December 19, 2024 • 52 mins
What if the latest moves by a major cannabis company could set off a chain reaction across the entire industry? Unravel the implications of Vireo's strategic transformation under the astute leadership of Tyson McDonald. We dive into the latest maneuvers by Vireo, who is making headlines with a game-changing capital influx and the acquisition of four profitable single-state operators. As we gather at Ben's festive office, we discuss the potential ripple effects of these no-cash deals and speculate whether this could ignite a wave of consolidation reminiscent of past industry-shaking investments.
The cannabis landscape is shifting, and 2024 has been a year of both tumult and triumph. Despite the downfalls of California giants like MedMen and High Times, there's a silver lining as we witness the resilience of companies that have managed to refinance and keep the gears turning. Meanwhile, the rise of cannabis-infused beverages is rewriting the rule book, capturing the attention of consumers and opening new doors in the alcohol market. We explore the exciting possibilities in this burgeoning sector, while also contemplating the ongoing challenges posed by federal hemp policies and potential farm bill delays.
Looking forward to 2025, we are filled with optimism for the hemp beverage industry and its potential to reshape the mainstream market. The conversation turns to the foundational strategies needed to capitalize on these opportunities, emphasizing education, influence, and team alignment. As we nurture a culture of peak performance, we remain committed to fostering authentic collaborations that drive positive outcomes. Join us as we embrace the dedication and passion of our team and partners, and gear up for bold moves that could redefine the competitive landscape in the coming year.
--
High Spirits is brought to you by Vertosa and Wolf Meyer.
Your hosts are Ben Larson and AnnaRae Grabstein.
Follow High Spirits on LinkedIn.
We'd love to hear your thoughts. Who would you like to see on the show? What topics would you like to have us cover?
Visit our website www.highspirits.media and listen to all of our past shows.
THANK YOU to our audience. Your engagement encourages us to keep bringing you these thought-provoking conversations.
Remember to always stay curious, stay informed, and most importantly, keep your spirits high.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
AnnaRae Grabstein (00:00):
Do I need to be closer to this Good?
Ben Larson (00:09):
Hey everybody, welcome to episode 71 of High
Spirits.
We're recording Thursday,december 19th, 2024.
And we're live in person.
It's the end of the year and sowe're going to do a little bit
of a wrap up today, checking onthe big happenings, what's top
of mind, and then what's goingto happen in 2025.
AnnaRae Grabstein (00:28):
Stoked to be here.
Thanks for hosting today, ben,of course.
How are you?
Ben Larson (00:31):
doing.
AnnaRae Grabstein (00:32):
I'm good we're here at Ben's house at
Burtosa and Berkeley.
Ben Larson (00:37):
Practically my house .
There's a Christmas tree rightover here.
AnnaRae Grabstein (00:39):
You also have a menorah.
Ben Larson (00:41):
We do.
Yeah, we're very inclusive here.
AnnaRae Grabstein (00:44):
Not everyone is represented.
That I see with your holidaysymbolism, but like you're
hitting a lot, there's a bigpole right over there.
What's the pole for?
Ben Larson (00:53):
Isn't that like a Seinfeld?
AnnaRae Grabstein (00:57):
Wasn't there like a pole or something?
I'm not sure.
People keep telling me thatit's going to get quiet towards
the end of the year, but I'veactually been hustling hard.
There's been so much work and Iactually kicked off a new
project last week, so people arenot necessarily slowing down.
Ben Larson (01:13):
Kicking off project mid-December that's bold.
AnnaRae Grabstein (01:16):
I know, but it should be a good one.
How about you?
Are you guys getting slower?
It's been nuts.
Ben Larson (01:22):
Finally, my travel ended last week, which was great
, but I'm trying to squeezeeverything into this week to
really protect a couple weeksover the holidays.
It's just made for a verysleepless week.
And then Alistair was sickyesterday, which just you know
having kids throws wrenches andthings.
AnnaRae Grabstein (01:41):
It sure does.
Well, having a sick kid.
Did that stop you from hearingthe news about the big Vireo
deal that was announcedyesterday?
Ben Larson (01:50):
I caught glimpses of it, but, as always, you're more
informed than I am.
AnnaRae Grabstein (01:56):
Well, I want to shout out Tyson McDonald, who
is both a friend and has been amentor to me this year, but he
just was appointed CFO to thenew Vireo I don't know if it's,
we'd call it Vireo 2.0.
Ben Larson (02:10):
So for our listeners , and maybe for me, what is
Vireo Got?
AnnaRae Grabstein (02:15):
it, yeah.
So Vireo for people that maybedon't walk out as much as me on
cannabis companies is a publiccompany, an existing public
company that has had a fairlysmall footprint in some
important markets.
They're one of the existingoperators, medical operators in
Minnesota, a registered operator, which means they're a medical
(02:37):
licensee in the state of NewYork, and then they also have a
license in Maryland and theyhave been flying under the radar
.
Mostly People might have heardabout them because they have
gotten involved in somelitigation with Verano over the
last couple of years.
Ben Larson (02:55):
That's probably why they sound familiar.
Yeah, because I'm familiar withVerano.
AnnaRae Grabstein (02:58):
Yeah, I think Verano tried to acquire them
and it didn't end up working out.
But either way, acquire themand it didn't end up working out
.
But either way, vireo has beena small, by all metrics, public
MSO and yesterday a majorannouncement happened that they
(03:18):
got a very large infusion ofcapital and have acquired four
single state operators, who allare very strong and profitable
in their own right, plus atechnology platform, and have
now positioned themselves,depending on what metric you're
looking at, to be a top six or atop eight MSO with some
(03:38):
stronger growth opportunities,based on some upcoming catalysts
, than almost any other cannabiscompany that I'm watching.
Ben Larson (03:48):
It really spurs a lot of thought for me, and I
even go as far back as to whenCanopy Growth received that $4
billion from Constellation.
It's like $100 million soundslike a lot.
$4 billion is an extreme amountof money, but what does that
mean for the future?
It's like people realizing thatthey can come in and just
(04:09):
become a top competitor bybuying it.
I mean, time will tell if theycan actually be that, but it
sounds like they have a goodfighting chance.
AnnaRae Grabstein (04:16):
Yeah, and what I know about Tyson is that
he likes to pick winners andthat he wants to pick winners
that he believes are going tolead.
He's very thoughtful.
He's one of the smartest dealengineers of anyone that I have
met in the space, so I canimagine that there are a lot
more deals ahead here and thatthis is a team that's going to
(04:38):
want to be acquiring more greatoperators across the industry.
And we've been talking aboutroll-ups and consolidation
consolidation since thebeginning of time.
Ben Larson (04:47):
We were actually even talking to Seth about
whether it was even going tohappen this year.
AnnaRae Grabstein (04:51):
Yeah.
And then, in the 11th hour, boomthis is it, and this deal has
definitely been in the works forsome time.
But, especially because it's apublic company, nobody can talk
about these things and I thinkthey've done a very good job of
doing just that and keeping itclose to the chest until the
time that it was time toannounce.
But I think that it createssome optimism around a public
(05:16):
company.
It also shows that there arethoughtful investors that are
paying attention to kind of anew focused cash flow, ebitda
positive business model that isgoing to carry us through 2025.
(05:37):
And my hope is that it willencourage more roll ups on the
back of this.
And, yeah, I'm excited.
Ben Larson (05:47):
Now I have a new thing to think about over the
next few weeks when I'm tryingto create some white space for
my brain, just like what wouldhappen if someone decided to
bring a $100 million check intothe beverage category and launch
a highly competitive beveragevertical.
AnnaRae Grabstein (06:04):
Yeah, and interestingly, every single one
of these acquisitions at leastfrom the announcement that they
made yesterday is a no-cash deal.
So it's all stock into the newcompany, and so the capital that
came into the company is forgrowth, and my guess is that
there's more capital behind it,depending on the different
(06:25):
levers that these folks aregetting ready to pull as things
unfold, and for moreacquisitions.
Ben Larson (06:32):
So you have a number of EBITDA positive companies
with $100 million bankroll now.
AnnaRae Grabstein (06:38):
Yeah.
Ben Larson (06:39):
Wow, interesting, and there was a tech platform
involved in the middle of allthis.
That made it an interestingdeal, but I don't know why it
was interesting.
AnnaRae Grabstein (06:48):
Yeah, the tech platform is called Arches.
To be totally honest, I havenever heard of this tech
platform and I texted a fewpeople yesterday when the deal
was announced, and nobody elsehad either.
So this is the one piece of thedeal that is a bit of a mystery
to me.
I am open to learning more.
Ben Larson (07:08):
If you know, let us know.
AnnaRae Grabstein (07:09):
If you know, let us know.
They've said in theannouncement that the tech
platform is going to be a tool.
They've used terms like POSdelivery platform, e-commerce.
I'm not sure if this is an erpsolution or if it's a pure
retail play.
I think um more to unfold.
(07:31):
Interesting.
I mean, I do pay attention tothe different retail tech stack
opportunities and options in thespace, so I'm a little
surprised.
I haven't heard of it and itwas just acquired, yeah, so
you're gonna have to go revisitthat tech map that we were.
Yeah, how did I miss this one ifit's so great, but I trust
these guys.
I think there's.
(07:51):
There's probably a purposebehind it all, um something
bigger going on so okay, so keepan eye on vireo keep an eye on
vireo, totally, and I thinktheir stock doubled yesterday.
No big surprise.
Um, we'll see if it keeps upand is able to withhold that.
But I'll say, like you know,when we went to Minnesota, top
(08:11):
fastest is that the two existingmedical licenses which are
owned by Vireo and GTI have anincredible early mover advantage
(08:32):
in the state, and the fact thatthey already have
infrastructure built thatthey're going to be able to get
to market faster than a lot ofthe newcomers it puts them in a
great position.
So that's when I started payingattention to the company, and
then I realized that their NewYork assets seemed pretty
underutilized as well, and thatisn't always a good thing.
(08:55):
But if you're trying to find agood platform for growth, and
underutilized asset base is agood place to start.
Ben Larson (09:01):
Yeah, yeah.
Well, what I like about theregulated market, and especially
in minnesota, is we've seen, uh, in the beverage category where
low-dose beverages rule, kindof the open markets.
You know, if you go into totalwines and all that kind of stuff
, that's what you're seeing inthose markets.
But in the regulated channelsand dispensaries you'll find 100
(09:22):
milligram drinks and ourfriends at uncle arnie's who
work very closely with GTI havebeen doing really well in these
states and so it's kind of Iknow a lot of people when they
were thinking about Minnesotait's like, all right, they
already have medical market,they already have low dose hemp,
like how does like what is theregulated piece really
(09:42):
fulfilling?
And it's like that higher doseproduct category.
AnnaRae Grabstein (09:47):
Oh yeah, and exploration of form factors,
more combustibles there's a lotthere for sure.
Yeah, I love what you saidabout if someone brings $100
million to really any categoryyou called out beverage, but
what happens and what does thatlook like?
Um, I hope to be faced with alot more of those questions in
(10:09):
2025, I think we will.
