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Interview with Greg Wilson, Chairman and CEO of VidaCannabis.com. Greg talks about: R&D, their new 315,000 Sq Ft growing facility, and more. Listen to the interview below or find the interview on iTunes
Interviewer: Today we're going to be hearing the story of Vida Cannabis, headquartered in Canada's capital of Ottawa. Vida has its sights set on becoming one of the largest and most advanced cannabis growers in Canada. Vida recently broke ground on construction of a state of the art 315,000 square foot production facility in Nova Scotia. We are fortunate to have Greg Wilson, the Chairman and CEO of Vida Cannabis with us today. Welcome Greg.
Greg: Thank you very much.
Interviewer: Glad you could be on the show. For people that are not familiar with Vida, can you give us a little background on what Vida is?
Greg: Yes, absolutely. Vida Cannabis was conceived from inception to build a leadership position in the medical marijuana market in Canada. We have assembled what I believe is the top management team in the country in the key areas of security, research, quality assurance and cultivation. We're in the process of obtaining a commercial production license from Health Canada under the MMPR, which stands for Marijuana for Medical Purposes Regulations, which came into effect on April first of this year. And as you mentioned, we purchased a 315,000 square foot building in the town of Stellarton in the Province of Nova Scotia, and we're nearing completion of a phase one build out that will include a 600 light, state of the art hydroponic grow facility.
Interviewer: God, that's absolutely massive, 315,000 square feet.
Greg: It's big, it's actually seven acres under roof and so it certainly gives us the size and scalability to expand in what we see as a market with significant growth over the coming years.
Interviewer: Okay. How did you get into the medical marijuana industry, I mean did you wake up one day and say I must be in this industry and build the biggest grow facility in Canada? Is it the biggest grow facility? It sounds like it might be.
Greg: Well, it's the biggest that we know of.
Greg: At the present time. And I hadn't really thought too much to be honest about the industry itself, but after watching this CNN documentary hosted by Dr. Sanjay Gupta...
Interviewer: Oh sure.
Greg: ...in August of 2013, I really started to think about the medicinal power of marijuana, and I was intrigued by the opportunity to create a business in a market that is in the early stages of significant growth and at the same time, be in a position to help patients who rely on marijuana for a variety of ailments.
Interviewer: Good timing. Are you looking to sell cannabis at the retail or wholesale level?
Greg: Our plans are to provide medical marijuana directly to patients, so at the retail level.
Interviewer: Okay. When do you estimate you'll have your first harvest and how big do you estimate that will be?
Greg: Well as I mentioned at the outset, we're in the process of applying for a license, and at present we are in the security clearance stage.
Greg: So our next milestone is the granting of what's called a ready to build letter, which is analogous to conditional approval.
Greg: Now we've already started construction in anticipation of that letter, and we hope to be ready you know early in January for an on-site inspection by Health Canada and at that inspection there will be a focus on security protocol and quality assurance standards, and if we pass that inspection, we'll at that point be granted the right to start growing which would put us in position to ship to patients in the Spring of next year.
Interviewer: Okay. You know as you're in the midst of it right now, what do you feel like Health Canada, Government officials, and regulators are doing right, what are they doing wrong, do you feel like it's too onerous in any way or do you think that what they're, the proper controls are in place, how do you feel about it overall?
Greg: You know, I think the MMPR is a step in the right direction. Again it was put into effect April first of this year and it really focuses on large scale commercial producers. And so I like the program, I think it's bringing needed regulation to the market. There's very strict quality control and quality assurance standards, which are good for patients looking for marijuana as medicine, and so I think there's a lot they're doing right. It is in the early stages of new legislations so I do think there will be change. One change we'd like to see is a different delivery method. Right now, according to Health Canada's guidelines, we ship by wither mail or courier directly to the patient.
Greg: And given the amount of money that spend to secure our facility, we're not sure that's the most secure or safe form of delivery. So we're hoping over time that that gets addressed.
Interviewer: So you're hoping to be able to have patients come into maybe a retail location and purchase real time instead of having to wait for a courier or mail, is that what you're hopeful for?
Greg: We do see some form of dispensary model evolving.
Greg: That will take some time but if they're properly secured and if they're you know professionally run and very patient centric, then we do you know, think that that would be a more viable model you know to work with patients longer term.
Interviewer: Now I just want to stop and talk about the facility in Stellarton Nova Scotia, the grow facility. I mean this is so outrageously huge I just got to get some more details. Is there any greenhouse aspect to this grow facility or is it entirely enclosed like a building and what's the security like there? You touched a little bit on the security but can you give us a little more detail?
Greg: Yeah, absolutely. It's an old warehouse facility. With 18 high walls, very secure, you know very few windows, and so you know it's a true indoor fully secure facility. We're actually implementing a level ten security standard, which is the highest level available and includes three meter high perimeter fence with barbed wire on top dug down two feet below surface, there's 24 hour surveillance, night vision cameras, thermal imaging on the roof, and biometrics inside to control access and I believe our facility will be the most secure medical marijuana facility in Canada and will set the standard for those that follow. Interestingly our head of security is Derek Ogden, who spent 27 years with the RCMP, the Royal Canadian Mounted Police.
Greg: And for the last seven of his 27 years of service he rose to the rank of Director General and Chief Superintendent in charge of the drug enforcement department across Canada and had 1300 investigators reporting to him. So Derek has tremendous experience working with Health Canada, working with security forces and you know is a huge sort of part of our team and that really resonates with Health Canada in terms of what they're looking for in terms of security.
Interviewer: That's great. I know you can't speak for Derek but that's a big turn about to go from you know RCMP or Government Enforcement to then security on your end, I mean has his attitude toward the plant changed or was he always in support of legalization?
Greg: You know if you ask Derek, he'll say in effect he's sort of working for the Government because he's going to be working for a licensed producer that is subject to very strict standards set out by the Government for the safe delivery of the product, you know, for delivering a quality product that again is medicine to patients. So in a way, Derek still feels he's working you know with the Government to enforce very high standards in this nascent industry.
Interviewer: Cool. How much has been invested in Vida so far?
Greg: Well, we raised a total of just under $10 million to date, and we'll be spending a total of about $12 million on the facility itself by the time we're done. And we expect to you know be finished construction sort of in the December time frame of this year. And we're currently raising additional funds to finish the building.
Interviewer: Is there still opportunities for investors to participate in Vida's growth and how can they do that if so?
Greg: Yeah, it's a private route of financing that we're doing right now. It's only available to accredited investors.
Greg: In Canada, the U.S., or foreign. And if anyone is interested, they could you know just go to our website or contact me through our website for more information.
Interviewer: Okay. So a little more detail circling back to Stellarton, you can tell I have a fascination with the size of this grow facility. Will that be broken down into like sub rooms, smaller rooms, how will that look from the actual grow perspective?
Greg: Right, so we're starting with an initial phase one build out of 93,000 square feet which will include about 35,000 square feet of actual grow space. And the rest of the areas will be you know employee areas, employees will have locker rooms, there will be shower facilities where they'll shower and they'll put on pharmaceutical sort of grade gowns, they'll go through a negative ionizer before they reach the cultivation area to ensure that there's no pests or pathogens introduced to the cultivation area.
Greg: There's also you know, shipping, receiving, there's a security area, and we're also going to have an onsite laboratory, which is quite unique to Vida. And so there's a lot of infrastructure bring built into the initial phase and again the grow facility itself will be broken down into four different grow rooms so as the plants advance to different stages of the growing cycle, they'll move through these different grow rooms.
Interviewer: Okay. And you mentioned a little bit about a lab on site, can you tell us what Vida's goals are in terms of research and development?
Greg: Yes, absolutely. We're very fortunate to have as our Chief Research Scientist Dr. Pritesh Kumar who earned his PhD in Cannabinoid Pharmacology and for the past six years has managed the cannabinoid research and testing lab at the University of Louisville in Kentucky. And Pritesh is a published expert and a featured speaker at medical marijuana conferences. And one of the objectives at the lab will be to develop proprietary genetics that can then be tested in clinical environments with research collaborations that we're creating. And one of those research collaborations that we're very excited about is with AltMed, a medical marijuana company based in Florida that shares our research focused, science based approach to producing pharmaceutical grade marijuana.
Interestingly again AltMed is setting up a lab of their own in Florida and we plan to work together to again develop proprietary genetics and then collaborate to really advance research in this area and provide clinical evidence and efficacy to the medical community which and the doctors we've talked to are open to prescribing medical marijuana but are clearly looking for more clinical evidence on the effectiveness to support this as a medicine.
Interviewer: Okay. Is there any specific ailments that you're interested in developing treatments or applications for right now, or that's still a little vague?
Greg: You know, one of the key areas that we see is for pain management and chronic pain.
Greg: We've done significant profiling of a patient population that our 5-person grow team has been supplying for over five years in British Columbia. And this group of 5600 patients which, by the way is very loyal to our grow team and has committed to moving over to Vida once we get a license. We've profiled 600 of these 5600 people and 70% are using medical marijuana for some form of pain management or pain relief. So our initial strains will be geared towards you know those ailments and that patient population.
Interviewer: Okay, interesting. I know that cannabis firms can't advertise in Canada, correct?
