What’s it like to immigrate from Nigeria, grow up in the US, and put yourself at the forefront of the cannabis industry in multiple states?
Here to help us answer that question is Seun Adedeji, CEO of Elev8 Cannabis.
Learn more at https://elev8cannabis.com
- Seun’s background in cannabis and how he came to start Elev8
- An inside look at Elev8 and its dispensaries across the US
- Where Elev8 currently is in the capital-raising process
- Why Seun decided to open dispensaries in Oregon, Massachusetts, and now Illinois
- Oregon’s shifting supply and demand and how Seun is working around it
- How Elev8 partners with local businesses to get customers in the door
- Seun’s advice to those trying to get into the cannabis industry
- Where Seun sees the cannabis market heading in the next few years
Matthew Kind: Hi, I'm Matthew Kind. Every Monday look for a fresh new episode where I'll take you behind the scenes and interview of the insiders that are shaping the rapidly evolving cannabis industry. Learn more at cannainsider dot com, that's C-A-N-N-A insider.com. Now here's your program.
Matthew: What's it like to immigrate from Nigeria, grow up in the USA and put yourself in the center of the cannabis industry in multiple states? Here to help us answer that question is Seun Adedeji, CEO of Elev8 Cannabis. Seun, welcome to CannaInsider.
Seun: Thank you, Matt, for having me.
Matthew: Give us a sense of geography. Where are you in the world today?
Seun: I'm currently in Eugene, Oregon at one of our dispensaries.
Matthew: What is Elev8 Cannabis on a high level?
Seun: Elev8 Cannabis is a retail cannabis store. We're a multi-state operators with locations in Oregon and Massachusetts, and we're looking to expand across the United States.
Matthew: I mentioned that you're originally from Nigeria, but can you share a bit about your background and journey and how you got into the cannabis space and started Elev8?
Seun: Absolutely. Like you said, I migrated from Nigeria at the age of three. I moved to Chicago, Illinois. While I was in Chicago, Illinois, I lived with my stepmom, and my home was not a wholesome home. There was just a lot of chaos. As a young kid to make money, I was a kid with a duffel bag with candies in my bag. I was selling the kids like, "Hey, y'all know you like Alexis, your breath stink. I got some gum for you." Kids used to buy gum from me, buy candy.
I used to go to a place that was like [unintelligible [00:01:48]. It's really big in Illinois. I used to buy a batch and mark it up, and the cafeteria people mark up was insane. I was undercut numb a little bit and kids just loved it. I progressed to cannabis. I saw that there was more margins in cannabis. I started selling cannabis to kids in school and I did really well. At the age of 13, I got busted. I got arrested for cannabis possession at a really young age, and at that time, I felt like my life was over. I had a stepmom that told me I would never amount to anything. I was in a destructive environment, and I just didn't see a path forward for myself.
Luckily, I had my auntie who said that I can move to Texas with her. My auntie's very successful. She's an entrepreneur/nurse. She gave me the opportunity to really hit a restart to really center my life and to encourage me. She was the first woman to show me love, meaning unconditional love. It really helped me focus my entrepreneur skill set to look at how can I be better? I started focusing more on education. I joined FBLA, future business leaders of America. We went to state, we went national, so different things like that really helped me out.
I then pivoted, moved to Washington state. At this time, I was about 20, 21, and I saw cannabis legalization unfold before my very eyes. I started looking at how can I get into this emerging market? Now, looking at the revenue being generated motivated me even more. I wanted to bring a level of unconditional love like my auntie brought to me to my company. How could I do that with a lot of capital that is required to get into the cannabis industry? Cannabis started to uplift Elev8 and encourage more people to have a better life. We got started, I only have $50,000. I was just a young kid. It was a process.
Like I told you earlier, it was a three-year process, where getting a license, getting everything set up. I called myself the CEO. I was the chief of everything, and we finally got our business open at the age of 23, where I was able to acquire a property here in Eugene, Oregon. Now, I was paying an arm and leg in a very hidden location, and what really helped us succeed in Eugene, Oregon was-- Customer acquisition is great, customer retention is even better.