Ben Larson (10:12):
yeah, I don't think I'm giving anything away by
saying that I'm receiving a lotof emails lately that are just
from people poking around ortrying to gain an understanding
of the landscape, especiallylike when it comes to our
category so like investmentbankers, m&a, like groups and
(10:33):
you know we're not outsoliciting or anything like that
but it's like, oh, I might aswell take these meetings just to
see what, how they're thinkingabout things.
AnnaRae Grabstein (10:39):
Absolutely, and and I know we're going to be
reflecting back on the year butin my work I'm starting to see
companies instead of companiesthat are coming to me that are
distressed and trying to figureout how to get out of distress,
I am now having companies thatare doing well and are
profitable and efficient and aretrying to figure out what next.
(11:00):
No-transcript how do we grow acategory that isn't going to be
(11:33):
growing at the same pace that itmaybe was when every new market
was coming on, but that winnersget to see incremental and
sustainable steps forward?
Ben Larson (11:38):
It's funny.
Emmett Bush on my team thismorning sent out an image they
had asked ChatGPT, like what isthe difference between a startup
and a company?
And it went through these likefive items about talking about
like sustainable growth andfocus on profitability and all
this kind of stuff.
And I just started reflectingI'm like, hey, it's nice to be
(12:01):
in that position as a companyourselves, Like I'm like check,
check, check.
But also I feel like, hey, it'snice to be in that position as
a company ourselves.
I'm like check, check, check.
But also I feel like the supplychain, the industry as a whole,
is kind of trying to make thatevolution, and you mentioned it.
But it made me also think thatthis year kind of rolled out as
expected.
I don't know if you feel thatway, and that's not for
(12:22):
everything.
Politics was crazy, Californiahemp ban was crazy.
There's a lot of craziness, asalways.
But I remember coming into theyear when we were recording this
episode last year of being likeI'm actually really optimistic
going into 2024.
And I think it's going to be agood year and we thought people
(12:43):
were going to be focusing on onprofitability and building
sustainable companies and andthey have, and they have we got
it right yeah, I think the yearjust got it right.
Like I don't want to take creditfor getting anything right,
it's just like the optimism andeverything that we kind of
anticipated uh happened, and soit's kind of nice.
It's the first year I felt likeI've been able to experience
(13:05):
that in the recent past.
AnnaRae Grabstein (13:07):
Yeah, well, let's dive into it.
I think that for this lastepisode of the year, we want to
think about first the thingsthat really will leave a lasting
impression on us and reflectingon the biggest news of the year
, and then we'll talk about whatwe think is going to happen
next year, both in the industryand maybe with us.
(13:28):
Yeah, what do you think?
Ben Larson (13:30):
I like it.
Okay, you want to go first?
AnnaRae Grabstein (13:33):
Sure, I'd say that I'll start with some of
the darker moments.
Some of the biggest things thathappened this year is that a
number of companies ended upcalling it.
It was these threats.
We've talked about extinctionevents of small farmers, but
there were some extinctionevents from some large
substantive companies MedMen,high Times Statehouse, which is
(13:59):
Harborside, and Urban Leaf.
Ben Larson (14:00):
Speaking about hundreds of millions of dollars.
AnnaRae Grabstein (14:03):
I mean this represents probably billions.
We didn't run the data beforeuh of of capital invested into
these companies and um, they allended up in the receivership,
uh, in the receiverships, in thereceivers hands, and um, all of
them mostly held assets incaliforn.
(14:25):
They all held assets inCalifornia.
So the California market reallyhad a hard 2024, unquestionably
, and it will leave a mark for along time.
There's almost no MSOs that areoperating in California anymore
public MSOs.
Ben Larson (14:41):
And it's not getting any better.
I just saw a post today thatthe DCC was considering
increasing the licensing fees.
AnnaRae Grabstein (14:49):
Yeah, yeah.
So so 2024 was a hard year forCalifornia, but you say it's not
getting any better.
I would.
I would maybe look at itdifferently.
I I think that it is.
I think that what's happeningis that the companies that
fundamentally don't work arefinally stopping trying and that
(15:12):
there are operators that aremaking it work in this state,
ones that carry the torchforward Like let's stop lighting
money on fire, let's run goodcompanies that have futures,
that are built on something real.
Um, if, if somebody at a retailstore is losing 50 cents for
(15:35):
every dollar of product thatthey sell, they're doing
something wrong.
That is no longer the way torun a company in this space.
So, um, so, yeah, that's.
That's a big takeaway for mefor for 2024, as as the
companies finally hit the rocks.
Ben Larson (15:49):
Yeah, and to counterbalance that, we did see
some success where there wasthis impending debt wall and
there were some companies thatactually pushed through,
refinance their senior debts andand live to fight another day.
Yeah, and so not everythingburned down, which was great,
but some, some, some did perishyeah well, so what do you got?
AnnaRae Grabstein (16:12):
what's the next one big, big news of the
year?
Yeah, I mean it'll be moreflowery right and positive,
absolutely a little bit moreliquid.
Ben Larson (16:20):
Um, you know it's for me it's just like status quo
in the most status quo sort ofways, but also like the benefits
that came out of that for us.
Um, so like when we're talkingabout cannabis, you know it's
like the same old story withrescheduling, safe banking, all
that kind of stuff.
It's just like when's it goingto happen?
(16:40):
Is it going to happen?
How's it going to happen?
I don't know, I don't have theanswers.
No-transcript it.
(17:30):
You know a category that washistorically one to 2% of
cannabis sales and even worsefor low dose.
Low dose beverage in Californiais about 0.3% of total cannabis
sales and all of a sudden youput it into the alcohol market
and people are planning on itbeing 10 to 20 percent of
alcohol sales.
Yeah, it's just a massiveopportunity.
(17:51):
And I had the opportunity totravel with you to to minnesota,
um, then to austin, charlotte,charleston, nashville, on and on
, and you just you're walkinginto these liquor stores and to
total wine and it's not like alittle well, I mean, end caps
(18:13):
are always nice, but it's notjust like one shelf, like we're
talking five, seven shelves insome cases of every low-dose thc
beverage that you could want sobasically, 2024 is the year
that beverages really soared.
They soared, the business isdoing great and I had to stop
selling the dream and just liveit, and that is the greatest
(18:35):
gift you can give anentrepreneur.
AnnaRae Grabstein (18:37):
Yeah, that's amazing.
I have been really amazed athow much beverages have
increased not only in mindsharebut in selection and in quality
this year.
It seems like everyone's makingone now.
The question at the beginningof the year was should we make a
(18:59):
beverage?
And now the question at the endof the year is are there too
many beverages?
And now the question at the endof the year is are there too
many beverages?
I'm sure you smile and say no,there's never too many beverages
and there's so many morebeverages that we need to bring
to market, and that's probablytrue because they're not widely
available enough to enoughpeople, but there really are so
(19:21):
many more choices and thecategories of flavors and
experiences and stuff, it's just.
It's just a whole nother world.
And so to see how much thecategory has shifted and changed
in the last 12 months, if, ifit keeps moving at this pace,
who knows in 36 months when it'sgoing to look like?
Ben Larson (19:42):
And it's just, it's really interesting the
conversations that we're having.
You're talking about likeeveryone's getting into it.
Uh, I've been talking withamber center, who you know uh,
she's a co-founder of supernovawoman and has has had a number
of different uh companies underher belt.
Um, she's even looking at thebeverage category in a really
(20:03):
exciting way.
You know, she sees opportunitythere from the lens of like this
is actually creating equityopportunities because the
barrier to entry is so low andwe can actually find supportive
partners to help accelerateproducts to market and give
people a fighting chance insteadof diluting them to thinking
that this lottery ticket of aretail dispensary is going to
(20:23):
provide generational wealth andprint money for them.
AnnaRae Grabstein (20:27):
The golden handcuffs of equity programs
that have never really workedout for anyone.
I hear you and I of courseagree that there has been a much
lower barrier to entry to bringhemp to market, and I also am
with you in the prediction thatthe farm bill will probably be
punted for another year or asignificant amount of time.
Ben Larson (20:51):
It's becoming a little less of a prediction, I
mean yeah, it's becoming clear.
Yeah, it's becoming very clear.
AnnaRae Grabstein (20:56):
However, what is shifting is even if the feds
aren't going to shift theirhemp policy, there is more state
level policy that's coming intoplace.
It was huge in California thisyear that hemp THC was banned.
There's more regulatory hopesand dreams kind of coming down
(21:18):
the pipe and some other Statesabout kind of clamping down on
the availability of THC products, and I expect that that is
going to continue next year,absolutely so.
When we're talking about thebarrier to entry, is it risky
for companies to be developingproducts in hemp now?
(21:40):
How do you think about thatwhen people come to you?
Ben Larson (21:45):
I'll give you the consulting answer.
It definitely depends.
AnnaRae Grabstein (21:50):
That's what I say too.
Ben Larson (21:55):
If you're launching a THCA flower, hopefully you
have deep pockets like UncleSnoop and you can weather a
complete and outright ban on it.
I wouldn't do it if I hadlimited funds.
I'd go a little bit safer.
It does seem that when we'retalking to the policymakers in
(22:15):
these various states, thatthere's a lot more receptivity
to at least the beveragecategory, and then your risk
profile increases as you kind ofgo up the value chain.
So it's like if you want totalk about gummies, okay, it's
not a smokable, a little bitsafer, but there's a big fear
about whose hands those mightget into and what they might be
(22:57):
mistaken for, and so I do thinkthe beverage category is
interesting and you also havejust a very supportive
environment, like anyone in thespace generally knows about in
the past, it's something thatthe hemp industry has been
accused of forgetting is reallylifting up the roots of the
(23:20):
cannabis industry.
AnnaRae Grabstein (23:21):
I'll answer my own question.
Here's what I tell people isthat the hemp opportunity
remains and is still massive andhuge.
The consumers love it.
It's really the policymakersthat are going to create a
decrease of opportunity incertain categories and in
certain markets, and so tostomach it.
(23:45):
If you want to move into thespace, I think that the best way
to think about it is how do wemanage supply chains to be able
to pivot fast enough so you'renot overbuilding inventory, and
also that you're maybe notrelying on certain product lines
or form factors to existforever?
And if you're going intosomething understanding that
there's an element like, forinstance, if you're going to
(24:06):
make a 10 milligram beveragebecause you understand that the
data tells you that that has thelargest amount of sell through
and moves through fast enough,just don't make so many that if
you get 30 days notice that astate or 60 days notice that a
state is moving and the packagesize now needs to be five
milligrams, that you can't pivotand you're left with a whole
(24:26):
bunch of inventory that you canno longer sell, but does that
mean that you shouldn't make a10 milligram beverage?
I think that if you can manageyour supply chain and if you can
manage your inventory, then theidea of just being flexible to
take advantage of what's infront of us now to build brand
affinity, to build market share,to get distribution in place
(24:51):
and then to pivot with theregulations and just be ready
for it and open to it, I thinkit is manageable.
I'm with you that as you movetowards more combustible form
factors, that those are reallyshort-term, think that.