Greg: That's right. We cannot advertise, however, there are a number of things we can do to create awareness for patients and for the medical community. And you know we're going to be partaking in a number of health care conferences with a focus on ones that Pritesh will be a speaker at. We've also got a medical outreach program where we'll be educating doctors and working with physicians across Canada to again, provide clinical evidence and research to back up you know the effectiveness of medical marijuana. And then of course there's public relations opportunities...
Greg: ... that we'll be able to advantage of too to create awareness about Vida as a company and our approach to the business.
Interviewer: Now what's your general feeling about where doctors are as far as the understanding how cannabis can help their patients? Not just doctors but you know the health care community in general in Canada, do you feel like there's a huge disconnect and there's a massive opportunity for education or do you feel like that gap is being bridged pretty rapidly?
Greg: I think there's work to be done. I think there is an openness from the medical community, certainly the people we've talked to, to prescribe medical marijuana, but they're looking for more information and as I mentioned, one of the reasons that we're going to take an active role in advancing the research and doing clinical studies is so that we can share the results of that with the medical community and really work with them on a peer to peer basis to create credibility for Vida and to educate them you know over the sort of shorter to medium term. So it's not going to happen overnight but again we've talked to a lot of doctors that we feel are open to it. We've talked to a number of pain management specialists in Atlantic Canada where our plant will be based, and there's a real openness and willingness to be educated and work with us on an ongoing basis.
Interviewer: Now you'll have to forgive me because I'm a little bit ignorant about some of the laws in Canada, can only the flower or the bud be sold, or can the oil be sold as well?
Greg: No you're right. Only the dry product at present is allowable to be produced and sold in Canada as per Health Canada's guidelines.
Greg: And so the oil we actually have to dispose of as waste.
Interviewer: Oh no.
Greg: Yeah. It's tough to do and it's actually not in the best interest of patients because of course the oil in a concentrated form is very therapeutic and patients are demanding edibles and infused products because for some of them it's a more therapeutic form of taking the medicine and also some you know don't want to smoke or use a vaporizer. So we do see those laws changing, hopefully soon, and when they do change, there's going to be a product development opportunity to bring in other forms of ingestion be it trans dermal patches, or sprays, or creams, or edibles and infused products so that product development area is another sort of area that we're working with AltMed on and that we've got plans to co develop products in that area so that when Health Canada does allow other forms of ingestion we'll be in you know a leadership position to take advantage and lead the way in providing that to patients.
Interviewer: Very cool. I get sad, I think about all that orphan oil out there I hope at least they can, you can find a way to store it maybe or something until that law changes because that's so valuable, hope that changes soon.
Greg: Yeah, it's pretty clear. We actually have to dispose of it, we have to pay to dispose of it and there's very strict guidelines on how we dispose of it so at present we're not able to store it.
Interviewer: Okay. Where do you see the cannabis industry in 5 to 10 years, I know it's a very tough question and you're not an oracle but I mean it is just changing everyday and every time I think that hey I think I have a handle on this, this seems like it's growing exponentially, what do you think we'll see in 5 to 10 years?
Greg: Well, you're right. One constant will be change. And we see a number of changes coming. Higher levels of quality assurance and quality control, we do see the medical community over time becoming more comfortable as they become more educated with prescribing medical marijuana, we see a national dispensary system to replace the current system of delivery through mail or courier.
Greg: We see product development with other forms of ingestion. And we also see the emergence of a few dominant brands emerging certainly in Canada. We feel it's a huge opportunity for Vida to create a dominant national brand that's synonymous with quality and professionalism.
Interviewer: Gosh I agree with you, I mean right now even just looking at the dosage problem, people come here to Colorado and they eat a whole candy bar and then they have a strange afternoon, there's just no consistency, there needs to be maybe a Coca Cola of the cannabis industry or something where people have a consistent feel and experience over and over so I wish you well with that. I know you have a background in the precious metals industry and finance, and I think there might be some similarities in that precious metals there's definitely a big supply and demand dynamic, in precious metals there's mining and in cannabis there's growing. Do you see a relationship at all between the two?
Greg: You know certainly there are some parallels that you pointed out. The more I learn and work in the medical marijuana market, the more I prefer that market especially in Canada given that it's a federally approved program.
Greg: In an industry where I see just tremendous opportunity for growth and development and the ability to help people. So it offers rewards in many different ways.
Interviewer: I agree. Well Greg as we close, can you tell listeners how they can learn more about Vida cannabis?
Greg: Yes certainly. Our website is vidacannabis.com and I encourage your listeners to visit us regularly because we are in the process of a major revamping of the website and so if you keep sort of looking regularly hopefully you'll see the development of that revamp and the results of the repositioning.
Interviewer: Well, thanks so much for the interview Greg, we really appreciate it.
Interview with David Wright, President and CEO of Altmed.co, Altmed has invested over two million dollars on its mission to earn one of Florida’s five medical marijuana licenses. Altmed uses the tag-line “the science of medical cannabis.”
Matthew: Hi, I'm Matthew Kind. Each week, I'll take you behind the scenes and interview the insiders that are shaping the rapidly evolving legal marijuana industry. Learn more at cannaInsider.com. That's C-A-N-N-AInsider.com. What are the five disruptive trends that will shape the cannabis industry in the next five years? Find out with your free report at CannaInsider.com/trends. That's C-A-N-N-AInsider.com/trends. Now here's your program.
Today, we're going to hear the story of AltMed, of Sarasota, Florida. One of AltMed's cofounders was inspired by his daughter who suffered from epileptic seizures, to start seeking safe and helpful cannabis-related treatments for families in need. AltMed has invested over $2 million on it's mission to earn one of Florida's five medical marijuana licenses. AltMed uses the tag line, "The science of medical cannabis" and is run by former pharmaceutical executives. We are fortunate to have David Wright, President and CEO of AltMed, with us today. Welcome, David.
David: Thank you, it's a pleasure to be here.
Matthew: For our listeners that may not be familiar with AltMed, can you give us a brief overview of who AltMed is and where you're at in the license process?
David: I'd be happy to. AltMed is a fully integrated medical cannabis company and by that, we plan on growing, processing, testing and distributing the highest-quality medical cannabis in a consistent and quality manner. There are two governmental actions going on right now. First of all, Senate Bill 1030 has been passed and it is in the rule-making process. Additionally, on November 4, there is, on the ballot in Florida, a constitutional amendment, which is much broader than 1030. The difference between the two initiatives, 1030 is a high-CBD/low-THC-only bill that requires the product not be swallowed or smoked, so it's limited to oils, vape pens, sprays, gums, anything like that, but if you chew it and swallow it, it's not allowed.
David: The amendment is a much broader amendment. It has a different definition of cannabis and it allows much broader usage than is allowed under the 1030 bill.
Matthew: Okay. Has it been a lot of paperwork and regulations to meet the requirements for the license?
David: Yeah, the requirements for 1030 are quite unique, in that the law requires you to have a nursery license for 30 years and have been growing over 400,000 plants a year for that time.
David: It also requires a $5 million performance bond and the license fee the first year is $150 and then every two years after that it's $300,000.
David: They are limiting the number of licenses in the state of Florida under this legislation to five.
Matthew: Right, okay. In talking with anybody, politicians or the word on the street, is there any prospect of recreational use down the road or is that not even on the radar?
David: I think it's on the radar as it is in every state. If you talk with people in the industry, they say it's three to five years away.
Matthew: Okay, okay. What applications or medications do you think look the most promising for AltMed down the road, once the license is in hand?
David: Well, I think, once the license is in hand and Amendment 2 passes, the conditions are pretty similar to all the other areas. It's pain, you get a nervous disorder, Parkinson's disease, epilepsy, Lou Gehrig's disease, multiple sclerosis and cancer are the main ones. I think one of interest has become of greater conversation and is included in the amendment, is post-traumatic stress syndrome. I think the applications, from the standpoint of administration, I think the edibles, oils, the patches, lotions and creams are going to become more and more important as the medical cannabis industry develops.
David: Even if you're using bud or the vaporizers, the volcanos, are going to become in use more and more for medical uses.
Matthew: Okay. I read that you're building out a partner network. Can you tell us a little bit about that?
David: Yeah. It is part of our business plan. We're looking to partner in three specific areas. One, we're looking at national brands. I think our belief is that one day this will be reclassified and no longer be a Schedule One substance, which will open up borders and will allow people to expand. In those states where there are brands and those brands that are out there, we think it makes sense to partner with these companies and bring these brands to Florida to begin to create national brands.
David: The second area is in the scientific area. We have partnered with Vita in Canada because we believe that they have a very strong scientific base up there, are doing a lot of the same type of work that we want to do. The third area that we want to partner with is in philanthropic enterprises. We truly believe that there's a reason to give back, that there's a reason to support these foundations that are trying to help patients and we believe we have a responsibility, a strong responsibility to the community and to the state, to make sure that we are good partners and that we work with these organizations to ensure patients get the treatments they need.
Matthew: Okay. Can you tell us a little bit about some of the proprietary genetics you're developing?
