June 10, 2025 • 56 mins
The path to cannabis normalization has never been straightforward, but as our industry faces critical regulatory crossroads, a fundamental truth emerges: consumers want cannabinoids. The "great hemp experiment" initiated by the 2018 Farm Bill has conclusively demonstrated mainstream appetite for these products across political spectrums and geographic boundaries.
Our wide-ranging conversation examines this pivotal moment through both strategic and philosophical lenses. We unpack the implications of the appropriations bill threatening hemp's future while reflecting on how regulatory uncertainty shapes business strategies. For cannabis entrepreneurs navigating this landscape, we identify markers of resilience: purpose-driven leadership, operational efficiency, and the ability to adapt continuously as market conditions evolve.
Those building successful cannabis companies today display distinct characteristics—they maintain realistic planning horizons (typically 6-12 months rather than speculative multi-year forecasts), track metrics like revenue-per-employee, and cultivate leadership teams capable of wearing multiple hats. Most importantly, these organizations build cultures where purpose permeates from top leadership through every aspect of operations. As we observe, "When a leader truly metabolizes values into their actions daily, it becomes pretty easy to filter that down through the company."
The conversation explores potential exit strategies for well-positioned operators, from strategic acquisitions (particularly in the beverage category) to employee ownership models that preserve company culture. Despite ongoing challenges, we remain fundamentally optimistic about cannabis's trajectory—public sentiment continues improving, with unprecedented mainstream support emerging even during regulatory battles.
For industry participants committed to this journey, remember that resilience isn't just surviving today's challenges but building organizations designed to thrive within uncertainty. As we conclude, "We can do hard things," and the future, while uncertain in its timeline, remains bright for those who maintain focus on building sustainable businesses while advocating for sensible regulation.
--
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Your hosts are Ben Larson and AnnaRae Grabstein.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
AnnaRae Grabstein (00:00):
If a leader is not truly living the purpose
and the values that the companyis espousing, it's a hard stop.
It won't work.
But when a leader does trulymetabolize the values and the
mission and the purpose intotheir actions on the daily, it
actually becomes pretty easy tofilter that down through all the
(00:23):
rest of the company.
Ben Larson (00:32):
Hey everybody, welcome to episode 91.
91 of High Spirits.
I'm Ben Larson and with me, asalways, is Anna Rae Grabstein.
We're recording Thursday, june5th 2025.
And it's been another week.
In cannabis, we have anappropriations bill that's
dropped.
(00:53):
The fire keeps on burning.
We're going to dive into allthat, but before we do, anna Rae
, how's your week going?
AnnaRae Grabstein (01:01):
My week's going really great.
It's my dad's birthday today,so happy birthday dad.
Happy birthday big man yeah.
Is he a listener?
Not really he.
You know, sometimes I mighttell him and he'll listen.
He is the one that was thefirst cannabis consumer in my
life, so he showed me the way.
(01:23):
He didn't show me the way.
I won't blame him for myinterest in cannabis, but he was
a significant normalizingfactor in in my life for the
plant.
So, yeah, it's been good,although my morning was full of
credit card fraud and I have togive a shout out to the robots
that detected the fraud.
I feel relieved but surprisedat what a mess Careful when
(01:50):
using those credit cards inMexico.
Yes, yeah, good reminder.
How about you?
How are you doing?
Ben Larson (01:57):
I'm doing okay.
It's been a busy week.
I've been struggling with alittle bit of back pain, so that
is not fun.
But I'm on my third day ofprednisone treatment and I am
sitting upright and speakingwith you, so things are looking
up.
AnnaRae Grabstein (02:13):
Welcome to aging man.
I've been sticking with myweight training plan and I've
got this really cool trainerthat keeps telling me how great
I am and I keep thinking thatI'm just paying her to tell me
that.
But it's working and I keepadding weight, so that's good.
Ben Larson (02:34):
It's not a trainer, but I have recognized how
ChatGPT is really good at givingyou the nice sandwich where
it's like this is well thoughtout, really critical points, and
then it'll get into kind of thecriticism.
AnnaRae Grabstein (02:52):
So I really appreciate that to the designers
over at OpenAI.
That's hilarious that youappreciate that.
I read an article this weekthat the positive feedback from
chat GPT is actually breakingbreaking our souls and making
our egos inflated is actuallybreaking our souls and making
our egos inflated.
Ben Larson (03:07):
Well, it's hard to be more inflated than me.
AnnaRae Grabstein (03:10):
Yeah, right, and so between the two of us,
our teams are going to behitting the streets next week
with a bunch of different eventsand cannabis and beverage.
So let's go over those realquick.
If you want to see us folksfrom Wolfmeyer, folks from
Bertosa yes, we will be inChicago at Benzinga.
(03:32):
I will be on stage on Monday.
My panel is how to sell yourbusiness without getting screwed
.
So if you would like to learnthose things, come listen to
what I have to say, and I do.
And and then I will be off toDenver after that for the
(03:55):
International Cannabis LawyerBar Association event, which is
a lawyer's event.
I'm not a lawyer, but I will betalking to the lawyers and at
the same time we've got Canra,which is the regulators event
that's happening in Denver also.
And then BevNet is in New Yorkright, and I'm missing all of it
(04:18):
and Ben will be single, daddingand taking care of his kids,
which is most important, but his, his team, will be spread all
over.
Ben Larson (04:28):
So go find him.
The Vertosa troops will be, Ithink, at all of those with the
exception of the lawyer event,but Canra, definitely look for
Diane Eberlein Benzinga, Ibelieve Sarah Falvo and Ryan
Pinsky will be there, and thenI'm sure we'll have some team
members at BevNet.
Yeah, Awesome.
AnnaRae Grabstein (04:47):
Cool.
And then, ben, before we jumpinto our big future casting
discussion that we promised ouraudience, will you give us a bit
of the update on this news withthe appropriations bill?
Ben Larson (04:58):
Yeah, so appropriations bill is similar
to the farm bill and the factthat it's this recurring thing
that can influence the world inwhich we operate.
Only, the difference betweenthe appropriations bill and the
farm bill is that appropriationsbill has to happen every year.
It was supposed to happen backin March and, if you didn't
(05:19):
recognize it, it did port overthe language from the Miller
Amendment that was introducedlast year as part of the Farm
Bill and appropriations, and soit's back, not surprisingly.
There were some efforts donethrough the beginning of the
year in order to influence andhopefully not bring the Miller
Amendment back into it, but it'sthere, and so there's a lot of
(05:43):
work to do.