I think that you will see thethe farm bill, when it does
change eventually most likelyclamp down on the ability for
(25:12):
people to bring combustible hempproducts to market, but it
might be another 12, 24 months Idon't know when that's going to
happen and so then any of thoserestrictions will actually fall
on the states.
And then it just becomes moreof a distribution management
(25:32):
challenge of if you're making aTHCA flower product, making sure
that you're only selling itinto the markets that allow it
and managing it.
And it's most likely ashort-term play, but still there
, still big.
Ben Larson (25:46):
Yeah, and to your point in focusing on building a
brand and building a consumerbase.
If you're really good at it andyou build great products, then
people are going to want to findthem in the future.
And maybe you could find yourway into a dispensary channel if
that became the only outlet anddrive your customers there.
I don't know.
Actually, I'm really interestedin checking out some of the
(26:07):
headset data for this year inCalifornia.
Following the ban, did beveragesales increase in dispensaries?
AnnaRae Grabstein (26:16):
because of the ban.
Well, and we have seen in 2024,a lot of cannabis companies
that are in the adult useregulated side finally realized
that there was this hugeopportunity in hemp and start to
explore it.
You've mentioned Cureleaf.
Gti has gotten into hempbeverage.
(26:36):
There's a number of otherexamples and so what they're
doing is they're going fromregulated marijuana into hemp,
but hemp has been thisincredible brand building
opportunity for folks who areable to be doing online
marketing direct to consumer.
I think that 2025 could be theyear and it might be till 2026,
(27:04):
but where we'll start to seesome of those really
well-developed hemp brands startto explore being able to move
into different form factors inthe adult use market and go back
the other way, because they arewell capitalized, they have
free cash flow, they've learnedto build great businesses,
they've got email lists allkinds of things that position
them to be able to play on bothsides of the fence, like vertosa
(27:26):
, which also plays on both sidesof the fence yes, we do get
accused of that sometimes.
Ben Larson (27:31):
Um, it's not a bad thing no, no, it's not.
But you know, everyone has theirangle, especially when it comes
to lobbying and all that, andso it's um, we, we often find
ourselves playing switzerland.
Um, especially in places likelike California, where we have
relationships with the variouspolicymakers and want to
preserve both sides of ourbusiness, we believe that
(27:55):
everything needs to beresponsibly shepherded.
So enough about us.
The interesting thing about thehemp beverage category is that
it also adjacent to another likefast burgeoning category, and
that's the, the non-alcoholmovement.
And um, I've been talking to alot of players in that realm and
and what I'm also seeing isthat a number of these, uh, hemp
(28:18):
beverage brands are launchingjust non-cannabis, non-hemp
products and, yeah, and that's areally interesting opportunity.
You know the folks at Colexo.
I know that they were shippingtheir just flared seltzers
basically out to Japan andgetting distribution out there,
and everyone generally knowsabout Breeze.
Breeze has their Lion's Maneonly product that really acts as
(28:43):
the main vehicle for theirsocial media marketing.
AnnaRae Grabstein (28:47):
Well, and seltzer and non-alcoholic you
know, lion's mane beverage isone thing I'd say that it's
interesting to start thinkingabout these non-alcoholic
beverages as adult beverages,where we've always just thought
about them as for all, for allthe, the part of the
non-alcoholic space that I think, outside of hemp, that's the
(29:08):
most interesting, is thenon-alcoholic beer category, and
I just say this probablybecause it's a huge part of my
refrigerator at home and do youhave a favorite brand?
Well, my husband does, and so Iwill just promote his favorite
brand, which is athletic brewinghands down.
And so I will just promote hisfavorite brand, which is
Athletic Brewing hands down.
And he's been trying them all.
He's been trying the localSonoma County craft beers that
(29:30):
are putting out non-alcoholoptions.
He's tried the Sierra Nevadaones and he likes them all.
But he really feels that theAthletic Brewing is just the
best.
It's pretty solid, it's prettysolid.
Ben Larson (29:44):
It's pretty solid.
AnnaRae Grabstein (29:45):
Yeah, and it is pricey.
It is the same price as buyingcraft beer.
I can't believe it.
They sometimes sell it at oneof our local Costco's but not
the others, and so we have beengoing specifically to the Costco
in Marin County where they willsell 12 packs of athletic
(30:06):
brewing, because we just can'tseem to keep it on the shelf in
our house.
So I think it's a hugeopportunity to really disrupt
the alcohol category, and Ithink that we're going to see
non-alcoholic beer, hempbeverages and other kind of
non-alcoholic beverages really,uh, really kind of staking a
(30:27):
claim in in the overall marketshare there there are a few
people that have eitherattempted or are doing right now
uh, infused non-alcoholic beerand people.
Ben Larson (30:40):
It's very polarizing .
People like, just like, don'tput THC in my beer, like no one
wants that, and then there'sother people that just love it,
and so I'm curious to see wherethat sliver, the category uh
goes.
AnnaRae Grabstein (30:53):
I think it will win you think?
So, but to be honest, the onesthat I've tasted I just don't
think are very good.
Yeah, um, so if you make a thcbeer it to me, I'd love to try
it, because they have notimpressed me, and I think that's
why they're polarizing isbecause you can easily deny it.
Ben Larson (31:12):
Based on the sentiment that I was getting at
BevNet and I'm not making anyclaims here, but I wouldn't be
surprised if some of the namesthat you mentioned previously
that are in your fridge wouldn'tbe getting into the space.
AnnaRae Grabstein (31:26):
Yeah, I hope they do.
That sounds great.
Ben Larson (31:29):
Funny enough back in the early days.
Do you remember House of SakaCynthia?
AnnaRae Grabstein (31:34):
and Tracy Wine.
Right yeah, infused wine, and.
Ben Larson (31:39):
I remember sitting down like wait, okay, so you're
taking this high quality NapaValley wine and then you're
putting it through a processwhere you high quality napa
valley wine and then you'reputting it through a process
where you have to remove thealcohol and then we're going to
add thc into it and so you havethis very expensive product that
, as a wine lover, I'm like kindof pales in comparison to the
original um yeah anyways, uh, I,I think I can say all this
(32:02):
right now because they, uh, theyno no longer are around, but
yeah the company.
They are just fine the peopleare good.
AnnaRae Grabstein (32:12):
Well, let's talk about this next year and
and what's ahead, um 25, 2025.
It just keeps stacking yeahjust keep moving?
Is it because we're old that itfeels like it happens faster,
or is the world just moving at afaster fucking pace?
Ben Larson (32:29):
Okay, so I can answer this a number of
different ways.
I did have this likepsychological explanation that
every year is shorter, if you'rethinking about it, relative to
your life.
Yeah, exactly so the older youget, the faster it goes.
Faster it goes.
But also I do think you saidpiling on, like we just do over
(32:51):
time, pile more things on.
It's like I have two kids, Ihave this business, the business
is getting bigger, we have moreemployees, like the industry is
getting larger, and so it's itis moving faster.
There's more to do.
I feel like I traveled way morethis year than I had in
previous years.
Yeah, and I think 2025 isprobably is getting larger, and
so it's it is moving faster.
There's more to do.
I feel like I traveled way morethis year than I had in
previous years.
Yeah, and I think 2025 isprobably going to be even busier
.
Yeah, god willing.
(33:12):
I mean like busy is great rightnow, I'm loving being busy.
AnnaRae Grabstein (33:16):
Busy is good.
I think 2025 is going to be agreat year in this space.
I think that there will beongoing troubles for operators
that aren't running goodbusinesses, but those that are
having a mind towards underlyingfundamentals, are building
(33:37):
foundational structures intotheir business, are going to be
really well positioned.
I am starting to see companiesreally start to think
strategically again in a waythat I think 2024 was all about
just like fixing stuff andgetting out from under a lot of
bad decisions that had been madein the past be it debt or way
(34:01):
too many products or bad marginson products or inefficient
supply chains, whatever it isand 2025 is now like all right,
we've got the house in order.
What are we going to do now?
How are we going to grow?
I'm working with a company thatis starting to think about
overhauling their internalgovernance and transforming
(34:22):
their leaders and theirleadership structure and to
start thinking about how theycan be ensuring that there is
kind of a new generation ofleaders inside of their company
and succession planning and likethis is the kind of thing that
real companies do, likecompanies that know that they're
not just going to be around fortwo years until the money runs
(34:43):
out, but that are looking at thenext 10, 15, and 20 years to
really think about who they areand how they're going to build
something strong.
So I am just really hopeful tosee people doing that type of
work and I think it's going tokeep happening and I think
there's more and more of thegood people rising to the top.
Ben Larson (35:04):
So it's a good prediction.
I love that.
I hope to be one of thosepeople.
Yeah, you know we invest a lotinto our employees and you know
there's employees now that arehere for five years and
realizing that this is a majorstep in their career and the
(35:24):
responsibility that comes alongwith that, and so we've.
You know I'm a member ofVistage.
I've been getting more of oursenior leaders into various
groups like that, and then also,you know, helping our finance
manager get her CPA and justreally think of different ways
(35:46):
Like how can we make peoplethrive and be happy to be here
long-term and it's nice to thinklong-term in the cannabis
industry.
That's a privilege that wehaven't always had.
AnnaRae Grabstein (35:56):
Well, on the flip side of that, as we think
about kind of up-leveling ofteams, the other thing that is
going to be happening in 2025 isis the integration of assets,
as companies are coming togetherafter M&A activities whether it
be the roll up that we justtalked about with Vireo,
(36:16):
bringing together five disparatecompanies that operate in
different markets or or the M&Athat we can't even yet predict,
and that integration work, Ithink, is going to be a big part
of 2025.
And some people will win at thisand some people will fail, and
I think that integration is abigger deal than lots of groups
(36:37):
realize, because integration isabout humans, but it's also
about systems.
It's about it's about uh,reconciliation of vendors and
supply chains and marketingplans.
Uh, there's so much to handlewhen it comes to integration,
and there are companies that arereally, I believe, truly
(36:59):
underestimating the importanceof it and thinking that it will
just happen naturally or it'snot important, and I think that
we're going to see someintegration challenges this year
.
That would be a prediction.
I don't know who yet, but therewill be some that are failed as
a result of not putting in theeffort to get it done.
Ben Larson (37:22):
Yeah, I mean it's hard enough to like integrate
like new senior leadership intoa company when you hire them and
just thinking about taking awhole new company and bolting it
on.
AnnaRae Grabstein (37:32):
Yeah.
Ben Larson (37:33):
Yeah, interesting when looking at 2025, I just
keep thinking about these majortopics that we've talked about,
like farm bill, rescheduling,all this kind of stuff.
I'm going in and I wrote thisinto my Christmas cards that we
(37:53):
sent out to everyone.
I'm like all right, everyoneneeds to be optimistic, we need
to be adaptable and we need tobelieve that we can thrive under
this new reality that we areentering, which is even like
just hearing these messages fromVivek and Elon about like just
involving themselves.
Like wait, no one elected you.
Like, why do you have so muchcontrol?
(38:14):
This is kind of scary, but I amoptimistic that we will see
rescheduling, maybe even enter arealm where we could start
talking about descheduling in apublic way.
