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Hidden Fortunes in Cannabis B2B Businesses with Alex Coleman of TILT Holdings

tilt holdings alex coleman

Business models from other industries are quickly making their way into the cannabis industry, TILT Holdings is aiming to become the swiss army knife of business-to-business offerings in the cannabis space.

A vertically-integrated infrastructure and technology platform, TILT Holdings delivers contract manufacturing, distribution, hardware, and software for over 1,500 retailers and brands throughout the U.S., Canada, and Europe.

In this episode, TILT Holdings CEO Alex Coleman shares with us an in-depth look at the goings-on at TILT, shares his insights on the future of cannabis, and provides some invaluable advice on how to navigate the cannabis B2B market.

Tilt Holdings Stock Ticker: SVVTF

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

Key Takeaways:

  • Alex’s background in cannabis and what inspired him to start a B2B business in the cannabis space
  • A deep dive into Tilt Holdings and the various companies under its umbrella, including Baker Technologies and Sea Hunter Therapeutics
  • How Alex believes the recently passed Farm Bill of 2018 will impact the cannabis industry over the coming years
  • Up-and-coming technologies like AI, gene editing, and nanotechnology and their implications for cannabis
  • Why big alcohol and tobacco companies are investing in cannabis and the traditional businesses Alex predicts will follow suit
  • Alex’s outlook for the future of cannabis and what he believes the industry will look like in 2030

 

Read Full Transcript

Matthew: Hi, I'm Matthew Kind. Every Monday, look for a fresh, new episode where I'll take you behind the scenes and interview the insiders that are shaping the rapidly evolving cannabis industry, learn more at cannainsider.com. That's cannainsider.com. Now, here's your program.

Business models that exist in other industries are making their way into the cannabis industry. Today's guest is Alex Coleman and he is going to explain how his company, TILT Holdings, is aiming to become the Swiss Army knife of business to business offerings in the cannabis space. Alex, welcome to "CannaInsider."

Alex: Thank you. Thank you for having me.

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

Alex: So I'm actually in, we have a office in South Florida in part because the weather in the Northeast has been a little bit challenging right now. Our primary office is in Cambridge, Massachusetts. We have four or five offices around the United States, Toronto and London at the moment.

Matthew: Okay. And I'm in Seaside, Florida today.

Alex: Great.

Matthew: What is TILT Holdings on a high level?

Alex: So TILT has progressed into becoming the leading provider of products and services to other businesses operating in the cannabis industry. And if I could just, I'll do a little bit of background there. Essentially, we provide, on a contract manufacturing basis, marijuana in a variety of form factors of vaporizers, inhalation devices, business and consumer delivery, and a broad suite of software products to about 1,500 retailers and customers and brands throughout the U.S., Canada and Europe. And it's an important distinction, though, that most of the products that we manufacture on behalf of our clients are customized to their specifications and branding. And the mission for our company is really to enable them to operate their businesses more efficiently and connect with their consumers more effectively. And that's the goal of the company.

Matthew: Okay. Alex, can you share a little bit about your background and journey and how you got into the cannabis space and started TILT?

Alex: Yeah, my background is traditional middle market private equity. I ran funds for Citicorp and prior to that for Dresdner Bank, Allianz. Always U.S. middle market-focused, three primary categories of industries. One is food and beverage, which obviously comes into play a little bit in the industry. One is information and business services and the other is specialized manufacturing, defined as sort of a low volume, high margin type businesses. And I was introduced several years ago into cannabis, looked at a REIT and you notice some odd discrepancies around the way that those are structured. And then you go and do a little bit of work in the federal-state conflict and then you look at demand and you certainly define a clear path into how you wanna get into the industry.

Matthew: Okay. What do you think about... The number of publicly-available traded companies in the U.S. is shrinking and private equity seems to be growing. Do you think it's because of the regulatory hurdles and compliance hurdles of being a public company?

Alex: Are we talking generally or specifically for cannabis?

Matthew: Generally.

Alex: Yeah, no question about it. I think that the, you know, as soon as you introduce things like Reg FD and additional reporting requirements and limitations on the information you could provide to the market, it became very challenging to operate a public company. And the proliferation of private capital gives you real viable alternatives to never have to go public. So, you know, I think there's a variety of contributing factors that, really, people think there's far more balance now in staying private versus going public. Whereas 15, 20 years ago, there was no question you would go public as the capital markets opened for your sector and your business.

Matthew: Yeah. And sometimes I worry about the bifurcation of society as the people that have the ability to access private equity continue to do well and then people that have this shrinking pie of public equities they can participate in. I wonder how that's going to change things at all and make them different. I mean, I don't know if you saw the acquisition of SeedInvest by Circle, that app, to maybe start to socialize private companies more. But that's still to accredited investors. So I wonder what the future looks like there. Any thoughts about it?

Alex: Yeah, I mean, it's an interesting discussion because, by virtue of the fact that if you talked to most market participants today, they would argue retail investors should only buy ETFs anyway and that one-off stock-picking has gone the way of every other, you know, past business that is largely inefficient, lack of information, lack of timing. And I think that the, look, if you have a pension fund, if you're participating in, that's going to be in private equity. It's also going to be in the public markets. So, like, there's a lot of different ways that the average retail investor, through some tertiary means, become a participant in both the private and public markets. I also think that from an analytical standpoint, you know, there are ways for individual investors to participate in VC startups, high risk, potential high return, but it's extremely high risk. So I'm not as concerned as the private market provides an alternative for larger cap companies, higher growth companies, because a lot of people end up being inadvertently investors in those companies through other means anyway. So I'm not sure, I think the market's evolving so quickly, I'm not as convinced it's leaving people behind as it is probably decreasing the risk profile for most people that maybe shouldn't be investing in the markets anyway.

Matthew: Okay, fair point. Now let's dive into TILT a little bit more here. You gave a quick overview of the different companies involved there, just kind of in market category. But can you go into the companies that comprise TILT so we can understand at a more granular level?

Alex: Yeah, I can. Although it's funny, we're so integrated at this point. And so the history... So maybe I'll work backwards and maybe through the supply chain and it's easy to understand how we put this together. So if you start, what was Baker Technologies? It was a CRM SaaS platform, which is a very sophisticated way of saying that it simply connected retailers with their customers. And the reason is there's a nuance in the law that prohibits those retailers from keeping customer data on a recreational level when they walk in and walk out. If you opt into a Baker platform, then the store can actually stay in contact with you. And then we go and drive growth. We drive growth through promotional activity, through weather alerts, sporting events, trial on new product developments. We have a over 10% clickthrough rate, now that that's where it started. Then we added a company called Blackbird, which is a business-to-business and business-to-consumer delivery company also providing the software and services for supply chain management.

Well, now we can go and help those retailers manage their inventories better, connect them with original equipment manufacturer suppliers. And we can also do last mile delivery for them if they choose to use that service from us. So it's very, it becomes very integrated with what was Baker in terms of that customer connection tool. Jupiter pens, working all the way back then, fits in that ecosystem perfectly. We can take unfilled cartridges, bring them to the manufacturers, take up the filled cartridges, bring them to the stores. And if the stores so choose, we can actually drive foot traffic for consumers to buy the cartridges.

So now our entire, what was our infrastructure asset platform, which really is, again, describes our manufacturing capabilities in marijuana, well, we now put that into the same supply chain and offer the same contract services to our customers. It's important to note that just about 72% of Jupiter pens are actually customized for our clients. And we look at the same kind of ratio for our marijuana products. If they aren't customized and they're really sold wholesale, TILT is not currently in a branding category in the market.

Matthew: Okay. So we did have Joel, the CEO of Baker on, gosh, maybe a year or two ago. And it was really interesting to hear how all the different ways that dispensaries can touch and reach out to their customers. And I found that fascinating. You seem to have, like, an overarching strategy here. Is it happening kind of organically or do you kind of have a master plan where you're having, as a customer comes in, there's more opportunities to work with them than just one? Obviously, you know, they come in as a Baker customer, but then you're talking about vape cartridges and delivery and all these other things, too. Is there a larger vision on where you're going with TILT here?

Alex: There is. I think you need to pick, even though a lot of markets require to be vertically integrated, meaning you need to cultivate and process, package and sell, it doesn't fit our business model as much. And so as we think about our business model, it's supporting companies that want to develop a retail strategy and/or a branding strategy. And that really requires connecting with a customer. And so I think about our company as enabling all those companies to do their jobs better and connect with the customers more effectively. And so that opportunity for us continues to expand in terms of providing supply-side services to all these companies, whether it be software or physical delivery, or both, that really enables the industry to grow and then we grow along with it. And in part, it's an acknowledgment that the industry is in a very nascent stage of its lifecycle.

There's probably $10 billion of trailing revenue collectively. By our math, if you take some of the data coming out of the recreational states and simply extrapolate it across the country, it's most likely a $100 billion annual market. And that lines up nicely with maybe the beer market, that's $111 billion, and I would put a footnote that that does not include medical products. That's really just a recreational view of where the market could go. We simply wanna be in a position where we can help the industry grow and also benefit financially for our company and deliver returns to our shareholders. So it's just a slate, you know, I think that's our specialization. We're not in the retail business, as I said, we're not a branding company and largely we're really not a cultivation company. Where we do cultivate, it's out of necessity where there's just short supply in the market. But you don't have to be a vertical. We don't have to be a vertical. We can, in other states like Nevada, Colorado, California, Washington, Oregon, you know, we can buy the commodity product and then add the value for our customers and deliver it to the shelf.

Matthew: Okay. There's a lot of moving parts here and deep domain-specific knowledge that's required. You know, I'm thinking about Baker in particular, but also for delivery software, I mean, each state has essentially their own market and has its own regulations. How do you keep up with that and also kind of prioritize what the best opportunities are as you go along?

Alex: That's a very good question. I think that what we've done internally is kept businesses functioning independently where they need to adapt to evolving state laws. Someone described it to me as wearing ballet slippers to work every day. We have two primary silos. We have our software and services division and that contains the Blackbird and Baker and some other ancillary services. And then we have the consumer devices and packaged goods division. And that's as it sounds, it's selling the hardware as well as marijuana products. And really by bifurcating the company like that, it allows us to augment all those expertise both across each line. But within those silos, there is a lot of overlap in all of the previous businesses that now, in many parts, just share headcount. I mean, most of them are just fully integrated now.

And the nice thing is, too, we can leverage all the market data to help our customers. When we do acquisitions now, it's an easier fit. You know, we have a very robust discussion at the management level, how they would fit not just from a product standpoint but culturally. And that's really enabled us to take advantage of what is incredibly, as you point, it's just a very fast evolving market. And so you need to make sure to have a tremendous amount of flexibility in your business model to adapt as laws inevitably will change. And importantly, consumer preferences will change.

Matthew: So with the passage of the Farm Bill and hemp becoming legal, what kind of opportunities pop to top of mind for you? Or how did your thinking change as that got signed into law?

Alex: I would say two distinct parts to that. One is, so hemp extract oil, which I believe it's what it's gonna be called now, with less than 0.3% THC is, it's a commodity. You know, the prices will simply come down as supply comes on the market. And the question is, you know, where can TILT benefit from a product standpoint, delivering to clients or an end product. And, you know, we're working in-house right now to a more larger scale of manufacturing, which we can't do in marijuana products, to deliver product across the states. Drinks come to mind, topicals come to mind, and to some degree, nutraceuticals come to mind. So that's where we're focused. And the in-house knowledge we have around extraction techniques, delivery, and not just delivery. We don't have to use our own. We can obviously use third parties now because it's legal and it's just about our getting endorsed, right, for CBD products.

The other part that I think is very interesting is, you know, everybody talks about the legalization of marijuana, they're both cannabis sativa plants. But talking about the legalization of marijuana, you know, watching the FDA machinate over generally regarded as safe practices and reevaluating all their consumable directives, you know, is definitely cause for concern. And a lot of senators are pushing them to come out with regulations faster that clarifies how we can, and any market participant can deliver product to the shelf that kind of adheres to the guidelines provided by the FDA. We don't have those guidelines yet, you know, so we'll see what happens. I mean, it could be, it could be unknown. It's a consumable product and their job is to protect the welfare of the citizens. So we just don't have any visibility yet on what changes they might make to allow hemp extract oil in a drink product, for example.

Matthew: Okay. And is there any other legislation that you're excited about in terms of it being like a big opening and, like, as big as the Farm Bill where you'd say, "Wow, this is another big milestone we've reached in terms of legalization," apart from, you know, just the federal government stepping aside and letting states regulate as they will?

