that what to hear and they don’t want to do the notes so they’ll record whatever is going on, like a lecture, so they can later come back to it. There’s all these different kinds of learning styles to match different brain types.

Armando: The thing here is because it’s a nice pen. It’s a sensory experience. So when you’re actually putting the words on paper you actually feel it. It’s not just I’m taking notes. I’m actually taking notes with a nice pen.

Matthew: Are you talking you use one of those old school fountain pens where you’re dipping it in an ink well?

Armando: Well that’s too old school but if you want to yes, except that’s kind of impractical when you’re in the field.

Matthew: Yeah, okay. So use a nice pen, but not too nice. Does yours have a leather veneer on yours? I’m just trying to visualize what nice is.

Armando: Something like that yes.

Matthew: Ostrich skin.

Armando: Yes.

Matthew: Armando thanks for coming on the show and educating us about the latest in growing technology. How can listeners learn more about Grodan and get closer to you and follow more of your work?

Armando: We have a lot of information on the website. We’re actually coming out with a new website. The original website is www.grodan101.com. Don’t go to grodan.com because grodan.com is the veggie guys. We also have www.grodan-mmj.com.

Matthew: More strictly focused on cannabis market. We appreciate that. We’ll definitely put in the show notes a video of rolling tables so people can visualize. Really I’m glad you’re expanding our thinking Armando. I really think it’s important to be ahead of the curve. There’s only going to be two types of people. They’re going to be ahead of the curve, anticipating these things, and then people that are behind the curve that said what happened. I definitely want CannaInsider listeners to be in the first group ahead of the curve. So, thanks for helping us get there.

Update on Florida Cannabis Legalization – Gregg Weiss

gregg weiss

Gregg Weiss is EVP Software Development at Getleaf.co and Founder of CannaHoldings.com
Listen in as Gregg gives a boots-on-the-ground update of the legalization movement in Florida.

http://www.getleaf.co

Key Takeaways:
[1:28] – Gregg’s background
[2:21] – What is Leaf
[5:01] – What is CannaHoldings
[8:04] – Cannabis life in Florida before and after
[14:36] – Fixing Florida’s cannabis laws
[16:03] – Gregg talks about John Morgan investing
[18:21] – Gregg talks about his decision to leave Florida
[20:24] – Wrong perceptions of creating an app
[22:37] – Gregg talks about the most successful in terms of monetization
[25:00] – Gregg discusses most common questions from doctors
[27:28] – Gregg answers some personal development questions
[38:22] – Gregg’s contact details

Important Update:
What are the 5 Trends That Will Disrupt the Cannabis Industry in The Next Five Years? Find out with this FREE Cheat Sheet at https://www.cannainsider.com/trends

Click Here to Read Full Transcript

While the West Coast of the United States and Canada seem to be stealing the headlines with sweeping stories of the Green Rush into cannabis, Florida, America’s third most populous state with 20 million people is moving forward with its legalization plan. The question that remains to be answered is will Florida have a functional market or is it mired in governmental incompetence and bureaucracy. Here to help us sort us sort through Florida’s red tape is Gregg Weiss, EVP of Software Development at Leaf, and Founder of Canna Holdings. Gregg, welcome to CannaInsider.

Gregg: Good to be here. Thanks Matt.

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

Gregg: I am in South Florida, Palm Beach County in the town of Willington.

Matthew: Are you in Del Boca Visa Phase 2?

Gregg: Del Boca Vista.

Matthew: That’s a Seinfeld reference for anybody listening.

Gregg: Definitely a Seinfeld fan, but it’s been a while. No, I’m not.

Matthew: I guess I could probably stop using 20 year old references. That might help a little bit. What’s your background? How did you get into the cannabis world?