It is being heard today formarkups and we have until
September, I guess, to get thisthing done, and so I don't want
to spend too much time in it.
There's much smarter peopleinvolved.
I'm sure if you go on LinkedIn,you'll see USM Roundtable, caba,
any other organization, ncia,looking at the federal movement
(06:07):
and realizing that this is animportant one if we want to keep
any element of hempcannabinoids open in the US, and
so I think the moral of it isthat the farm bill work is very
important to be done.
But critical path right now isappropriations, and we don't
(06:29):
really want to be revisitingthis every year.
So the importance here which Ithink we will discuss in kind of
the the rest of the show is ishow clarity is is super
important.
You know, we can't be operatingin ambiguities if we're going
to survive yeah, the ambi.
AnnaRae Grabstein (06:47):
It's the ambiguity that's killing us.
It's like we just need to knowwhat the path is and then people
can make plans and and runafter the right thing and even
by virtue of us saying ambiguity.
Ben Larson (06:59):
I know that in of itself is controversial in some,
but at the end of the day, ifwe're having to revisit the
language periodically, it'sambiguous.
You know, it's like our futureis ambiguous, and so what we
need to be driving towards isfinality and clarity, certainty.
All those things.
AnnaRae Grabstein (07:20):
Yeah, use the thesaurus.
That is what we want.
We want to know an outcome thatwe can depend on.
Well, so you know, ben, youwrote a bit of a manifesto
recently talking about the past,of how we got here in terms of
a bunch of legislative history,which I was really happy to read
(07:45):
and got me thinking about wherewe're going also, and you and I
talked about it and we thoughtthis is a great opportunity to
really speak to people wholisten to this podcast and who
are turning to us, for ourthoughts to turn towards the
future a little bit.
Do you want to set the table bygiving us a little bit of what
(08:08):
was your reasoning behindtalking about where we came from
and what were some of the bigtakeaways?
Ben Larson (08:14):
Yeah, and I appreciate you subscribing to my
infused insights newsletter.
So thank you for reading.
Totally.
Look, I mean it was.
It was inspired by just the,the emotional responses to
what's been happening in texas,and anytime something like what
happens was was senate bill 3 intexas, the banning of hemp or
(08:39):
any other kind of movement oncannabis or hemp?
There seems to be a lot ofpointing the finger, blaming,
complaining, and what oftenhappens is we're being pitted
against each other hemp versuscannabis, hemp beverages versus
the rest of hemp, licensedcannabis operators, dispensaries
(08:59):
versus brands Like it's justhappening perpetually and think
we're we're put into thisterrible situation where people
are fighting for theirlivelihoods and that is forcing
them to lose kind of perspectiveon the greater scope of of our
overall objective as an industry.
And so you know, the one thingI've always confidently fallen
(09:23):
back on, and why I haven't beenafraid to be outspoken about my
perspectives, is that at the endof the day, I want to see the
plant recognized for what it isand completely normalized and
destigmatized and made availableresponsibly to society.
In fact, that's embedded intoour company's mission.
(09:45):
You know, our purpose as acompany is to unlock the healing
powers of the plant and createaccessible or create access to
people responsibly around theworld, right.
So it's like, as long as we'redoing that and we're on the
right path.
And so I always kind of try toask myself, like, how did we get
here?
And if we look at the greaterarc of cannabinoids and people's
(10:08):
familiarity with them, you haveto look all the way back to the
drug wars.
You have to look at those times, those decades, where cannabis
and hemp were both on theControlled Substances Act,
essentially being treated as thesame plant as we often like to
talk about.
And it wasn't until recentlywhere we had this bifurcation
right.
We had the 2014 Farm Bill thatkind of started to signal the
(10:32):
separation of hemp and cannabisand created some interesting
pathways.
2018 is what really kicked offthe CBD boom and it wasn't
really until, like the pandemicyears and beyond, where we
really started to understand theopportunities with intoxicating
compounds and all this and soisn't it interesting it took
that, it took a few years.
AnnaRae Grabstein (10:53):
These, these legislative shifts in the farm
bill, both in 2014 and in 2018,did open doors, but it was not
immediate.
People weren't paying attentionto the language.
And then what opportunities thelanguage provided, like they
are today Because now there's somuch riding on it Once the door
became open.
(11:14):
Now we've got hawks looking atevery word, making sure the door
stays open or trying to closethe door.
Ben Larson (11:21):
It's like someone cracks the door open and then a
bunch of people walking by, it'slike one person stops like, hey
, is that door open?
And then a little bit like, andall of a sudden they're like
peeking around through the doorslike anyone in here, and you
know it's like, and then onceit's open, it's like boom, kick
it open, like, and theneveryone's like hey, everybody,
this door is open and nowthere's a festival inside now
(11:45):
there's a rave and this.
We're having a great time.
It's like we should do this allthe time, and you know, as mark
hauser said, I don't want to beflipping um, but it's kind of
been like this great experimentopportunity, uh, to create
access to cannabinoids, toleverage the normalcy that the
(12:05):
legalized movement has created.
And, going back to mymotivation for the piece, like
just trying to point out toeveryone that we all need each
other.
We're all here today because ofthe work that each other has
done.
And when I say each other, Imean hemp and cannabis and all
these disparate groups that Iwas previously talking about.
But I wouldn't be building thecompany that I am today if I
(12:29):
didn't believe eight years agothat low-dose hemp beverages or
low-dose THC beverages were abig opportunity for normalizing
the plant as a whole, right, andso, whether you call it hemp or
cannabis, for me, whole right,and so, whether you call it hemp
or cannabis, for me theopportunity is about creating
(12:50):
legal clarity in creating accessto the plant for people.
Right, and I see beverage as areally big opportunity for
taking that incremental stepforward.
And, and I think the challengeright now is, if you narrow the
lens, that feels like things arebeing taken away from this hemp
movement.
But in the greater arc ofcannabis in general, I see
(13:13):
there's actually been a lot ofadvancement that's been made in
the last year because of justall the activity that's been
occurring.
AnnaRae Grabstein (13:22):
So I think it leads into and thank you for
that, thank you for thatreflection on what you wrote
about, and I hope that it makessense then for us to be thinking
about where we go from here andwhere we go from here and where
we are now.
I think you've started to openup a train of narrative that's
(13:42):
really interesting about hempbeing a great experiment to
prove cannabinoid interestbroadly.