Alex: Well, I think some form of the SAFE Act looks like it's imminent. And the SAFE Act is basically just protecting us for the banking side. What it does beyond that, we'll see. I mean, it's such an interesting evolution of a market where, you know, you have $10 billion of historical revenue, largely, cash transactions. We are aligned with the federal government to make sure that that is visible and transparent and taxes are paid. You know, we obviously have a problem at the retail level around taxes. You know, we're stuck with a 1983 crystal meth ruling against a drug lord. You know, we pay taxes where we can't shelter any store expenses. How much they tackle with what's called the SAFE Act along with banking, we'll see. It's challenging for the industry right now, but that, I think that's the most likely. The STATES Act is the one that legalizes it, again, whatever definition you wanna use. And that seems to be less sure right now.

Matthew: How do you think exponentially changing technologies like AI, gene editing, nanotechnology could perhaps change or enhance the cannabis industry?

Alex: So, you know, you have to come into the industry and say we've had a 50-year medical blackout on research and broadly. You know, we have now partnered up with people that actually have DEA licenses and have been doing work in cannabinoids for 30 years, but they are not the mainstream. And there's an infinite number of white papers around the health outcomes of using cannabis independently or in conjunction with medical. But again, they're suggestive. So, you know, I think it's a high-level opportunity for us as a company. You know, we have a very robust science team, a lot of formal relationships with medical professionals and we're working diligently to make sure that we can discover ways to address basic conditions. You know, gene editing is interesting because you can obviously help plants grow faster. As importantly, to me, you can also reduce the negative influence of aphids or powdery mildew through that as well.

Now, do we produce plants that have, you know, you do a terpene profile that addresses a specific medical condition through that? We might be able to. It's just, you know, we're putting a lot of money and time behind it and there's some near-term advantages, but I think you have to have a long-term view on that. It is not something that's gonna happen overnight. And as I said, you know, we're just starting to pick up momentum now on new research around using CRISPR nine technology, for example, to help the plant evolve into something that's useful for the consumer or the medical patient.

Matthew: So big alcohol and tobacco companies are making investments in this space. Are there any other types of traditional businesses you see making big investments either now or in the near future?

Alex: You know, I would hope healthcare pays attention and invests and, you know, even a middle company, I would call middle because a lot of consumer products like a Johnson & Johnson seems ideally suited for it. You know, and Estee Lauder might be ideally suited for it in terms of, you know, they use tobacco in most of their products in terms of certain, you know, as a derivative ingredient. So, yeah, I mean, I, you know, tobacco feels a little bit defensive. When we open into a recreational state, we see low-end wine and beer sales plummet. And it could be share-of-wallet, it could be an enhanced experience where you just don't need to drink as much. And so those companies need to really understand it's the same consumer and they really need to figure out the shift in preferences and that's why it makes sense for them. On the other side of that coin, you have maybe an offensive investment by a J and J or some company like that that really wants to go and pioneer new CBD, THC products for specific medical conditions.

Matthew: Okay. Well, Alex, you're in a position where you're having to make projections, talk to investors, look at all these hard objective facts all the time, but it's equally important to dream big and have a big imagination. If you were to look out to 2030 and say, "Hey, you know," I know this is wildly subjective, but what will the cannabis industry look like then? I mean, what do you think we can dream about that will come to pass?

Alex: 2030 is about a century in cannabis time. I would hope that every state in the United States, Europe, Pan-Africa, that these countries have evolved to allow their citizens access to marijuana products in whatever form factors they want. You know, we see trends in consumer preference driving towards micro-dosing. I think if you think about basic, you know, anxiety, sleep, we have the product that can really free people from synthetics and allow them to incorporate it into their day to day lives in a very healthy way. I mean, for goodness sakes, for some reason, cannabis rebuilds your epithelial layer in your gut, protects your liver. There's all sorts of things that come from this.

So my hope is we get through the next 10 years and we shake this social stigma that came from, you know, Nixon in 1970 and that with a right amount of research and investment dollars, you know, the consumer now adopts this same way they have alcohol in their house or anything else. And the biggest difference between alcohol and us is it's actually very healthy and it can be very specific in terms of the outcome. Now where they buy it is gonna be interesting because I think in 10 years, you know, you'll see a lot more home delivery or mail order. You'll certainly see mail order, direct to consumer with CBD products. And I think that's gonna be another difference, that the whole supply chain is gonna be expanded a bit.

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

Alex: No, I couldn't say it would be a specific book. I think you'd have to go, anything from, you know, a Frederick Taylor book to, maybe from a good to great type book in management. I'm learning on the job every day. It's, I mean, I feel really fortunate because I learn something, more than one thing every day, and something about myself. And so I think you have to bring an amalgamation of experiences just from private equity, just from my own intellectual curiosity that really helps make decisions. I mean, you know, one of my favorite quotes is, you know, "The harder you work, the luckier you get." You were asking earlier about, you know, by design or by fortune, I mean, you know, we are, every single person in my management team and hopefully everybody in the company, this is a very consumptive industry and you have to love it. You have to love the frenetic pace. Now there's no way to help those decisions and structure them, you know, unless you've taken a broad approach in everything, including the background of materials that you like. And so, I mean, I would attribute it to, I mean, even, you know, from ''Zero to One,'' the Musk book was great and what are, you know, just some people just aren't asking the right questions. You can draw from all of these things.

Matthew: Yeah. I have a Peter Thiel question for you in just a moment, but first, is there a tool that you and your team use that you consider really valuable to your productivity that you'd like to share?

Alex: Well, I mean, you know, from my own background, personal interaction is key to idea sharing. We have a sort of a on-demand every Monday. The entire management team gets on the phone for as long as it takes and goes through sales reports, product development successes, failures, needs excesses. It's shared across most silos inside the company. And so for all of the great intranet tools and all the other technology we have available, I find that unequivocally, the most important part of the week is that call that helps everybody understand exactly where we are as a company and where we're trying to go.

Matthew: Okay. So you pull up sales reports, numbers, projections and things like that. And when you're on that call, is there anything that in particular you feel like is the most important thing or a hurdle to get over or target to be hit that you feel like, "Hey, if I only do one thing on this call, it's gotta be this"?

Alex: So it's not as specific as that. You know, it's more about, you know, big customers. What are they asking for? What do we need? How can we cross-sell products? So the most important thing coming into the call is making sure that we transition, continuously transition the company and evolve it in a way that's meeting customer needs. So, you know, usually, we get off that call with a dozen good ideas around how to improve our product offering for our customer base, which is the other businesses in the industry. And there's no call that we don't have where there's an overlap of customer or an overlap of product idea, sales initiatives or all of them. And so, yeah, they're very fruitful calls.

Matthew: Okay. Now here's that Peter...you mentioned the book ''Zero to One'' and here's a Peter Thiel question for you. He's the author of that book. What is one thought you have that most people would disagree with you on?

Alex: I would say I am not interested right now in seeing marijuana become legal federally.

Matthew: Okay. And why is that?

Alex: You know, as I said earlier, the Farm Bill really is a good test case for what happens when the federal government becomes involved. There's no current oversight or legislation on the federal level. At the state level, we have very specific requirements about lab testing, quality of product, delivery of product, a seed-to-sale tracking system that doesn't let anybody sell product at the point of sale unless it started in that state. Now is, like, the introduction of federal bodies like OSHA, the FDA, other groups, is that a good thing? You know, I mean it's like "Charlie Wilson's War." Maybe. Maybe, maybe not. We know what we have today and the number of shifts we have to take a week, the shifts in packaging or delivery or how we test product on a state by state basis right now is infinite. And so we have a lot of requirements that will only be increased with a federal government position that makes us legal and then the intervention by the federal government in the evolution of the industry.

Matthew: Okay. So kind of to go back to your point earlier in the interview where the regulatory and compliance and all those costs just go up a lot and you've got a lot of different referees on the field making different calls and it just gets confusing and expensive.

Alex: Yeah, well, that, so there's no question about that. And again, it's not that I don't... It's an eventuality. My concern is that the industry has the right amount of time to educate the people that will write the laws that eventually govern the industry. That's all. So it's not opposition, it's more acknowledging that it's not as simple as saying we're gonna make it legal tomorrow because that has a large number of unintended consequences. Now, the other side of this, my other big concern is, you know, as an industry, we might be spending $5 million or $10 million a year on lobbying efforts. You know, I think the drug industry, the last number I saw was $125 million. Now, what is cannabis doing? It's providing an alternative to the proliferation of synthetic drugs that have only become available because cannabis was illegal, right? Opiates, etc., or sleep aids, anything that had been synthetic. Now, we have the solution.

My other concern about the legalization is that the drug companies get involved and writing some type of the legislative initiative that then makes it more challenging for us to simply get a product to the customer that's safe and easy to use. You cannot overdose on THC. There's no long-term organ damage. You know, we have some very accelerated programs right now for post-op recovery, which hopefully will take the place of opiates. And my concern is if we don't accelerate that knowledge base fast enough and the federal government takes a position backstopped by, you know, a $125 million lobbying effort, well, the net loser's gonna be the consumer.

Matthew: Right. That's kind of, those... What you're describing there is invisible to most people. They don't think about that, how big interests sometimes come in, in this to craft things to block out other entrants is essentially just defense. They're paying for big defense and limit their competitors. So, well said. Alex, as we close, how can listeners find your stock ticker and also how do they connect with you and find your websites and so on and so forth?

Alex: Yeah, so the URL is tiltholdings.com. T-I-L-T, Holdings. We are traded on the Canadian Securities Exchange or more familiarly known as the CSE under the ticker TILT, T-I-L-T. And I believe within the next 24 hours for U.S. investors, we are gonna have our OTCQB listing, which is basically linked to our Canadian Securities Exchange stock under the ticker, T-I-L-T-F.

Matthew: Okay.

Alex: So, you know, it's readily available. It's a good retail stock in terms of accessibility.

Matthew: Okay. Alex, thanks so much for coming on the show today and educating us and good luck for the rest of 2019.

Alex: I appreciate your time. Thank you very much.

Matthew: If you enjoyed the show today, please consider leaving us a review on iTunes, Stitcher, or whatever app you might be using to listen to the show. Every five-star review helps us to bring the best guests to you. Learn more at cannainsider.com/itunes.

What are the five disruptive trends that will impact the cannabis industry in the next five years? Find out with your free report at cannainsider.com/trends.

Have a suggestion for an awesome guest on "CannaInsider?" Simply send us an email at feedback@cannainsider.com. We'd love to hear from you. Please do not take any information from "CannaInsider" or its guests as medical advice. Contact your licensed physician before taking cannabis or using it for medical treatments.

Promotional consideration may be provided by select guests, advertisers, or companies featured in "CannaInsider." Lastly, the host or guests on "CannaInsider" or may or may not invest in the companies or entrepreneurs profiled on the show. Please consult your licensed financial adviser before making any investment decisions. Final disclosure to see if you're still paying attention. This little whistle jingle you're listening to will get stuck in your head for the rest of the day. Thanks for listening and look for another "CannaInsider" episode soon. Take care. Bye-bye.

Cannabis Capital Raising is Maturing Here’s How…

Troy Dayton CEO of Arcview Group

With the cannabis market projected to hit $31 billion by 2021, it’s easy to feel like the industry has simply taken on its own momentum.

However, what most people don’t know is that there’s a group of investors called The Arcview Group that funds the very companies we’ll be reading about in the headlines 1-2 years from now.

In this episode, founder and CEO of Arcview Troy Dayton gives us an in-depth look at the goings-on at Arcview, shares his insights on the future of cannabis, and provides some invaluable advice for those looking to take the plunge.

Learn more at https://arcviewgroup.com

Key Takeaways:

  • The cannabis industry’s current landscape and where Troy sees it heading over the next few years
  • How The Arcview Group has evolved from angel investors to now also include venture capitalists and large companies looking to make acquisitions
  • Overlaps in the entertainment and cannabis industries and how this could positively influence cannabis’ growth
  • The amount of capital Arcview investors have invested to date and projections for the future
  • Troy’s advice on what to look for when investing in startups
  • A deep dive into Arcview Ventures and Arcview Market Research
  • What it will take for cannabis to become as established as other industries and start seeing more interstate commerce

 

Read Full Transcript

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

Many of us read the cannabis headlines and awe each day. We see an industry exploding, it just seems like things are happening of their own momentum. But there's a group of angel investors that meet several times a year and fund the companies that we'll be talking about one to two years from now as we read about them in the headlines. The name of that angel investing group is called the Arcview Group. And today, I'm excited to welcome back Arcview's founder and CEO, Troy Dayton. Troy, welcome back to CannaInsider.

Troy: Thanks for having me, Matt, it's great to be back.

Matthew: Give us a sense of geography, where are you at today, Oakland?

Troy: I'm in Oakland, California.

Matthew: Great. And Troy, you've been on the show twice before, and we talked about your background and cannabis advocacy and your pivot into creating Arcview, so today, let's focus on investing. So just so people can get their bearings, the first time you were on, we talked about Colorado and Washington as they were kind of the focal point, and now we have 33 states with medical or adult use, and so much has changed. What is your 10,000-foot view of where we're at right now, and the context of how you view the cannabis landscape?