We were really community-focused and we were able to really word of mouth spread. We really did great. Like I said to anyone, listen out here, I slept in my shop for a whole year because I was underfunded. I only had 50,000 to get my first shop open, and now we're multi-state operators with locations in Massachusetts.
Matthew: You're in Oregon and Massachusetts. That's right?
Seun: That's correct.
Matthew: You've raised capital more than that initial 50,000 seed money. Can you talk a bit about that?
Seun: Yes. Oregon one, is an over-saturated market. In 2018, we saw products going for $100 a pound. We saw a dispensary selling grams for about little to $1 a gram to consumers. Longevity, I saw that this was not sustainable. I didn't want to work and die at my shop. I saw a greater opportunity in Massachusetts because there's a limitation of licenses and the harder it is for you to get an application in, the better it is. One thing that we leveraged, the State of Massachusetts, for retail cannabis, they limited to three per corporation. What this corporation, what do they want to do? They want to be profitable for the shareholder.
I know how to win licenses. I know how to write applications. I went to Massachusetts, I read the law. I hired one of the top attorneys out there, Paul Feldman, and we worked together to win our first license in Athol, Massachusetts. We purchased the properties. We lobbied the politicians, and we were able to win a license in Mass, and we won two additional ones. Now keep in mind, Massachusetts is a hard market to win a license, so we had our host community agreement non-opposition. That's the first step of winning a license. You got to win it in the community before you can actually apply with the state, which is what we did.
Each city in Mass, they limit the amount of licenses that they are given out to entities. For us, we were able to go to cities they were only given out to, and we were able to win them. Now, the second phase is how do we raise more capital to complete our build-out? What I did was I had a relationship with politicians like Tito Jackson, who is very minority-focused and very minority forward. I told him my situation in raising more capital. He introduced me to an entity that saw the benefit of shelf space.
What I did was I basically sold my shelf space to raise more capital instead of giving up any equity. Long-term, we modified that into just strictly debt capital with X amount and percent after we open after six months period.
Matthew: That makes sense. Well done so far, that's a big accomplishment. How did you say you were again? You're in your 20s?
Seun: Yes. I just turned 27, May 23rd. I opened my first location at the age of 23.
Matthew: Oh, great. Well done. You have a multi-state operator who invested in your business. Can you talk about that?
Seun: Yes. We negotiated for about eight months. It was a back and forth. The reason why they invested in me, keep in mind, to get a license in Mass is very hard and they see this young kid that had a lot of hustle. I was able to articulate and speak on the market on a high level compared to a lot of other people. I think that they were super impressed by that. I also own property, so that's the other way I was able to get some capital. My real estate property, I bought it for a huge discounted price. One of our property, we bought for 50,000. Now, the property is appraised at a mil. What we were able to do was re-collateralize the property to get more finance out of it.
Matthew: You leveraged the equity in your existing real estate, you cashed out that equity to invest in your Massachusetts dispensaries. Is that right?
Seun: That's correct.
Matthew: Was it this politician in Massachusetts who was pivotal and introducing you to some investors that could help you out? That was a key introduction.
Seun: Absolutely. It was a politician and also their attorney, so the big multi-state operators. Keep in mind, I'm sitting here lobbying for myself to win a license in different cities. They had lobbyists, we were all sitting together because we had a presentation. They were all impressed by me. They were impressed by my knowledge show. Outside in the politician, we also had some big firm, Vicente Sederberg, their attorney spoke really highly of me.
All those people, your reputation follows you. When those people are speaking highly of you, and what you've accomplished in such a hard market to even get a license in, that also helped me out. It was a combination of just people speaking highly of me and my track record of winning licenses.
Matthew: That's great. How do you think you honed your mindset because unfortunately, the state of the world is that I think most people would rather complain that the system doesn't work and they can't get things done. You just see this as an opportunity and run right into it and just talk to people, figure it out. Did you read any books or have any mentors or anybody that helped illuminate like, "Hey, this is possible. This is how you do it," or was it just self-taught? What can you say there?