David: Well, it's really early in the stage. What we're looking at is, we believe in the entourage effect of the plant. Typically, in a pharmaceutical biotech company, you need a single isomer, a single chemical. For example, the drug Marinol, which is on the market, is a high-THC product, but it's THC only and it's only one THC. The physicians I've talked to who have prescribed this say patients come back and say it doesn't work. Actually, smoking of the product or taking it in an edible or an oil does work. One of the things we're looking at from a genetic perspective is to separate out different levels of THC and CBD, different CBD, CBN, what's the relationship between CBD and CBN and THC and the effects it has on specific conditions.
David: Is a high-THC product with a low CBD maybe better for a cancer patient, rather than a high CBD and a low THC? The same goes for the other conditions. I believe, as this becomes more accepted, the pharmaceutical industries will try and step into this arena, but with my background in the pharmaceutical industries and my knowledge of the way medicines work, it's very unlikely that any drug product made from the plant will ever be as effective as the whole plant.
Matthew: Okay. It's not a matter of replacing the plant with some alternative, it's a matter of dialling in exactly what the solution is for each problem, like cancer or epilepsy, things like that.
David: You're exactly right. You hit it right on the head, and we believe that there is something about this plant and this is not just AltMed saying this. The people that I've talked to at the University of South Florida, the people I've talked to in Canada and the science and the way the industry is looking at this, this is a very complex plant and produces a very complex medicine. There are over 86 cannabinoid receptors in the human body and we have no concept today of what parts of the plant and what is the relationship between these cannabinoids that has on the body. This is important research to be done as we take this medicine to the next step.
Matthew: Okay. You mentioned a little bit about your background in the pharmaceutical and biotech industry. Most of the people I interview in the cannabis industry don't have that background. How would you say that's going to help AltMed or how are you going to approach things differently right out of the gate?
David: Cannabis and the cannabis industry is coming out of the closet, so to speak. It started in California and it has progressed through the other states that have approved this. As it starts to come out of the closet, we will get more sophisticated. I believe that with the background in manufacturing and clinical trials and animal studies and processing and chemistry, that we will be able to provide a more consistent product and a higher-quality product and that are two of our goals. There are a lot of things that we should know about our products that we don't know and aren't paid attention to and this starts with labelling. We will probably create a package insert for our products, just like they do in the pharmaceutical industry, that tells a patient what they should know and reminds them that you shouldn't drive or operate dangerous machinery after taking your medicine.
David: This should be looked at as a way of providing education to patients and physicians. Physicians need to know what they should look out for, what the signs of abuse might be, what the other drugs that they might not want to prescribe if they have a patient that is taking medical cannabis. I believe that the background that we bring from the pharmaceutical and biotech industry can propel us many steps ahead of our competition.
Matthew: Now, will you be doing any kind of clinical trials on your own or do you partner with other companies for that or is that too premature to talk about right now?
David: We will partner with other companies who have partnerships with other institutions. For example, we're building a relationship with the University of South Florida, Vita in Canada has a relationship with Kentucky, University of Kentucky and one of the foundations that we're working with has a relationship with Cleveland Clinic. Through these relationships, we will look to these institutions for help in setting up these trials, finding the patients for these trials and they're not all going to be initially double-blind, placebo-controlled pharmaceutical studies with thousands of patients. You start off with small demonstration trials and then you work up from there. One of the trials I'm interested in doing is a trial using Marinol in a group of patients, in a trial using the same, similar subject of patients, using the whole plant extract and let's see what the difference is.
David: I believe there's going to be a tremendous difference. There's a tremendous amount to be done. This industry is in it's infancy.
Matthew: I agree, I agree. Best days are ahead. How large of a growing operation do you plan on building? How many pounds per year do you estimate you'll be able to yield?
David: Initially, our initial grow is 25,000 square feet of indoor grow and we look at 25,000 square feet of greenhouse grow and the green house grow will be produced mainly for making oils and extracts.
David: Over a five year period, our business plan takes us to almost 10,000 pounds a year, production.
Matthew: Okay, that's great. Looking forward, where you do you see the cannabis industry in five to ten years? I know that's kind of a tricky question because it's moving so quickly, but do you have any insights on where you think it's going?
David: I do. I believe that there's going to be a lot more controls, there's going to be a lot more attention to quality and consistency, there's going to be a greater number of products on the market and ways to administer it, but you're not going to have someone sitting in their kitchen making up a brownie mix and throwing some cannabis in it and wrapping it up, putting a label on it and selling it in a dispensary. I think dispensaries are going to get much more sophisticated. I think that you will see dispensaries that have private areas for consulting with patients. I believe you'll see the medical industry getting much more involved in the training of the patient specialists or bud-tenders, if you will. I see the medical side moving to a much more sophisticated place.
Matthew: Okay, that's good.
David: I think there'll be a separate recreation side.
David: I think the recreational information and marketing will be different than the medical and I think you will have separate dispensaries in the future, where one will be recreational and the other will be medical.
Matthew: Okay, good. Do the politicians and people in government that you've interacted with, do they seem receptive to moving forward in this direction or is there still a stigma?
David: There's no doubt there's still a stigma. One of the decisions we made as a company was to go public, tell people what we're doing, open up and show who we are and what we're doing and how we're doing it because we don't believe we're doing anything wrong. We don't believe we have anything to be ashamed of. It's just quite the opposite. We've very proud of where we're going and the ability to help patients. I've spent 40 years of my career working to help patients with pharmaceuticals. I believe in neutraceuticals, I believe in oriental medicine and I believe that cannabis has a huge role here. Once you sit down and talk with these people and show them some of the data and talk about the, really, atrocities have been done to this plant and to it's reputation over the years, than they listen. Having said that, we still have people out there that, no matter how much you educate them, what you tell them, they will be against this forever and think it's a horrible thing. Prejudice is a hard thing to overcome.
Matthew: That's true. Are there any areas in the cannabis industry that you feel investors should be looking at or excited about,\ or that you're excited about?
David: I'm particularly excited about extractions and what we can do. While there probably is, in my mind, no greater feeling than having grown a plant that has a big, beautiful bud, that's full of tri-tones and is gorgeous. I am looking forward to the extractions, to being able to manipulate the extractions and provide a really high-quality consistent product to patients. I'm looking forward to seeing children not suffer from epilepsy. I'm looking forward to seeing children not running around in a dazed manner with a look because they are so highly-medicated on really, really strong drugs that effect - not only do they prevent their seizures, but they also prevent them from living a normal life. I think that OxyContin is one of the worst drugs the pharmaceutical industry has ever produced. While it's very effective, it is also very debilitating. I look forward to medical cannabis virtually replacing that to its own great extent.
Matthew: Great, great, I do too. David, as we close, what's the best way for people to learn more about AltMed?
David: We have a website that is up, it's AltMed.co. Www.AltMed.co and then we have a Tweet site, which is @AltmedFL. Our Twitter site.
Matthew: Great. Then, assuming you get a license, how soon would patients be able to reach out to AltMed?
David: We are taking a great deal of risk in that, we are moving forward to construct our first growth facility. We should be pouring concrete in November, after the announcement. Depending on how long the rule-making takes, we will be prepared probably six months after the rules are issued, be able to provide treatment for patients.
Matthew: Okay, great, so springish 2015. Excellent.
David: That will be the earliest and that depends a lot on the government and the rule-makers.
Matthew: Sure, sure. Well, thanks so much for the interview, David. I really appreciate it. Again, the website is altmed.co for people that want to learn more.
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Peek inside the mind of a Canadian Marijuana, Cannabis grower, Trevor McDonald of Trichome Health Care in Vancouver. He shares growing tips, where cultivation is going, and more.
Interviewer: What is it like to be behind the scenes working as a cannabis grower in British Columbia, caring for plants, maximizing crop yield and dealing with regulations? We'll find out the answer to that question today with our guest, Trevor McDonald, of Trichome Health Care.
Hi Trevor; how you doing?
Trevor McDonald: Pretty good, thank you.
Interviewer: Great. Well welcome to the show. For people who haven't heard of Trichome Health Care in Vancouver, can you tell us a little bit about what it is and what you do there?
Trevor McDonald: Well Trichome wants to basically reach patients to give them easy access to a very clean and high-quality cannabis product. Now with the new regulations it makes things difficult to only being by mail, so one of our things that we want to give to Canadian citizens is basically to have a store front to bring knowledge to future customers and basically set up a very reliable delivery service, so it would be delivered right to their homes.
Interviewer: Oh, that's convenient.
Trevor McDonald: Yes.
Interviewer: Great, would they order online, call, or both?
Trevor McDonald: Both.
Interviewer: Okay, and that would be in the greater Vancouver metro area?
Trevor McDonald: Correct, and our future plans would obviously have one of these storefronts in every major municipality so we could have nice local deliveries so it would be very reliable and quick service.
Interviewer: How much cannabis do you think you'll need to produce to satisfy that demand?
Trevor McDonald: Well you're looking at about 1,500 to 2,000 patients per probably around 600 pounds annually. So you know, each patient would probably go through an average per month of about two ounces; one ounce to two ounces per month.
Interviewer: Okay. And what is it like day in and day out being a grower? What are some of the challenges and opportunities you see when you know doing your day-to-day work?