As someone who started mycannabis career in the medical
space and then in the adult useregulated cannabis space in
California, I really looked athemp as it was beginning, as a
(14:03):
major threat, and over time myperspective has shifted, not
necessarily to let's free all ofthe hemp and not have
regulations, but exactly whatyou said of wow, this has been a
great experiment.
That's undeniable to prove thatthere are unique pathways for
(14:25):
cannabis to exist in a morenormalized way.
That moment when we went out todinner in Minneapolis and got to
sit at a fancy restaurant andthere was THC beverage on the
cocktail menu was reallymeaningful for me.
It was like holy cow.
This is what I've been workingfor for 15 years to be able to
(14:45):
enjoy a five star meal and toget to choose whatever it is
that I want to drink, whether itwas tequila or water or THC all
of those things, or God forbidall of the above, all of the
above, and so I love this pointthat one of the things that hemp
(15:06):
really has done has shown thatthere is this broad interest in
products made with cannabisinside of them.
And how we get there, how theycome to market.
What the regulatory pathwaylooks like yes, it's complicated
for a lot of reasons, but itwill never truly go back in the
(15:30):
box to be able to say thatpeople don't want this anymore.
Even if Texas fully shuts downtheir hemp market and SB3 gets
signed by the governor, nobodycan ever say that Texans don't
like cannabis, because it'sclear that Texans really enjoyed
buying THC and they've beenbuying a lot for a couple of
(15:52):
years.
Ben Larson (15:53):
Whether it's $2 billion, $4 billion, $8 billion.
I've heard lots of numbers overthe last several months.
55,000 jobs in Texas, we'veheard.
What has happened over the lastsix months in particular is
that the community has shownthat they're very supportive of
these products and that theywant these products in the most
(16:15):
conservative of states.
We also have a lot of externalforces that when something like
this would typically happen,we'd be fearful of what it would
signal, like how it wouldreduce the forward-looking
sentiment for the category.
It's not what I'm seeing rightnow.
I'm seeing people moremotivated than ever to fight and
(16:38):
people writing hundreds ofthousands of letters to the
governor in Texasxas and andlike mainstream media, both
conservative and and liberal,like speaking up and being like
this is not how to, how weaddress this.
Like we've talked about this onprevious episodes, bans are not
the answer, especially when thecat has been this far out of
(16:58):
the back.
You know, again, taking thelonger lens on everything.
This is like a ban may come inTexas.
It's not official yet, ithasn't been signed, a veto is
required and I hope that doeshappen.
But if it were not to happen,we're not done in Texas.
It's like there's a two-yearlegislative cycle, which is
(17:19):
painfully slow, but you betterbelieve that we're coming in
full steam two years from now.
No-transcript.
AnnaRae Grabstein (17:48):
And the challenges that hemp faces at
certain states are different butnot dissimilar to the
dysfunction that regulatedcannabis faces in some states,
due to the ways thatoverregulation has challenged
the industry, to the ways thatover-regulation has challenged
(18:09):
the industry.
And so we have these market bymarket challenges.
But there's a differencebetween chaos and transition,
and I think that the companiesand the leaders that are going
to really show resilience inthis next chapter for the sector
are the ones that are wearingthat lens of of transition and
(18:30):
adaptation.
Uh, because, because if there'sone thing that I've learned in
cannabis is that reinvention issomething that you can almost
depend on as a human and as acompany.
It's that there is going to bechange, and so we have to build
that into our DNA.
We have to stay open to, likewhat you said, ben, this long
(18:53):
view that we know that theproducts that we're creating are
having an impact on people'slives.
The plant is creatingalternatives to different types
of intoxication that is lesshealthy for people than ours
over here, and it's going towork itself out.
But it's this space in themiddle, and how do we get
(19:16):
through that?
How do we evolve and thrive?
Through transition andreinvention.
Ben Larson (19:23):
Yeah, I'm curious though You're right and I could
speak to that about how we'vedesigned our business and happy
to jump into that but I'mcurious about your perspective
about the operators that are inthe space and the ones that are
showing the ability to adaptversus ones that are less likely
(19:44):
to.
And as we kind of look at thedifferent segments of operators
in space, like you know, I talkabout how the, the beverage
brands, have shown the abilityto kind of be pretty fluid
across the various supply chains, be it, you know, regulated
states, hemp or canada.
They's still largely being abrand.
(20:05):
Some of them are, arevertically integrating and
getting into to manufacturingand all that.
But then we have, like the MSOs, and then we have the, the, the
licensed operators in theregulated States, like the
dispensaries and the licensedbrands, and so I don't know if I
see a lot of adaptability.
(20:27):
I see, you know, the themlocked into these frameworks,
that that have been establishedthrough the legalization process
, and feels kind of stuck Rightand it changes on state level,
market and you know, what'shappening in California is
(20:52):
substantively different thanwhat's happening in Florida and
that's substantively differentthan what's happening in New
Jersey and Missouri.
AnnaRae Grabstein (21:00):
But in terms of your question of my thoughts
of what are the type ofbusinesses that are able to
reinvent themselves and to beresilient in the face of all
this change, I think that whenyour business model is dependent
on regulatory capture, it is alot more challenging to shift
(21:21):
and change, and a lot of theearly MSOs that went into
limited licensed states and thatvertically integrated are who
I'm talking about.
I think that if your businessmodel is dependent on not having
competition, you are notnecessarily setting yourself up
to be able to compete.
(21:41):
You are in this sort ofengineered monopoly and it it
represents a moment in time, andit might be the moment in time
that we are now, but what I'mseeing is that the businesses
that are in more competitiveenvironments and are still
(22:03):
winning with profitability andthey exist, and I think that we
don't talk about them a lot.
The headlines are about thefailing cannabis businesses and
there was headlines this weekabout the decline by top line
sales of the California market,and that might be true, but
there are still businessesinside these markets that are
(22:24):
growing and are profitable andwhat is the difference?
That are growing and areprofitable and what is the
difference?
I think that some of the thingsthat I see inside of the
businesses that are thriving andare profitable is a leadership
quality that I think the newterminology is multi-hyphenate.
(22:48):
These are leaders that arewearing lots of hats, they have
lots of different types ofskills, they are getting their
hands dirty, doing a lot ofdifferent things, and also these
are businesses that areinvesting in humans and taking a
long view, as opposed to whiteknuckling through making really
fast, impulsive decisions, towhite knuckling through making
(23:11):
really fast, impulsive decisions, but really doing the opposite
of that Investing in humans,investing in process, investing
in leadership and creating deepauthenticity and integrity as
underlying foundations to theirbusiness, knowing what their
business foundation is, leaninginto their purpose, their
mission and their value andvalues, and then making
decisions that sit on top ofthat, just like what you were
(23:33):
just saying in terms of the waythat you delineate what is
supporting your long-termpurpose versus what isn't, and
and if you're moving forward inthe right direction.