Gregg: My background is in technology. I started an app development company about eight years ago or so when the app store first started. Actually, previously was a web development company. I sold that company about a year and a half ago with in interest in getting into this cannabis industry, as it was starting to develop in 2014-15 here in Florida. Like a lot of the entrepreneurs who got into this huge market and decided that this is where I wanted to be. Also I’m an advocate for specifically medical marijuana and all the uses and the conditions that it can help.

Matthew: Okay. We’ve had Yoni Ofir, Founder of Leaf on the show before, but give us a reminder of what Leaf, and what role you play there?

Gregg: Leaf is a plug and plant cannabis grow system, also grows vegetables. We just completed a $2.5 million Series A raise on Seed Invest, which we’re really excited about. It’s the only one of its kind with a climate controlled system, LED lights, hydroponic grow system and yields anywhere between three to four ounces per grow.

Matthew: That’s amazing. It really is. There’s few products in the cannabis space, I can probably only think about two or three others that kind of create a craving for it when you see it. The only thing I can say it’s similar to is maybe an Apple product or even some cars where you’re just like you look at it and it’s like, “I want that.” I don’t know where it comes from, but I do really want to get one of those. It looks so cool. There’s so much excitement around it. I know since you’re involved with the app, it’s going to be very clean and work well. I’m really excited about that. That’s a massive raise on Seed Invest too. How much bigger is that than the average seed invest raise, because I’ve seen other Seed Invest raises and they don’t seem nearly as big. Is that one much bigger, or am I crazy?

Gregg: No it is. I don’t know officially, compared to what the rest of the companies on Seed Invest have done. I know there’s one or two that have raised north of $2 million. I think very few. Seed Invest is a relatively new platform for equity crowd funding. It’s only been legally around with the FCC, being able to do that in the last year, year and a half. Yeah, we’ve had a lot of great success with it. We had over 600 people who have invested, with the majority of them being non-accredited investors. That’s really the big opportunity. If you want to invest in a company, a non-accredited investors previously didn’t have a chance to get in to a startup. They can invest anywhere from $1,000 to $20,000. The majority have been $1,000, $2,000, smaller investors, which has been great because then you have brand ambassadors for your product. It’s been a really good experience. We weren’t really sure how it was going to work out, but we’re very happy that we got involved.

Matthew: What is CannaHoldings?

Gregg: CannaHoldings is a company that I created last year before I actually started with Leaf last summer here in Florida, as things started to progress. Amendment 2 last summer was on the ballot, but it didn’t pass, but it did pass in November, as we know. I started CannaHoldings as a way to start educating our local physicians. Every state is different, but in Florida a physician needs to take an eight hour course in order to become a recommending physician. As we know, physicians in the United States are not taught anything in medical school about the endocannabinoid system, or how cannabis works as medicine. They’re very skeptical.

In order for Florida to become the medical market that everyone is predicting, you need to have a top down approach and the physicians need to be onboard. They need to take this eight hour course, otherwise you’re going to have a very small amount of doctors writing the recommendations, and then it’s going to turn into a sort of “Pot Doc” than a speech type of atmosphere, which no one really wants.

Matthew: That’s exactly what I thought of too. I thought of (6.27 unclear) beach and $40 and you’re like, “Oh, I’m having trouble sleeping?” Yep that’s it. On your way, young man.

Gregg: Yeah, girls on roller skates with pot leaf tank tops handing out little promo cards for $30, exactly. In fact, that’s some of the imagery that the No one 2 Campaign, No one Amendment 2 used heavily with their ads, and they literally said, we don’t want this to turn into California. The top down approach is really just getting physicians onboard and really starting with education. Again, this was before I joined Leaf last summer. I did a first symposium, invited a few physicians, presenters, Al, Dr. Sue Sicily [ph] was one of them, Dr. Greg (7.20 unclear). I did a free event in Palm Beach County. We had over 100 physicians attend. This was in September. Had a couple of sponsors. I thought you know what, if Amendment 2 passes in November, I think there’s going to be even a greater need. It did pass. I did a second one in March in South Florida that was a full, and then this past weekend was the third symposium in Orlando, where we had over 200 physicians attend. It was very well received.