Trevor McDonald: Well I mean with the old program it's a lot more free, not as many restrictions. But coming into the new Federal program it's more along the lines of a pharmaceutical company. Well much more strict security protocol. As far as the sanitation program, which is very strict, you know, no contamination can be allowed whatsoever. And then again, very thorough testing for micro and for any kind of pesticides or anything like that cannot be used at all.
Interviewer: Interesting, so totally organic. No pesticides.
Trevor McDonald: No pesticides, that's right. So it's about containing a very controlled environment for your plants and a lot of pre-planning and very strict execution.
Interviewer: Okay, and when you say the regulations it's a Federal level, so it's at the Canadian government level, not at the Vancouver level.
Trevor McDonald: Correct.
Interviewer: Okay. Got it. And what kind of pests do you see that would typically warrant pesticides, like mites or things like that?
Trevor McDonald: Yes, I think the two big killers would probably be mites and then you have your powdery mildew. So getting rid of these naturally, I mean, normally people growing in their homes or what have you, doing it recreationally, or if they have their own license and are allowed to grow in their house, most people will get something over the counter, like Endall, which has about 22% permethrin, which I believe big agriculture uses it on fruits, vegetables, and stuff like that. Hence why we wash our fruits and vegetables. But it's not allowed under the regulations, so you know, either you're using lady bugs or you're just keeping a very, very clean environment. It's basically all about prevention.
Interviewer: Right, and for people that don't know, what are the best ways to prevent, I mean, humidity is probably one of them. What's the ideal humidity range for a greenhouse or a grow room?
Trevor McDonald: Well for an indoor grow room, you want to be adjusting it for different times that the plant's life cycle from what it's in. I like to get into the details of it. But to keep powdery mildew, you want to be fluctuating your temperature. The problem with that is powdery mildew thrives at the same temperatures the plant does, which would be around 25 degrees, we are Celsius over here.
Trevor McDonald: And then also humidity. It likes at around 40% to 50%, which is the ideal temperature and humidity for the plant. So to keep powdery mildew at bay naturally, you're going to have a lot of hepa filters. You also want to have the ability to control your humidity, whether you want to raise it or lower it, and as well with your temperature. So you're basically really controlling the environment in multiple ways to battle these things naturally.
Interviewer: Yes, I would imagine. And for people who aren't familiar with what a grower's day is like, what is a typical day look like? Could you just walk us through what it looks like in the day in the life of a grower?
Trevor McDonald: Well I'm running the whole place, so there are other growers that work with me. So we come in and discuss what our plan is for the day, and the first thing we do is do a walk-through, checking out each room. We do micro growing, so every four to ten lights is it's own little room.
Trevor McDonald: I'm running right now about a 4,000 square foot facility, so it's not extremely large, but it's about a hundred-light operation. So what we do is we go through every area first, and then determine which room needs what kind of attention. And then we go about it like that, you know and begin the process of our day from watering, adjusting the PPMs for the nutrients, the pH; checking for pests, checking your electrical, checking your lights, making sure temperature and humidity is correct and how it was overnight, which will determine what we're doing that day.
Interviewer: Okay, and what's an ideal pH? Does it differ from vegetative to flowering?
Trevor McDonald: Correct. The pH for vegetation time would be more around 6.1, or 5.8 to 6.1 for your vegetation period. And then through your flowering period you would want it between 5.5 to 5.8.
Trevor McDonald: Now we have had some different types of strains that were genetically modified which was called the Polyploid at UVC. It was a type of chemo. So that was more a little bit of research and development we were doing, which required much higher pH. So I mean you can get different strains that do require specific growing methods. But it can hinge, you know; if you're not micro growing it can hinge a larger grow op.
Interviewer: Okay. And for people who aren't familiar with it, can you describe what topping or pinching off is, and why that's important?
Trevor McDonald: Topping and pinching off, depends what grow method again you're using, and what kind of yield you want to go for. But if you're taking away from the top, you're basically bringing more energy to your side buds. You know, it's apples and oranges. I mean, it's what the grower wants to do. Some people say, "Yeah, I like to pinch off the top, and then basically bring a lot more yield to your lower side buds" which depending on the strain again, can increase your yield quite a bit. Or it can take it away, I mean; it does all depend on the specific strain. But actual pinching would be every day you're coming in and you're squeezing that top to basically promote larger health and larger buds to the sides and lower branches.
Interviewer: Okay, so you're saying if you don't pinch or top off the top of the plant, the buds on the top could potentially be larger, even though there wouldn't be them on the side as much.
Trevor McDonald: Correct. You can trim up, and it goes both ways. You can trim up the sides or bottoms of those branches and just focus on your top and bring a lot more energy to the top of the plant, or vice versa. You could take off the top or pinch it and bring a lot more growth to your lower side branches. So I mean, again, I think you make a choice depending on what method you're growing, how tall you want your plants, how much space do you have, and also what strain are you growing, where it can benefit the most from either or method.
Interviewer: Okay. And what kind of bulbs do you use, both in the vegetative or I guess; do you separate the nursery from like the cloning from vegetative to flowering? And what kind of bulbs do you use in each situation?
Trevor McDonald: Well with the vegetation we would go with the metal halide.
Trevor McDonald: Larger grow ops are switching to LED for vegetation, where you could get away with it perhaps but probably lack on a bit of your production time, the growth of the plant. We have to do a lot more tests versus LED with the metal Halide and even plasma lighting. But most people go with metal Halide still; it is the proven best right now, but there is a lot of competition coming.
And then as far as the flowering goes, we're using Hortilux HPS 1000 watt bulbs so it's a high pressure sodium. And again, there is competition from LED and plasma trying to come in, which is using less electricity. But if you want the same yield you probably have to use two of those things, which then ends up you know pretty much using two LED lights you know equivalent to a 1000 watt bulb. So you're getting close to using the same amount of electricity anyways. So right now it's not quite there, but it's definitely getting close.
Interviewer: Okay, so you think at some point in the future, I mean, fast forward five years, what do you think the LED market's going to look like?
Trevor McDonald: Yes in four or five years I think definitely it will either be plasma or LED. They just need to get a little more intensity to the light. They have the spectrum with the right colors for either vegetation, which would require more of the blue spectrum; and for flower more of the oranges and reds. And they are just missing that intensity. So I think a couple of years from now there might even be some new prototypes on the market that are really doing well, from what I hear. But I would have to conduct some of my own tests to be 100% confident.
Interviewer: Now that would just be a huge electricity savings in your mind, correct?
Trevor McDonald: Yes, you could be looking at up to 50% in savings.
Trevor McDonald: Yeah, it's a lot; it's a lot.
Interviewer: Trevor, could you describe what it means for a female plant to turn hermaphrodite and how you prevent that?
Trevor McDonald: Can I describe the difference between a hermaphrodite and a regular female plant?
Trevor McDonald: Well, hermaphrodite is obviously both sexes. It can still flower, but you can also get patches of seeds growing from it or pollen at the same time. So you could have one branch that's producing like little pollen pouches that can burst. And then basically pollinate your female plants next to it. What's tricky about a hermaphrodite is if you have a very packed grow room, and you have a hermaphrodite in there, and you know, if there is even a little bit of a flicker of lighting that creates one and stresses the plant out, you could basically have really nice top buds on that hermaphrodite plant, and then still have a side branch that you don't see, because it's tucked away, producing all kinds of pollen and seeds. So they could be very dangerous; it would pollinate them and then they would be in turn creating seeds inside your buds.
So we've actually had that happen to us with a few plants in the vicinity of our hermaphrodite. It was due to electrical light flickering too much, so stressing out the plant, basically creating a hermaphrodite. And one branch that we didn't see, and this is exactly what I meant, basically created that pollen and then pollinated plants in the vicinity around it. And then what you had was really nice buds, but then when you kind of squeezed that bud you'd get little rock hard seeds inside of it; so it wasn't very good.
Trevor McDonald: Yes.
Interviewer: Is there any way to detect if there's pollen in the air or anything in a grow house?
Trevor McDonald: Yes, and for higher tech if you've got a really nice room, and there can be sensors put in for sure. There are a few products that are going to be coming out too that are more hand held and very user friendly, like I think it was called MyDx weed tester. It'll have sensors that will sense the air, also your bud or even food, stuff like that. So you know, eventually it's going to be another year. I believe they're on Kickstarter now, but in another year from now you'll see products like that a lot more mainstream for people going to say a dispensary and buying their pot and then this little tester with sensors on it will test that product right there and it'll let them know if there are any pesticides or anything on it. And then you could switch that sensor out say if you wanted to check for airborne contaminants. It could check that, too. I guess it would be a matter of if that sensor can pick up that kind of pollen. But I would imagine it would.
Interviewer: Very interesting. I love Kickstarter. That's awesome to hear.
Trevor McDonald: Yes.
Interviewer: What is the feeding cycle like in your grow operation? Is it like one day off, one day water, one day fertilizer? How does that work?
Trevor McDonald: We do about one day a week, just a flush. Right now we're using coconut medium, so it's a soilless medium. It's still hydroponicb but the best of both worlds. So basically we get the fast speed of growth, like hydroponic, but we get the flavor and really good taste and security of soil, with the root system.
So we basically go with right now with this facility we're using Dutch Master. I've tried out many different fertilizers. And right now we're going with that and it's the gold line with Dutch Master. And it's really nice; a good product. And we use that and keep our PPMs around 900 to 1,200, so we're very light. We're not that aggressive. And we do a flush once a week, and we have to water every day.