Seun: I believe nothing is given, everything is taken. What I mean by that is everybody has their own problems situation. You have to go out there and hustle, you have to go out there and get it in and nobody's going to do it for you. What I did was I learned from everybody. I assess every situation. I learned from people what their success were, what their mistake was, what decision they made to get them to the point they're at right now. I assessed those situations. I said, "Okay, this is what I don't want to be and this is what I want to be."
I started hanging out with people that I want to be like. I remember the first wealthiest multimillion-dollar person I met was in Eugene, Oregon. He was just wealthy beyond my wildest imagination. When I was struggling, he never gave me a penny but what he did give me was knowledge. I didn't want his money, I wanted knowledge. I called this man, I called him about a hundred times. I was like, "Hey, can I just take you out for coffee?" One day he finally returned my call and he's like, "Yes, I'll take you out and I'll pay for it." I said, "No, I want to pay coffee for you."
He came, we went to coffee and he started talking and I learned so much. I asked him about his journey. I don't want to hear about people's success, I want to learn about your journey for you to attain that success. I think that's super important. I read a lot of books. I think that a lot of people undermine kindness and love. I think that in these times that we're in, love win more than anything because back in the day you had to be firm, you had to be a hardcore, you had to be this mean person and control people. I think right now when you lead with love and passion and integrity, you can go a lot further than ever before
Matthew: Well said. You have a presence in Oregon now. You've got the three licenses in Massachusetts and you're working on Illinois. You're like, "Hey, how can I get into the most difficult markets?" [chuckles] That's the decision you made but that's also good. You have a moat around you. Illinois is maybe a little less difficult than Massachusetts but I wouldn't say it's easy. What do you have going on there?
Seun: Illinois is my home state, giving back is really big. What we did in Illinois is in 33 states out of the 50 States in the United States, all 33 states you need real estate before you can even get into or apply for a cannabis license. This does not say you're going to win. You're gambling hundreds of thousands of dollars. What we did in Illinois, we worked together, we lobbied and we had the opportunity to talk to the politicians that are writing a bill like Stein, Kelly Cassidy. We really advocated for the real estate to be removed as a criteria before you apply.
We also advocated for funds for minorities to tap into so they can get their business started because when you look at all the states right now, everyone is looking at how to implement minority inclusion. The biggest thing that fail when people do that is yes, it's great that we have advocacy work that's being done and we have now social equity that people are rolling out with but the biggest hurdle is capital. Money talks at the end of the day. What we did in Illinois, we lobbied for capital to be implemented in the bill. To our surprise, they did that which was a huge one for us.
The third step was, how do we get this information out to the people that really need it? The people that have been affected by the war on drugs. Illinois bill was 800 plus pages. Just for you to read the law, the process on how to apply, you have to read 800 pages worth of legislation. When you look at the minority that have been most affected by the war on drugs, they live in a disproportional area, they have three jobs.
One of the things that we did was we started to Elev8 Our Community where we went out, we helped people from the Southside, Westside of Chicago and we helped them with understanding how to apply. We also had workforce seminars where we partnered up with Minority for Medical Marijuana, we partnered up with greenRush, with Good Tree Capital where we gave them the resources they needed to apply and actually have an opportunity to win a license.
Matthew: That's a lot. You've got endless hustle, Seun.
Seun: That's one of our core values. I'm young right now and the biggest thing is I'm the underdog. They don't see me so it gives me the ability to if I make a mistake compared to all the bigger MSOs, I can pivot, I can adjust. There's a lot more in the capital cost to build out our store compared to a lot of other people is a little bit lower because our target market, we don't really focus on big cities. Our goal is smaller border town, so that's what we focus on. You don't currently see Elev8 in Boston or any big city right now because we see that property acquisition in smaller towns are a lot cheaper.
We focus on smaller towns because they're on the border of illegal state, so all three of our locations in Mass are on the border of New York, Vermont, New Hampshire. We do that strategically because of those few things I initially mentioned, less capital and the lobbying power. You have a greater opportunity especially when you already have a track record, the ability for you to get in front of the mayor, and actually talking them buying into your goal and your vision and how you can help the city and the town is a lot greater. Strategy is big and understanding your market is big.