I know that's a bold prediction.
That's a bold prediction, butI'm going to put it out there.
Uh, with with RFK entering thefold, uh, is he still?
(38:37):
I don't know, I don't followeverything.
He's in the fold.
He's still in the fold.
AnnaRae Grabstein (38:40):
Okay, good.
Ben Larson (38:41):
I mean good.
I mean good.
Yeah, I don't know.
I just am optimistic that wesee some real change.
I guess that's what we can hope.
To see is like a thinning outof the FDA and maybe a talking
(39:02):
about CBD being a perfectly fineingredient for food products,
because we still haven't hadthat conversation.
Yeah, I don't know.
I just feel so much has beengummed up in the federal
government that good or bad likejust shaking it up and lighting
it on fire might returnsomething positive.
(39:24):
I'm curious, for sure, andoptimistic, and optimistic
Totally.
I'm curious, for sure andoptimistic.
AnnaRae Grabstein (39:28):
And optimistic totally.
I am optimistic and skeptical.
I choose to be optimistic whilebeing well-informed.
I think that feels like thepower We've talked about,
pattern recognition and, I think, pairing optimism with a deep
understanding of the market andall the things that are
happening in all the places,which is another element.
(39:50):
While we, while we talk aboutfederal policy, like you've like
you've mentioned, and some ofthe ways that those could lever
into to market opportunity orgrowth or shifts, shifts in the
dynamics, we will most likely in25, see some new state markets
come on in the adult use spaceor in the medical space.
It's a little hard to know andthere's less and less new state
(40:14):
opportunity than there was theyear before as states turn on.
But it seems very likely thatthere will be progress in
Pennsylvania, which could be areally big market and already
has a lot of public companiesthat are operating there.
So I can see that that could bea pretty big lever for growth
(40:37):
of some public companies.
Ben Larson (40:39):
Sucks for those dispensaries that popped up on
the borders.
AnnaRae Grabstein (40:43):
Yeah, absolutely yeah.
Pennsylvania is losing a lot oftax money to the border
dispensaries, unquestionably, Ithink New York is going to
continue to grow.
I think that it's it isn'tquite hitting a billion dollars
in 2024, but it could.
It could easily double that in25.
Ben Larson (41:03):
I think that was one of the positive highlights of
2024.
AnnaRae Grabstein (41:06):
Yeah, we forgot to say that.
Yeah, New York.
Ben Larson (41:08):
New York like finally Finally coming to life.
AnnaRae Grabstein (41:11):
Yeah, it's not there yet, but at least I
think everyone can show up witha little bit of confidence that
New York is on the right path toactually realizing an adult use
market.
And yeah, I'm seeing somegrowth shutting down a ton of
the illegal stores, which Ithink is generally positive.
Yeah, new york, new york wasgood this year and I think this
(41:34):
prediction will be better nextyear yeah, are there other
markets that you're excitedabout?
Uh, any predictions on texas?
Ben Larson (41:46):
yeah, I do have predictions on texas, um and
this comes, I guess, wellinformed, to use your term uh,
that I do think we'll seebeverage preserved in the
mainstream marketplace in texasin the,000 plus now hemp
(42:06):
licensed retailers.
But I think there will be astrong crackdown on most of the
form factors beyond that,definitely on flour and vape,
and I think it's going to be ahard fought battle and I think
that if beverage doesn't getprotected in it, that nothing
(42:30):
will pass and you'll have statusquo for another two years.
It's a lot of horse tradinggoing on and it's a it's a
divided house that isn'tcompletely under the pen of Dan
Patrick.
AnnaRae Grabstein (42:43):
Sure.
Well, so you think beveragewill be preserved.
But you always think beveragewill be preserved, Is there?
Ben Larson (42:50):
any way that you think that beverage won't be
preserved With the exception ofCalifornia?
AnnaRae Grabstein (42:55):
Okay, so you said it, so you're not totally
myopic in believing thatbeverage will always be
preserved in every one of thesestate debates.
And of course, you have to beoptimistic about it, and we all
want access.
Ben Larson (43:10):
I think that's clear .
AnnaRae Grabstein (43:11):
I mean not everybody who listens, I think,
wants free market hemp access,but I think that we both agree
that hemp beverages inmainstream retail have been
positive on many levels for mostand look, I am overtly
optimistic and we have moresupport than we've ever had
before.
Ben Larson (43:32):
Uh, but it's not unanimous support from the
alcohol industry and I thinkthat's important to know.
Like in california, you know,abc is not convinced.
I think the beer institute alsoput out a weird like-THC
newsletter that got a lot ofbacklash.
So we still have a lot ofbridge-making to do.
(43:55):
But attending Bevanette justlast week, it was just so
eye-opening to see how excitedeveryone was about it and having
steve jabor on stage sayingthat, like this is a massive
category, everyone needs to besupporting it, like it's just so
cool, right, like I was atbeverage forum, which was also
(44:17):
in la at the beginning of theyear, in a two-day beverage
conference and no one mentionedthc, uh, which was equally like
bizarre.
But um, yeah, I think.
AnnaRae Grabstein (44:27):
I think it's evolving in the right direction
yeah well, so we've talked abouta bunch of industry kind of
cannabis, thc relatedpredictions.
What are your intentions goinginto the new year?
What are you?
How are you leaving it behindand looking forward?
Ben Larson (44:45):
Yeah, so this year was.
I mean, I'm guilty of likehaving business totally envelop
my life, but I look at this yearas really kind of leaning into
the foundation that we had builtin 2023 and capitalizing on it,
and so we were able to grow thebusiness and not increase our
(45:10):
overhead too much.
It was just like kind of likelean into the systems that we've
developed.
It has created the space for meand the desire to really as you
were mentioning for othercompanies, like think about
what's possible.
Like you know, we had themorning mixer the other day and
just the people that were in theroom like it really inspired me
(45:31):
to think bigger.
You know, what would I do with$100 million and you know what
is the future?
And you know, outside ofbeverage, I've been having, you
know, fun conversations with,like, the medical community and
we do a lot of work with JohnsHopkins.
And how do we address that partof the market that has largely
(45:53):
been ignored because of all theexcitement and necessity to
drive towards the recreationalmarketplace?
And so, kind of going back, canwe actually create great
therapeutic cannabis products?
AnnaRae Grabstein (46:06):
Yeah.
Ben Larson (46:07):
So you know, I'd like to explore that in the new
year.
But yeah, just what is thedirection of all this going?
How can we educate theconversation, Maybe influence it
a little bit?
AnnaRae Grabstein (46:21):
Yeah.
Ben Larson (46:22):
Yeah, how about you?
AnnaRae Grabstein (46:26):
My business really grew a lot in 2024.
So, yeah, yeah, how about you?
My business really grew a lotin 2024.
And as someone that's mostlybeen building it on my own, with
(46:51):
a partner here and there andsome people that I've brought in
, I've looked back on the, onthinking about creating in
myself and in all the peoplethat I work with just an ongoing
commitment and culture on peakperformance, and I've just been
thinking about peak performancea lot and, yeah, an optimization
of my time and my health and mybrain and my information.
And how do I create that just aspart of the DNA of my work and
(47:15):
my life in an integrated way,and then that ends up being kind
of the way that the businessgrows as well, because we can be
known for being so smart andastute and efficient and
optimistic and executionoriented and all of those things
.
So, yeah, I'm excited aboutnext year.
(47:38):
There's a ton of really uniqueopportunities and it's about
feels like what I want to keepdoing is is playing three
(47:59):
dimensional or four dimensionalchess as best as I can with,
with my career, with my company,with my community, with my
favorite people that I want towork with and build with, and
and how to create kind of justongoing mutual alignment with,
like aligned incentives foreverybody that deserves to be at
the table, like keep pickingwinners.
Um, that is that's what I wantto focus on in 2025.
And then also, I'd say,specifically, since we are here
in the high spirit studio atVertosa, is, uh, what we want to
(48:21):
do with with this community aswell.
Ben Larson (48:25):
Um, and I think we have a lot of ideas.
We have coasters.
AnnaRae Grabstein (48:29):
Yeah, we have a coaster, so that's our first
piece of merch.
Ben Larson (48:34):
A fancy piece of swag?
Yeah, but in the merch store.
AnnaRae Grabstein (48:39):
But I think in 2025, we need to be really
paying attention to the momentumthat we've built with the High
Spirits community and listeningto our audience, and what I am
hearing our audience tell us isthat they love access to good
information with other leadersin the space, and creating
(49:08):
spaces to collaborate and beauthentic together can lead to
unintended positive outcomes inbusiness, and I want to.
I want to engineer more ofthose opportunities to create
magic between humans in business.
Ben Larson (49:21):
I love that, yeah, and I, and it's going to happen
Like it is being extracted fromus.
AnnaRae Grabstein (49:27):
It is.
Ben Larson (49:28):
And shout out to Eric, who's sitting right here
off camera.
AnnaRae Grabstein (49:31):
He's going to be helping us out.
We just got a producer, youguys.
Ben Larson (49:36):
It's been official.
It's a big deal.
AnnaRae Grabstein (49:39):
Of course, Sarah Falvo has been a big, big
part of our community andhelping drive our morning mixer
part of our community andhelping drive our our our
morning mixer belinda on thevertosa team has created uh
brand assets for us all yearlong.
Ben Larson (49:52):
The entire team, both wolfmeyer and vertosa, is
just like hugely supportive ofof this, uh, what I used to call
a boondoggle, but it's actuallybecoming a, a big love child of
the, of the companies and yeah,it is, it's growing like big
love child of the companies.
Yeah, it is.
AnnaRae Grabstein (50:10):
It's growing.
It feels like a love child.
It is, I agree, and our highspirits children, all of you out
there, we just want to keepdoing this for you.
We want to be making an impacton your life and inspiring you
to be the best leader that youcan be, to be creating the best
companies that you can be, to becreating the best companies
that you can be, to be buildingaccess to cannabis for anyone
who wants it.
Ben Larson (50:31):
That's right.
AnnaRae Grabstein (50:31):
Yeah.
Ben Larson (50:33):
And over the next couple of weeks, which we're not
going to air until.
January beginning of January wewill be thinking about all
those things and so if you'rewatching and you have ideas
about how we can be better, whatwe can do to really amplify the
value of the show, uh drop us amessage.
AnnaRae Grabstein (50:51):
Yeah, events that we can activate around.
Um, we want to be doing more,more in-person events, so let us
know.
Ben Larson (50:59):
Uh, if your city needs us, maybe we'll be coming
through yeah, and if you or youknow someone that wants to be on
the show, we're building outthat list for next year as well.
AnnaRae Grabstein (51:15):
Yeah, I'm super excited about 2025 and
thanks Ben for just being acreative partner again.
It feels great to be getting tothank you again this year for
being my creative partner and myaccountability partner and
doing something that's hard.
Showing up every week andmaking this content and putting
ourselves on camera is not easy.
(51:37):
It's scary, it's vulnerable,but we can do hard things.
And it's easier to do the hardthings with the people you like
and the people that you loveAlso a great podcast, I hear.