Interviewer: Okay. And how does that water drain away? Does it go down towards a drain, or how does that work?
Trevor McDonald: The plant actually use 100% of our water.
Trevor McDonald: There is no draining.
Interviewer: Wow! So you must have some very specific measurements as far as how much the plant will need to absorb and not have any excess?
Trevor McDonald: Correct.
Interviewer: Are they in like a 30-gallon planter or something like that?
Trevor McDonald: No, no we bury, depending on which rooms we're growing in. But it varies from as small as a two-gallon up to seven gallons.
Trevor McDonald: So you know your volume of water and plant nutrient per plant, basically, depending on the size of the pot.
Interviewer: Do you grow from like do you start with a clone; or do you grow from seed? How does it work?
Trevor McDonald: We have mother plants, and then we make our clones. And bring it from a small rockwool cube basically from the clone trays. And plant that directly into one-gallon pots if they are coconut. We put that through veg time, and then about a one month veg. Then we go into our flower for two months, so we're turning over a crop about every three months.
Interviewer: Oh great. And what do you do to kind of ensure that the first few weeks for the clone, that they are really optimal. I know there are a lot of different tricks of the trade, and different growers have different opinions. But do you use Vitamin B1 or different...
Trevor McDonald: Correct.
Interviewer: Is that what you use? Okay.
Trevor McDonald: We go with a product called either Super Thrive, which has the B1 vitamins plant hormones with just water. So you don't want to put really any nutrient, aside from that. You can go with a bit of Rhizotonic, which is a Canna product, which basically promotes root growth. And you put that in the humidity dome, and then you're lightly adjusting your humidity dome to become less and less humid, so you're slowly training that clone to stop drinking through its leaves and start drinking through its roots, which can be stressful. And at the same time you also want to keep it not hot, but a bit warm. So it's creating a much more comfortable environment for that root system to grow in.
Interviewer: Okay, now I'm not sure, excuse my ignorance, but where are edibles in the Canadian market?
Trevor McDonald: Well it's huge actually, and I think it's definitely a big future in the industry. In BC there was a court case I believe two years ago with a guy that was baking for a dispensary I believe on Vancouver Island. He had gotten busted or raided by police, and went to court. And basically they won in court, so the case was thrown out. And in BC now, because of that, patients are allowed to cook their own products, or have their designated grower create their edibles or Canna caps or pills for them.
Trevor McDonald: The rest of Canada, though, for the actual legalities, I believe are different than BC. This was a BC Supreme Court. So I think in the rest of Canada they do use these products, but definitely not the same culture as it is in BC or in Vancouver. It's definitely, you know, practically legalized, I would say, in Vancouver considering the amount of dispensaries we have and storefronts we have. I believe we have over 100 in Greater Vancouver. So it's definitely very mainstream. We create Canna caps for our patients. I have a few patients that ingest orally. I'm not necessarily baking cookies, as opposed to we're making more pills; and then getting that tested in the lab, so we know the exact milligram and we know exactly what the components are inside the Trichome. For example, the amounts of THZ, CBD, CBN, CBG; I mean, it goes on and on. There are between 80 to 120 different types of cannabinoids inside of the Trichome.
Trevor McDonald: Yeah, so there's a lot of research to be done, and this is a big thing that we're going to be getting into. We will be building a very sophisticated lab in our new facility. And we're going to be doing a lot of work with CBDs, and THZ, and a few other major components within the Trichome. But there's a lot of promise, for example, with CBD working with somebody that suffers from seizures.
So let's say I was an epileptic, and I was on a pharmaceutical product, a synthetic pharmaceutical medicine, with a boat load of negative side effects. And basically I'm suffering still from my seizures and suffering from those negative side effects. Now we've had exact cases, multiple cases like this in Vancouver. There was a little girl, and I believe her name was Wendy, suffered from seizures. And we then got her CBD pills, and got her off the synthetic pharmaceuticals. Not only did she go from 200 seizures a day down to none, but there were also no negative side effects.
So products like this have a very, very big future. But again, the problem with it is that you cannot patent these things. It's a natural plant. So either you're making a synthetic CBD to patent it for large pharmaceutical companies that make a profit, hence why large pharmaceutical companies are starting to come around, because they are starting to make synthetic versions. But again, doing this will create some negative side effects.
So yes, edibles have a huge future. There are multiple components that you want to be ingesting regularly that have no psychoactive effects at all that is extremely healthy for us. So yes, it's very interesting and there's a lot of R&D still to be done.
Interviewer: And there are some benefits for people that suffer from schizophrenia, as well, correct?
Trevor McDonald: Correct. That's also CBD. So CBD would be very prominent with schizophrenics, because it has an anti-psychotic quality in it; and also for seizures. There were a few other tests done for like ADD or people who are very nervous people. They did a test; I think it was with 40 people, so you had 20 on placebo and you had 20 on CBD pills. And they made them do public speaking. The guys on those placebos were still very, very nervous as opposed to the other 20, who suffered from this in a very large degree were as cool as a cucumber. So it basically chills you out, relaxes you, and very anti-psychotic and no psychoactive effects at all; so there is no high. And we have many, many health benefits to go. So not only are there no negative side effects, there are actually positive side effects; but again, everything in moderation.
Interviewer: Right. Right. How about, is there any research emerging as far as helping maybe patients that have nausea from other medications?
Trevor McDonald: Oh yes, absolutely. I mean, with THZ alone is where that basically comes in with nausea, loss of appetite. Basically people with cancer, going through chemo or HIV, really, really benefit from THZ pills whether they're smoking it or ingesting it, or vaporizing it. Obviously we want to promote more along the lines of vaporizing or ingesting as opposed to smoking. Any combustion isn't good.
Interviewer: Right. Switching gears, how did you get interested in growing it?
Trevor McDonald: Well it was an old family friend of my mother's. He actually felt quite ill, and was on many medications and was using cannabis as well. He was buying from a dispensaries, but at the time dispensaries weren't exactly mainstream, so it was very difficult for him to find a high-quality cannabis, let alone an affordable price. So that's when I looked into the program. I saw there was a Federal program, and began a lot of research and basically applied for a Federal license and was granted that license; and it began with that one patient. That was about eight years ago, and I haven't looked back since; I just kept going.
Interviewer: Wow! How long did you feel before you were really good at growing? Did it take a while?
Trevor McDonald: No, I seemed to have a knack for it right away. I was interested even before that period. Originally I'm from Montreal and when I was back there, obviously it's been a part of Canadian culture for some time. You know, anyone in high school, you're growing up around it, so I did have some friends that were growing one or two plants in their closet¸ stuff like that. So I was definitely interested in it.
I never thought I'd be making a living out of it, but it just happened that way, so I mean I did have some knowledge before the fact and that's when I found out when that family friend did fall ill is only when I found out though there was a Federal program for me to get involved with. So that's how that happened.
Interviewer: Okay, we talked a little bit about the LEDs in the future, but what do you think life for a grower is going to be like in five or ten years? How do you see things changing?
Trevor McDonald: Well are we talking in Canada, or in the States, or worldwide?
Interviewer: Just worldwide.
Trevor McDonald: Worldwide I think it's going to be blown wide open. I think more countries are going to be getting on board; not just because of the profits people are going to make, but I mean how safe the medicine actually is in comparison to others. And if it goes correctly, using the correct delivery system, it can be very healthy. So I think you know it is going to be definitely a lot of trade. I mean, we could apply now for import/export. We can't really do business with the States yet, until it gets more on a Federal level, I believe. But that will open up I think in the next, I would say, about three to five years, definitely.
Interviewer: Okay. Do you see a move to more greenhouses, again for the electricity reasons, on the spectrum of the sun?
Trevor McDonald: Yes, I've looked into that. I mean, people in greenhouses, I mean, when you get to winter it depends where you're growing obviously. If you're in a place where it's very cold, and Canada gets cold; well not too much in Vancouver, but back east it does. So I don't know how beneficial greenhouses would be in those really cold winters, but definitely in the summertime you'd be saving quite a bit. And I know they have new systems where in a greenhouse they have shaders come down and they're using their in-house indoor lighting basically to make up for the winter months. But again, it can be very complicated, so I mean, there are pros and cons for every growth system, and every grow room. You're always going to have some kind of problem to compensate for. So greenhouses being that as far as winter versus summer crops.
Interviewer: Okay, what's the compliance burden like for you as a grower? I mean, you've touched on it a little bit, but would you say it's a heavy burden, or medium, light?
Trevor McDonald: With the current program it's not so bad. It's very loose. But they are changing that. So with the new regulations it's going to be very, very intense like I said it's going to be along the lines of a pharmaceutical company. So I mean from people that are producing morphine or any other drugs; we're basically following those same laws in Canada now. So it's very, very strict; very strict.
Interviewer: Okay. And what about security risks as a grower? Have you ever had any break-ins or close break-ins or anything like that?
Trevor McDonald: No, not in our facility. It's fairly secure. We're in a concrete building, also surrounded by fencing and 24-hour video cameras. And again, in the new program we have a specific security company that has done a lot of work in the past with RCMP and a lot of officials that will be handling our security. So you're looking on a, say if you're doing a 25,000 square foot facility, you'll be spending up to $500,000 with your safe and security system.