Matthew: Let’s just rewind a little bit because you’re so immersed in this day-to-day. Let’s just go over that one more time. What happened? What was cannabis life in Florida before the November election and then after?

Gregg: In 2014, the Florida legislature passed what’s known as Senate Bill 1030, also known as the Compassionate Medical Cannabis Act of 2014, which allowed qualified patients to use the low THC, also known as Charlotte’s Web, mainly for seizures and epilepsy. It was a very limited program. Then in March of 2016, last year, the state legislature then passed House Bill 307, which is known as the Medical Use of Cannabis, which allowed for THC and expanded the use for patients that were terminal. Prior to November, with the Amendment 2, November of 2016, if you qualified, the only qualifying conditions were you’re terminal or you have seizures or epilepsy.

Amendment 2, which 71 percent of Floridians voted yes for, it added around 10 debilitating additions such as, HIV, PTSD, Parkinson’s, MS, ALS, etc., a couple of others. Floridians voted overwhelmingly 71 percent yes for that. Now in 2017, it’s funny because I’ve learned so much about how government works from being in the cannabis industry. Way more than I learned in my history class in high school or college. Now, the session, the legislative session just finished, and unfortunately they did not pass a bill. It got to the last day, and they did not pass the bill to implement the rules for Amendment 2. This is actually pretty timely because this past Friday, Governor Scott here in Florida, called for a special session, which is going to start this week. I believe Wednesday, Thursday and Friday. Called everybody back to discuss the budget because there were a couple of things out of the session that did not get passed. The budget was one of them. Medical marijuana was another one.

Unfortunately, medical marijuana is not on the agenda for the special session, which is really confusing and people in this industry here are like, why are they not addressing this. Apparently they’re not going to address it, which means it’s up to the Department of Health to write the rules. The Department of Health to write the rules. The Department of Health is consisted of appointees by Governor Scott. They’re not legislators. They don’t represent the people of Florida. It’s really frustrating and sort of backwards the way that Florida government works with regards to implementing that goal, marijuana.

Matthew: Yeah, it almost sounds like you’re saying these government bureaucrats have not done an optimal job in representing their constituencies Gregg. Is that the allegation at hand?

Gregg: In my opinion, yes, you’re absolutely correct.

Matthew: Shocking, I’m shocked.

Gregg: There’s just so much lobbying happening. You have seven existing license holders. Florida is a vertically integrated market, which in other states that have come before Florida have tried vertical integration, have proven that it really doesn’t work and they’ve gone horizontal. I want to say in Florida, it’s really expensive to get your medicine, and it’s almost half the price in other states , like Colorado, to get the same oil. When you have very few outlets to get this it drives up the price, and that doesn’t help patients who are paying cash and really can’t afford it in the first place. We know that their health insurance doesn’t cover it.

Matthew: This is why I really hope we don’t have universal healthcare coverage at the national level. If we’re going to have it, have it at the state level. Then if all these laboratories kind of trying out things, some work, and the ones that work make the other ones just look ridiculous because you could just point to Colorado and say look they’re doing it and then look this state over here is doing it, and even conservative states are doing it ten times better. This argument that it’s complex and the peons don’t understand all the esoteric knowledge and debates going on at the legislature. That kind of is a point. I kind of went off on a tangent there, but I think eventually Florida is going to have to come around because the citizens see functional markets all around them. They’re saying, can you just do what they’re doing in this state over here? Don’t reinvent the wheel.

Gregg: Yeah, I mean, people that really need it is just going to move out of Florida.

Matthew: Although it seems like the trend is the exact opposite. It seems like there’s a flood of people from the Northeast moving to Florida right now. It’s amazing. It’s like the wildebeest migration in the Serengeti Plains. There’s this flood, and huge dust storms of people pouring out of high tax, cold states, down to Florida.