Ben Larson (51:48):
Have you heard this one?
We Can Do Hard Things.
No, my wife's a big fan.
Oh yeah, check it out.
AnnaRae Grabstein (51:53):
Okay, yeah, thanks, thanks for a great year.
Ben Larson (51:56):
Yeah, thank you.
This has been great and thankyou, thank you everyone.
If you're watching, please,please, uh, here at the end of
the year, go give us a subscribe, a like, a share.
Uh, the community is growing.
I think we're almost about 1100on on on linkedin and the the
viewership is is going up a loton youtube and our podcasts.
(52:17):
Uh, I think that's it yeah,read us out I can't read
anything.
Stay engaged.
How about you do it?
What do you do?
What do we say?
It's your turn, it's the end ofthe year.
AnnaRae Grabstein (52:29):
Stay curious and stay informed.
Stay informed and keep yourspirits high.
Ben Larson (52:36):
Until next time, until next time.
That's the show.
That's the show you.
Do I need to be closer to this Good?
Ben Larson (00:09):
Hey everybody, welcome to episode 71 of High
Spirits.
We're recording Thursday,december 19th, 2024.
And we're live in person.
It's the end of the year and sowe're going to do a little bit
of a wrap up today, checking onthe big happenings, what's top
of mind, and then what's goingto happen in 2025.
AnnaRae Grabstein (00:28):
Stoked to be here.
Thanks for hosting today, ben,of course.
How are you?
Ben Larson (00:31):
doing.
AnnaRae Grabstein (00:32):
I'm good we're here at Ben's house at
Burtosa and Berkeley.
Ben Larson (00:37):
Practically my house .
There's a Christmas tree rightover here.
AnnaRae Grabstein (00:39):
You also have a menorah.
Ben Larson (00:41):
We do.
Yeah, we're very inclusive here.
AnnaRae Grabstein (00:44):
Not everyone is represented.
That I see with your holidaysymbolism, but like you're
hitting a lot, there's a bigpole right over there.
What's the pole for?
Ben Larson (00:53):
Isn't that like a Seinfeld?
AnnaRae Grabstein (00:57):
Wasn't there like a pole or something?
I'm not sure.
People keep telling me thatit's going to get quiet towards
the end of the year, but I'veactually been hustling hard.
There's been so much work and Iactually kicked off a new
project last week, so people arenot necessarily slowing down.
Ben Larson (01:13):
Kicking off project mid-December that's bold.
AnnaRae Grabstein (01:16):
I know, but it should be a good one.
How about you?
Are you guys getting slower?
It's been nuts.
Ben Larson (01:22):
Finally, my travel ended last week, which was great
, but I'm trying to squeezeeverything into this week to
really protect a couple weeksover the holidays.
It's just made for a verysleepless week.
And then Alistair was sickyesterday, which just you know
having kids throws wrenches andthings.
AnnaRae Grabstein (01:41):
It sure does.
Well, having a sick kid.
Did that stop you from hearingthe news about the big Vireo
deal that was announcedyesterday?
Ben Larson (01:50):
I caught glimpses of it, but, as always, you're more
informed than I am.
AnnaRae Grabstein (01:56):
Well, I want to shout out Tyson McDonald, who
is both a friend and has been amentor to me this year, but he
just was appointed CFO to thenew Vireo I don't know if it's,
we'd call it Vireo 2.0.
Ben Larson (02:10):
So for our listeners , and maybe for me, what is
Vireo Got?
AnnaRae Grabstein (02:15):
it, yeah.
So Vireo for people that maybedon't walk out as much as me on
cannabis companies is a publiccompany, an existing public
company that has had a fairlysmall footprint in some
important markets.
They're one of the existingoperators, medical operators in
Minnesota, a registered operator, which means they're a medical
(02:37):
licensee in the state of NewYork, and then they also have a
license in Maryland and theyhave been flying under the radar
.
Mostly People might have heardabout them because they have
gotten involved in somelitigation with Verano over the
last couple of years.
Ben Larson (02:55):
That's probably why they sound familiar.
Yeah, because I'm familiar withVerano.
AnnaRae Grabstein (02:58):
Yeah, I think Verano tried to acquire them
and it didn't end up working out.
But either way, acquire themand it didn't end up working out
.
But either way, vireo has beena small, by all metrics, public
MSO and yesterday a majorannouncement happened that they
(03:18):
got a very large infusion ofcapital and have acquired four
single state operators, who allare very strong and profitable
in their own right, plus atechnology platform, and have
now positioned themselves,depending on what metric you're
looking at, to be a top six or atop eight MSO with some
(03:38):
stronger growth opportunities,based on some upcoming catalysts
, than almost any other cannabiscompany that I'm watching.
Ben Larson (03:48):
It really spurs a lot of thought for me, and I
even go as far back as to whenCanopy Growth received that $4
billion from Constellation.
It's like $100 million soundslike a lot.
$4 billion is an extreme amountof money, but what does that
mean for the future?
It's like people realizing thatthey can come in and just
(04:09):
become a top competitor bybuying it.
I mean, time will tell if theycan actually be that, but it
sounds like they have a goodfighting chance.
AnnaRae Grabstein (04:16):
Yeah, and what I know about Tyson is that
he likes to pick winners andthat he wants to pick winners
that he believes are going tolead.
He's very thoughtful.
He's one of the smartest dealengineers of anyone that I have
met in the space, so I canimagine that there are a lot
more deals ahead here and thatthis is a team that's going to
(04:38):
want to be acquiring more greatoperators across the industry.
And we've been talking aboutroll-ups and consolidation
consolidation since thebeginning of time.
Ben Larson (04:47):
We were actually even talking to Seth about
whether it was even going tohappen this year.
AnnaRae Grabstein (04:51):
Yeah.
And then, in the 11th hour, boomthis is it, and this deal has
definitely been in the works forsome time.
But, especially because it's apublic company, nobody can talk
about these things and I thinkthey've done a very good job of
doing just that and keeping itclose to the chest until the
time that it was time toannounce.
But I think that it createssome optimism around a public
(05:16):
company.
It also shows that there arethoughtful investors that are
paying attention to kind of anew focused cash flow, ebitda
positive business model that isgoing to carry us through 2025.
(05:37):
And my hope is that it willencourage more roll ups on the
back of this.
And, yeah, I'm excited.
Ben Larson (05:47):
Now I have a new thing to think about over the
next few weeks when I'm tryingto create some white space for
my brain, just like what wouldhappen if someone decided to
bring a $100 million check intothe beverage category and launch
a highly competitive beveragevertical.
AnnaRae Grabstein (06:04):
Yeah, and interestingly, every single one
of these acquisitions at leastfrom the announcement that they
made yesterday is a no-cash deal.
So it's all stock into the newcompany, and so the capital that
came into the company is forgrowth, and my guess is that
there's more capital behind it,depending on the different
(06:25):
levers that these folks aregetting ready to pull as things
unfold, and for moreacquisitions.
Ben Larson (06:32):
So you have a number of EBITDA positive companies
with $100 million bankroll now.
AnnaRae Grabstein (06:38):
Yeah.
Ben Larson (06:39):
Wow, interesting, and there was a tech platform
involved in the middle of allthis.
That made it an interestingdeal, but I don't know why it
was interesting.
AnnaRae Grabstein (06:48):
Yeah, the tech platform is called Arches.
To be totally honest, I havenever heard of this tech
platform and I texted a fewpeople yesterday when the deal
was announced, and nobody elsehad either.
So this is the one piece of thedeal that is a bit of a mystery
to me.
I am open to learning more.
Ben Larson (07:08):
If you know, let us know.
AnnaRae Grabstein (07:09):
If you know, let us know.
They've said in theannouncement that the tech
platform is going to be a tool.
They've used terms like POSdelivery platform, e-commerce.
I'm not sure if this is an erpsolution or if it's a pure
retail play.
I think um more to unfold.
(07:31):
Interesting.
I mean, I do pay attention tothe different retail tech stack
opportunities and options in thespace, so I'm a little
surprised.
I haven't heard of it and itwas just acquired, yeah, so
you're gonna have to go revisitthat tech map that we were.
Yeah, how did I miss this one ifit's so great, but I trust
these guys.
I think there's.
(07:51):
There's probably a purposebehind it all, um something
bigger going on so okay, so keepan eye on vireo keep an eye on
vireo, totally, and I thinktheir stock doubled yesterday.
No big surprise.
Um, we'll see if it keeps upand is able to withhold that.
But I'll say, like you know,when we went to Minnesota, top
(08:11):
fastest is that the two existingmedical licenses which are
owned by Vireo and GTI have anincredible early mover advantage
(08:32):
in the state, and the fact thatthey already have
infrastructure built thatthey're going to be able to get
to market faster than a lot ofthe newcomers it puts them in a
great position.
So that's when I started payingattention to the company, and
then I realized that their NewYork assets seemed pretty
underutilized as well, and thatisn't always a good thing.
(08:55):
But if you're trying to find agood platform for growth, and
underutilized asset base is agood place to start.
Ben Larson (09:01):
Yeah, yeah.
Well, what I like about theregulated market, and especially
in minnesota, is we've seen, uh, in the beverage category where
low-dose beverages rule, kindof the open markets.
You know, if you go into totalwines and all that kind of stuff
, that's what you're seeing inthose markets.
But in the regulated channelsand dispensaries you'll find 100
(09:22):
milligram drinks and ourfriends at uncle arnie's who
work very closely with GTI havebeen doing really well in these
states and so it's kind of Iknow a lot of people when they
were thinking about Minnesotait's like, all right, they
already have medical market,they already have low dose hemp,
like how does like what is theregulated piece really
(09:42):
fulfilling?
And it's like that higher doseproduct category.
AnnaRae Grabstein (09:47):
Oh yeah, and exploration of form factors,
more combustibles there's a lotthere for sure.
Yeah, I love what you saidabout if someone brings $100
million to really any categoryyou called out beverage, but
what happens and what does thatlook like?
Um, I hope to be faced with alot more of those questions in
(10:09):
2025, I think we will.
Ben Larson (10:12):
yeah, I don't think I'm giving anything away by
saying that I'm receiving a lotof emails lately that are just
from people poking around ortrying to gain an understanding
of the landscape, especiallylike when it comes to our
category so like investmentbankers, m&a, like groups and
(10:33):
you know we're not outsoliciting or anything like that
but it's like, oh, I might aswell take these meetings just to
see what, how they're thinkingabout things.
AnnaRae Grabstein (10:39):
Absolutely, and and I know we're going to be
reflecting back on the year butin my work I'm starting to see
companies instead of companiesthat are coming to me that are
distressed and trying to figureout how to get out of distress,
I am now having companies thatare doing well and are
profitable and efficient and aretrying to figure out what next.
(11:00):
No-transcript how do we grow acategory that isn't going to be
(11:33):
growing at the same pace that itmaybe was when every new market
was coming on, but that winnersget to see incremental and
sustainable steps forward?
Ben Larson (11:38):
It's funny.
Emmett Bush on my team thismorning sent out an image they
had asked ChatGPT, like what isthe difference between a startup
and a company?