Ben Larson (23:45):
Yeah, I want to dig into this.
What is it in the rightdirection?
AnnaRae Grabstein (23:50):
Yeah, I want to dig into this.
What is it?
Hyphenate?
What's the word Multi-hyphenatethe less sexy term of that?
Could that be like a generalist, or is that?
Yeah, cross-functional leaders,and really what this is about is
we've talked about how some ofthe larger MSOs have gotten
(24:11):
really large at the top, andwhat that has meant is that they
have a lot of corporate fat andthat they've had trouble
competing with a mom and popbusiness.
Well, let's stop calling it momand pop businesses businesses.
(24:32):
Let's call these leanbusinesses that are really doing
what they need to do to stayefficient and operationalize in
a way that makes sense for thecosts and prices that exist in
the market.
I spent time working in themeat industry, and in the meat
industry there's no burning cash.
It's like you watch yourmargins they're thin and you're
either making money or you'renot.
(24:52):
And if you're not making money,then you're going to figure out
a way to shift your operationsin order to make money.
And that is the same kind ofprofile that I'm seeing, with
leaders that are doing whateverit takes shifting into different
roles and responsibilitiesinside of their company to truly
understand the elements of thethings that are going to push
(25:13):
success forward.
Ben Larson (25:14):
Yeah, one of my favorite metrics to be tracking
in our company is just revenueper employee and we track it on
a trailing 12 months, so it'snot too reactive or anything
like that.
But growing that over time andseeing how much we can do with
each person in the team has beenat least a big focus for the
(25:35):
last two or three years.
And it's funny how trackingcertain metrics really just
changes your mindset aboutcertain things and like
decision-making, and every timewe start considering like a new
resource allocation, have wethought about all the ways that
we could actually execute onthat before we throw more cash
(25:56):
at it or more bodies at it?
I think it's put us into areally kind of healthy mindset.
But what you were saying alsobrought up kind of a another
topic for me is how we react tothe dynamics in the market and
how we kind of predict them sothat we're able to manage that
cashflow month over month and wedon't find ourselves six months
later like having flown off acliff without knowing it and, I
(26:23):
think, being in the business andunderstanding what are all the
metrics that you're tracking forevery department, how do you
know you're kind of on track andwhat adjustments need to be
made, like every month, to beright, sizing your efforts based
on what the market's doingchapter that is very metrics
focused, it's very based inrealism, it's based in market
dynamics, it's based in solidfinancial leadership, because
(26:59):
there is not the type of capitalthat there was six years ago
coming into the industry.
AnnaRae Grabstein (27:01):
I think the perspectives about the venture
opportunity in cannabis haveshifted.
Whereas we had people coming inand investing in seed stage
companies years ago, now ifthere's going to be investment,
that investment tends to begrowth, growth capital.
Sometimes it's growth debt,sometimes it's growth equity,
but either way it's.
(27:22):
It's that capital wants to seethat these are companies that
have traction, that understandthe metrics that run their
business, and that any moneythat's going to come into the
business is for a specificpurpose.
That is going to come back asgrowth and profit and cash flow
to support the business, andthat is a very major shift
(27:44):
compared to where we were whenlegalization and some of these
early markets started coming on.
Ben Larson (27:50):
Oh yeah, I'm guilty of having taken on some investor
dollars with just really starsin the eyes and high growth well
at least mapped out on the proformas.
But this timeline has just beenmuch longer than anyone
anticipated.
We don't have many comps or any.
I really don't believe we haveany comps when it comes to M&A
(28:14):
or acquisitions.
It just feels very chaotic andeither opportunistic at the time
or sometimes lucky.
Finding any trends in any ofthat has been hard, and so I
think early stage venturecapital, or at least series A um
, is going to be near zero.
You know for the foreseeablefuture that you might get your
(28:35):
seed capital, but you got toturn yourself into kind of a
profitable, sustainable businessreally quick From from that
moment.
AnnaRae Grabstein (28:41):
Absolutely.
Ben Larson (28:42):
Like series, a crunch is known as a thing in
Silicon Valley.
AnnaRae Grabstein (28:46):
it's going to be like series, a void uh in in
the cannabis industry yeah, butthen within that context, I am
curious of where we both thinkthat exits land in the coming
years, because I do see someinteresting things happening and
, uh, within the context of the,those quiet heroes that are
(29:10):
operating in markets withprofitability, I think that
people will have options to selltheir companies.
I just talked about that.
I'll be talking about sellingyour company at Benzinga next
week, so I think that it's easynot to get screwed if you can't
sell.
Yeah, exactly.
All you have to say is no, andthen you're not screwed.
That's, that's the, that's themy panel for dummies.
(29:32):
But I mean, who do you think,or do you think there are
acquirers in the next 24 monthscoming into the space, be it
regulated cannabis, hemp, what,what's?
What's happening from yourperspective?
Ben Larson (29:48):
oh man, um, I mean, look it's.
I'm in a weird mental spacetoday just because of the
appropriations bill, uh, that Igot to read through yesterday,
and so if we don't have like anexistential crisis on our hands
in september, that I do thinkbeverage is like.
There's just really interestingopportunities in beverage, my
(30:10):
company included.
We are in that middle kind ofgrowth stage profitability,
focusing on just providingbetter and better service and
innovation to the marketplace,and we have great relationships
with large ingredientmanufacturers, like the large
beverage entities looking at thespace.
And so whenever that time comes, whenever there's a little bit
(30:32):
more certainty about the runwayand I do think there's some
general sentiment that even ifwe did get status quo from the
farm bill and appropriationswhich we were also discussing
that, the challenges of statusquo but if we did get status quo
, that would be kind of a signalthat it's like all right, well,
we have another several yearsto further ingrain, ingrain this
(30:53):
marketplace, and so that wouldbe looked at as an opportunity
by these bigger companies.
The brands, too, the brands thatare being built.
There's some serious revenuebeing done by by some of these,
the, these hemp brands, and sothe reason beverage is so
interesting is, they're alwayson the bleeding edge of
introducing new categories, newingredients, like this is how
(31:16):
red bull was created beverageswilling to push the envelope
more than any other cpg category.