Gregg: Yeah, it is a great quality of life. It’s a great place to live. There is no state tax so that’s a plus as well.

Matthew: Florida is making a lot of mistakes. The jury is still out when they’re going to fix them, but it sounds like this regulatory body is going to start making decisions in the absence of clear laws from the state legislature.

Gregg: That’s right. The amendment that did pass, Amendment 2, it states that if the state legislator can’t get it done, which they can’t, they didn’t, that it’s up to the Department of Health to promulgate the rules of how this program is going to roll out. I believe by July 3rd, if I’m getting this correctly. Then issue cards by October. I think they’ve already started issuing cards. There are some key dates that they have to have this implemented by. I think July 3rd is the next one. They basically have about a month, and there’s only a handful of people in the Office of Compassionate Use to get this done. They haven’t allocated a budget for it. The state has not given them the money that they actually need to roll this out. Hopefully, a special session this week, they are going to discuss and hopefully pass the budget, and hopefully they will allocate some dollars to the Office of Compassionate Use to roll this out.

Matthew: We’ve had John Morgan on the show, a lawyer that’s really prominent in Florida, that’s been a big advocate for responsible adult use cannabis, particularly for medical use. I think I’ve read a couple of things that he’s made some investments or he’s going to deploy capital. Have you heard anything about that?

Gregg: Yes, which is contrary to his whole agenda prior to Amendment 2, saying I don’t have any interest in the industry. I don’t own a grow. I’m really just doing this for my brother and it’s the right thing to do, and I’ve invested millions of dollars. You were there in Orlando at MJ Biz when he gave the keynote. I think he hasn’t even spoke after that. That was the first time I saw him speak. I was blown away. I was like, wow, he’s really doing the right thing. I believe him. Then the state legislature didn’t get it done, and Ben (16.45 unclear) who is his campaign manager. He publically shamed and blamed it on him, which is unfortunate. I can’t say that it’s his fault.

Then I read that he is going to invest some money. I also heard that he has 100 acres somewhere in Florida that he wants to build a grow. It’s just contrary to everything that he’s “ran on” even though he wasn’t running, over the last year and a half to kind of get this done. So, it kind of makes you wonder.

Matthew: It does make you wonder. At the same time, I’ll play the devil’s advocate and just say, he possibly changed his mind. That could happen too.

Gregg: Yeah, I mean, at the end of the day, he’s an entrepreneur as well. He’s a businessperson. He not only has his big, national firm, personal injury law firm, but he owns restaurants. He owns entertainment things. With my entrepreneurial hat I would say, why wouldn’t you invest in the industry. If you spent all this money trying to get Amendment 2 passed and medical marijuana passed, and now it’s passed, why wouldn’t you invest and capitalize on this billion dollar industry in Florida. It would almost be stupid for him not to.

Matthew: Yeah, you could definitely make that argument. You’re leaving Florida. Why is that?

Gregg: It’s looking like I’m going to be relocating to Boulder and really head up the Leaf office there, in the next probably 60 days, now that we’ve closed on this round of funding through Seed Invest. That is really the primary reason. If I were to stay in Florida, there’s a lot of testing that needs to happen with these Leaf units. We have two engineers in Colorado that have a lab and have about a dozen Leaf units that are currently growing. We have units in Israel that are growing. I was brought on last year to really head up the software side of Leaf, and I hired two guys to work on the app in the backend, and that’s my experience from running Blue L Apps, the company that I sold a year and a half ago. Building software teams and building apps.

Being able to test with the app and a Leaf unit legally in Colorado is another big deal. Otherwise I would just be here in Florida growing tomatoes. Not that there’s anything wrong with that, but this unit is really optimized to grow cannabis. That’s what we’re trying to do. So, that’s a big part of it.

Matthew: I don’t often talk with people that have the depth of skill you do in developing apps. What do you think the public’s idea is of developing an app, and then what the reality is, for someone that knows. We kind of look into the fish bowl and say oh, they just write some code and it’s done. I know it’s more difficult than that, but what does the public perceive about creating an app that’s wrong.