Troy: Yeah, you know, really ever since 2012 when Colorado passed legalization, we've been at just an incredible inflection point, and at any time you check in, it's like, "Well, we're at an inflection point, right?" But it's always been true. And I think, you know, there's just an endless stream of superlatives for the last, you know, seven years, but this batch of superlatives is really seeing this massive increase in the amount of investment. You know, there was over a 3X increase in investment into the cannabis sector in 2018 over 2017. That's incredible, and in fact, there was more money invested into cannabis companies last year than there was legal cannabis purchased. So to give you a sense as to what's changed, it's...there's now...the investment community has caught on to the fact of what you and I have known for quite a while, which is that the compound annual growth rate for the cannabis industry is tremendous. In fact, from 2018 to 2019, we project a 36% increase, which will be the largest increase in a single year that we've ever seen.

And so the investment community is responding to that. And I think the investment community is really noticing that the barriers that have really kept them out for the last, you know, five, six years, they can taste the evaporation of those barriers. Things like banking, things like end to federal prohibition, things like the IRS tax code issues, and some of the stabilization that needs to happen in the state markets for it to be conducive to activity, and then of course, what's happening worldwide. And even though we're not there yet on any of those issues and those barriers evaporating, the fact that the capital is starting to pour in ahead of that is a good signal that the smartest people are...can really sense the end of these barriers coming in the not too distant future. And as we get closer, the level of investor and the amount of money that they're going to pour in is going to even eclipse what we're seeing today. Because, despite the fact that we are seeing a lot more investment, it's still surprisingly capital constrained when you consider the opportunity relative to other industries that have similar opportunities.

Matthew: Now let's rewind to your last events. Can you tell us where that was at and in terms of the tone of the entrepreneurs' pitching and the sentiment of the investors, can you tell us, give us a little color around that?

Troy: Yeah, so our last event was in Los Angeles in the beginning of February. And, you know, I think the biggest thing is, it's interesting listening to your intro about angel investors, that's kind of like, that's an old story. I mean, we were only angel investors because that's the type of investors that were involved in the cannabis sector for the first, you know, six or seven years of Arcview, but it's really changed. I would say angel investors are a minority of the attendees at our events.

Matthew: Oh really? How has that changed then? What's the makeup now?

Troy: Well, there's a lot of venture funds, you know, people who were originally angel investors with their private money but we're full-time investment professionals in their day jobs, but those people weren't involved...either those firms have gotten involved, or those people have started their own firms to deploy capital. And so, it's a little bit of a different thing. Then there's also larger companies that are looking to make acquisitions in this space and partnerships in this space that are there, as well as public companies, companies that were raising capital at one point, and maybe are still, but are simultaneously looking to make acquisitions. So we have a lot of the bigger public companies that now have pretty huge market capitalizations and can use that to buy other companies, so a lot of those companies are there as well, and then a few more ultra-high-net-worth people, or people representing ultra-high-net-worth people.

So I would say, you know, of the investors at the event, I would say, you know, less than 30% primarily identify as angel investors. Of course, across the board, you've got people placing some of their own personal money into these things. But that's really changed, and that was particularly evident at our last Los Angeles event.

And I'd say the sentiment is that, you know, the companies have to be really good. Like people are not supporting companies that are not amazing, right? That don't present really well. And I think, you know, in the past, in years previous, the competition just wasn't as stiff as it is today. And so what you're seeing is companies recruiting out of big alcohol, and big tobacco, and big natural-products world. They're recruiting out of these top companies, and bringing them into these companies. And that's one of the big shifts that we're seeing. And I think, you know, there's also a lot more attention to data and macro trends, and less gut-level business. It's all we used to have was our guts, right?

Matthew: Right.

Troy: And now, there is this world of data, and, you know, making larger, higher leveraged decisions, because as companies are growing and moving into their A, and, B, and C stages, it's a whole different ballgame. And then when you look at the startups, you either have people focusing on smaller and smaller niches of problems, or people bringing incredible backgrounds and whole new better mousetraps to solve the problems for which there are already a dozen or so companies trying to solve that problem for. So it's really a different ballgame.

Matthew: And since that event was in L.A., did you see any kind of more dovetailing of the entertainment industry with the cannabis industry?

Troy: Absolutely, I mean the entertainment industry sees the opportunity here. There's so much overlap between culture and cannabis, and particularly with a lot of celebrities getting involved as well, and some of the advertising restrictions paradoxically opened up more opportunity because you know that... How else are you going to get your products in people's minds other than through various entertainment means and things like that? So absolutely seeing more of that.

Matthew: And I know you typically have this information on the tip of your tongue, so what is...how much capital have Arcview Investors invested to date?

Troy: Well, of what we know of, which we are 90% sure is just this fraction of what's actually happening now, we used to be able to track this much closer, but during this explosion of capital, it has become much harder to track what's happening in our group, but we've counted over $240 million invested into a little over 200 companies in the cannabis sector just from our members to companies that have come through our ecosystem.

Matthew: Okay. And can you think of an entrepreneur that maybe didn't have their best showing initially, but took the feedback that was given from investors in the ecosystem and improved? Because there's some pressure up there, if you go on stage and you don't have a background in presentation or anything like that. It's not something that everybody feels totally comfortable with out of the gate. Some people are just naturals. But for someone that's not, have you seen someone evolve and then go back out and like really nail on the second or third time?

Troy: Well, nowadays you don't really get second and third times, right?

Matthew: Okay.

Troy: I mean, it's so competitive now that, you know, you really gotta be really good, or you've got to have a really good business. And that's the other thing I would say is, it's no longer so much about presentation as it is about fundamentals, and about having a good track record. And so certainly, you know, you see people who have a strong business and a strong background, they don't need to be that great of a presenter if they've got those other things because especially as we shift into more professional investors who, it's their job to look at this stuff, it's a little harder to just be a, "Wow" presenter, and really get through it. And so there's two examples I would give of companies that have had major struggles and have reinvigorated investors' interest and gotten them re-excited of companies that have been really involved with Arcview over the years. And I would say, both ebbu and MJ Freeway are, kind of, in that boat. For a background, ebbu recently sold for over $300 million to Canopy Growth.

Matthew: Right. I saw that. Yeah.

Troy: And ebbu, you know, raised a good portion of their early capital through Arcview members and then, you know, ran into some issues and some challenges and their sales weren't going well and there was leadership changes, and...really tough. And, you know, a lot of people thought, "Oh wow, we were counting this company out." And then, you know, they were able to turn it around. They pivoted their business model to an intellectual property model, and turned around and sold it a few years later for just an enormous multiple. And I think that's a story where it shows you that, you know...there's this term in poker where you say, "All you need is a chip and a chair." If you still are sitting at the table and you have a chip left, you've got a chance. And some people do their best when they're...necessity is the mother of invention and they are up against the wall, and they've got to figure out how to make one or two chips be their saving grace. And that's what makes being in business and being in an industry as volatile as the cannabis industry. It's just part of what makes it exciting, it's part of why we all play the game, right? And I think that's a great example of it.

Matthew: Yeah, and there're colorful people in this industry to begin with. And when then you put them up against the kind of those circumstances, things get...it's like an episode of VH1 "Behind the Music." Like incredible things happen that people will be talking about for a long time.

Now, what are the most common questions you get from investors that are kind of thinking about joining Arcview, and how have those questions changed from when you first started to today? I mean, it sounds like the industry is maturing quite a bit from your vantage point, so are the questions more, not so much seed-stage-investment-type questions, but more mature market questions?

Troy: Yeah, yeah. I think you know, initially, people were like, "What...like I'm excited about the cannabis industry, I read about it in the news, how do I get involved?" And they would call and they would know nothing, right? And they would have no access to deals in this space. Now it's pretty rare to run into somebody who has no exposure to understanding some of the metrics or... I mean, even now, it's pretty hard to run into somebody that hasn't looked at a few deals in this space and doesn't have a census to like the different aspects of the business, at least at a surface level. And so, I think what really makes the difference now is about building peer networks of trust with other investors and other companies. It's not just about deal flow, it's about how you wind up negotiating with those companies. It's about how you place that capital, it's the kind of a network that you build because I think people more and more understand that this is, you know, ultimately a relational game.

And it used to be that any company that was big enough to be in an A round or a B round would...you would already know them. But now, there's no single investor that could actually wrap their whole head around all of the opportunities for companies that are now in growth phase. There's just too many of them to keep your head around them. And so that's where having the kinds of relationships that bring you certain deals that... And the other thing is that deals are getting snapped up now, it's not like it used to be that every company had a tough time raising capital. Well now, you've got deals that only get passed around 10, 15 people before they're done. And so, that's why it's important to really know the other people in this space, and to build those trust networks, and to show them that you're somebody that you want them to show you a deal. And increasingly, more of the deals that are getting done, you know... I don't...I've never even... You know, they just...they kind of flow through the group in various ways.

Matthew: Okay. Now, how can an investor get very comfortable with a startup? Because one of the questions I get emailed most frequently is that, "I'm considering investing in a company, but I can't tell if they're legit or if the management team's any good." And I have no answer for that. How do you tell? I mean, that's a subjective thing, but maybe you could talk about how investors get to that comfort level. What is the most typical things people do to get to comfort?

Troy: Yeah. A couple of things and this is...and the answer to this is the reason why we created Arcview, right? Which is that this is the hardest question, and I don't purport to have the answer nor should anybody, right? There's a couple of ways that you do it, and they all involve other people. So which is, you know, the first is, you want to look at a couple other deals in the similar vein, right? If you're looking at a packaging company, and you're trying to evaluate this strategy, and you're trying to evaluate this particular team, and the valuation, how many other packaging company deals have you looked at? If it's not at least five or six, then you don't have enough information to look at this. Or if you've got to find somebody else who's looked at a bunch of different packaging deals and have them give you their feedback on how this one compares.

Secondly, it's about knowing what you don't know. You know, if you're in the packaging business, well then you probably will do a pretty decent job of evaluating this packaging company, but if you're not in the packaging business, then you've got to talk to some people who come out of that realm and learn about what they know.

And then the other is to be connected with customers, and not just customers that you pick up the phone and call, but, you know, people where you have the kind of exposure and relationship with where they'll give you the real deal, right, as opposed to just getting references from the company. And, you know, they're very few ways to do that very efficiently, which is why we've put together our group, which is so you get in one place, with a lot of these folks, as well as, you know, through an online platform, and then also through our team, which who can connect you to the people that you're most needing to connect to to evaluate a deal. Now there are certainly ways to do that without Arcview or a group like ours, but it's just more work.

Matthew: Yeah. And there's more arms to Arcview now, there's Arcview Ventures, there's Arcview Market Research, maybe you can tell us a little bit about Ventures to start.

Troy: Yeah. So three, four months ago, we launched Arcview Ventures, which is a venture fund, and we are in the, kind of, raising phase for that right now, and Brian Shang and Jeanne Sullivan are our general partners for that. And we're going to be really focused on A stage, growth A and B stage, sort of, growth stage companies in the hemp, and brands and, technology space...agricultural technology space as well as, you know, software and things like that, and really, really focused on that. And I feel like we've got a unique role to play there given all of the exposure that we have to potential deals.

Matthew: And you've also been producing reports here for a number of years, the Arcview Market Research State of Legal Marijuana Markets is probably the most well known, but can you talk a little bit about the research that you're generating and how that works and maybe the partnership with BDS?

Troy: Yeah, yeah. So, I'll start back a little further which one of our main partnerships and things that we've worked on is creating CanopyBoulder, which is a seed stage mentor-driven accelerator in Boulder. And one of the companies that came through CanopyBoulder was BDS Analytics. And right as that was happening, Arcview, who had been producing these market reports for years, realized that this industry was maturing, and as it needed more data and more data was starting to become available, and we had to decide, are we going to become, you know, a data company in order to do this or are we going to partner? And we thought, you know, "Hey, that's not what we really...we don't really, really know the deep data. We understand the market, and we can make sense of data, right, but we're not going to be the one that's generating it." And so we partnered with BDS to, you know, meet the needs of an evolving, maturing industry.

And so, we've been putting out reports with them for a few years now, and it's really raised the bar for the cannabis sector and has really become sort of the industry Bible, so to speak. And, you know, we released a semi-annual update to our sixth edition of "The State of Legal Marijuana Markets." We'll be coming out with the seventh edition very soon. And it's, you know, it's...you know, your listeners are big purchasers of our market reports and big downloaders of our executive summaries, but, you know, we really try and give a really big overview of what's happening, and then, we've also been putting out a lot of reports that go specifically into certain topics, so going into concentrates. We just put one out about how pharmacies and dispensaries are going. The pharmaceutical industry and then the state-regulated industry, how those two industries are going to compete with each other, and what the dynamics are there between pharmaceutical development with cannabinoids versus, you know, oftentimes having that very same product basically available for a fraction of the cost at a local dispensary, those sorts of dynamics. So we're putting out a new report every, you know, four to six weeks now, based on that, and so people can subscribe to the Cannabis Intelligence Briefing service, which gives you access to everything as it comes out.