So I think that's where, for amultitude of reasons, that's
where we'll see a lot of uh, m&a.
To start, there's also justinternally, uh, you know, the
cannabis and hemp companiescoming together to get bigger
and more sustainable.
So I think there's, you know,the, the investment bankers are
(31:38):
probably going to be really busytrying to, in a more
intelligent way than than, say,the past, like you know, weave
some of these companies togetherto create healthier companies
well you.
AnnaRae Grabstein (31:48):
you highlighted that a lot of the
opportunity on the hemp side ofthe market is dependent on
legislation and I think you'reright and I think that with some
level of certainty there willbe massive opportunities for
some of the companies at the topwho have really gained traction
and proven themselves to tohave some nice exits.
(32:10):
But there is more certainty inthe regulated cannabis part of
of the sector.
And while the regulated cannabiscompanies have experienced more
pressure, be it downwardpricing pressure, complex tax
structures, a lack of efficientsupply chains.
(32:30):
Those that have clean balancesheets, who didn't take on too
much money and have gotten to aplace of profitability, have
options, and I think thatprivate equity is becoming more
comfortable coming in to thesetypes of companies, and we're
seeing that more and more and Ithink we will continue to.
And then the other model whichis really interesting, and I am
(32:54):
seeing more and more, isemployee stock ownership through
ESOP models.
Oh yeah.
Ben Larson (33:01):
Shout out to Darren.
AnnaRae Grabstein (33:03):
Yeah, we had Darren Gleeman on the show.
It was a pretty new concept forme at that time and since then
there's been more announcementsof more cannabis companies doing
it, and I've even been a partof a discovery process with a
client who is a company thatreally bootstrapped and didn't
take on a lot of capital and asa result, they have a clean
(33:25):
balance sheet and they'reprofitable and it's a really
good option to be able tocontinue to invest in the
culture that a company hascreated the people as opposed to
selling through a process wherethe leadership shifts and
changes and could reallyactually change the internal
(33:53):
culture of a company.
I think ESOPs are a great wayto do that and it can all be
done with seller's notes, and soif a company can take on the
debt of being able to pay offthe owners over time, over
certain terms, it can be a greatway, I think, to maintain
continuity of mission andpurpose while also providing an
(34:14):
out for the early founders orcapital partners into the
company.
So I'm excited by that pathalso.
Ben Larson (34:23):
It's episode 38, if anyone listening wants to go
back and listen to the ESOPepisode.
So yeah, 55 episodes ago, soprobably over a year now oh yeah
, over a year wow, time flies itis really interesting I if I,
if I recall correctly to beeligible or to have it make
sense, you would want to bedoing, you know, at least 20
(34:44):
million in revenue and and notbe growing a rapid pace.
So like if you're happy with 10to 15% growth year over year,
you have a clean balance sheetand you're doing, like I said,
in excess of 20 million, thenit's a really good option and
provide some liquidity to thefounding team.
And again, like you said, putsthe ownership into the hands of,
(35:07):
hopefully, a unified employeebase.
And I do want to kind of jumpinto that part of the
conversation like how to buildthose companies and build those
cultures for this phase of theindustry that we're entering,
right, how do we build strongcultures and how do we make sure
(35:28):
that we're building a companythat the employees would want to
own anyway?
What are your thoughts?
AnnaRae Grabstein (35:34):
oh, oh, I wish you'd warned me on that one
ahead.
How do we build culture?
I, I truly believe you don't.
Ben Larson (35:42):
You don't have to like call anyone out.
I'm in fact.
I encourage you not yeah uh,but I know you work with a lot
of different companies ofvarying culture and success and
I'm just curious what are youseeing in the industry?
What do people need to befocused on?
AnnaRae Grabstein (35:57):
Well, it starts at the top,
unquestionably, and that meansthat if a leader is not truly
living the purpose and thevalues that the company is
espousing, it's a hard stop, itwon't work.
But when a leader does trulymetabolize the values and the
mission and the purpose intotheir actions on the daily, it
(36:21):
actually becomes pretty easy tofilter that down through all the
rest of the company and so whatpercentage of companies do you
think, actually have a solidbrand foundation to refer back
to?
Ben Larson (36:35):
Like when you go and engage with new companies, do
they say here's our brandfoundation, here's what we stand
for, here's our purpose, here'sour mission, here's our habits?
Do companies do this?
AnnaRae Grabstein (36:45):
No, and I'd say that most companies and I
don't wanna call anyone out, butoften say that they do.
They say they have a mission inplace, or they say they have
values, or they say they havesome pieces of it.
And I'll be clear I call it thefoundational pillars, you call
it the Brown Foundation.
What I'm talking about ispurpose, mission, vision and
(37:08):
values and, as this underlyingstructure, that if you have that
, then you can build a strategyon top of and a company on top
of it, and so usually peoplethink that they have some piece
of it, and then I'll say well,can you share it with me?
It would be really helpful, asI'm getting to know you and and
sometimes they can't even findit, or it's not written down,
(37:30):
and and or it is, and it's ait's a page long mission
statement that reads like like achapter out of out of you know,
a book written in the 1920s.
So almost nobody has has that,and so I think that it's really
important to have that solidfoundation, but then, not only
that, you don't just create itand then put it in a folder in
(37:52):
your Google Drive.
You figure out how to embed thatpurpose into all of your work.
How is it effectuated inside ofyour meeting structure?
When you do quarterly businessreviews or monthly business
reviews, are you remindingpeople about the mission that
the company is after, who yourconsumers are, how you're
(38:12):
centered on them, how you'reshowing up for them?
All of those elements likecreating a vessel for humans to
have purpose is almost one ofthe most important elements, so
that people remember why theirwork is a part of something
bigger.
It's just part of a humanimpulse to be a part of
something that's meaningful.
We have to create meaning inour work, Otherwise we won't
(38:36):
feel good about investing ourtime and energy in it and
staying a part of it, right,Right.
Ben Larson (38:43):
Which is, I think, why so many people are committed
to the industry itself, zoomingback out, like if you are
serving the progression of theindustry through advocacy,
through entrepreneurship, weinherently are part of something
bigger, and so it's like if youhave a company within that, you
(39:03):
need to be able to mirror thatand be able to point to, like
how, how you're a part of that,or else, like, the cracks are
going to start to show right.
And and I think that's where Iget into these frustrating
conversations sometimes on onlinkedin, where I know that, yes
, sometimes when I'm speakingfrom a place, it is speaking
from a place that benefits mycompany.