Trevor McDonald: So it's a lot of money, and it's very intricate and very strict; but yes, very high security in all aspects of the word.
Interviewer: Okay. How much of the grow process do you feel like is automated versus how much you'd like to see it automated in the next five or ten years?
Trevor McDonald: Well as a grower for awhile, I'd love to see it all automated, you know. A lot of people fantasize, a lot of romance in this industry, for a lot of newcomers. And then when you're in it for awhile that could disappear quickly. Automation; I mean, you have fully automated programs today. I mean you could go on the Internet and I could fix my whole mix over the Internet applying the fertilizer, and turning on the aeration and the mix, turning on the pump. You can do it all automated. As far as running into problems, though, I mean, you can address that but nothing really replaces a human touch. I mean, you're there, you're on site and you're running into pests or you're running into other problems, you make quick adjustments. So I mean to be comfortable with it, you want to have a nice balance between people being there and automation to make the actual work easier; but still, having people on site to handle any problems. So I would say about a 60/40 split; 60% being automated, and 40% being the human touch.
Interviewer: Okay. Now when you see amateurs get into the business, what kind of mistakes do they typically make? What do you see over and over again?
Trevor McDonald: Over fertilizing. You have to remember that less is more.
Trevor McDonald: You know, knowing your plant. You know you have to really not be so like mechanical about it. You have to look at each plant. You have to see that it's healthy. You don't just read a book and then go buy those numbers. You'll end up just killing your plants by over fertilizing or not the correct temperatures or humidities. Again, just know your plant and know the strain that you're growing. Read a lot about it, and less is more. I mean, everyone makes that rookie mistake; everyone does too much. They annoy the plants too much. And they also underestimate how delicate they could be in flower, as far as stress goes, by letting in a little bit of light when you shouldn't. Or for small amateur growers, say they just they always want to go in and peek in their room at night, and look at their plants and they're excited about it. Again, it could cause a lot of stress. So less is more; that's my advice to amateur growers.
Interviewer: Okay. Now for investors that may be listening to the show, where do you think the best investment opportunities are in the next five or ten years for where cannabis is going?
Trevor McDonald: Well, I mean, from our point of view now, and where we are, you want to be ready to pounce for whenever everything does blow up, or you want to be already in the production of it, working on building your clientele, building a name for your corporation; and showing the quality before it really does go mainstream. So the earlier the better, and no risk no rewards. You want to be there before it hits, and all signs are pointing that it's coming, if it's not already here. But I think it's definitely going to get a lot larger once it goes Federal in the States. And then even our current Federal program, I believe it's a very political situation.
So people like Trudeau get into power and it's more along the lines of alcohol. You already want to kind of e-setup and rocking and rolling, and basically ready to take advantage of a much more looser program when it comes as opposed to being late in the game. So the message to investors is start looking now and start planning now and basically be ready; but also be careful. You could assess those risks as much as you can, and make an educated decision.
Interviewer: Sure. Now as far as supply versus demand, do you feel like in Vancouver there's more demand than supply, or more supply than demand? Or is it pretty...
Trevor McDonald: The demand is huge. With all these dispensaries now in the past year the market here has definitely been flooded. Prices have dropped on wholesale, but as far as retail goes their prices haven't moved. So definitely storefronts are doing very, very well. They are still charging between $8 to $12 per gram. I know in the States it's much higher, I believe. And as far as the supply and demand goes, I mean the demand I think is underestimated, especially when it goes more mainstream, like someone opening up again a 20,000 square foot facility, growing about 400 lights, probably can't take on more than I would say 1,500 patients. I'd be scared once I got to 1,500 patients with a place that was that size, because if you have those 1,500 patients buy more than two ounces in that one month, you're going to be sold out.
Trevor McDonald: So you have to be very careful on how many patients you take on. And being in Vancouver if these dispensaries were to get shut down or what have you, I mean, just in a very saturated place, and a saturated city, with all of these dispensaries, you probably have about 100,000 patients just in Vancouver alone that are recreational smokers. So I mean, once the laws get loosened up the demand is going to be ridiculously huge; much larger than anticipated.
Trevor McDonald: Yes.
Interviewer: Now I'd like to close with a kind of a fun question here. If you could clone yourself and do something totally different but still in the marijuana industry, what would it be?
Trevor McDonald: Well I'd like to design facilities for growing. It would be fun. I've always been more of a very creative, very imaginative mind. So yeah, I guess building self-sufficient high tech facilities that might capture solar, wind, even rain power to power that indoor grow op and maybe even going to other types of crops, like vertical growing in large sky rises downtown, with a large self sufficient grow building and bring the cost down, you know, and have a lot of fun building it. So yes, I would like the engineering side or the building of the facility side would be a lot of fun.
Interviewer: Cool. Trevor, as we close, is there any information you'd like to give out to anybody that would like to get a hold of you?
Trevor McDonald: Well we're Trichome Health Corp, located in Vancouver; and no specific information. We just are very happy the way things are going and look forward to the future and supplying patients nationwide.
Interviewer: Great. Thanks so much to Trevor McDonald of Trichome Health Care in Vancouver, British Columbia. If you want to see the show notes for this episode, please visit CannaInsider.com.
In this episode I interview JJ Walker and Danny Schaefer of my420tours.com the first cannabis tourism company in North America. JJ and Danny go over all the fun and educational activities explored on the tours, including: cannabis cooking classes, dispensary tours, investor tours and more. 420 Tours has even partnered with cannabis-friendly hotels to make sure your tour is fun and stress-free.
My420Tours.com was kind enough to offer a discount code of 15% off any package purchased online when you use the code: cannainsider
Again that coupon code from 420 Tours for 15% off is: cannainsider
Matthew Kind: Hi, I'm Matthew Kind. Each week I'll take you behind the scenes and interview the insiders that are shaping the rapidly evolving legal marijuana industry. Learn more at CannaInsider.com. That's C-A-N-N-A Insider.com. Now let's get started with the interview.
Matthew Kind: What is it like to be at ground zero of the recreational cannabis industry in Denver, Colorado, helping tourists experience all that legalization has to offer? We are going to find out the answer to that question today with our guests, J.J. Walker and Danny Schafer from My 420 Tours. Welcome, guys.
J.J. Walker: Hey, man. How are you?
Danny Schafer: Hey.
Matthew Kind: Good to have you on the show. For our listeners that haven't heard of My 420 Tours, can you tell us a little bit about your business?
J.J. Walker: Sure. We are the nation's first cannabis tourism company that offers a wide range of services from cannabis-friendly hotel rooms, all-inclusive vacation packages that include a number of different activities and events and things like cannabis cooking classes, grow and dispensary tours, investor tours, rent a vaporizer, things like that. As people come into Colorado, they want to experience the industry for their own purposes and everything from entertainment to looking at the industry on a business standpoint. We are here to provide any services that they need for that.
Matthew Kind: That's great. And I know there's a lot of demand for that. Can you tell, for people that might not be familiar with what "420" means, can you just give a little background on that?
J.J. Walker: The word "420" is, I guess, the nationally known time of day at which people consume cannabis. 4:20 p.m. has become this phenomena of getting together and consuming cannabis and then they say now, once a year on April 20th, 4/20, is the national holiday celebrating the legalization and things like that of cannabis.
Matthew Kind: Great. Great. And how did you get started in this business?
J.J. Walker: This is J.J. by the way, and I got started back in 2009 when things just started changing on a federal level. Obama comes into office and says that federally they're not going to start prosecuting people with medical marijuana states that are interested in running their business and things like that according to state law. So we opened up one of the very first dispensaries in Colorado, one of the first 20 dispensaries. And we did it with a very small amount of money. At that time there were no rules, regulations, guidelines, anything about how to run a business in marijuana. And so we were fortunate enough to be a part of the early adopters and built our business for a few years and ended up selling my first dispensary in late 2011.
Matthew Kind: Oh, great.
J.J. Walker: And in the industry, we were part of the rulemaking and just a lot of the progression of medical marijuana which then was turned into recreational marijuana and then we started the tours of the company.
Matthew Kind: Gosh! It sounds like the Wild West. The regulations aren't really being formed, all these moving parts. Was it kind of a crazy time when that was going on?
J.J. Walker: It was as crazy as it could be. The Wild West is definitely a good description of sort of what it was. Each and every day, each and every week and month, there were new things that were getting thrown at us, new types of government officials and regulators that were trying to get into the mix. And not having any education about the marijuana industry, not having any rules or laws or regulations in how to actually make the dispensaries run in a way that both satisfied the government and the people that pass the laws initially. So it was a long process of just sort of working with our government as closely as we could and trying to stay up with their strong demands of what they wanted to do as far as regulating our industry. Early on it was so easy to get in that, like us, we started with $10,000 and today you can't even start with almost a million dollars, but that's when they said that there were more dispensaries in Starbucks and things like that and they had opened up all over. So part of the regulation process was trying to weed out the guys that weren't doing it right. So part of the process that we had to deal with was as things got regulated, we had to keep up with every single rule and law in very short amounts and periods of time and had to come up with different large sums of cash to be able to facilitate the different rule changes and things like that. So it was a pretty crazy time, but I think the speed-up of the process really allowed us to get to the recreational side of things, which are all benefiting them, today.