Matthew: Okay. And what do you think is in store for the cannabis industry in the next three to five years that might surprise people that they don't see around the corner that you feel like not enough attention is being paid to but you see it pretty clearly?

Troy: Yeah. So, one of those is about this question of valuations and execution, right? So we were in this phase right now where the companies... Most of the value here has been created recently by moving assets around, essentially, M&A, mergers, and acquisitions, bringing companies on the public markets and seeing, you know, a big arbitrage between private company valuations and public company valuations. This is where most of the money's being created right now. But once you bring all these disparate elements together and you move it to the public markets, which gives it more access to capital, and, you know, there's all this financial engineering that happens, right? At the end of the day, the real measure of whether a company is going to succeed is whether or not they can get these disparate elements to work together, which means getting the right talented people to work well with other really talented people.

And at the end of the day, everything in a business revolves around getting people to work together to execute on a vision. It's not about selling that vision to investors, it's about actually executing on it. And that's going to be hard, that's going to be hard to do, especially for companies that are making an acquisition every month or two to get those systems actually working synergistically together, and get those people actually working synergistically in a way that creates efficiency, and then ultimately, it really rests on whether or not they can make regulators and customers happy at the same time, and to be able to use all of that, to make that happen. That's what's going to really, ultimately make these companies valuable, not all the financial engineering and stuff that's happening right now. So, I think that's really important, which is one of the reasons why, you know, recruiting is such a big deal, and I think we're going to see a lot more management consulting, and executive retreats, and these sorts of things because we're going to need to get everybody working together. So it starts to look a lot more like other industries very quickly.

Another aspect that I feel is under considered is....everybody thinks interstate commerce is just going to happen. That like, as soon as the STATES Act passes or anything happens at the federal level, all of a sudden states are going to be able to trade and countries are going to be able to trade, but I don't think that's how it's going to work. I think particularly in these Northeastern states, in Florida and these sorts of places that have very limited licensing, I think they're going to hold on for dear life to the regulatory models. They do not want to be competing with other states and other tax codes and these sorts of things. I think maybe in the West, there'll be a little bit more interest in this because they're a little bit more open-type markets instead of very constrained, but I think eventually court cases will bust it open and will cause there to be interstate commerce. But I think that we're looking at probably two to four years after the effective end of federal prohibition before we really start seeing interstate commerce. And so, I think people that are making their business models based on the idea that we're going to be able to trade back and forth very soon, I think they're mistaken.

Matthew: Interesting.

Troy: Yeah. And then the other thing, which is sort of the obvious elephant in the room, so it's not really unique for me to be saying it right now, but hemp and CBD are going bananas. I mean, this is wild and I... You know, I think we're all trying to wrap our heads around it, frankly.

Matthew: Okay. Troy, I'd like to ask a few personal development questions to help listeners understand who you are individually, and I've asked you some of my favorites in the past, so I've come up with some new ones here for you. Is there a best practice that you've implemented in your business that has been really helpful that you'd like to share?

Troy: Yeah, so one of the things we've been doing at Arcview for years now is, once a week the whole team gets together, and we do a couple of breathing exercises just to center ourselves just for 30 seconds or so to get present. And then each person goes around the room and they say somebody that they appreciate on the team and why, what they appreciate about them specifically, it can't be like a general thing. Then they say what it is that's on the top of their mind workwise, like what's the big thing that they want to accomplish this week or this day, and that gives everybody a sense of, you know, what everybody's working on. And sometimes in an organization, it's harder really to get a sense as to what other people are working on, and that helps to create more synergy with people. And then any bottlenecks, anything that's in the way, because oftentimes someone will say that something's in the way, and it turns out, somebody else has the solution to that, or there can be some more empathy for whatever they're going through. And then lastly is celebration, right? And oftentimes these are more in people's personal lives, right, really humanizes people in the workplace. And, you know, this has been, you know, kind of a thing we do once a week, and I think it's made a huge difference in morale, and a huge difference in people feeling appreciated, and to formalize it in that way.

Matthew: Great. Is there an opinion that you used to hold really firmly, have had for a long time that has changed in the last 18 months?

Troy: Yeah. This is related to the cannabis sector, hemp-derived CBD. You know, for a long time I kind of thought that hemp-derived CBD was not going to ultimately be a thing because it didn't have as strong of an impact on people as when there was THC involved. And then there was this on... You know, Sanjay Gupta had his whole special about, you know, what we talked about, "the entourage effect" and all of this. But consumers seem to be buying up hemp-derived CBD, and there are credible brands and credible people that are now supporting and coming out with products that are from hemp-derived CBD.

And so, I think I was likely mistaken there. I mean, you know, time will tell whether this is a flash in the pan, kind of, hot trend that's going to dissipate, or whether it's real, but I know lots of people who are using hemp-derived CBD and saying that it helps them with the issues that they're dealing with. So yeah, that's one area where I think I was probably wrong, but I don't think I was alone there. I think a lot of people in our industry and probably many people still share that opinion. But at the end of the day, the consumer is king.

Matthew: Now, Troy, if you were not in the cannabis industry and you had a career that was solely for fun, what, what would it be?

Troy: But Matt, this is so much fun.

Matthew: It is fun, it is fun. I mean, I mean just totally fun, not in the cannabis industry.

Troy: Yeah, what I love doing is bringing people together in interesting unique ways, which is some of what we do at Arcview, but it's less about the topic, whether it's cannabis or anything else, and it's more about this idea that humans are magic, and that when you put them together in the right type of context, with the right kind of prompts, and the right kind of intention, that magical things can happen for people, and they can feel, you know, transcendence, and they can feel connection in a way that they didn't think they could feel connection with, particularly when it's across difference. You know, people, they didn't think they would connect with that turns out that they can. And I love creating those kinds of contexts, whether business or personal.

You know, for example, a friend's wedding recently, I led a group exercise that got people connected and it's one of these multiple-day weddings, and it was really powerful to see how... You know, people at weddings, they fuss over the flowers, they fuss over the band, and the food and all of this kind of stuff, but usually what a couple really wants is for their family members who are from disparate areas and different subcultures and different ages, they wanted them to bond. They want those people to bond and to connect and feel good about each other, and this was an opportunity to put some real focus on that in a way that I think might have achieved the goal. So that's the kind of stuff I get excited about.

Matthew: Oh, cool. What did you have them do?

Troy: There are a number of... It's different ways of putting people in contact where they get to see how similar they are, and then also really appreciate the ways in which they're different in a way that is that is fun for them, makes them feel closer.

Matthew: Okay. Well, Troy, that's for coming on the show today. As we close, can you tell listeners how they can find out about your next event, about the research and anything else you'd like them to know?

Troy: Yes. You can go to arcviewgroup.com or arcviewmarketresearch.com and I think our website is very explanatory about all those things. And our next event will be in Vancouver, April 23rd through 25th. It's a beautiful venue, it's a beautiful time to be in Vancouver, and if you qualify, we would love to have you.

Matthew: And accredited investors are the ones who qualify, and just go to your website and fill out the form, or to speak with someone, or book a call or something like that?

Troy: Correct. Exactly.

Matthew: Okay. Troy, thanks so much for coming on today. We've got a really exciting future, and I'm glad to be part of it with you.

Troy: Yeah, congrats on all your success as well.

Matthew: Thanks, Troy.

Man: If you enjoyed the show today, please consider leaving us a review on iTunes, Stitcher, or whatever app you might be using to listen to the show. Every five-star review helps us to bring the best guests to you. Learn more at cannainsider.com/itunes. What are the five disruptive trends that will impact the cannabis industry in the next five years? Find out with your free report at cannainsider.com/trends.

Have a suggestion for an awesome guest on cannainsider.com? Simply send us an email at feedback@cannainsider.com, we'd love to hear from you. Please do not take any information from cannainsider.com or its guests as medical advice. Contact your licensed physician before taking cannabis or using it for medical treatments.

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Man: Lastly, the host or guests on CannaInsider may or may not invest in the companies, entrepreneurs profiled on the show. Please consult your licensed financial adviser before making any investment decisions.

Matthew: Final disclosure to see if you're still paying attention, this little whistle jingle you're listening to, will get stuck in your head for the rest of the day. Thanks for listening and look for another CannaInsider episode soon. Take care. Bye-bye.

Can Craft Cannabis Survive The Big Money Takeover?

ryan stoa craft weed

Can small-scale craft cannabis survive against huge corporations and the big ad practices they’re introducing to North America?

Here to help us answer that is Ryan Stoa, Associate Professor at Concordia University School of Law and author of “Craft Weed: Family Farming and the Future of the Marijuana Industry.”

In this episode, Ryan argues the need to keep cannabis “more craft beer than Anheuser-Busch” and proposes a Marijuana Appellation system that would support a sustainable, local, and artisanal farming model within the U.S.

Learn more at http://ryanstoa.com

Key Takeaways:

  • Ryan’s background in law and cannabis and what sparked his desire to write “Craft Weed”
  • Why Ryan argues we need to support craft weed over big companies with large scale cultivation facilities
  • The extensive research that went into Ryan’s book and the information that shocked him the most
  • Smart farming and how it relates to indoor cannabis growing
  • How Ryan believes the newly passed Farm Bill of 2018 will affect the small American family farm
  • Why the desire for sustainable, artisanal cannabis fluctuates across the U.S.
  • Ryan’s positive outlook for the future of cannabis agriculture and how he believes legalization will benefit our culture
Read Full Transcript

Matthew: Hi, I'm Matthew Kind. Every Monday I look for a fresh new episode where I'll take you behind the scenes and interview the insiders that are shaping the rapidly evolving cannabis industry. Learn more at cannainsider.com that's C-A-N-N-A insider.com. Now here's your program. Can small scale craft cannabis survive in the face of huge corporations bringing big Ag practices to North America? Here to help us answer that question is Ryan Stoa, Associate Professor at Concordia University School of Law in Boise, Idaho and author of the book "Craft Weed Family Farming and the Future of the Marijuana Industry." Ryan, welcome to CannaInsider.

Ryan: Thank you very much, Matt. It's a pleasure to be here.

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

Ryan: I am in my cabin in the mountains outside of Boise, Idaho.

Matthew: Oh, nice. And I'm in Charleston, South Carolina today.

Ryan: Awesome.

Matthew: Can you share a little bit about your background and journey and what drove you to write this book?

Ryan: Sure. So, I started my career in Miami, Florida, Florida International University, and was studying at the time, predominantly water rights and water conflicts around the world. And I turned my attention to water conflicts domestically here in the United States and one of the conflicts that originally jumped out to me was occurring in Northern California. And it was between, you know, cannabis farmers, small scale cannabis farmers, many of whom were doing their best to practice sustainable and legal cannabis agriculture. But were not doing so with water rights that have been granted by the state of California largely because the state had not figured out how to develop a water permining system for cannabis agriculture. And once I kind of delved into water conflicts in the cannabis industry I realized that there was a huge number of questions that regarded cannabis agriculture and its future. And once I started digging in I realized that there was just so much fruitful information out there to uncover and discuss and ultimately write about in my book.

Matthew: Okay. So, your book is called "Craft Weed," can we have craft weed as big companies move into the space and focus on huge large scale cultivation facilities?

Ryan:Yeah, I really believe we can. You know, I'm not pretending that there won't be this sort of big marijuana model that'll come to become a reality. You're already seeing some really good investments by big tobacco and build out big alcohol players, you know, the owner of Corona beer has made a billion dollar investment in a Canadian marijuana producer in late, I believe, in August of 2018. And then in December, a few months later the owner of Marlboro made an even bigger investment in a marijuana producer...Canadian marijuana producer. So, you're seeing a lot of money coming in and certainly like other industries, there's likely to be consolidation and scaling up and perhaps even a commodification or commoditization of the product. But I think craft weed or artisanal model of marijuana agriculture and production can survive and even thrive. I think that's really what a lot of consumers have shown an interest in and a preference for in terms of diversity of products and strains.

I think people look for higher quality and sort of the products that they're consuming, especially if you look at other industries such as the wine industry and the craft beer industry there's evidence out there that a craft model can coexist alongside the sort of cheaper generic products. And I think that's just as likely to be true in the cannabis industry.

Matthew: Okay. Was there anything that really surprised you when you were researching this book that really jumped out that you weren't expecting?