(39:24):
I just see that as aresponsibility as an
entrepreneur to kind of likebuild something that's viable in
the way that I see the world.
However, the way that I see theworld does go back to this
place of like progressing theindustry, creating access and
like trying not to lean onsomething, like, you know,
regulatory capture to do so andI think that's what keeps my
(39:45):
team so motivated is that, like,every time we make a decision,
every time we post something,it's always built and rooted
into that brand foundation andif it doesn't have that
integrity at any point in time.
It can be called into questionby anyone on my team and I'll be
the first to stand up if I makea mistake.
(40:06):
If I do something that's out ofline with our foundation, then
I owe a great number of peoplean apology.
AnnaRae Grabstein (40:13):
Yeah, it's interesting Culturally.
Right now we're at this funnyplace and you know I always make
connections to the broaderreality of the world.
But people are looking forsomething to believe in and it's
coming out in our politics.
It's coming out in actuallypolitics.
It's coming out and actually aresurgence of people are
becoming more religious.
(40:33):
In America, for the first timein a generation, we're starting
to see certain religions startto bring more people into the
fold.
Younger people are starting togo back to churches and
synagogues and mosques at ratesthat are actually kind of
turning after years of decline,and I think that people just
(40:57):
truly need something to believein, and we look for that first
in the things that we do mostoften, which is our work.
So having something to believein is really meaningful, but
that isn't enough.
So having something to believein is really meaningful, but
that isn't enough.
It can't stop there, becausethose foundations are often
lofty and broad, and so when youtalk about how do you create
(41:21):
the right culture and how do youbuild a company, I think more
and more we're not building fromscratch.
In the cannabis sector, we arebuilding from an existing base,
whether that foundation isstrong or not.
Got a foundation, but you haveto build something on top of it,
(41:49):
and that's like what are thewalls, what are all of the
elements that really are thebackbone of success?
And I think that that's reallywhat business strategy is, is
what comes after the foundation.
It's figuring out what your realobjective is, these more
concrete, execution-orientedgoals that you can put numbers
(42:16):
on, that talk about yourtraction in the market, the ways
that you're going to guideinnovation in pursuit of very
specific business goals, whattypes of margins you're going to
demand in the market, howyou're going to regionally focus
or how you're going todistribute all of these
questions that then become waysthat you can take that mission
(42:39):
and put it in the hands ofpeople to focus their work.
And people are looking for that.
They want to be successful,they want to know if what
they're doing is contributing tothe big goal.
And so you start at the topwith that lofty goal, and it's
not just lofty, it's also withthe people.
You know it's like the leadershave to embody it and then the
(43:00):
structure has to support it, andthen that goes all the way down
to all the individualsunderstanding what what winning
looks like here for them andseeing how it relates to that
purpose that we talked about.
Ben Larson (43:12):
I think the biggest challenge is that a lot of what
you were just saying oftenrelies on having a decent
understanding of where you'regoing and what the future looks
like.
And what we know in establishedmarkets is that we can go into
the press and we can figure outroughly how large a market is
(43:33):
and what the TAM is and how toexecute and how to differentiate
and all that and generally whata timeline should look like.
You know you put X amount ofresources in.
This is how many customers youcan get in front of and you can
make some assumptions.
You can make some assumptions.
The problem is with with withcannabis in particular, is that
we've just had to make way toomany assumptions as far as what
the forward looking pathway is,and in doing so, sometimes we
(43:58):
start to believe thoseassumptions and we build
business models that just travelthat kind of narrow path where
I think things are just verydifferent.
And I'm curious as to yourthoughts on, like removing this
certainty of the future andunderstanding that it can go a
multitude of different ways onmultitude of different timelines
(44:19):
.
Like, how do you build yourbusiness differently from like a
kind of a strategy perspectiveto make sure that you're not
falling into these traps of likeoh, I built my business on this
cost structure, understandingthat, oh, maybe legalization is
going to make things a littlebit easier over time.
(44:41):
It's not.
And what have we learned overthe years?
And how do we like enter aspace and responsibly build a
business where we're not quitecertain how big the total
addressable market's going to bein a certain given amount of
time?
AnnaRae Grabstein (44:51):
Yeah Well, to not answer your question, but
we do need legislative clarity.
The industry deserves it.
We need to keep fighting for it.
We need to build some level ofclarity of what the laws and
regulations are that we existinside of.
(45:12):
So we can't give up doing that,but knowing that we exist in
this place of lack of clarityand, putting that aside, of how
do we keep moving forward.
I think that we look at thingsin amounts of time that we still
can depend on realistically,like six and 12 month increments
(45:36):
of truly being able to plan,but based on what is in
existence today.
And, granted, we're talkingabout an appropriations bill
that could have significantimplications.
But broadly, we could talk aboutthe next six months in our
industry with some level of trueunderstanding of what the
(45:56):
market opportunities look likeright in front of us, and make
some clear plans, not gettingtoo far in front of our skis,
not over-raising, notover-promising, standing next to
and building relationships withpeople that we think are going
to be long term partners to our,to our business, just doing the
right thing, always in theshort term that supports the
(46:21):
long term, while just buildingthe DNA of reinvention, of
making it okay to realize thatthe thing that you were doing
before doesn't have to be thething that you keep doing in the
future, because that is thecycle of denial that we have to
get off of.
Yeah, you just this concept, youknow.
(46:43):
I know you want to talk aboutit next, so I'll let you take it
, but I think that what we haveto do is we have to get to a
place of normalizing the realityof what's right in front of us,
still having lofty aspirationsthat are that's where our
purpose and our vision landsabout the world that we hope to
(47:04):
get to live in one day.
But what about the world thatwe're living in today?
Staying grounded in that,planning for that in ways that
we can control?
Six months, 12 months we gotthat.
It's hard to plan financiallypast 24 months in cannabis, so
don't do it.
Ben Larson (47:20):
Don't do it.
I I've historically refused todo like detailed three to five
year models as like the you know, the detailed three to five
year models.
As, like the, you know the theinvestors always like to ask for
, I'm like I will give you asomewhat accurate, hopefully
projection for what the nextyear looks like.
Here's what it could be, with abunch of asterisks, over the
(47:40):
next two years.
Three to five years is yourguess as good as mine.
As long as we're not, you know,crashing into the earth, we're,
we're in a good place exactlyit's just.
AnnaRae Grabstein (47:49):
Don't spend your time on that.
It's just not worth it.
Ben Larson (47:53):
Okay so.