Matthew Kind: Yeah, I agree. Would you say from the compliance standpoint, it sounds like it's definitely more expensive to get involved in a dispensary now, but would you say, aside from cost, is it easier or harder? Do you think the burdens are greater or lesser apart from the cost of getting into it now?
Danny Schafer: Yeah, from the operational perspective, in the Wild West days it was things were changing rapidly as J.J.'s mentioned. There's a new compliance regulation that comes out with a very short period of notice and it requires the small business owners to implement new processes, procedures, resources, tools, technologies or otherwise to remain in compliance.
Matthew Kind: Right.
Danny Schafer: So very frustrating and costly, but as it stands today the state has been great in laying down more of those rules and regulations. So coming into it right now, especially as it progresses across the state using Colorado as a model, I think it won't be less expensive or easier by any means, but at least more streamlined in the sense that there are some guidelines in place, which will definitely help just ensure the success of whether it be the entrepreneurs or the states that allow it in moving forward.
Matthew Kind: Okay. So what's been the most surprising aspect about the marijuana business? Being on the inside where you thought it was going to be one thing, good or bad and then you got on the inside and you said, "Oh, this is really much different than I anticipated."
Danny Schafer: The evolving technology has been very impressive. Being a consumer of the industry for 15 plus years, to see what has come out in the last couple of months is inspiring. You have different ways to consume; different ways to determine what is in your product that you're consuming, just a lot of very innovative technology that's necessary. This is a medicine for a lot of people and it's no longer this underground black-market product. So with that, as industry gets into it, watching just how it's progressed in such a short period of time is absolutely inspiring.
Matthew Kind: It is. It seems like it's changing every day. It's crazy. Is there one technology that you could throw out there that you're saying, "Wow, this is really pretty cool. This is moving the market forward and I'm interested in this technology"? Is there anything recently you've looked at that kind of sparks your interest in that way, even from a consumer point of view?
Danny Schafer: Yeah, the extraction technologies and how they can derive the different C.B.D.s and T.H.C. components from the cannabis plant and then how the kind of genetics or chemistry can be derived to make a consumable product for children to help treat their cerebral palsy and things of that extent. It's nothing short of amazing.
Matthew Kind: Yeah, I hear about owners of dispensaries getting letters all the time from people out of state saying, "My child could benefit from some of these medicinal benefits of cannabis, can you send us some?" And they're like, "No, I can't." But they feel compassion for these people. I hope that changes for the rest of the states pretty quickly. Circling back to 420 Tours, what aspect of the tours do you think people like the most or you get the most feedback on? Like, "Hey, this was awesome, we weren't expecting this and this really was fun."
J.J. Walker: I would definitely say it's with the educational piece of our business and when people come in and just to understand the depth of how advanced we are with the plant and with our industry and the business-savvy entrepreneurs that are a part of the business. So for a lot of these people, it's really, I would say the people that come and do our all-inclusive vacation package, they can really get a full range of the experience and really see so many layers of this business, both on the educational standpoint, on entertainment, on the medicine side, and the business side. It's pretty incredible and when people come experience that multi-day experience, they tend to leave with something that they didn't expect to actually leave with, a lot more education and just a new re-found respect for the industry.
Matthew Kind: Yeah. So you take them inside to see the plants, grow houses, things like that?
J.J. Walker: Yeah, part of the experience is we have one of our days is a dispensary and grow tour and we take them to one of the top state's industrial growth facilities and the head grower, the owner of the company, actually walks them through and shows them all the technology and the way that they do the plants and shows these massive grow rooms and these processing areas to obviously process the cannabis after it's grown. So yeah, it's really eye-popping for people to actually walk in and see that live.
Matthew Kind: See and smell it too, right?
Danny Schafer: Yeah, they have actually two different sides of their grow operation and within a large building I think it's 50 to 75,000 square feet. Half of their space is the original grow, which is plywood walls and handmade shelves and things to that extent versus their newer I think it's a 40,000 square foot grow operation, which is state of the art. Crack units, aluminum walls, treated water, things of this extent that really show how fast these operations have had to evolve in such a short period of time to not only meet the demand, but of course the state regulations of food quality standards and things of that extent.
Matthew Kind: Right. There are just a lot of details people don't think about, me included, the humidity in the air. It is interesting to see how the growers force the plants to bud by simulating sundown. There's just so much to it, it's fascinating. It's very interesting. I can see why people walk away from it saying, "Wow!" You mentioned the cooking classes. Can you tell me a little bit more about that? What actually is being cooked? Is it pastries, dishes, entrees, or what exactly people are cooking?
Danny Schafer: Yeah, you name it. We're fortunate in the sense we have a culinary arts chef that's got years of training in being a pastry chef as well as a head chef at some of the more prestigious restaurants in Denver. We've got a strategic relationship with a cooking school that has a phenomenal facility for these types of cooking classes. And our class, call it curriculum, goes all the way through how to extract the oils and bases used for cooking from the cannabis plant all the way through different recipes of how to make cream cheese frosting that's infused with cannabis. So things like trail mix, pastries, filet mignon, different recipes that consumers can actually cook at home and then with the education piece on the extraction and call it dosage, how they can safely infuse their products with, again, knowledge.
Matthew Kind: I'm really glad you brought up dosage because I've talked to a lot of family members that don't live here in Colorado and their concern is always, "How do I get the appropriate dosage?" Maybe you can kind of assuage some of those concerns and tell people how the dosage system works so people aren't worried about, you know, you eat something and you take too much, that type of thing.
Danny Schafer: Yeah, it's important in the sense that a lot of people come with the same kind of expectations as alcohol. Whether you drink one glass of wine and one beer or one shot of whiskey, you get roughly the same alcohol content. With cannabis that is definitely not true. So paying attention to the labeling, that's been some of the recent state regulations on edibles. What's the milligram dosage? I believe the state of Colorado recommends 10 milligrams and some of the original edibles, a cookie, for instance, could have had up to 100 milligrams of cannabis in that product. So some of the initial growing pains were people would come from out of state and would consume an entire cookie, taking 10 times the recommended dosage.
Matthew Kind: Then they would blast off.
Danny Schafer: You can imagine the blast-off effect. So that's one thing the state has definitely helped curb through regulations and making different requirements of edible companies to clearly mark their packaging and make it safer for the uninformed adult to consume.
Matthew Kind: Sure. That makes sense. And I notice that on your website that you said that you provide a Silver Surfer vaporizer. Now, what's that like, using something like that, and why do you prefer the Silver Surfer?
Danny Schafer: Yeah, the Silver Surfer, they're actually number one, a great local company. We love supporting other local entities that are helping grow this industry. But Silver Surfers specifically, there's no shortage of vaporizers on the market, the reason we like working with them is the technology and they make a handmade base station that uses a coil heating system that has a clay exterior. So the concept there is it heats up the coil enough to pass hot air through a glass tube, where you fill it with your cannabis, but it burns it at such a specific temperature that it merely burns the trichomes off of the plant to give you the effects, but it does not burn the plant so much so where the carcinogen count is substantially higher than when you're just smoking it.
Matthew Kind: Yeah. Very, cool. And for someone that's never seen it before, it's really just amazing to watch how that works. It looks like something from Star Trek. It's pretty cool.
Danny Schafer: As part of our services, we've even started renting them to different consumers and of course we include them with our hotel-only guests. So although all hotels, or at least the majority of hotels, are no-smoking zones, we actually have strategic partnerships here in town that will allow vaporizing in the room as it does not leave the scent and does not pass the carcinogens for secondhand smoking concerns.
Matthew Kind: And do you run into anybody saying, "Hey, this is hard to use." Or pretty much everybody can figure it out right away, all age groups?
Danny Schafer: Yeah, they do need some assistance in some cases. We've got some online video references and then of course our staff is happy to even stop by the hotel and show them in person how to use it.
Matthew Kind: What a great job that would be, to help people. Okay. You know, I was in a dispensary the other day and I was talking to a woman and she told me, this bud-tender told me that the average age of the people coming in the dispensary was 61 and I was shocked by that. I don't know if I should be or not. Maybe it's the baby boomers circling back and saying, "Hey, now's our time, it's legal." But what is the demographic? Is it all over the board for people to go on the tours or are you noticing there's a certain kind of demographic that you're seeing? What's it like?
Danny Schafer: Yeah, our demographic I'd say is right in line with that. 45 to 65 is the average age of our tour participants. Definitely, the baby boomers coming back around and finally getting to enjoy their newly found civil liberties. I think they're specifically interested in the tour in the aspect that the industry has obviously evolved substantially since they were smoking joints at Woodstock. The technology and the cannabis has changed so rapidly that I would say that the most fulfilling piece of the tour for us, is the opportunity to sit down with these, in a lot of cases, elderly people, people with different health issues or otherwise and really educate them, take them by the hand, walk them through this industry as a guide. Show them the common pitfalls, you know, "Be careful how much edibles you consume." And explain these different things because when they come here, they're definitely gun-shy and a little bit nervous about just the industry in general and when they leave, a lot of times it's hugs or tears or handwritten two-page "thank you so much" letters just for enlightening them on what this industry really is.