Ryan: Yeah, you know, I was roughly familiar with the history of cannabis, and of course I knew that cannabis cultivation and use stretched back centuries. But I think what surprised me a little bit about the history of cannabis cultivation, I think sometimes we sort of assume that you know this war on drugs that the US implemented in the 20th century was something really novel and new. And that previously everybody had been in love with cannabis plants and that's really not the case. Cannabis cultivation has been controversial for centuries and it's been...and many cultures around the world have sort of had this tension between those that recognize the opportunities and potential of cultivating cannabis on the one hand and authority figures that were uncomfortable with it and try to prohibit it on the other hand. And so it provided sort of a useful backdrop and really surprised me in the sense that, you know, a lot of cultures and societies have tried to deal with cannabis cultivation and square that with our societal norms.

Matthew: It does not surprise me at all because I feel like the first time you consume cannabis you say, "This is not anything that I was told it was. It was demonized." And then the second thing is that you start to ask other questions. So, I could see while it's why authority figures don't want people asking a lot of questions, it makes a lot of sense.

Ryan: Yeah, and, you know, the cannabis plant as many of your listeners would likely now, you know, as a diversity of uses. It can be recreational, it can be medical, it can be therapeutic, it can be spiritual. And historically it's been used for all of those reasons and I think what can be especially threatening, especially historically where, you know, groups that were using it for spiritual purposes that sort of threatened the, you know, the status quo or the world order of the dominant society. And I think that those were cases where it was perceived to be especially threatening.

Matthew: Let's talk about smart farming. And how does that dovetail with indoor cannabis growing?

Ryan: So, there's been a rise in the last few years of this concept of vertical farming or smart farming, in other words, growing crops indoors. And by doing so you can optimize growing conditions and increasingly monitor those growing conditions to a very scientific degree. And so, a lot of smart farming operations will have sensors for the quality of the soil, and moisture content, and the climate, and the temperature. And you're measuring all these things at once and those technologies can inform you when, you know, those plants need more inputs or need a change to their growing environment. And you know, it's interesting that that concept is now increasingly being applied to grow produce indoors. And really a lot of the foundations of that indoor farming movement or the vertical farming movement are, you know, indoor cannabis grows, which sort of developed out of necessity in the 60s and 70s when the federal government and state law enforcement were starting to go after cannabis outdoor grows. It drove cannabis growing inside and the benefits of that are still numerous.

You know, you don't have to be subject to the whims of mother nature. Now you can control your environment and really dial in your system. And of course, there are also downsides and as I talk in my book, I think, you know, indoors farmers really need to reckon with the fact that the, you know, the cost and energy consumption required to grow plants indoors instead of under, you know, the bright light and free light of the sun it can be an enormous challenge.

Matthew: So, most licensed cultivators operate indoors as we've talked about, but how will the greenhouse model, will that be a catalyst here, you know, to be more sustainable? And how do you think that will look because politicians are still really nervous about this. They treat cannabis like plutonium. What do you think is gonna happen?

Ryan: Yeah, you know, I think one of the interesting developments in the cannabis industry and the legal cannabis industry is that you've got these two different communities growing cannabis. There are the indoor growers on the one hand and the outdoor growers on the other hand and both are really passionate advocates for their model of farming and just can't see how the other approach would have a viable future. And, you know, that's interesting. I think eventually it may be that one comes to become more popular than the other. You know, at the moment, you still have a thriving outdoor cannabis agriculture community, especially in western states and especially in Northern California. But certainly authorities in some states aren't even allowing outdoor cultivation largely for the reasons that you mentioned. They want it to be out of sight and out of mind. And so that certainly gives a leg up to the indoor growing community.

Ultimately, you know, I think there's probably going to be a happy medium in the form of greenhouse agriculture. It makes sense that you would create a growing environment in which you're taking advantage of the sun's light energy while at the same time, you know, not subject to all the whims of mother nature including storms and droughts and the like. And so, I think greenhouse, you know, that sort of middle ground or what some state license issuers or regulators are calling is sort of mixed light approaches are gonna have a bright future, no pun intended.

Matthew: Now, how will the Farm Bill affect the small independent American family farm? Will it be a new era of like these beautiful systems being built with small family farms being able to support themselves and without having to just scrape by?

Ryan: Well, I think that we can certainly hope so. I'm not sure I'm that optimistic that I would project that that's a guaranteed future but I certainly hope that you know, the Farm Bill can help support the American family farm. And with respect to cannabis agriculture, of course, the significant development was the federal legalization of hemp cultivation. And one of the things that's interesting about that is that, you know we have...I think a lot of folks kind of mistakenly believe that, you know, hemp and psychoactive marijuana are these two very distinct plants. Whereas, you know, really we're talking about pretty similar plants, one might be a strain that is low in THC and the other is not. And so, I think it'll in some ways help make communities and especially agricultural communities a little bit more comfortable with with farming the cannabis plant and seeing the potential uses of that. And hopefully as that develops and American hemp farmers become competitive in the global trade for hemp products will sort of loosen up our conceptions and fears around psychoactive strains or psychoactive crops and enable those to legalize and then thrive.

Matthew: So, wine lovers tend to think wine from Napa or Sonoma, California are better than other places. Will something similar happened with cannabis? And if so, what would it look like?

Ryan" Well, I expect and in some ways you can probably already see that if you spent time in California or Washington. Colorado, I think folks there and can be very proud of their local products. You know, you often hear people brag about, you know, the quality of Cali weed or Colorado weed. And I definitely think something similar will happen in the cannabis industry. And one of the ideas that I propose that has been gaining traction is the...is using the wine appellation model for the cannabis industry. So, what I mean by that is that in the wine industry, if you're drinking a bottle of wine that says Napa County on it, you can be sure that the grapes that were used in that wine actually came from Napa County because a regulatory authority is verifying that that's the case. And that's called an appellation system. And there are many who are now believing and hopeful that such a system can be applied to cannabis agriculture as well.

In other words, farmers that are cultivating cannabis in Humboldt County can advertise and put Humboldt County grown on their cannabis and that will be verified and certified by an authority or governing body. That way, someone who's, you know, growing in, you know, their basement in Arkansas can't just put Humboldt County on that to take advantage of the solid reputation of Humboldt County and get away with them. And the same could be said of other growing regions Washington, Oregon, Colorado, Nevada, wherever. You could really use that system to diversify the amount of products that are available and help, you know, sophisticated in a way the cannabis marketplace.

Matthew: I think that works. It works but there in some ways there's still kind of these imposters. Like I went to Parma, Italy last year and I went through the Parmesan cheese tours and watch how they made that. And they have essentially like a cartel that is allowed to say, you know, Parmesan cheese but then you have these competitors that say like, Parmesan inspired cheese or Parmesan-style cheese and for a lot of people that aren't paying attention they're like, "Oh, just grab this one's a little bit cheaper or, you know, I like the packaging a little bit better." So it does work because the person that really wants, you know, the real Parmesan cheese will look for that seal, will say, "Okay, this is one the real deal." But for people that are not that into it, they still lose some market share. So, it'll be interesting to see how strict this becomes, you know, I know in California, they love making like laws and regulations so, maybe they will make it really strict there and it'll be difficult to do that.

Ryan: Yeah, I mean, it's a great point. And, you know, one of the major challenges of an appellation system is enforcement. Famously, it took, you know, over a decade and ultimately a US trade mission to China to get Chinese authorities to stop a Chinese wine manufacturer from labeling their wine as coming from Napa Valley and you could see the same thing happening with cannabis. The origin of the appellation system can be traced back to the Champagne region of France, you know, so champagne wine producers were developing this really high-quality product and wine growers from other regions were recognizing that and saying, "Hey, if we just say champagne people will pay more." And so that's, you know, really the origin they sort of, there were riots around this issue and ultimately, French authorities said, "All right, we're gonna have to verify this and allow these producers to develop their reputation." And also one of the questions about an appellation system, you know, there's sort of two different models in the US for wine.

All our appellation system says is where the wind came from, whereas in France, the appellations are also used as a mechanism to regulate what types of grapes you can grow, when you can grow them, how you can grow them, et cetera. So ultimately, there's some potential there for the appellation also to be a mechanism for farming communities to get together and talk about what type of strains they might wanna specialize in, or how to be sustainable on their agricultural practices.

Matthew: Yeah, that would be interesting. I mean, in one way, you could see why that would be a cool way to create like a heritage that passes down from generation to generation that consumers get to know but in another way, it might seem stifling. So, it'll be interesting to see what balance is chosen there.

Ryan: Yeah, and hopefully, you know, since legalization and regulation is taking place on a state by state basis, we might have a lot of different models to look at and investigate.

Matthew: Yeah. In your book, you talk about cannabis consumers desire to have their cannabis come from small, sustainable and wholesome places. But as I drive across the US as I have many times and I stop all over in the middle, a lot of times there's...I see people making choices about food that is there's not much thought put into the sustainability or perhaps the budget, so think about that as much. So, will this simply be a bi-coastal thing you think?

Ryan: You know, it's a great point and I think in the cannabis industry or cannabis consumers, they're still going to be a large subset or a significant portion that are, you know, their most important factor is price. They're gonna be price sensitive, and they're gonna be looking for that inexpensive, yet potent generic product that maybe the big marijuana purveyors can specialize in. But I still think there's going to be a robust market for the higher quality strains, the sort of boutique artisanal craft producers that are churning out and producing interesting varieties and strains that have interesting effects and taste and flavor profiles. And so, I think there's still gonna be a robust market for that. And what's interesting about the cannabis industry, you know, especially compared to the agriculture, the sort of broader agricultural industry we have in the United States today, I think a lot of people, you know, certainly some people aren't thinking about this issue or are more price conscious and, you know, the status quo is it works fine for them.

I think there's a growing community in the United States that sort of laments the state of American agriculture and the unsustainability of practices and the monoculture that we've developed. And yet, it's kind of hard to change because, you know, we have these entrenched interests. What's interesting about the cannabis industry is that it's brand new at least from a legal perspective. And so, there's a wonderful opportunity here for stakeholders, including growers and regulators and consumers to build from scratch the industry that we want.

Matthew: Yeah. How do you think the cannabis industry is going to change and evolve in the years ahead?

Ryan: I think we'll continue to see big moneyed interests entering into the marketplace. Ultimately, federal legalization could be a huge force and potentially a disruptive force but I think there's a bright future for the for the small scale farmer and for the artisanal producer. I think you're already seeing a sophistication of the industry as people, you know, walk into a legal dispensary and, you know, oftentimes the person behind the counter sounds an awful lot like a sommelier that you be speaking to at a fancy restaurant when talking about wines. You know, you can kind of go in there and say, "Hey, look, I'm having migraines. Is there a strain that can help?" And they can say, "Yeah, here's a few you might want to consider." And I think that that's likely to continue.

Matthew: Okay. One aspect, we don't talk about too much on this show but is culture in terms of how it affects culture, you know, different generations, the boomers, the millennials, Gen X, now also Gen Z, the homeland, or homeland generation. How is this affecting our culture and how we live?

Ryan: Well, I think, you know, America as a society is becoming more and more comfortable with cannabis and the cannabis industry. You know, we sort of moved from a model that, you know, really try to demonize the plant and especially demonize users and now sort of the war on drugs. So, I think that generations that lived through that might either, you know, still be buying that message or be scarred from that experience. But as we're moving away from that and more and more Americans are sort of aware, you know, in the 90s that California had legalized medical use and that throughout the 2000s you have more and more states that are legalizing. I think that we're becoming more comfortable with it and now starting to think about, "All right if this is going to be legal, what do we want it to look like?" And ultimately my book, you know, doesn't focus too much time on legalization or whether or not the plant should be legal. You know, really I think it's time to think about the future and the next steps. If this is gonna be legal, what do we want this industry to look like? We have an opportunity right now to really help shape that future.

Matthew: Okay. Just out of curiosity, what's the reaction been with your colleagues at Concordia University as you published this book?Because I know Idaho is typically pretty conservative, but also becoming less so now with so many California transplants and transplants from all over the country discovering what an awesome state it is.

Ryan: Yeah, you've got a good read on our state. Certainly, Idaho's rather conservative when it comes to cannabis legalization. I think we're one of three states that have not legalized medical use in any form or decriminalized small amounts of possession. So, certainly our legal infrastructure is still relatively unfriendly with respect to cannabis. But I think from a research perspective, my colleagues are supportive and I think there's still a lot of interest. You know, we're surrounded by states that are legalizing cannabis, Washington, Oregon, Nevada, Utah, Montana, and of course, Canada. And so, it's certainly even though it hasn't been legalized here, a terribly relevant issue, even for Idahoans.

Matthew: Oh, yeah. And also it's coming in over state lines one way or another. So there's gonna be, you know, a reckoning in how to deal with it.

Ryan: Absolutely.

Matthew: So, Ryan, at this point in interview, I'd like to ask a couple of personal development questions to help readers...listeners get a better sense of who you are personally.

Ryan: Sure.

Matthew: With that, is there a book that's had a big impact on your life or way of thinking that you'd like to share?