So one thing I wanted to get at, just because it kind of keeps
going in my head and and kind ofhelps us kind of circle back to
like, where are we in in thisphase of the industry?
And I keep thinking about theTuckman model and if you're if
you're not familiar, the Tuckmanmodel and if you're not
familiar, the Tuckman model isoften described as a way that
teams develop and so, like,every time you added a
(48:15):
significant new team member oryou're bringing a team together,
hemp and cannabis industry wewe kind of jumble this up
sometimes like cannabis wasgoing through the forming stages
(48:36):
, this very painful, iterativekind of process of implementing
new rules.
There was the storming period.
A bunch of venture capital camerushing in and then we started
figuring things out.
And we're in this normalizationperiod where we're trying to
figure out how to runsustainable, successful
(48:57):
businesses and how to like kindof really kind of emerge from
this doom and gloom, if at allpossible In 2018, and the years
that followed possible in 2018and the years that followed,
hemp had this opportunity to doa bit of storming without a lot
of the forming, and there have,as we said, been a lot of
(49:19):
benefits that that this hascreated for exposure of
cannabinoids to society andnormalizing of the plant, and it
was built again a lot off a lotof the progress that we'd been
making in the regulated cannabisspace.
And so, after the storming, whatis happening now is this
combination of forming andnorming at the same time.
(49:40):
People are believing that theyshould have access to it, that
it's kind of normalizing, butthe rules are being formed as we
go and anyone that's out thereraising their hand saying we
already have rules, it's alreadylegal, it's like it's not clear
, like you have to use thestructure that's given and we
have to have the right rules inthe right places, and so that's
(50:02):
why there are organizations thatare pushing very hard for
regulatory clarity.
So I just wanted to kind ofbring this up because it's
breaking my brain a little bitas to like why we're in the
situation that we are and it'sjust like this whole, like
forming then storming, notstorming then forming.
But here we are.
I don't know what are yourthoughts on this?
(50:23):
Are you familiar with theTuckman model, and am I bringing
this out of nowhere?
AnnaRae Grabstein (50:27):
Totally.
It's definitely come up and Ilike this idea of normalization
of cannabinoids being an outcome.
That is the result of what wecalled today the hemp experiment
.
But you are absolutely rightthat the storming happened
(50:48):
before the forming and I don'tblame the humans involved.
I think that there sometimes isan opportunity that arises and
the instinct is to grab it, andthat's what that storming was.
It was holy cow.
There is an opportunity forhemp-derived cannabinoids to
fill a void in the market rightnow.
(51:10):
Let's go do it, let's go getthem out there.
But because the forming didn'thappen, we are feeling the pain
overall.
Everybody, whether you're anoperator that started a business
or you are a regulated cannabiscompany that feels that you're
competing with the hempbusinesses- or you're just being
lumped all together in thesepress conferences that are
(51:32):
happening down in Texas, whereit's just reefer madness all
over again.
Ben Larson (51:35):
It's hurting all of us, right.
AnnaRae Grabstein (51:37):
But norming is certainly what we're going
for here, and I think that theexperiment has proved that
normalization is something thatthe consumers want.
But can we get the ecosystem tosupport what it is that the
(51:57):
consumers clearly want?
You know, we'll see.
Wow, we've been talking aboutsome big things here.
I hope that people are enjoyingit and that we're not too out
there and thinking about thefuture, but the thing is, if
you're listening to this, whatyou need to know is that Ben and
I are both in this.
We are so deep in it.
(52:19):
Ben is building his ownbusiness and I am working inside
of multiple businesses helpingthem navigate all of this, and
we're both not going anywhere,and so there's a lot of
challenge no matter how much youwant me to.
Yeah, it's like yeah we're goingnowhere.
We're here this is, this is mygreatest and best use is to help
(52:40):
solve problems in cannabis andand make marriages between
cannabis companies and all thethings that we're all doing.
So I think we're not given up,and I know I'm here because I
believe this work matters.
But I also love the challengeof it all.
I love that we're getting toplant the seeds for what is the
(53:04):
future, and I love that I ampersonally being challenged to
constantly reinvent myself andreinvent businesses, because
that's just endlesslyfascinating, even if it's hard.
But we can do hard things right.
We can do hard things, people,and if you're listening to this,
you know that cannabis is hard.
(53:25):
There is nobody that isexisting in cannabis today that
thinks that it's easy.
But we can do hard shit and wehave to wake up every day with a
resolute commitment to diveinto the shit and to somehow dig
our way out of it, becausethere is a future that is like
what Andrew Livingston said lastweek that is affordable,
(53:46):
accessible, with a greatassortment for consumers.
I believe that we're moving inthat direction.
It just there is some painalong the path Hell yeah, hell.
Ben Larson (53:54):
Yeah, annarie.
Yeah, you're still bullish,right?
Ben?
Absolutely yeah.
I mean, look, on the grandscheme of things, everything is
up and to the right.
It's just it gets a littlevolatile the closer that you
that you zoom in.
I I think what we have proventhis year in particular is that
people want cannabinoids.
(54:15):
Cannabinoids still generallydon't kill people.
We're on the right trajectory.
Everything is generally stillup and to the right and the
public sentiment that we have isthat people want to fight for
this, like we have peoplefighting for hemp, for cannabis.
That we've never had in ourcorner before and after doing
(54:36):
this for the last decade.
It is.
It is tangible, like how muchmomentum that we actually do
have, despite any legislativeheadwinds that we're feeling in
the current session and in thesessions ahead, all intents, and
we are getting more access tomore people every year that
passes.
So still very bullish.
AnnaRae Grabstein (54:58):
Stay strong.
People Face the hardest things.
Ben Larson (55:02):
Yeah, to that end, it is important that, in some
way or another, get involvedwith the federal movement,
whether it's hemp or cannabis,both are constantly being
deliberated at this point.
There are very tactical ways todo it.
Creating more voices in theroom isn't necessarily the way
Any of the existingorganizations doing good work.
(55:24):
On the Hill the ones that speakto you most get involved,
contribute your dollars.
The hill the ones that speak toyou most get involved,
contribute your dollars,contribute your support.
And, yeah, let's get someserious change, clarity
implemented at the federal levelin the coming year.
AnnaRae Grabstein (55:39):
Amazing.
So we hope you liked thisepisode and, if you did join the
conversation, a bunch of peopledid comment during this live
recording, so thank you to allof you.
We pay attention, we listen andwe will reply later.
Ben Larson (55:55):
Being that it's our 91st episode and there are a
number of you watching, soplease go and subscribe to our
podcast.