Gregg: There are many things. Number one, that it’s cheap and it’s easy and you could go offshore and hire someone from India for example and get it done really quick. You can even get an estimate offshore, and it will be cheap, but the quality of the product and what you’re going to get is not going to be good. It is a process. Every app, just like I always use the housing analogy. Someone wants to build a house and say build me a house. Okay well, how many stories is it? Is there a pool? Do you have granite in the kitchen? There’s all these details of it that you really need to figure out before you can give someone an estimate on what it’s going to cost to build a house.

An app is sort of a generic name. There’s social media apps. There’s simple calculator apps. It’s a very wide range of complexity in what you’re building. The app store is now, I want to say, almost 10 years old. I think the iPhone just had its 10 year anniversary this, and then the app store came a couple years later. It’s very difficult to not only build an app, but then get it in the hands of people who are actually going to use it. Marketing and promotion of your app. The days of build it and the user will come, but I don’t have a business model or my business model is I’m going to make money on advertising once I have millions of people and hope that I can sustain that business model is very difficult. You really have to have a business model with an app, if you’re an entrepreneur. You have that sort of app idea.

Matthew: Right. What have you seen be the most successful in terms of monetization? Is it something that’s an upgrade, like a freemium model? Is that the best way to go because ad support sounds hard?

Gregg: The freemium model is definitely good because that removes the barrier of the 99 cents or whatever you’re going to charge, and it gets people to try it and use it and have your app become sticky in a sense. Then you have some premium, paid for, whether it’s contented or features in it. That has worked very well. Advertising works well, if you have more of a utility type of app that people are using. Maybe it’s a weather app or that sort of thing. Again it’s very difficult to monetize an app. What a lot of people are doing now is apps for businesses.

These are the apps that you and I don’t see as consumers. When I ran my app development company we did build a lot of these internal company process driven apps, whether it’s an iPad for a guy who is out in the field, and he needs to take some notes and send it back to the back office. Previously he was doing that on a piece of paper and then going back to the office at 5 o’clock and then reentering everything in a desktop tool. Well now he can go out in the field, enter everything in, do what he needs to do and it’s done, and it really provides for a lot of corporate efficiencies. I think a lot of business and companies are really moving to mobile apps to help them run their businesses, and that’s really where a lot of this value is taking place.

Matthew: That’s a great point. You don’t hear about that as much because usually we’re all focused on consumer apps, but that is amazing efficiency you can gain from that. I would love to have you back on when Leaf’s up and running and we can talk more about the app later. That’s a future conversation. Circling back to some of the education events you’ve done with doctors and so forth in Florida. Is there a question they have that you see comes up or a concern? What’s their pushback or general thoughts about, I know you said they weren’t familiar with the endocannabinoid system. What are their other thoughts in general or obstacles or resistance would you say?

Gregg: I’d say the number one is that they don’t find that there’s enough research and the triple blinded studies that they’re used to that are done with millions of dollars in the pharmaceutical companies and the package insert that says dose this or take this three times a day for seven days. We know that medical cannabis is not like that. It’s unique to every person’s condition and every person’s different situation. It’s a different paradigm. It’s an herb. It’s not a synthetic pharmaceutical that has gone through all these controlled trials, at least not yet in this country. In several other countries they are doing those studies.

The last symposium we had last weekend we had Dr. Sue Sicily and she was talking about her study that she just started for PTSD on whole plant with the veterans. Her study is the first triple blinded control study for whole plant marijuana for PTSD for veterans. That’s going to be going on for another year and a half. It was great for her to present some of these findings and what she’s doing to this audience of somewhat skeptical physicians. We had an audience of 200, and for them to go, oh there is actually a study here. It took her seven years to get to a point where she could actually study that.