Matthew: Let's circle back to what pushed you out to look at Massachusetts and now Illinois. It was Oregon's flood of inventory. There was so much supply of cannabis flower that the price just dropped massively. You said $100 a pound and that was a couple of years ago. Where is it today?
Seun: The prices are actually coming up. You saw a lot of institutes sell out and you saw bigger corporations come in and consolidate a lot of the mom-and-pop businesses. Prices are going up again. You can get a b-bud from $500 a pound. Now, you could get some really great flowers from 1,000 to 2,500 so prices are normalizing. Before, that was not the case. As you know Oregon right now does not have a cap on the total amount of licenses they've given out so is a endless amount of licenses. Now, they put a pause on it currently and that is really helping the market.
Matthew: When you have a dispenser, you have the problem of chicken and egg problem is that you want customers, you want to serve them and you want to retain them. How do you get them in the door? Right now, Leafly and Weedmaps is probably the biggest chunk for most dispensaries. It's thousands of dollars a month that they're being paid to get people into the store. That's a valuable service, I don't want to minimize that. What else can you do? How do you drive word of mouth? Is there anything else that's less expensive or how do you get those initial customers to come in?
Seun: Partnering up with small businesses, that's what we really do. Vendor days where we get our local farmers to come out. COVID-19 is freezing that for us a little bit but we get local farmers. They have their following, they have people that trust them and we get them to come in, set up a booth, do different promotions where we both eat the cost. We get different discounts out there where we can really push. We look at different margins like what is your profit margin need to be? What is ours need to be? We partner up with those farms to get it to that where now we are pushing really crazy deals to get people to notice us but now once we get those customers in, the prices we then normalize it.
It's a win, win for us and the cultivator. There's a mom-and-pop-business that might be struggling to even push their product out. Now we've come up with a creative way where I'm not taking any equity in your company but we are coming up with creative ways where we can both win. We also do things like treat everyone like gold. We partnered up with University of Oregon local businesses, where our customers come in, they write positive note, each month we pass it our random strangers. What that does for us is it gives more visibility to who we are.
Those local businesses are putting our flyers at their business. They're putting different swags at their business, so really partner up with the community and local businesses has really given us the ability to save on costs. Like you said, Leafly is a arm and a leg, but those little small things where we could do a cross-promotion with local businesses has definitely helped us out.
Matthew: Three locations in Massachusetts strategically placed to border other states. It's a lot of logistics and capital and everything to get that open. When do you think the first sales will happen in Mass for you?
Seun: We are ready to go. We have our post provisional license right now. Due to COVID-19, we were set for our in-person walkthrough investigation. Right now because of COVID-19, they paused on that about two, three weeks ago. Mass Cannabis Control Commission, we've been lobbying for virtual investigation, our commissioned title and our Commissioner Hoffman has agreed to those things. They're now just working on the guidelines on what virtual investigations actually going to look like is in place. Once they figure that out, we're really hoping before Q4, we're going to open our shops in Mass and we'll be good to go.
Matthew: There's a lot of people that are listening that have been waiting and trying to figure out how to get into the industry. They maybe just send out a few resumes and then they say, "That didn't work. I guess this isn't for me." What do they need to do differently? You have a level of commitment I think that is way higher than the average person. Is it first just the commitment in your mind to get into this industry? Is that what it took for you, or once you got some traction that gave you the courage for the commitment? What are your thoughts there?
Seun: I'm scared. I was scared when I first started. I was terrified. I'm a young kid. Outside of selling drugs, I was a marketing manager for Sprint, but I never run my own store. Being optimistic and knowing that life, you can have-- I believe personally, this is me, this is just my personal opinion. I think that, like I said, nothing is given everything is taken. It's just how bad do you want it? There's a saying you have to want something as bad as you want to breathe. Has anyone ever try to hold your breath, how hard would you fight to make sure you're able to breathe? For me, I don't make excuses on what is not possible. I started looking at what can be done.