Matthew Kind: That's great to hear. Where do you think the tourism industry is going to be headed in the next five years or so? Is it evolving or is it kind of settling down into certain patterns? Where do you see it going?
Danny Schafer: Rapidly evolving. We're fortunate in the sense that Colorado obviously already has a successful tourism industry. We're adding the cannabis component, which has been very successful. And the states that, as they come online, the same I think will apply to those different states. Obviously Washington is in its infancy stages, but as it scales up, people that plan to travel there for different events in their lives that want to add cannabis as a component, we plan to be there to walk them through that industry and that state. Areas like Nevada, obviously already successful in tourism, and by adding the cannabis component we see it scaling straight across the nation as the states reevaluate if they want to take advantage of this industry.
Matthew Kind: Cool. Yeah, Nevada really could explode quickly, especially with a state government that seems like they want to help more than hinder. That could really come on board quick. Is that what you're thinking?
Danny Schafer: Absolutely. Especially with the numbers shown in Denver, kind of it being the beta for the entire nation. Jobs up, tax revenue up, crime rate down. I mean all good indicators that we believe will be used to help roll out the different industries across the nation as the different states embrace it.
Matthew Kind: Okay. Aside from the dosages, which we covered a little bit, is there any kind of preconceived notions that someone coming to Colorado that wanted to go on a tour, you can help walk them through? I mean I imagine the dosages. Is there anything else? Any kind of top questions they have where you hear it a lot?
Danny Schafer: Yeah, just like any other industry, whether it be restaurants or otherwise, they're not all created equally. There are definitely leaders in the dispensaries, in the quality of product they're producing and things of that extent and you want to be cautious or aware of who's doing it right. So I'd say that's one of the primary concerns is, "Where should we get our cannabis?" And then depending on their education level, "What type of cannabis should I get for these types of things?" I like the indicas for relaxing; I like the sativas for more of a cerebral high. The industry has progressed so far that it's, depending on strain, comparable to even pharmaceutical drugs where it's not the old cannabis being imported from Mexico, where it was seedy and lots of stems. This is engineered for different types of highs. So I'd say that's probably one of the other most pressing questions.
Matthew Kind: That's a great point, so different strains, different moods, and a lot of factors. It's good to have a Sherpa over your shoulder helping you make those decisions if you're not familiar with it.
Danny Schafer: Absolutely.
Matthew Kind: And you mentioned earlier in the interview about investor tours. Can you tell us a little bit more about that?
Danny Schafer: Yeah, we've been fortunate in the sense, being the nation's first, we definitely have a strong foothold in the industry and have the leading partnerships with different grow and dispensary companies. So we were fortunate to do a 225-person tour for an outfit called ArcView, who's one of the nation's leading investment groups in the cannabis industry. They had their annual summit here in town that was just before the N.C.I.A. Expo that was here in town as well. But we were fortunate to take 225 accredited investors on an entire tour of the industry, just to show them what dispensaries look like, what are some of the needs of the dispensaries, different technologies that are being rolled out, and just to kind of paint the picture of the multiple different areas that this industry needs capital in to continue to grow. So that was probably one of our best and most enjoyable tours so far.
Matthew Kind: Yeah. And for listeners out there that may be wondering how big this industry could be, there are a lot of analysts out there that are saying it could be as big as the alcohol industry in 20 years. So to go from where it is now to anywhere in that ballpark, it's going to just have massive mushrooming growth for decades so there is this huge potential there. And there are a lot of people outside of Colorado that were wondering how to get into it and so I think an investment tour might be a good place to start.
Danny Schafer: Absolutely, yeah. It's nice to be able to meet the, as J.J. had mentioned, the head grower that can paint the picture of what his growing challenges have been and leaves an amazing space for different creative individuals, entrepreneurs in all walks of life. This is comparable to the alcohol industry. However, different in the sense that it's already a multiple billion dollar a year industry, but as we take it from gray market to white market, you can imagine all the different aspects of any emerging industry in the United States and it's top down. They need marketing, consulting, sales, customer service, technical support, technology, and products. I mean all aspects of these different industries obviously apply to cannabis as well.
Matthew Kind: Yes, compliance, too, as you talked about earlier. This is a huge job creator. I mean, could you just kind of go over where you see the jobs being created? You have growers. Who else is in the ecosystem that is creating jobs here in Colorado and eventually wherever else it's going to be legal?
Danny Schafer: Yeah, interesting fact, I think up through June I believe the state of Colorado estimated anywhere from 7,500 to 10,000 jobs have been created by the industry so far. And, again, it's top down. It's not only the producers, grow operators, people that clip the cannabis specific to ensuring that the product is of a certain quality, the compliance aspect for any legal-oriented folks, the technology that's used to cultivate it, again, simulating Mother Nature in a closely controlled environment definitely leaves a great opportunity for technology, electricians, you name it. Customer service-oriented people, bud-tenders. It's the grand scale of employment opportunities. Important to note the actual CannaSearch is going on, I forget the dates off the top of my head, but it is the industry recruiting job fair that'll be going on here in town I believe next Monday or Tuesday, so a great opportunity for those folks who are either unemployed or are looking to get into the industry. A great area to meet the different leaders, drop off a resume, and even guys like us are looking to recruit additional staff.
Matthew Kind: Great. I will put some information about that in the show notes for anybody that's interested. Just getting to some more personal questions, what's your favorite edible? I mean, if there's someone out there that are just like, they have never even experienced an edible before, and it's something foreign to them. If they put their toe in the water, get maybe one of Dixie Elixirs' or is there any out there that you feel like, "Hey, this is a good place to start and just try one of these." What would you suggest?
Danny Schafer: Yeah, I definitely like Dixie just covering the range of different products, whether it be mints or drinks or offering multiple areas of kind of discreet consumption. Auntie Dolores, I'm not sure they're in total footprint, but I really like them for the baked goods. There have been some of the chews; some of them have been kind of controversial just based on their dosages. I can't personally say I'm a big edible guy, but I would just encourage people that like the edibles to obviously pay attention to the labeling and the dosage being one of the most important components.
Matthew Kind: Right, right. And kind of the standard, we're not recommending any dosage levels here at all but kind of the standard that was mentioned already is kind of a 10 milligram is kind of a single serving. Is that generally right?
Danny Schafer: Definitely, yeah. I'd say that's a good place to start and then it's about the time between consumption as well. As it is edible, going through digestive tract, there is a time component as to when you can fully realize the effects. So leaving a wide window between consuming, whether it be the chews or the cookie, you want to leave at least I'd say probably 90 minutes just from personal experience as a good time to really see the effects before you continue to consume, and then again, small dosages. Even things like eating additional food will actually intensify the effects. Mango and grapefruit, some of the citrus-y fruits are known to intensify the effects, so lots to be considered on the edibles.
Matthew Kind: That's great information. As far as supply and demand coming together right now, there's a lot of talk about where supply is. Do you feel like dispensaries are producing less than they need to right now for demand? I know that's kind of a tricky thing to say, but where do you feel like, at least in the Denver area, supply and demand is meeting up?
Danny Schafer: Yeah, I think just for the dispensaries in general, it was obviously the first few months in ramping up things, there was definitely more of a demand than there was supply. However, just in the dispensaries that we visit, I would say they're right at line and have kind of a perfect match so far. If anything, we've scaled up rapidly and are definitely looking forward to more demand. So hopefully the states and federal government bridge some gaps as these different states come on-board that will allow companies like Dixie Elixirs, as an example, that have a very good business model and have proved their ability to scale, that they will open up the ability for wholesale markets and things to that extent. If that doesn't take place then exactly as we see in Washington right now, where the single dispensary that's in Seattle, is constantly out of product. So just a major need for that in more of the wholesale market and hopefully there are some plans to address that.
Matthew Kind: Cool. Now, here's kind of a fun question. If you could clone yourself and do something entirely different but still in the marijuana industry, what would it be?
Danny Schafer: I really like the chemistry piece of it. Again, the importance of different strains, whether it be indexing those strains or otherwise, to standardize some of the different strains that are on the market, actually, that being a very important component, again, more along the lines of pharmaceutical medication. Just because between the T.H.C. and C.B.D. counts as well as different strains with different effects, there is such a wide spectrum of how this plant can be beneficial to society. So I really like the science behind it and standardizing the different consumption options for consumers that are definitely diverse and looking for a range of different products to either treat their ailments or empower their recreational activities.
Matthew Kind: Awesome. Awesome. Well, thanks so much for this interview. If there's anybody that wants to reach out and get a hold of you or go on a tour, what's the best way they can do that?
Danny Schafer: Definitely through our website. We're all fully web-based. We also have people obviously standing by for any inquiries, whether they by phone or email. But anyone coming by way of CannaInsider can actually use CannaInsider as a discount code. We'll honor a 15% discount on any services booked through our site using that promo code.
Matthew Kind: Oh great! That's great. And your website, again, is My420Tours.com, correct?
Danny Schafer: That's correct.
Matthew Kind: All right. Well, thanks so much again. And if anybody has any questions at all, you can leave it in the comments on CannaInsider.com and we'll try to address those. Thanks again so much to Danny and J.J. at My420Tours.
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