Matthew: I’ve had her on the show, and I know she’s been very persistent and come up with some corporate interest that do not want to see her succeed in what she’s doing. So I give her all the credit in the world. She’s also a very nice person. I wish her the best. Gregg, I know you have to get going so I want to ask you a couple more questions before we close. I like to ask some personal development related questions. 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?

Gregg: I mean just with regards to agile software development and apps and hardware/software. I think the Lean Startup. I’m sure everybody would probably mention that in this field, by Eric Rice. That’s a really great one which hammers home the idea of proving your assumptions. Every startup, every entrepreneur has a great idea and then they have assumptions that are, everyone’s going to like this or pay for this because of XY and Z. You have to find a way to prove those without spending a lot of money or raising a lot of money, only to find out that maybe you were wrong. Gone I think are the days of let’s raise a ton of money. Let’s build this thing and then test it and see if people want it, and we’ll pay for it. If they don’t, we just lost a lot of money.

That has had a profound impact I think not just for myself, but a lot of people. Pivoting, based on your customer feedback. There’s been a lot of great examples of companies who have pivoted. Then also just the Law of Attraction books, just that whole thing. I was first introduced to that about 10 years ago. I saw the film, someone introduced me. That kind of changed my life in terms of business and personal and just the way you think and your mindset and all that. I think that’s important.

Matthew: I’m glad you mentioned that because you’ve got two very different examples there. One’s kind of a very—We got the yin and yang, The yang being the technical, objective things with the Lean Startup and more yin energy there with the Secret. I think we don’t talk about those type of intangibles that much because we can’t measure it. We can’t measure it, we can’t touch it. So it must not be important, but it is.

Gregg: It’s so important. I can’t tell you, we don’t have time now, but I can tell you how by employing the mindset of the Secret and the Law of Attraction and all of that, and some people, Ah I’ve heard of that. It’s this or that. They have their own opinion of it. I can’t tell you how many examples that for me I’ve worked both personally and career-wise that I can attribute to learning from that, and having a really big impact on my personal life and my career life. There’s just so many. I’m a big fan of that.

Matthew: There’s a related topic to that called, Lorenzo’s Butterfly, which if you do a Google Image search, you can see a diagram of what this looks like. Essentially it puts in math how whatever you’re putting out there, whatever you’re putting into the universe, it comes back to you in greater mass. So if you’re putting out positive energy, you’ll get this back. If you’re having thought about a startup you want to create, all these new thoughts will come and surround that. There you have a very intangible theoretical idea backed with something objective for the two type of listeners that are out there that are some saying, I want proof, and some saying, I like the softer side. Really glad you mentioned both of those things. Is there a tool web based or otherwise that you consider indispensible to your day to day life, I’ll say besides Leaf.

Gregg: It funny, one may think coming from the app world, that I’m the most techy guy and I use all these different apps. I really don’t. I use, and this is something I thought of, I was like man, I got to have some great answer for Matt that I use all these crazy apps. I use iCal the most. I use my calendar as many people do. They kind of plan their day. If it’s 11 o’clock at night and there’s something that I think about that I need to do, I’ll just add it in my calendar, little notes, because I live by my calendar. I think that’s really important. On personal development I learned TM, Transcendental Meditation a couple of years ago. When you do that in the morning, you’re supposed to do it for 20 minutes twice a day. Admittedly I very rarely get to do it at the end of the day. I try to do it in the morning when I first wake when everything is quiet, and it really sets the tone for your day. And just learning that has been a really great, personal benefit, and I would definitely recommend it.

Matthew: Don’t they give you your own mantra when you go through that process?

Gregg: They do yeah.

Matthew: What is your mantra? Do you mind sharing that?

Gregg: I cannot share my mantra, no. You’re not supposed to tell anybody.

Matthew: Oh really. (whispers) Gregg, it’s just me and you. No one is listening.