And it went through these likefive items about talking about
like sustainable growth andfocus on profitability and all
this kind of stuff.
And I just started reflectingI'm like, hey, it's nice to be
(12:01):
in that position as a companyourselves, Like I'm like check,
check, check.
But also I feel like, hey, it'snice to be in that position as
a company ourselves.
I'm like check, check, check.
But also I feel like the supplychain, the industry as a whole,
is kind of trying to make thatevolution, and you mentioned it.
But it made me also think thatthis year kind of rolled out as
expected.
I don't know if you feel thatway, and that's not for
(12:22):
everything.
Politics was crazy, Californiahemp ban was crazy.
There's a lot of craziness, asalways.
But I remember coming into theyear when we were recording this
episode last year of being likeI'm actually really optimistic
going into 2024.
And I think it's going to be agood year and we thought people
(12:43):
were going to be focusing on onprofitability and building
sustainable companies and andthey have, and they have we got
it right yeah, I think the yearjust got it right.
Like I don't want to take creditfor getting anything right,
it's just like the optimism andeverything that we kind of
anticipated uh happened, and soit's kind of nice.
It's the first year I felt likeI've been able to experience
(13:05):
that in the recent past.
AnnaRae Grabstein (13:07):
Yeah, well, let's dive into it.
I think that for this lastepisode of the year, we want to
think about first the thingsthat really will leave a lasting
impression on us and reflectingon the biggest news of the year
, and then we'll talk about whatwe think is going to happen
next year, both in the industryand maybe with us.
(13:28):
Yeah, what do you think?
Ben Larson (13:30):
I like it.
Okay, you want to go first?
AnnaRae Grabstein (13:33):
Sure, I'd say that I'll start with some of
the darker moments.
Some of the biggest things thathappened this year is that a
number of companies ended upcalling it.
It was these threats.
We've talked about extinctionevents of small farmers, but
there were some extinctionevents from some large
substantive companies MedMen,high Times Statehouse, which is
(13:59):
Harborside, and Urban Leaf.
Ben Larson (14:00):
Speaking about hundreds of millions of dollars.
AnnaRae Grabstein (14:03):
I mean this represents probably billions.
We didn't run the data beforeuh of of capital invested into
these companies and um, they allended up in the receivership,
uh, in the receiverships, in thereceivers hands, and um, all of
them mostly held assets incaliforn.
(14:25):
They all held assets inCalifornia.
So the California market reallyhad a hard 2024, unquestionably
, and it will leave a mark for along time.
There's almost no MSOs that areoperating in California anymore
public MSOs.
Ben Larson (14:41):
And it's not getting any better.
I just saw a post today thatthe DCC was considering
increasing the licensing fees.
AnnaRae Grabstein (14:49):
Yeah, yeah.
So so 2024 was a hard year forCalifornia, but you say it's not
getting any better.
I would.
I would maybe look at itdifferently.
I I think that it is.
I think that what's happeningis that the companies that
fundamentally don't work arefinally stopping trying and that
(15:12):
there are operators that aremaking it work in this state,
ones that carry the torchforward Like let's stop lighting
money on fire, let's run goodcompanies that have futures,
that are built on something real.
Um, if, if somebody at a retailstore is losing 50 cents for
(15:35):
every dollar of product thatthey sell, they're doing
something wrong.
That is no longer the way torun a company in this space.
So, um, so, yeah, that's.
That's a big takeaway for mefor for 2024, as as the
companies finally hit the rocks.
Ben Larson (15:49):
Yeah, and to counterbalance that, we did see
some success where there wasthis impending debt wall and
there were some companies thatactually pushed through,
refinance their senior debts andand live to fight another day.
Yeah, and so not everythingburned down, which was great,
but some, some, some did perishyeah well, so what do you got?
AnnaRae Grabstein (16:12):
what's the next one big, big news of the
year?
Yeah, I mean it'll be moreflowery right and positive,
absolutely a little bit moreliquid.
Ben Larson (16:20):
Um, you know it's for me it's just like status quo
in the most status quo sort ofways, but also like the benefits
that came out of that for us.
Um, so like when we're talkingabout cannabis, you know it's
like the same old story withrescheduling, safe banking, all
that kind of stuff.
It's just like when's it goingto happen?
(16:40):
Is it going to happen?
How's it going to happen?
I don't know, I don't have theanswers.
No-transcript it.
(17:30):
You know a category that washistorically one to 2% of
cannabis sales and even worsefor low dose.
Low dose beverage in Californiais about 0.3% of total cannabis
sales and all of a sudden youput it into the alcohol market
and people are planning on itbeing 10 to 20 percent of
alcohol sales.
Yeah, it's just a massiveopportunity.
(17:51):
And I had the opportunity totravel with you to to minnesota,
um, then to austin, charlotte,charleston, nashville, on and on
, and you just you're walkinginto these liquor stores and to
total wine and it's not like alittle well, I mean, end caps
(18:13):
are always nice, but it's notjust like one shelf, like we're
talking five, seven shelves insome cases of every low-dose thc
beverage that you could want sobasically, 2024 is the year
that beverages really soared.
They soared, the business isdoing great and I had to stop
selling the dream and just liveit, and that is the greatest
(18:35):
gift you can give anentrepreneur.
AnnaRae Grabstein (18:37):
Yeah, that's amazing.
I have been really amazed athow much beverages have
increased not only in mindsharebut in selection and in quality
this year.
It seems like everyone's makingone now.
The question at the beginningof the year was should we make a
(18:59):
beverage?
And now the question at the endof the year is are there too
many beverages?
And now the question at the endof the year is are there too
many beverages?
I'm sure you smile and say no,there's never too many beverages
and there's so many morebeverages that we need to bring
to market, and that's probablytrue because they're not widely
available enough to enoughpeople, but there really are so
(19:21):
many more choices and thecategories of flavors and
experiences and stuff, it's just.
It's just a whole nother world.
And so to see how much thecategory has shifted and changed
in the last 12 months, if, ifit keeps moving at this pace,
who knows in 36 months when it'sgoing to look like?
Ben Larson (19:42):
And it's just, it's really interesting the
conversations that we're having.
You're talking about likeeveryone's getting into it.
Uh, I've been talking withamber center, who you know uh,
she's a co-founder of supernovawoman and has has had a number
of different uh companies underher belt.
Um, she's even looking at thebeverage category in a really
(20:03):
exciting way.
You know, she sees opportunitythere from the lens of like this
is actually creating equityopportunities because the
barrier to entry is so low andwe can actually find supportive
partners to help accelerateproducts to market and give
people a fighting chance insteadof diluting them to thinking
that this lottery ticket of aretail dispensary is going to
(20:23):
provide generational wealth andprint money for them.
AnnaRae Grabstein (20:27):
The golden handcuffs of equity programs
that have never really workedout for anyone.
I hear you and I of courseagree that there has been a much
lower barrier to entry to bringhemp to market, and I also am
with you in the prediction thatthe farm bill will probably be
punted for another year or asignificant amount of time.
Ben Larson (20:51):
It's becoming a little less of a prediction, I
mean yeah, it's becoming clear.
Yeah, it's becoming very clear.
AnnaRae Grabstein (20:56):
However, what is shifting is even if the feds
aren't going to shift theirhemp policy, there is more state
level policy that's coming intoplace.
It was huge in California thisyear that hemp THC was banned.
There's more regulatory hopesand dreams kind of coming down
(21:18):
the pipe and some other Statesabout kind of clamping down on
the availability of THC products, and I expect that that is
going to continue next year,absolutely so.
When we're talking about thebarrier to entry, is it risky
for companies to be developingproducts in hemp now?
(21:40):
How do you think about thatwhen people come to you?
Ben Larson (21:45):
I'll give you the consulting answer.
It definitely depends.
AnnaRae Grabstein (21:50):
That's what I say too.
Ben Larson (21:55):
If you're launching a THCA flower, hopefully you
have deep pockets like UncleSnoop and you can weather a
complete and outright ban on it.
I wouldn't do it if I hadlimited funds.
I'd go a little bit safer.
It does seem that when we'retalking to the policymakers in
(22:15):
these various states, thatthere's a lot more receptivity
to at least the beveragecategory, and then your risk
profile increases as you kind ofgo up the value chain.
So it's like if you want totalk about gummies, okay, it's
not a smokable, a little bitsafer, but there's a big fear
about whose hands those mightget into and what they might be
(22:57):
mistaken for, and so I do thinkthe beverage category is
interesting and you also havejust a very supportive
environment, like anyone in thespace generally knows about in
the past, it's something thatthe hemp industry has been
accused of forgetting is reallylifting up the roots of the
(23:20):
cannabis industry.
AnnaRae Grabstein (23:21):
I'll answer my own question.
Here's what I tell people isthat the hemp opportunity
remains and is still massive andhuge.
The consumers love it.
It's really the policymakersthat are going to create a
decrease of opportunity incertain categories and in
certain markets, and so tostomach it.
(23:45):
If you want to move into thespace, I think that the best way
to think about it is how do wemanage supply chains to be able
to pivot fast enough so you'renot overbuilding inventory, and
also that you're maybe notrelying on certain product lines
or form factors to existforever?
And if you're going intosomething understanding that
there's an element like, forinstance, if you're going to
(24:06):
make a 10 milligram beveragebecause you understand that the
data tells you that that has thelargest amount of sell through
and moves through fast enough,just don't make so many that if
you get 30 days notice that astate or 60 days notice that a
state is moving and the packagesize now needs to be five
milligrams, that you can't pivotand you're left with a whole
(24:26):
bunch of inventory that you canno longer sell, but does that
mean that you shouldn't make a10 milligram beverage?
I think that if you can manageyour supply chain and if you can
manage your inventory, then theidea of just being flexible to
take advantage of what's infront of us now to build brand
affinity, to build market share,to get distribution in place
(24:51):
and then to pivot with theregulations and just be ready
for it and open to it, I thinkit is manageable.
I'm with you that as you movetowards more combustible form
factors, that those are reallyshort-term, think that.
I think that you will see thethe farm bill, when it does
change eventually most likelyclamp down on the ability for
(25:12):
people to bring combustible hempproducts to market, but it
might be another 12, 24 months Idon't know when that's going to
happen and so then any of thoserestrictions will actually fall
on the states.
And then it just becomes moreof a distribution management
(25:32):
challenge of if you're making aTHCA flower product, making sure
that you're only selling itinto the markets that allow it
and managing it.
And it's most likely ashort-term play, but still there
, still big.
Ben Larson (25:46):
Yeah, and to your point in focusing on building a
brand and building a consumerbase.
If you're really good at it andyou build great products, then
people are going to want to findthem in the future.
And maybe you could find yourway into a dispensary channel if
that became the only outlet anddrive your customers there.
I don't know.
Actually, I'm really interestedin checking out some of the
(26:07):
headset data for this year inCalifornia.
Following the ban, did beveragesales increase in dispensaries?
AnnaRae Grabstein (26:16):
because of the ban.