Ryan: Sure. I think, you know, one book or series of books that have really influenced me were written by Daniel Quinn, you know, when he came out with his sort of Ishmael trilogy, including "Ishmael" and "The Story of He and My Ishmael." I just thought that was such an innovative and novel way to approach sort of a lot of philosophical questions that we have between humans and our natural environment. And the way that Daniel Quinn talks about that in narrative form, encourages us to reevaluate our relationship with the earth. I thought was really, really influenced me and helped shape my thinking. And I think another book that, you know, was influential in the way that I wrote "Craft Weed" is the "Unsettling of America" by Wendell Berry. And if you read the book the last chapter I sort of quote from several passages from Wendell Berry in that book talking about sort of the development of big agriculture in the United States and the impact that that has had on our rural communities. And I think that book will still have...leave a lasting impression on readers into the 21st century.

Matthew: Do you know anybody close to you that had a positive impact from cannabis or hemp that caused you to start to broaden your opinion of the plants' abilities?

Ryan: One of an indispensable figure in my life with respect to understanding cannabis and the cannabis industry is Jack. The sort of figure that I opened the book with and talk about throughout the book. He was a close friend of mine and, you know, moved up to Northern California and sort of got his start in the cannabis industry and is now a flourishing, you know, artisanal craft farmer. And I think, you know, being able to hear from him and hear his stories and his experiences and learn how the industry is changing and changing rapidly on the ground, you know, was a really invaluable experience in writing this book. And you can hear a lot about the cannabis industry from, you know, online media or sort of your larger publications, but it's really an industry such as this one that is sort of quasi-legal and still evolving and moving in a lot of different directions. Having contacts on the ground is really an essential aspect of understanding the industry and where it's going.

Matthew: Well, Ryan, this has been a lot of fun. As we close can you share with listeners the best way to find your book and connect with you online if you're on social media or like connections there?

Ryan: Absolutely. I'm on social media, I'm on Instagram and Twitter. You can find me at Ryan Stoa, or on Twitter @ryandstoa. I have a website ryanstoa.com R-Y-A-N-S-T-O-A .com, and you can find my book "Craft Weed Family Farming and the Future of Marijuana Industry" essentially anywhere you buy books online, whether that's IndieBound or Amazon.

Matthew: Ryan, thanks so much and best of luck with your book.

Ryan: Excellent. Thanks very much, Matt. It's been a pleasure.

Matthew: If you enjoyed the show today please consider leaving us a review on iTunes, Stitcher, or whatever app you might be using to listen to the show. Every five-star review helps us to bring the best guests to you. Learn more at cannainsider.com/itunes.

What are the five disruptive trends that will impact the cannabis industry in the next five years? Find out your free report at cannainsider.com/trends. Have a suggestion for an awesome guest on CannaInsider, simply send us an email at feedback@cannainsider.com. We'd love to hear from you. Please do not take any information from CannaInsider or its guests as medical advice. Contact your licensed physician before taking cannabis or using it for medical treatments. Promotional consideration may be provided by select guests, advertisers or companys featured in CannaInsider. Lastly, the host or guests on CannaInsider may or may not invest in the companies or entrepreneurs profiled on the show.

Please consult your licensed financial advisor before making any investment decisions. Final disclosure to see if you're still paying attention, this little whistle jingle you're listening to will get stuck in your head for the rest of the day. Thanks for listening and look for another CannaInsider episode soon. Take care. Bye bye.

Bringing Cutting Edge Science to Cannabis ­- Dr. Jon Vaught

dr jon vaught fronrange bioscience

With the recent global surge in industrial hemp, scientists are moving into the hemp and cannabis space to provide cultivators the technologies and best practices of other industries.

Helping lead the movement is Dr. Jon Vaught, CEO and founder of Front Range Biosciences, an agricultural biotechnology company that specializes in tissue culture cloning for cannabis and other high-value crops.

In this episode, Dr. Jon shares how Front Range Biosciences is revolutionizing cloning methods to not only produce robust, healthy plants but also create new varieties that could disrupt the dietary and pharmaceutical industries.

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

Key Takeaways:

  • A breakdown of Front Range Biosciences and the revolutionary biotechnology it’s bringing to the cannabis industry
  • Dr. Jon’s background in biotechnology and what led him to start Front Range Biosciences
  • The differences between cannabis and hemp
  • A deep dive into Front Range Biosciences’ services, including its Clean Stock Nursery Program
  • The ins and outs of tissue culture laboratories and the benefits they offer researchers and cultivators alike
  • How to avoid common mistakes in cultivation, including exposing plants to disease
  • Dr. Jon’s goals to create new plant varieties and cannabinoid profiles for the purposes of dietary supplements, nutraceutical products, and even pharmaceutical products
  • Our current understanding of the cannabis genome and the exciting new discoveries Dr. Jon anticipates in the years to come

 

Read Full Transcript

Matthew: Hi, I'm Matthew Kind. Every Monday look for a fresh new episode where I'll take you behind the scenes and interview the insiders that are shaping the rapidly evolving cannabis industry, learn more at cannainsider.com. That's C-A-N-N-A insider.com. Now, here's your program.

Matthew: Scientists are moving into the hemp and cannabis space to help cultivators enjoy the technology and best practices from other industries. Here to help us understand this is Doctor Jon Vaught of Front Range Biosciences. Jon, welcome to CannaInsider.

Dr. Jon: Thank you Matt. Glad to be here.

Matthew: Jon, I know you've got a voice issue because you've been traveling and speaking and so forth. You may sound like the villain, Bane, from Batman, but we will forgive that if it's a couple of octaves lower, don't worry about that. This is not how Jon normally sounds and I'm not distorting his voice in any way.

Dr. Jon: Thank you. Yeah, it's definitely a couple of octaves lower right now. But it still works. So, we'll move forward.

Matthew: Jon gives a sense of geography. Where are you in the world today?

Dr. Jon: So I'm actually back at home in Colorado, on my farm. I live in East Boulder County, not too far for most of our locations and our headquarters here in Lafayette, Colorado. But I just got back from a trip to Virginia at the Industrial Hemp Summit where we had a collection of farmers from Virginia, North Carolina, South Carolina, Kentucky, who were all going to be adding industrial hemp as a new crop to their rotation. So, just got back there late last night...from there late last night and I'm happy to be home again.

Matthew: Great. And I'm in Charleston, South Carolina today. Jon, tell me what is Front Range Biosciences at a high level?

Dr. Jon: Yeah, Front Range Biosciences has been...we've set it up to be an agricultural biotechnology company for high value crops. And we currently focus really on two crops. The first being cannabis, which we include hemp, which is actually the majority of our work in cannabis. But then also the high-THC version as well, through some relationships that we have in California. And then the other main crop that we work on currently is coffee. And there's really two parts to our business. And the first part is our clean stock nursery program, which is pretty similar for all of the crops. We use a process called tissue culture to produce clean, disease-free, healthy, vigorous young plants, and then we put them into the greenhouse and then we ship them to customers. So we basically sell young plants, seedlings, clones, rooted cuttings, lighters, these are all words for young plants and we sell those to farmers.

The other part of our business is our variety development in our breeding program where we're using advanced technologies like next-generation sequencing, bioinformatics, the combination of those things called marker-assisted breeding to improve our ability to breed new varieties. And we're particularly focused on hemp in this area, so looking at a unique cannabinoids and agronomic traits so that we can grow this crop and domesticate it in new growing environments. Not only here in the United States, but around the world.

Matthew: And Jon, can you share a little bit about your background and journey and how you came to get involved in this business?

Dr. Jon: Yeah, certainly. It's a little bit of a long story, but I'll try to keep it as short and sweet as I can. My formal training is in organic chemistry, so I'm a synthetic organic chemist by training. I did my PhD work at the University of Colorado at Boulder. And I started my career in biotech while I was at the University of Colorado at Boulder working for a startup company here in Colorado that was focused on human diagnostics. And I spent actually about 15 years in the molecular diagnostics worlds after completing my PhD. And what I mostly worked on was the development of new technologies for laboratory tests. These were things, tests for early detection of diseases like cancer and heart disease and chronic inflammation. And I worked a lot with pharmaceutical companies to help support FDA clinical trial submissions and really improve what we call personalized medicine, where we better understand the side effects of certain drugs and can predict them better so that we can improve treatment and outcomes for patients.

I also spent a couple of years in food safety, similar technology platforms. But we were focused on a different application, which was the detection of food pathogens, or food-borne pathogens. So things like salmonella, listeria and E. coli in large scale food production. During this 15-year stint in molecular diagnostics, I got really engaged with farming. I started a 501(c) three non-profit. It's actually a small goat farm called Mountain Flower Dairy here in Colorado. And we were really focused on helping bringing the community closer to agriculture and help giving them a chance to understand where their food comes from because it's shocking how removed we are today from where our food comes from. So we did summer camps and workshops and I spent actually nights and weekends in between building these biotech companies setting the farm up.

And it's turned out to be a hugely successful here in Boulder over the last seven years. And so all of that combined, I fell in love with farming and agriculture. And, you know, when I looked at this emerging industry and cannabis and this new crop here in Colorado about four years ago, I thought, "What an incredible opportunity for me to move my career more into agriculture and combine all of these things that I care about." Because, you know, cannabis is a crop, has implications and applications in nutraceuticals or dietary supplements and nutrition and obviously pharmaceuticals and then agriculture and the growing, the production of the crop. And so that was really what motivated me. And I ended up stepping down from one of the other companies that helped start and went out to start Front Range Biosciences.

And it's been quite a journey ever since. And I don't regret it at all. I love moving my career into agriculture and, you know, and I think at the end of the day, when I look at human disease and human health and food production and all these things that I spent my career, you know, working on, you know, it all comes together in this new crop and in agriculture really. I think the root of many of our problems that we face in health care are due to poor nutrition and challenges in food production and things like that. So, yeah. That's kind of how I got here.

Matthew: I want to dive into this more, Jon, but before we do, can you just clarify for people that are still unsure about the difference between what cannabis and hemp is. They're the same plant, but different genotype and what that means exactly for a lay person.

Dr. Jon: Yeah, definitely. So cannabis is really the genus of a plant. And traditionally it's been thought of as three different species, indica, sativa, and ruderalis. The reality is that over the last 60 years due to prohibition and lack of access to modern breeding practices and characterization, everybody has been crossing all of these different varieties. And we kind of have a mixed up gene pool right now, meaning it's not really clear what's what, and you can use next-generation sequencing to track things back to some of the original, what they call landrace strains. But the reality is that right now they're all basically the same plant, and they can be hybridized or bred together. And so their only real difference between hemp and cannabis or marijuana is really a regulatory difference, which is the amount of THC that's present. And so currently in the United States, hemp is defined as having less than 0.3% THC whereas marijuana or cannabis is considered everything that's above 0.3% THC. And so from a scientific perspective, they're the exact same plant. They, you know, there's some unique differences in the different varieties, but it's not necessarily related to whether they're hemp or cannabis or marijuana. It's more about the region that they came from or how they're grown that makes them different.

Matthew: Now, could you tell us a little bit more detail about who your primary customers are at Front Range and what you're doing for them right now in terms of your clean stock nursery program and what problems? That's all.

Dr. Jon: Yeah, absolutely. So we're a B2B business and so our primary customers are all growers and farmers. They're our target audience and they're the folks that we support. You know, we work with all different types of farmers. So in hemp, for example, the majority of farmers are growing outdoors. Some grow in some greenhouse, but generally speaking, they're growing outdoor acreage and it's starting to look a lot more like the production of corn or wheat or soy although it's still just a very small fraction of the footprint that those crops make up worldwide. But, so we support farmers there on the hemp side. In California we have some partnerships with some cannabis companies and so we work with cannabis growers there that grow indoors and outdoors and in greenhouse conditions.

And then for their coffee growers, we're currently focused on growers in California, so we've been working with a group...our partner in coffee, Frinj Coffee. And they're out of the Santa Barbara area in California. And we work with them to distribute coffee plants to the coffee farmers throughout California. It's a new crop for the state and it's an exciting project to be a part of. And we have a significant production agreement with them to produce millions of coffee plants for farmers at California. And coffee is generally grown outdoors in California and in other climates as well.

Matthew: Okay. And then when you talk...when you say the word tissue culture, can you just explain what that means exactly?

Dr. Jon: Yeah. Tissue culture is a tool and there's a lot of misconceptions about it, I think especially in the cannabis industry. You know, but it's really just a tool, and it's one of many tools in our toolbox that we use to produce healthy plants. The processes really...it's not that different than growing in a greenhouse in some ways only it's growing in a sterile environment instead of the greenhouse where you have pests and pathogens and exposure to environmental conditions. In a tissue culture lab, we're still growing the plant. So it's still does things like rooting. It still produces new leaves and can even flower. And you know, but you're growing it in this unique environment. It's sterile. It's kind of like a clean room for production of plants. So tissue culture, it really can be used in a variety of different ways as a tool to support agriculture.