Gregg: They tell you that when you do the training. The training is four days. The first day is two hours and they have to be consecutive days. The guy that taught me was actually trained by Maharishi in Spain in the seventies. Back then he did this retreat there. I never asked him, but he’s probably in his seventies, but he looks like he’s my age. He looks like he’s in his forties. It’s definitely beneficial. We got our 14 year old son to do it. He does it because he’s 14, but we hope that as he grows up he’ll be able to use this tool like he’s been taught when he feels like he needs it. I wish I was taught it when I was in high school or college and be able to draw from that. I would definitely recommend it anybody.

Matthew: Was there a lot of anticipation when they revealed what your mantra was, because I can just only think okay they’re going to do the grand reveal now. It is, duh-ta-duh, and the whisper in your ear, Gregg, your mantra is Pop Tart. You’re like wait a second, I can’t be thinking about a Pop Tart the whole time when I’m meditating. I’m going to be craving Pop Tarts. It’s nothing like that is it?

Gregg: No, I think they’re all Sanskrit words. The mantra is not supposed to have meaning. It’s not a word. I found myself trying to analyze what it is. If you told me what it was and I was like well how do you spell it. What does it mean? He’s like, I’m not going to tell you how to spell it. I’m just going to say it again. I was like, well should I say it fast. Should I say it, you know, you don’t say it. You internalize it in your head, and have all these questions. There’s no right or wrong. You just repeat it as your mantra.

Matthew: That is hilarious. It seems like the people that are into Transcendental Meditation stick with it much more than other kinds of meditation, and I think it’s because they put this money into it upfront, and they’re like, hey I’ve invested in this. I’m going to make sure I get return on my investment. Do you think that’s why?

Gregg: I don’t think that’s why. I think it’s just very different than mindfulness, all those other types of meditation. There are some people that would be like, you don’t have to spend the money to do it, but there’s a lot of science and research behind TM. When you go to the initial consult there’s all these pamphlets and stuff that they give you. It’s backed by science. It helps with blood pressure. It helps with stress. It helps with a lot of medical conditions. It’s real. I’m not exactly sure why. That is the number one thing of why people don’t do it, because it is expensive to do. If you really want to do it, there are grants that you can get and you can get it paid for if you really want to.

Matthew: I had an amazing experience at a Korean Buddhist Temple, and I went in there for a meditation session and they said, okay you mind, like most people’s is kind of polluted with this river of thought, and there’s really no way to turn it off, but we have some things that can help. We want you to do this 100 times before we start meditating. You have to sit down, then get on your knees and then stand up, then bow. It was something like that and I did it 100 times, and they said, okay by the end of that your mind has gotten rid of most of it. I was like okay, well this seems a little strange. After that they led me through a meditation, and I had this experience where I didn’t fall asleep or feel tired at all, but just time kind of stood still for an hour and without any thoughts. It’s just such a rare thing to be awake and not have thoughts going through your head, that the first time it happens, it’s so restful. You feel like you’re recharged somehow. I can’t explain it any other way than that.

Gregg: You’re absolutely right. That’s what it is. You can experience it for five seconds or a minute or five minutes. The goal is that every time that you meditate you get into that state. Some days you have a lot of thoughts. Some days you don’t. Some days you don’t even get into that state. Yeah we’re really going off on a tangent here.

Matthew: We’re going off on a tangent. People love it. Everybody, let Gregg know that you love it. Gregg, how can they reach out to you and learn more about Leaf and learn more about CannnaHoldings and all the things you’re up to? Is there any way?

Gregg: Sure. The website for Leaf is www.getleaf.co and we’re still taking pre-orders. The website for CannaHoldings is www.cannaholdings.com, which I’m actually going to have a website up in the next couple of months. Right now that just redirects to Event Bright, which is the last symposium that we did.

Matthew: We went all over the place today, but it was a fun conversation. I appreciate you coming on. Good luck with your move to Boulder and everything you’re working on.

Gregg: Thank you Matt. I appreciate it.