Well, and we have seen in 2024,a lot of cannabis companies
that are in the adult useregulated side finally realized
that there was this hugeopportunity in hemp and start to
explore it.
You've mentioned Cureleaf.
Gti has gotten into hempbeverage.
(26:36):
There's a number of otherexamples and so what they're
doing is they're going fromregulated marijuana into hemp,
but hemp has been thisincredible brand building
opportunity for folks who areable to be doing online
marketing direct to consumer.
I think that 2025 could be theyear and it might be till 2026,
(27:04):
but where we'll start to seesome of those really
well-developed hemp brands startto explore being able to move
into different form factors inthe adult use market and go back
the other way, because they arewell capitalized, they have
free cash flow, they've learnedto build great businesses,
they've got email lists allkinds of things that position
them to be able to play on bothsides of the fence, like vertosa
(27:26):
, which also plays on both sidesof the fence yes, we do get
accused of that sometimes.
Ben Larson (27:31):
Um, it's not a bad thing no, no, it's not.
But you know, everyone has theirangle, especially when it comes
to lobbying and all that, andso it's um, we, we often find
ourselves playing switzerland.
Um, especially in places likelike California, where we have
relationships with the variouspolicymakers and want to
preserve both sides of ourbusiness, we believe that
(27:55):
everything needs to beresponsibly shepherded.
So enough about us.
The interesting thing about thehemp beverage category is that
it also adjacent to another likefast burgeoning category, and
that's the, the non-alcoholmovement.
And um, I've been talking to alot of players in that realm and
and what I'm also seeing isthat a number of these, uh, hemp
(28:18):
beverage brands are launchingjust non-cannabis, non-hemp
products and, yeah, and that's areally interesting opportunity.
You know the folks at Colexo.
I know that they were shippingtheir just flared seltzers
basically out to Japan andgetting distribution out there,
and everyone generally knowsabout Breeze.
Breeze has their Lion's Maneonly product that really acts as
(28:43):
the main vehicle for theirsocial media marketing.
AnnaRae Grabstein (28:47):
Well, and seltzer and non-alcoholic you
know, lion's mane beverage isone thing I'd say that it's
interesting to start thinkingabout these non-alcoholic
beverages as adult beverages,where we've always just thought
about them as for all, for allthe, the part of the
non-alcoholic space that I think, outside of hemp, that's the
(29:08):
most interesting, is thenon-alcoholic beer category, and
I just say this probablybecause it's a huge part of my
refrigerator at home and do youhave a favorite brand?
Well, my husband does, and so Iwill just promote his favorite
brand, which is athletic brewinghands down.
And so I will just promote hisfavorite brand, which is
Athletic Brewing hands down.
And he's been trying them all.
He's been trying the localSonoma County craft beers that
(29:30):
are putting out non-alcoholoptions.
He's tried the Sierra Nevadaones and he likes them all.
But he really feels that theAthletic Brewing is just the
best.
It's pretty solid, it's prettysolid.
Ben Larson (29:44):
It's pretty solid.
AnnaRae Grabstein (29:45):
Yeah, and it is pricey.
It is the same price as buyingcraft beer.
I can't believe it.
They sometimes sell it at oneof our local Costco's but not
the others, and so we have beengoing specifically to the Costco
in Marin County where they willsell 12 packs of athletic
(30:06):
brewing, because we just can'tseem to keep it on the shelf in
our house.
So I think it's a hugeopportunity to really disrupt
the alcohol category, and Ithink that we're going to see
non-alcoholic beer, hempbeverages and other kind of
non-alcoholic beverages really,uh, really kind of staking a
(30:27):
claim in in the overall marketshare there there are a few
people that have eitherattempted or are doing right now
uh, infused non-alcoholic beerand people.
Ben Larson (30:40):
It's very polarizing .
People like, just like, don'tput THC in my beer, like no one
wants that, and then there'sother people that just love it,
and so I'm curious to see wherethat sliver, the category uh
goes.
AnnaRae Grabstein (30:53):
I think it will win you think?
So, but to be honest, the onesthat I've tasted I just don't
think are very good.
Yeah, um, so if you make a thcbeer it to me, I'd love to try
it, because they have notimpressed me, and I think that's
why they're polarizing isbecause you can easily deny it.
Ben Larson (31:12):
Based on the sentiment that I was getting at
BevNet and I'm not making anyclaims here, but I wouldn't be
surprised if some of the namesthat you mentioned previously
that are in your fridge wouldn'tbe getting into the space.
AnnaRae Grabstein (31:26):
Yeah, I hope they do.
That sounds great.
Ben Larson (31:29):
Funny enough back in the early days.
Do you remember House of SakaCynthia?
AnnaRae Grabstein (31:34):
and Tracy Wine.
Right yeah, infused wine, and.
Ben Larson (31:39):
I remember sitting down like wait, okay, so you're
taking this high quality NapaValley wine and then you're
putting it through a processwhere you high quality napa
valley wine and then you'reputting it through a process
where you have to remove thealcohol and then we're going to
add thc into it and so you havethis very expensive product that
, as a wine lover, I'm like kindof pales in comparison to the
original um yeah anyways, uh, I,I think I can say all this
(32:02):
right now because they, uh, theyno no longer are around, but
yeah the company.
They are just fine the peopleare good.
AnnaRae Grabstein (32:12):
Well, let's talk about this next year and
and what's ahead, um 25, 2025.
It just keeps stacking yeahjust keep moving?
Is it because we're old that itfeels like it happens faster,
or is the world just moving at afaster fucking pace?
Ben Larson (32:29):
Okay, so I can answer this a number of
different ways.
I did have this likepsychological explanation that
every year is shorter, if you'rethinking about it, relative to
your life.
Yeah, exactly so the older youget, the faster it goes.
Faster it goes.
But also I do think you saidpiling on, like we just do over
(32:51):
time, pile more things on.
It's like I have two kids, Ihave this business, the business
is getting bigger, we have moreemployees, like the industry is
getting larger, and so it's itis moving faster.
There's more to do.
I feel like I traveled way morethis year than I had in
previous years.
Yeah, and I think 2025 isprobably is getting larger, and
so it's it is moving faster.
There's more to do.
I feel like I traveled way morethis year than I had in
previous years.
Yeah, and I think 2025 isprobably going to be even busier
.
Yeah, god willing.
(33:12):
I mean like busy is great rightnow, I'm loving being busy.
AnnaRae Grabstein (33:16):
Busy is good.
I think 2025 is going to be agreat year in this space.
I think that there will beongoing troubles for operators
that aren't running goodbusinesses, but those that are
having a mind towards underlyingfundamentals, are building
(33:37):
foundational structures intotheir business, are going to be
really well positioned.
I am starting to see companiesreally start to think
strategically again in a waythat I think 2024 was all about
just like fixing stuff andgetting out from under a lot of
bad decisions that had been madein the past be it debt or way
(34:01):
too many products or bad marginson products or inefficient
supply chains, whatever it isand 2025 is now like all right,
we've got the house in order.
What are we going to do now?
How are we going to grow?
I'm working with a company thatis starting to think about
overhauling their internalgovernance and transforming
(34:22):
their leaders and theirleadership structure and to
start thinking about how theycan be ensuring that there is
kind of a new generation ofleaders inside of their company
and succession planning and likethis is the kind of thing that
real companies do, likecompanies that know that they're
not just going to be around fortwo years until the money runs
(34:43):
out, but that are looking at thenext 10, 15, and 20 years to
really think about who they areand how they're going to build
something strong.
So I am just really hopeful tosee people doing that type of
work and I think it's going tokeep happening and I think
there's more and more of thegood people rising to the top.
Ben Larson (35:04):
So it's a good prediction.
I love that.
I hope to be one of thosepeople.
Yeah, you know we invest a lotinto our employees and you know
there's employees now that arehere for five years and
realizing that this is a majorstep in their career and the
(35:24):
responsibility that comes alongwith that, and so we've.
You know I'm a member ofVistage.
I've been getting more of oursenior leaders into various
groups like that, and then also,you know, helping our finance
manager get her CPA and justreally think of different ways
(35:46):
Like how can we make peoplethrive and be happy to be here
long-term and it's nice to thinklong-term in the cannabis
industry.
That's a privilege that wehaven't always had.
AnnaRae Grabstein (35:56):
Well, on the flip side of that, as we think
about kind of up-leveling ofteams, the other thing that is
going to be happening in 2025 isis the integration of assets,
as companies are coming togetherafter M&A activities whether it
be the roll up that we justtalked about with Vireo,
(36:16):
bringing together five disparatecompanies that operate in
different markets or or the M&Athat we can't even yet predict,
and that integration work, Ithink, is going to be a big part
of 2025.
And some people will win at thisand some people will fail, and
I think that integration is abigger deal than lots of groups
(36:37):
realize, because integration isabout humans, but it's also
about systems.
It's about it's about uh,reconciliation of vendors and
supply chains and marketingplans.
Uh, there's so much to handlewhen it comes to integration,
and there are companies that arereally, I believe, truly
(36:59):
underestimating the importanceof it and thinking that it will
just happen naturally or it'snot important, and I think that
we're going to see someintegration challenges this year
.
That would be a prediction.
I don't know who yet, but therewill be some that are failed as
a result of not putting in theeffort to get it done.
Ben Larson (37:22):
Yeah, I mean it's hard enough to like integrate
like new senior leadership intoa company when you hire them and
just thinking about taking awhole new company and bolting it
on.
AnnaRae Grabstein (37:32):
Yeah.
Ben Larson (37:33):
Yeah, interesting when looking at 2025, I just
keep thinking about these majortopics that we've talked about,
like farm bill, rescheduling,all this kind of stuff.
I'm going in and I wrote thisinto my Christmas cards that we
(37:53):
sent out to everyone.
I'm like all right, everyoneneeds to be optimistic, we need
to be adaptable and we need tobelieve that we can thrive under
this new reality that we areentering, which is even like
just hearing these messages fromVivek and Elon about like just
involving themselves.
Like wait, no one elected you.
Like, why do you have so muchcontrol?
(38:14):
This is kind of scary, but I amoptimistic that we will see
rescheduling, maybe even enter arealm where we could start
talking about descheduling in apublic way.
I know that's a bold prediction.
That's a bold prediction, butI'm going to put it out there.
Uh, with with RFK entering thefold, uh, is he still?
(38:37):
I don't know, I don't followeverything.
He's in the fold.
He's still in the fold.
AnnaRae Grabstein (38:40):
Okay, good.
Ben Larson (38:41):
I mean good.
I mean good.
Yeah, I don't know.
I just am optimistic that wesee some real change.
I guess that's what we can hope.
To see is like a thinning outof the FDA and maybe a talking
(39:02):
about CBD being a perfectly fineingredient for food products,
because we still haven't hadthat conversation.
Yeah, I don't know.
I just feel so much has beengummed up in the federal
government that good or bad likejust shaking it up and lighting
it on fire might returnsomething positive.
(39:24):
I'm curious, for sure, andoptimistic, and optimistic
Totally.
I'm curious, for sure andoptimistic.
AnnaRae Grabstein (39:28):
And optimistic totally.