It's used as a research tool where groups use it to transform the plant, do things like genome editing and use it to research the underlying biology of the plant. And then it can also be used in the production setting, which is really how we use it in our clean stock program where we produce pesticide-free, pest-free, virus-free plants. And we're able to do that because of the sterile environment that we grow them inside the tissue culture lab. So, you know, we, we can use it to produce much more healthy, vigorous and cleaner plants for our growers. And the end result is a higher quality product going out of the greenhouse. So when farmers go to or come to pick up their plants from us, you know, our goal is always to have the highest quality plants and tissue culture is really just a tool that we use to do that. You know, there's other tools that we use as well. Like next-generation sequencing or an integrated pest management program, these are all really tools that we use to improve the quality of our plants that we produce for our growers.

Matthew: Okay. And the term tissue culture is thrown around a lot. But since you're in this business, can you tell us what misconceptions there are about it?

Dr. Jon: Well, I think a lot of people see it as this holy grail of how you can produce plants and you no longer have to have the mother stock and you don't you don't have to do cuttings anymore. And the reality is that when you use tissue culture in production, that's not really how it works. I mean, you always have to have plants. You always have to have stock plants and other plants and, you know, and you really...the production of plants through tissue culture includes both the tissue culture lab as well as the greenhouse. Because plants that are grown in the tissue culture lab can't just be immediately put into a greenhouse or into a field. They wouldn't survive. They've been grown in this very isolated climate-controlled environment. And you can't just simply put them out into the real world. They don't have the ability to survive.

And so, it's quite a delicate process to take the plants from, let's say the greenhouse to the tissue culture lab, clean them up, then produce them in the tissue culture labs and back to the greenhouse, and then from the greenhouse to growers. That process can take quite a significant amount of time. And it's also labor intensive and expensive and requires a specific set of expertise that can be hard to come by in today's labor environment. And so, it's really a little more complicated that I think a lot of people realize.

And I think the other misconception is that, you know, a lot of people have experience using tissue culture and plants as a research tool, you know, whether it's in graduate school or even an undergraduate and working in research labs and using it to understand the biology of the plant. And that's certainly an important use of tissue culture. But the difference between doing tissue culture that scale and using it to mass produce plants is significant. It's a whole different world when you go from a small isolated, you know, tissue culture lab, you know, with maybe one or two scientists that are highly trained, it might have PhDs and working very carefully in the lab to being able to produce millions and millions of plants on an annual basis with a team of people in a tissue culture lab. So it's just two very different worlds. I think there's also the idea that it's a quick and easy solution and I think I've heard people say, "Oh, we're just going to build our own tissue culture lab and, you know, we're going to start producing plants in less than a year."

And the reality is, and I've been very fortunate to assemble a team that's been doing this work for decades in large commercial, you know, settings. Places like Driscoll's and Syngenta and Ball horticultural. The reality is that to put a new crop into a clean stock program and tissue culture, it takes years. And, you know, it takes a minimum of six to nine months to get a new variety clean and stable and the tissue culture process and then to get it from there into production. You know, it can certainly take a years and especially to get into the large scale production of millions of plants. So, I think these are all a set of misconceptions that are out there in the industry. We've watched a lot of companies try to do this on their own and spend millions of dollars and not be able to execute. It's a little more challenging, I think, than people realize.

Matthew: Okay. And you mentioned, you know, you have virus-free, bacteria-free, all these different things did you do to keep the environment clean. How does the less sophisticated cultivator typically introduce disease to their plants?

Dr. Jon: Yeah, so the most common thing we see in cannabis is because it's so easy to vegetatively propagate, people find a plant that they really like and they take cuttings off of it and then they transfer it to their friend or their friends' friends. And, you know, they move these plants around and if proper clean stock processes are not put in place, then those cuttings in those plants simply carry along whatever might be present on the mother plant. So these could be pests like thrips or mites or aphids. There could also be viruses that people aren't aware that are, you know, residing inside the tissue of the plant. There can be bacteria and fungus and molds and all of these different pests and pathogens. They're out in the real world. So if you have a plant, whether it's growing in the field or in the greenhouse or an indoor grow, if it's...unless it's in a tissue culture lab, it's not in a sterile environment.

So it can be exposed to any number of these different pathogens. And so every time somebody transfers it from one environment to another, they not only bring along the pests and pathogens that were in the first environment, they also introduce the new ones and the second environment. And then you end up over time, as people move these plants around different facilities and different growers, you introduce more and more and more of these pests and pathogens. You know, and I think simple precautions like, you know, sterilizing your tools that you cut your plants with and making sure that you've got clean plugs that you're going to root your plants in, and just having a strong integrated pest management program in place in your grows so that you're constantly on top of your pests and pathogens. I mean, the reality is that in agriculture, when you go to a place there's pests, there's no way around it.

I mean, you know, we unfortunately have to live in the real world. In the real world, there's things like thrips and aphids and mites and they're just there. And so the idea that, you know, you don't have to pay attention to that is not a good one. You have to constantly stay on top of it and be proactive and take preventative measures to make sure that you don't get huge outbreaks. And especially in the spring when, you know, everything kind of comes back to life and all of the bugs, you know, kind of break out and start to attack the plants again. So, you know, it's really important that people take preventative measures. But yeah, I think that's a shortlist of the ways that we see folks introduce pests and pathogens.

Matthew: You have a goal of creating new plant varieties and new cannabinoid profiles. Can you talk about that a little bit?

Dr. Jon: Yeah, definitely. You know, when I look at this plant cannabis from the organic chemist perspective, you know, I see it as a treasure trove of unique small molecules. There's really not so many plants in the world like it. There's over 500 small molecules that are produced in this plant. Things like canabinoids, there's I think at least 110 or 115 unique cannabinoids that have been identified. I'm sure there's a few more that haven't been identified. There's terpenes and flavonoids, which just all of these unique small molecules, it's a pretty diverse, you know, a diverse group of compounds in this plant. And so, the two that everybody knows the most about are THC and then now CBD, which really just happened in the last few years. And I think we're really just at the tip of the iceberg.

I think there's a lot more cannabinoids and combinations of these small molecules that are going to be effective and in human disease and preventative health measures. And then, you know, and then even as a dietary supplement, when you start to look at hemp grain, as a protein source, you know, it's got to balance fatty acid profile and it's got fiber and has got a balanced amino acid profile. So, from a crop perspective, you know, whether it's cannabinoids or any of these other components, it really has the ability to produce a lot of unique things that I think are going to be beneficial to both humans and even animals and pets. You know, we're starting to see that now as well. So, we're certainly focused on trying to breed new varieties that can produce some of these unique canabinoids that hopefully will become a part of either dietary supplement or nutraceutical products or even pharmaceutical products or even nutritional products.

Matthew: Now, how do you think about the future of patenting cannabis plants and what that holds?

Dr. Jon: Well, it's a very interesting question. I mean, you know, the reality is that when you look at agriculture and just like any other industry, intellectual property or IP is often the foundation for a company's value. It's certainly the case in biotechnology, whether you're talking about diagnostics or agriculture or a drug development. And, you know, for better or worse, the only way to protect that IP is through patents. And so we've already seen some patents issued for cannabis plants. And I think we're certainly going to see more. You know, the reality is it's the only way to protect somebody's hard work. So, for example, if a plant breeder spends years breeding a new plant variety that has some very special trait, you know, the only way they can protect that hard work and recognize value would be to get some type of patents on it.

And, you know, while that might scare some people off, you know, I think you have to look at it from the breeder's perspective and say, "Wow, if they spend years in typically...in traditional plant breeding and even in cannabis breeding to create a new stable variety, you know, it really does take years of hard work." You know, if you look at it from their perspective, it's really the only way they can truly capture the value and protect the hard work that they've done. You know, and so, I think we're going to see a lot more of that. And, you know, and I think it's, like I've said, for better or worse, it's really just the way the world works in terms of intellectual property. Now, that being said, you know, I think it's important that growers and farmers have access to these plant varieties and, you know, and I think there's ways to develop intellectual property and create that value, but then also to provide access to farmers.

There's generally enough money to go around. And so, you know, while some groups of farmers may get early access to some new variety over time and traditional crops, you know, the folks that might have developed these unique varieties will make those varieties available and then occasionally, you know, they get...can get deposited and in public banks or made available to the public. And so, you know, I think we'll see that as well. And, you know, just because there's a patent on something doesn't mean it's not going to be available. It just means that somebody has a legal or they has the legal ability to generate revenue through a royalty off of the use of that product. And so, you know, I think as long as those royalties are not, you know, overly greedy in terms of, you know, limiting folk's ability and farmer's ability to grow these plants, you know, I think the system can work quite well so that everybody wins. The farmers get access to these new varieties and the breeders that develop them get the ability to recognize and create value from their hard work.

Matthew: Yeah, I think about things like that when I bite into like a honeycrisp apple and it's like, there's just something about those. And I know they've kind of been designed for the human mouth, mouth feel and taste buds and the crispiness and the sweetness level. Like everything has been engineered to perfect satisfaction and they're not too expensive. But I'm really glad they exist at the same time.

Dr. Jon: Yeah. And I think that's a great example. I mean, that, you know, that took a lot of hard work to create that variety and other varieties as well. I think the companies that invest the money, you know, you look at an agricultural company, you know, let's take Driscoll's, for example, that creates all of these unique strawberry and blackberry and raspberries and, you know, I mean, they invest millions and tens of millions of dollars, you know, to develop these varieties and produce them in a way that consumers trust and believe in. And they know that when they go to the supermarket and they buy that strawberry, it's going to taste the same. It's not going to be funky or weird. It's going to taste just like the strawberry that they were expecting it to. And, you know, I think that's an important thing to keep in mind.

Matthew: Where are we in sequencing the cannabis biome or genome? And what are your thoughts around that, in general?

Dr. Jon: Yeah, I think there's actually two parts to your question there. You mentioned the cannabis genome and then also the biome without considering the microbiome. And so when we look at cannabis, actually when you look at any organism or any plant, it's actually a combination of those two things. It's actual genome, so the genetics that make up the DNA that makes up that actual plant variety or even an animal or whatever it might be. And then you've also got the microbiome, which are all of the microbes and things like bacteria and yeast and fungus and all of those things that coexist with that, you know, with that plant. And so, with next-generation sequencing available in the technologies have been developed over the last really 10 years especially. You know, we can look at both of these genomes. We can look at the microbiome and all of the unique genomes there and the bacteria. And then we could also look at the plant's genome.

Cannabis, we're still very early in our understanding of the genome and it's...there's a few groups around the world that are working on it. There's been a few great papers that have been published over the last, even the last six months, a few papers had been released. You know, and I think there's...it's good to take a collection of research groups around the world to fully develop our understanding of the cannabis genome. I know we're working on it with University of California at Davis, you know, we hope to release some results or professor that's running that study is going to release some results over the next 6 to 12 months. There are other groups that are working on it as well, but when you look at a crop like corn for example, you know, I think the first fully annotated genome map didn't really come out until around 2012 and it took around 30 labs and over $30 million.

And so, you know, there's...we're still a far cry from being at the...our genomic understanding that we have and in other crops. So there's still a lot of work to do. I think the same is true for the microbiome. The microbiome is even more complex. When you start looking at that, you're talking about, you know, many, many different species of bacteria and yeast and microbes and it's, you know, it's going to take a long time before we understand how each of those play a role in interaction and growing of the cannabis plant. So, you know, I think to summarize, we're certainly working on our genomic understanding and hoping to make contributions to the broader scientific community, but also leverage some of that for our own internal breeding program and how we develop new plant varieties.

And I think there's a lot of other groups around the world, but I'd say it's still early. And I think, as I mentioned earlier in the interview, the complexity of this plant is significant. And the biological pathways does it make up the production of all of these unique small molecules, things like cannabinoids and terpenes and all the other components of the plant. They're very complicated and it's not as simple as, you know, "Oh there's a gene for this cannabinoid or that cannabinoid and you can turn it on or off. They're often interrelated. And so, you know, if one changes, it doesn't necessarily mean that, you know, you're going to wipe out that effect or, you know, you're going to change the production of that compound. A lot of these pathways are, you know, they intersect in different ways. And so, you know, biology is pretty amazing, if one pathway gets shut down, it will often open up another pathway. So I think it's still very early in our understanding of the cannabis gene

Matthew: Can you explain what CRISPR-Cas9 is for listeners that are unfamiliar and maybe what you think is great about the future with that and then maybe what you don't like about it or you think is not yet ready to do anything with? That makes sense?