There's certain things that are absolutely out of my control. I really dive in on creating a core team around me, really great executive teams. Shout out to Catherine Tanner, she's our COO. She keeps me grounded. She's super amazing. For the people that feel like they're just having a hard time to get in, I think really understanding what part of the cannabis industry are you most passionate about that even if you don't get paid, you'll still do it. Figure that out first. Then once you're able to figure that out, look at now, how do you get paid?
Keep it simple. What step do you need to do to win a license, or to get this job? Who do you know, within your network? Can you go on LinkedIn and start looking at who works in this facility? Can you start interacting with them, emailing them, showing them your resume, showing them who you are, your personality? I think it's more about getting creative, thinking outside the box and inside the box. Look, I tell people leverage the laws to get to where you want to go. In every state, I read the laws. What that does is, outside of my attorney reading it, it gives me a level of understanding on how can we target this market and how do we win a license.
Like in Massachusetts, we had a lot of people that were targeting the same city we were targeting. I was the only minority African-American man to win in that particular city where everyone, big foreign firms looking to get in. How I did that was I understood the laws and I also have a track record. This is a mouthful, but hopefully, it answered your question on a mastery level so I'm going to leave it at that.
Matthew: All right. Seun, I'd like to ask some personal development questions to help listeners get a better sense of who you are as a person. I think in your case, everybody's gotten a sense already, but I'm still going to ask the questions. Is there a book that had a big impact on your life or your way of thinking that you'd like to share?
Seun: Yes, I have several books. The Four Agreements really played a big part in my life. How I look at it is what you speak to yourself is what manifests. I think that we are all-powerful beings, our mind is so powerful, so when we think something it manifest. When we are gloomy or sad, that's how we see the world. When we're elevated, we see it in a different light. We have the power to-- I believe in the blank page, and what that means is we all have the power to write our story because you didn't come from wealth, that does not mean you can't obtain wealth.
I'm going to say this again. I came from a third world country where poverty was everywhere, where is either you're rich or you're poor. There was no middle class. When I came to America and I saw the endless opportunity. Not everything is perfect, but I believe that if you have a level of hustle and grit, there is more possibility for your success than if you were in a third world country.
Matthew: I love it, man. That should be your slogan, grit and hustle. You got it.
Seun: [chuckles] Actually, that's actually part of our eight core value that we make all our decisions based off our eight core values, and that's how I live my life.
Matthew: Tell me, is there one thing that you believe to be true that most people disagree with you on?
Seun: Wow. Yes, that's a deep question. I'm a very optimistic person. Let's just say we get in a confrontation and you do something bad to me that really hurt me or you screwed me over. I have different options. I can sit there and harbor hatred and look at how to get you back, or I can pivot and use my energy in a more positive way to get the outcome that I want. I'm the type of person where I'm very optimistic. I don't take bullshit, of course, but if you do something to me, the way I would react is a little different than other people. I just don't have time, nor do I have the energy to apply on your demise when I could focus on my own success.
I believe energy and my time is precious, so I rather not waste it on negativity when I could be more creative when my mind is clear, when I'm a lot more positive. I have an example, somebody owed me a lot of money and it was getting to the point where it was just draining me. It was like, "Just pay me what you owe me," and I just told them to keep it. The amount of stress and energy that it was taking me to really get, it just messed up my whole vibe. It messed up my day. I just don't have time for that. Let me stop right there, but it's just your mindset is really powerful and what you focus on is what you manifest.
Matthew: Well said. Seun, as we close, how can listeners connect with you and find Elev8 online?
Seun: You can find us at elev8cannabis.com. You can also follow us on social media @Elev8Cannabis on Instagram, Twitter, and all social platforms.
Matthew: Awesome. Thanks so much for coming on the show and good luck with everything. You do have a lot of grit and hustle. I really appreciate the spark and energy you bring to the industry. It's really motivating. Keep it up.
Seun: Thank you so much for having me. I'm a huge fan of yours. I listen to your podcast every Monday.
Matthew: All right.
Seun: Yes, so huge fan. Thank you so much for having me on.
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