I am optimistic and skeptical.
I choose to be optimistic whilebeing well-informed.
I think that feels like thepower We've talked about,
pattern recognition and, I think, pairing optimism with a deep
understanding of the market andall the things that are
happening in all the places,which is another element.
(39:50):
While we, while we talk aboutfederal policy, like you've like
you've mentioned, and some ofthe ways that those could lever
into to market opportunity orgrowth or shifts, shifts in the
dynamics, we will most likely in25, see some new state markets
come on in the adult use spaceor in the medical space.
It's a little hard to know andthere's less and less new state
(40:14):
opportunity than there was theyear before as states turn on.
But it seems very likely thatthere will be progress in
Pennsylvania, which could be areally big market and already
has a lot of public companiesthat are operating there.
So I can see that that could bea pretty big lever for growth
(40:37):
of some public companies.
Ben Larson (40:39):
Sucks for those dispensaries that popped up on
the borders.
AnnaRae Grabstein (40:43):
Yeah, absolutely yeah.
Pennsylvania is losing a lot oftax money to the border
dispensaries, unquestionably, Ithink New York is going to
continue to grow.
I think that it's it isn'tquite hitting a billion dollars
in 2024, but it could.
It could easily double that in25.
Ben Larson (41:03):
I think that was one of the positive highlights of
2024.
AnnaRae Grabstein (41:06):
Yeah, we forgot to say that.
Yeah, New York.
Ben Larson (41:08):
New York like finally Finally coming to life.
AnnaRae Grabstein (41:11):
Yeah, it's not there yet, but at least I
think everyone can show up witha little bit of confidence that
New York is on the right path toactually realizing an adult use
market.
And yeah, I'm seeing somegrowth shutting down a ton of
the illegal stores, which Ithink is generally positive.
Yeah, new york, new york wasgood this year and I think this
(41:34):
prediction will be better nextyear yeah, are there other
markets that you're excitedabout?
Uh, any predictions on texas?
Ben Larson (41:46):
yeah, I do have predictions on texas, um and
this comes, I guess, wellinformed, to use your term uh,
that I do think we'll seebeverage preserved in the
mainstream marketplace in texasin the,000 plus now hemp
(42:06):
licensed retailers.
But I think there will be astrong crackdown on most of the
form factors beyond that,definitely on flour and vape,
and I think it's going to be ahard fought battle and I think
that if beverage doesn't getprotected in it, that nothing
(42:30):
will pass and you'll have statusquo for another two years.
It's a lot of horse tradinggoing on and it's a it's a
divided house that isn'tcompletely under the pen of Dan
Patrick.
AnnaRae Grabstein (42:43):
Sure.
Well, so you think beveragewill be preserved.
But you always think beveragewill be preserved, Is there?
Ben Larson (42:50):
any way that you think that beverage won't be
preserved With the exception ofCalifornia?
AnnaRae Grabstein (42:55):
Okay, so you said it, so you're not totally
myopic in believing thatbeverage will always be
preserved in every one of thesestate debates.
And of course, you have to beoptimistic about it, and we all
want access.
Ben Larson (43:10):
I think that's clear .
AnnaRae Grabstein (43:11):
I mean not everybody who listens, I think,
wants free market hemp access,but I think that we both agree
that hemp beverages inmainstream retail have been
positive on many levels for mostand look, I am overtly
optimistic and we have moresupport than we've ever had
before.
Ben Larson (43:32):
Uh, but it's not unanimous support from the
alcohol industry and I thinkthat's important to know.
Like in california, you know,abc is not convinced.
I think the beer institute alsoput out a weird like-THC
newsletter that got a lot ofbacklash.
So we still have a lot ofbridge-making to do.
(43:55):
But attending Bevanette justlast week, it was just so
eye-opening to see how excitedeveryone was about it and having
steve jabor on stage sayingthat, like this is a massive
category, everyone needs to besupporting it, like it's just so
cool, right, like I was atbeverage forum, which was also
(44:17):
in la at the beginning of theyear, in a two-day beverage
conference and no one mentionedthc, uh, which was equally like
bizarre.
But um, yeah, I think.
AnnaRae Grabstein (44:27):
I think it's evolving in the right direction
yeah well, so we've talked abouta bunch of industry kind of
cannabis, thc relatedpredictions.
What are your intentions goinginto the new year?
What are you?
How are you leaving it behindand looking forward?
Ben Larson (44:45):
Yeah, so this year was.
I mean, I'm guilty of likehaving business totally envelop
my life, but I look at this yearas really kind of leaning into
the foundation that we had builtin 2023 and capitalizing on it,
and so we were able to grow thebusiness and not increase our
(45:10):
overhead too much.
It was just like kind of likelean into the systems that we've
developed.
It has created the space for meand the desire to really as you
were mentioning for othercompanies, like think about
what's possible.
Like you know, we had themorning mixer the other day and
just the people that were in theroom like it really inspired me
(45:31):
to think bigger.
You know, what would I do with$100 million and you know what
is the future?
And you know, outside ofbeverage, I've been having, you
know, fun conversations with,like, the medical community and
we do a lot of work with JohnsHopkins.
And how do we address that partof the market that has largely
(45:53):
been ignored because of all theexcitement and necessity to
drive towards the recreationalmarketplace?
And so, kind of going back, canwe actually create great
therapeutic cannabis products?
AnnaRae Grabstein (46:06):
Yeah.
Ben Larson (46:07):
So you know, I'd like to explore that in the new
year.
But yeah, just what is thedirection of all this going?
How can we educate theconversation, Maybe influence it
a little bit?
AnnaRae Grabstein (46:21):
Yeah.
Ben Larson (46:22):
Yeah, how about you?
AnnaRae Grabstein (46:26):
My business really grew a lot in 2024.
So, yeah, yeah, how about you?
My business really grew a lotin 2024.
And as someone that's mostlybeen building it on my own, with
(46:51):
a partner here and there andsome people that I've brought in
, I've looked back on the, onthinking about creating in
myself and in all the peoplethat I work with just an ongoing
commitment and culture on peakperformance, and I've just been
thinking about peak performancea lot and, yeah, an optimization
of my time and my health and mybrain and my information.
And how do I create that just aspart of the DNA of my work and
(47:15):
my life in an integrated way,and then that ends up being kind
of the way that the businessgrows as well, because we can be
known for being so smart andastute and efficient and
optimistic and executionoriented and all of those things
.
So, yeah, I'm excited aboutnext year.
(47:38):
There's a ton of really uniqueopportunities and it's about
feels like what I want to keepdoing is is playing three
(47:59):
dimensional or four dimensionalchess as best as I can with,
with my career, with my company,with my community, with my
favorite people that I want towork with and build with, and
and how to create kind of justongoing mutual alignment with,
like aligned incentives foreverybody that deserves to be at
the table, like keep pickingwinners.
Um, that is that's what I wantto focus on in 2025.
And then also, I'd say,specifically, since we are here
in the high spirit studio atVertosa, is, uh, what we want to
(48:21):
do with with this community aswell.
Ben Larson (48:25):
Um, and I think we have a lot of ideas.
We have coasters.
AnnaRae Grabstein (48:29):
Yeah, we have a coaster, so that's our first
piece of merch.
Ben Larson (48:34):
A fancy piece of swag?
Yeah, but in the merch store.
AnnaRae Grabstein (48:39):
But I think in 2025, we need to be really
paying attention to the momentumthat we've built with the High
Spirits community and listeningto our audience, and what I am
hearing our audience tell us isthat they love access to good
information with other leadersin the space, and creating
(49:08):
spaces to collaborate and beauthentic together can lead to
unintended positive outcomes inbusiness, and I want to.
I want to engineer more ofthose opportunities to create
magic between humans in business.
Ben Larson (49:21):
I love that, yeah, and I, and it's going to happen
Like it is being extracted fromus.
AnnaRae Grabstein (49:27):
It is.
Ben Larson (49:28):
And shout out to Eric, who's sitting right here
off camera.
AnnaRae Grabstein (49:31):
He's going to be helping us out.
We just got a producer, youguys.
Ben Larson (49:36):
It's been official.
It's a big deal.
AnnaRae Grabstein (49:39):
Of course, Sarah Falvo has been a big, big
part of our community andhelping drive our morning mixer
part of our community andhelping drive our our our
morning mixer belinda on thevertosa team has created uh
brand assets for us all yearlong.
Ben Larson (49:52):
The entire team, both wolfmeyer and vertosa, is
just like hugely supportive ofof this, uh, what I used to call
a boondoggle, but it's actuallybecoming a, a big love child of
the, of the companies and yeah,it is, it's growing like big
love child of the companies.
Yeah, it is.
AnnaRae Grabstein (50:10):
It's growing.
It feels like a love child.
It is, I agree, and our highspirits children, all of you out
there, we just want to keepdoing this for you.
We want to be making an impacton your life and inspiring you
to be the best leader that youcan be, to be creating the best
companies that you can be, to becreating the best companies
that you can be, to be buildingaccess to cannabis for anyone
who wants it.
Ben Larson (50:31):
That's right.
AnnaRae Grabstein (50:31):
Yeah.
Ben Larson (50:33):
And over the next couple of weeks, which we're not
going to air until.
January beginning of January wewill be thinking about all
those things and so if you'rewatching and you have ideas
about how we can be better, whatwe can do to really amplify the
value of the show, uh drop us amessage.
AnnaRae Grabstein (50:51):
Yeah, events that we can activate around.
Um, we want to be doing more,more in-person events, so let us
know.
Ben Larson (50:59):
Uh, if your city needs us, maybe we'll be coming
through yeah, and if you or youknow someone that wants to be on
the show, we're building outthat list for next year as well.
AnnaRae Grabstein (51:15):
Yeah, I'm super excited about 2025 and
thanks Ben for just being acreative partner again.
It feels great to be getting tothank you again this year for
being my creative partner and myaccountability partner and
doing something that's hard.
Showing up every week andmaking this content and putting
ourselves on camera is not easy.
(51:37):
It's scary, it's vulnerable,but we can do hard things.
And it's easier to do the hardthings with the people you like
and the people that you loveAlso a great podcast, I hear.
Ben Larson (51:48):
Have you heard this one?
We Can Do Hard Things.
No, my wife's a big fan.
Oh yeah, check it out.
AnnaRae Grabstein (51:53):
Okay, yeah, thanks, thanks for a great year.
Ben Larson (51:56):
Yeah, thank you.
This has been great and thankyou, thank you everyone.
If you're watching, please,please, uh, here at the end of
the year, go give us a subscribe, a like, a share.
Uh, the community is growing.
I think we're almost about 1100on on on linkedin and the the
viewership is is going up a loton youtube and our podcasts.
(52:17):
Uh, I think that's it yeah,read us out I can't read
anything.
Stay engaged.
How about you do it?
What do you do?
What do we say?
It's your turn, it's the end ofthe year.
AnnaRae Grabstein (52:29):
Stay curious and stay informed.
Stay informed and keep yourspirits high.
Ben Larson (52:36):
Until next time, until next time.
That's the show.
That's the show you.
Popular Podcasts
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.