Dr. Jon: Yeah, definitely. So CRISPR-Cas9 is really a tool that was discovered. It exists naturally in bacteria and archaea. And it's...these are microbes and it's a natural system that evolved to help these microbes fight off viruses that would come in. And without going into the weeds here, it's basically a complex set of molecular machinery. So things like enzymes and short pieces of DNA and RNA that all kind of work together to achieve a certain purpose at the, you know, at the molecular level, if you will. And so, you know, the bacteria use it naturally to, you know, go in and cut out pieces of DNA or RNA, you know, to basically cure itself of a virus that might have invaded the organism. And so what sites is they've done over the last 10 years is they've isolated this molecular machinery out of these bacteria and then they use it to go in and do similar types of molecular work.

So you can think of it as scissors, cutting DNA and going in and stepping out pieces and even inserting pieces. And so people have started to develop this tool both in plants and animals. And even folks who are looking at it for treatment of human disease, but they use this molecular machinery to go in and do what we call genome editing. And it's really, a lot of people, once again, a lot of times with science there's misconceptions, people, there was an article I think that came out and people said, "Oh, you can do CRISPR in your garage." And one of the guys that I always love the saying that, when the guys that did a lot of CRISPR work and runs a team for a company, which I won't even mention, but anyways, they, you know, he said, you know, "If somebody knows that guy, please tell him to send me his resume because, you know, if he could do it in his garage, he needs to be on my team."

It's actually a lot harder than everybody realizes it. It really can take years to use CRISPR genome editing to effectively accomplish a goal such as, you know, removing a target or inserting a target. And it also takes millions of dollars. It takes the right types of facilities and people and, you know, and I think in plants, we're certainly seeing the use of CRISPR-Cas9 technologies in a lot of different crops. But I think, you know, a lot of those crops are crops that have already been pushed to the limit in terms of what can be accomplished with breeding. So when you look at things like corn and, you know, how many bushels per acre you're yielding of corn and things like that, you know, minor increases are hugely valuable for these very large commodity farmers. You know, in cannabis, you know, the margins are still pretty high in terms of what you can generate for revenue from this crop.

So, you know, the need to employ these advanced technologies, I'd say it's still a little bit early for it. And there's certainly a lot of folks talking about it and wanting to do it, but I think you'll find that, you know, just like everything else, it's a lot harder than it might appear based on what you hear in the press and, you know, the internet. And I think it's going to take quite some time before we see, you know, true CRISPR genome edited, you know, cannabis products out on the market. And the last thing to keep in mind is there's also a big regulatory component. You know, I think there's...whenever you do anything like that, especially in the United States, but around the world, you start doing genome editing or even things like genetic modification, you know, there's regulatory concerns that come into play.

So a lot of these crops are highly regulated and to, you know, it's one thing to make it work and it's another thing to get it to the marketplace. And then obviously, there's a big public concern with GMOs right now in the United States and around the world. And so, you know, so I think most companies approach, you know, product development with those technologies with some caution because of market reaction and then also the regulatory hurdles that have to be overcome to actually get those products in the marketplace.

Matthew: I mean, just putting on just my conjecture hat, I mean, when this CRISPR-Cas9 technology more stable and well understood in the future, what's possible. I mean, could you combine elements of the coffee and cannabis plants to do something interesting? Because, you know, you mentioned you're in coffee and I'm always thinking, you know, coffee's great, but like if you have just a little bit too much coffee, it's like it's not so good. I think like chocolate has a little bit better onset of that, like a little bit and fed, I mean, I think it's the theobromine they call it. Like, is there a way to tweak that or do something? I mean, what do you think is possible there in terms of customizing our experiences with these plants?

Dr. Jon: Oh, that's a fun question. I mean, I think realistically, you know, the ability to combine two very different plants like coffee and cannabis, you know, that's science fiction at this point. You know, it's really, you know, coffee is like, it is a tree. It's a perennial plant. It takes years. And it, you know and cannabis is more like a...it what's an annual and it's a grass. It dies every year. So there's big differences biologically that make it kind of hard. It's like saying, you know, it's kind of like looking at my livestock guardian dog that takes care of my goats. And then looking at the cute baby goats and thinking, "Gosh, if only we could combine those two into this new little creature, it'd be the cutest thing that ever walked the earth." The reality is it's not going to happen as much as...as much as they might try, it's just not going to happen.

So, you know, but I think, you know, I think there are going to be opportunities as we better understand that the genome of both of these plants and improve our breeding practices and everything else that we will see some interesting traits come out of them. You know, and the ability to develop, you know, whether it's new flavors for coffee, which is, you know, kind of one of the things that we're working on or that Range is working on in terms of their breeding efforts. How do you produce these truly exquisite flavors in the coffee bean that are, you know, that you don't get from other types of coffee. And I think we'll see the same types of things and cannabis and, you know, there's certainly the potential for it to have unique effects as well. You know, you mentioned something like theobromine or, you know, obviously there's caffeine in coffee and then there's THC and CBD and all these other cannabinoids in cannabis today. I think we'll certainly see the fine tuning of some of those small molecules and end each of these plants which might produce different effects, definitely produce different flavors. But, you know, I think for sure we'll see some customization of the user experience, you know, directly from planet breeding.

Matthew: Okay. And thanks for letting me down easy there. You told me very gently I was being crazy, but I think, you know, I think I read an article about how like some tomato cultivators used a gene from a spider. Do you remember that story and what that's about?

Dr. Jon: Yeah, definitely. So there are certainly, I don't remember the specific one about tomato and a spider, but the one that I'm thinking of was actually from a goat and a spider where they actually...the goat, they insert some genes from the spider that produce the web that spiders spin. And then it came out inside the goat's milk and then they actually extracted that fiber and we're using it for different processes. So there are those examples out there where you can, you know, you can take a piece of biology from one animal or one plant and put it into another one. Those things are certainly possible with the technologies today. But, you know, there comes a lot of concerns and questions that go with that that those types of applications, I mean, you know, is it fair to, you know, to animals or whatever it is? Is it safe?

And are there other effects that we don't recognize? So, you know, it definitely is possible, but I'd say those are, are generally outlier situations and not the norm. Generally speaking, when you start playing around with the biology of an organism like that, you know, it doesn't survive. You know, nature kind of has done things better than we do still. And there's a reason for that. And, you know, I think these things evolved to function in the way that they do in their existing environment. And when we'd go and play around too much with that, the outcomes are not always as good as we'd like. So, you know, so I think it's possible, but I don't think it's going to be the norm. And I think it's a lot more challenging than, you know, than people realize.

Matthew: What footprints do you operate in besides Colorado? How can different people listing, "We want to work with you in different geographies. Reach out." How does that work?

Dr. Jon: Yeah, so our largest footprint is currently in Colorado. It's where we manage all of our hemp operations out of. We have a tissue culture lab here. We have indoor breeding facility and research facility. And then we also have several greenhouses that we use for production of young plants and seed production as well. We also have a greenhouse facility in Wisconsin that we use to distribute young plants to farmers in the Wisconsin area and also the Midwest. We also have some partnerships in California. So, we have a tissue culture lab and a greenhouse for our coffee plants in Gilroy, California. And then we have some partnerships with some licensed cannabis companies in California so that we can implement our clean stock technology to produce clean plants for growers in the regulated California Cannabis market. So, you know, so those are the geographical areas. We're working on additional areas which I can't talk about right now, but there'll be some announcements in the near future about that.

Matthew: Damn it, Jon, don't give us teasers. We want the meat.

Dr. Jon: I know, I know, but I have to keep some things for later. So yeah, so we're working on expansion and trying to get our varieties as well as our technology, you know, out throughout the United States as well as internationally. So, you know, so people can reach out to us on our website, frontrangebio.com. There's a lot of information about us there and email addresses and order inquiry forms and requests for services and things of that nature. So I encourage people to check us out there.

Matthew: All right. Just a couple more questions before I let you go. Where are you in the capital raising process?

Dr. Jon: So we just closed a $10 million series A last fall of 2018, and so we're in pretty good shape currently, but given the rapid growth of this market and the demand that we're seeing, I anticipate that we'll probably raise some more money this year. We certainly have a lot of interest on the investor side, and I think given the fast pace that this industry is seeing in terms of growth, and then especially when you look at the growth in hemp from the passage of the Farm Bill this year, I think there's a huge opportunity and a huge need for what we do in the marketplace. And so, yeah, so I'd say stay tuned. And we're certainly considering...we're planning our strategy for our next round of fundraising. But I would anticipate that that happens at some point this year.

Matthew: Okay. And is there...I want to ask you a few personal development questions to help listeners get a better sense of who you are personally. Is there a book that's had a big impact on your life for your way of thinking that you'd like to share?

Dr. Jon: Wow, that's a great question. There's probably a couple that I would point out. The first was one that I read a long time ago in the early '90s. I'm a book called "Ishmael" by Daniel Quinn and it's really about...it's really interesting book. It's an interaction between a young scientist and a gorilla who's lived for quite a long time. And they actually have...the book is basically an entire conversation or dialogue between these two. And the gorilla, you know, from the gorilla species standpoint, his view of the human race and civilization and it really brings up a lot of interesting points about how, you know, modern technology and human civilization and how it's evolved. You know, over thousands and thousands of years. And it looks at it from, you know, from the gorillas perspective. And so that was really, really interesting. It definitely made me think a little bit differently about our world and modern technology.

And the other one I think there's really interesting is the four agreements. It's a book. It's a very short book, but it's about kind of a set of guidelines that come from a tribe called the Toltecs, a pre-Columbian tribe out of Central and South America. And, you know, and it's really about just how to live your daily life. It's a...I think the four agreements are being impeccable with your word, don't take things personally, don't make assumptions and always do your best. And I think it's a great set of a daily guidelines to live by. And they certainly have had a big impact on my life. And I certainly try to achieve that on a regular basis.

Matthew: Is there a tool you use that is helpful for your or your team's productivity that you'd like share of?

Dr. Jon: Yeah, you know, I think one of the things that I've done over the last year, I have a great CEO coach who's been around for quite a long time. I won't mention his name or his age, but, and he gave me a book about a year ago called "Traction." And it's really been a great tool for me in terms of helping grow the company effectively. And they have what they call the entrepreneurial operating system. And it's really a set of guidelines and in a structural way to view your company as you grow it, and how to build your management team and how to effectively hire and manage people. And so I highly recommend that book to any entrepreneurs or aspiring entrepreneurs. It's really a great tool for management and for building a successful company. It's a lot of work being an entrepreneur and being in the driver's seat for a startup company is really, really tough. And I think that book has a lot of great insight in order to execute effectively in the entrepreneur endeavors...entrepreneurial endeavors that somebody might go through.

Matthew: Here's a Peter Thiel question for you. What important truth to very few people agree with you on?

Dr. Jon: That's a pretty funny one. I don't know, the thing that that comes to mind, you know, is a lot of people might say this, but I don't know that many of them truly believe it or are actually truly live it. But it's what doesn't kill you, makes you stronger. I think I've experienced this throughout my entire life and, you know, a lot of times things that might seem like an unfortunate situation or things that are really hard or challenges that you feel like you're never going to be able to overcome. You know, I think if you stay patient and you stay focused, and you overcome them, I think it does make you stronger and I think it opens up new doors and new opportunities. And I think that's certainly been true in my life and there's been a lot of moments where I wanted to give up and, and not live that out. But I have, and I think it's how I've gotten here and I'm going to continue to take that approach and I've certainly heard other people say it, but a lot of times it's a tough one to actually live. A lot of times you can get discouraged and give up or turn away from sayings just because they're challenging or they're not going the way you want them to. And I think that it's important to push through those things.

Matthew: Yeah. It sounds like this cold is going to make you stronger, this deep voice.

Dr. Jon: Absolutely. Absolutely.

Matthew: John, as we close, can you tell listeners how they can learn more about Front Range Biosciences? How to connect with you or...and also for accredited investors that are interested in learning more about your next round of capital raise?

Dr. Jon: Yeah, definitely. So our website is the best place to start. www.frontrangebio.com. We're on Facebook and Instagram as well, in LinkedIn, so you can certainly reach out to us that way. And depending on what the person's interest is, you know, we've got folks that will direct you to the right person. You know, investors, you know, are certainly welcome to reach out to me directly through any of those channels. And I'm always happy to speak with folks. We also are out at conferences on a regular basis. We have a big one coming up here in Colorado, the NoCo Hemp Expo. It's going to be in Denver this year. We're going to have a big booth and a lot of our staff will be on site. We're probably gonna even offer some tours of one of our facilities. And so, I think that's at the end of March. I can't remember the exact days, but it's a Friday and Saturday last weekend of March. So we'll certainly...I'd encourage people to come out there. And then stay tuned, we'll be announcing some other conferences that will be out at as well, both in California and some other places as well to share.

Matthew: Jon, thanks so much for coming on the show. We really appreciate it. Keep us updated as these developments continue to evolve. This is really exciting stuff.

Dr. Jon: Absolutely. Well, I appreciate the opportunity to do the interview and hopefully it was helpful and the folks out in the audience learned a thing or two and yeah, I hope we get a chance to speak again. I'm always happy to do this.

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