Like, share, review.
Leave five stars.
Please Help us get seen.
Our listenership is growingevery week, every month, and we
just are thrilled with with theprogress.
I don't know what we're gonnado for 100th episode.
(56:16):
It'll be big, it'll be thebiggest, it'll be big and
beautiful, so tune in.
Thank you so much.
AnnaRae Grabstein (56:23):
Beautiful episode.
Ben Larson (56:25):
A big, beautiful BBE .
We don't have enough reviews onApple, though.
AnnaRae Grabstein (56:28):
Guys, we need more reviews on Apple, so
please go on and give us areview.
It would be really meaningful.
Ben Larson (56:35):
Absolutely.
Thank you to our teams Evertosaand Wolfmeyer, Thank you to our
producer, Eric Rossetti, andthank you for tuning in.
Until next time, folks Remember, stay curious, stay informed
and keep your spirits high.
That's the show.
If a leader is not truly living the purpose
and the values that the companyis espousing, it's a hard stop.
It won't work.
But when a leader does trulymetabolize the values and the
mission and the purpose intotheir actions on the daily, it
actually becomes pretty easy tofilter that down through all the
(00:23):
rest of the company.
Ben Larson (00:32):
Hey everybody, welcome to episode 91.
91 of High Spirits.
I'm Ben Larson and with me, asalways, is Anna Rae Grabstein.
We're recording Thursday, june5th 2025.
And it's been another week.
In cannabis, we have anappropriations bill that's
dropped.
(00:53):
The fire keeps on burning.
We're going to dive into allthat, but before we do, anna Rae
, how's your week going?
AnnaRae Grabstein (01:01):
My week's going really great.
It's my dad's birthday today,so happy birthday dad.
Happy birthday big man yeah.
Is he a listener?
Not really he.
You know, sometimes I mighttell him and he'll listen.
He is the one that was thefirst cannabis consumer in my
life, so he showed me the way.
(01:23):
He didn't show me the way.
I won't blame him for myinterest in cannabis, but he was
a significant normalizingfactor in in my life for the
plant.
So, yeah, it's been good,although my morning was full of
credit card fraud and I have togive a shout out to the robots
that detected the fraud.
I feel relieved but surprisedat what a mess Careful when
(01:50):
using those credit cards inMexico.
Yes, yeah, good reminder.
How about you?
How are you doing?
Ben Larson (01:57):
I'm doing okay.
It's been a busy week.
I've been struggling with alittle bit of back pain, so that
is not fun.
But I'm on my third day ofprednisone treatment and I am
sitting upright and speakingwith you, so things are looking
up.
AnnaRae Grabstein (02:13):
Welcome to aging man.
I've been sticking with myweight training plan and I've
got this really cool trainerthat keeps telling me how great
I am and I keep thinking thatI'm just paying her to tell me
that.
But it's working and I keepadding weight, so that's good.
Ben Larson (02:34):
It's not a trainer, but I have recognized how
ChatGPT is really good at givingyou the nice sandwich where
it's like this is well thoughtout, really critical points, and
then it'll get into kind of thecriticism.
AnnaRae Grabstein (02:52):
So I really appreciate that to the designers
over at OpenAI.
That's hilarious that youappreciate that.
I read an article this weekthat the positive feedback from
chat GPT is actually breakingbreaking our souls and making
our egos inflated is actuallybreaking our souls and making
our egos inflated.
Ben Larson (03:07):
Well, it's hard to be more inflated than me.
AnnaRae Grabstein (03:10):
Yeah, right, and so between the two of us,
our teams are going to behitting the streets next week
with a bunch of different eventsand cannabis and beverage.
So let's go over those realquick.
If you want to see us folksfrom Wolfmeyer, folks from
Bertosa yes, we will be inChicago at Benzinga.
(03:32):
I will be on stage on Monday.
My panel is how to sell yourbusiness without getting screwed
.
So if you would like to learnthose things, come listen to
what I have to say, and I do.
And and then I will be off toDenver after that for the
(03:55):
International Cannabis LawyerBar Association event, which is
a lawyer's event.
I'm not a lawyer, but I will betalking to the lawyers and at
the same time we've got Canra,which is the regulators event
that's happening in Denver also.
And then BevNet is in New Yorkright, and I'm missing all of it
(04:18):
and Ben will be single, daddingand taking care of his kids,
which is most important, but his, his team, will be spread all
over.
Ben Larson (04:28):
So go find him.
The Vertosa troops will be, Ithink, at all of those with the
exception of the lawyer event,but Canra, definitely look for
Diane Eberlein Benzinga, Ibelieve Sarah Falvo and Ryan
Pinsky will be there, and thenI'm sure we'll have some team
members at BevNet.
Yeah, Awesome.
AnnaRae Grabstein (04:47):
Cool.
And then, ben, before we jumpinto our big future casting
discussion that we promised ouraudience, will you give us a bit
of the update on this news withthe appropriations bill?
Ben Larson (04:58):
Yeah, so appropriations bill is similar
to the farm bill and the factthat it's this recurring thing
that can influence the world inwhich we operate.
Only, the difference betweenthe appropriations bill and the
farm bill is that appropriationsbill has to happen every year.
It was supposed to happen backin March and, if you didn't
(05:19):
recognize it, it did port overthe language from the Miller
Amendment that was introducedlast year as part of the Farm
Bill and appropriations, and soit's back, not surprisingly.
There were some efforts donethrough the beginning of the
year in order to influence andhopefully not bring the Miller
Amendment back into it, but it'sthere, and so there's a lot of
(05:43):
work to do.
It is being heard today formarkups and we have until
September, I guess, to get thisthing done, and so I don't want
to spend too much time in it.
There's much smarter peopleinvolved.
I'm sure if you go on LinkedIn,you'll see USM Roundtable, caba,
any other organization, ncia,looking at the federal movement
(06:07):
and realizing that this is animportant one if we want to keep
any element of hempcannabinoids open in the US, and
so I think the moral of it isthat the farm bill work is very
important to be done.
But critical path right now isappropriations, and we don't
(06:29):
really want to be revisitingthis every year.
So the importance here which Ithink we will discuss in kind of
the the rest of the show is ishow clarity is is super
important.
You know, we can't be operatingin ambiguities if we're going
to survive yeah, the ambi.
AnnaRae Grabstein (06:47):
It's the ambiguity that's killing us.
It's like we just need to knowwhat the path is and then people
can make plans and and runafter the right thing and even
by virtue of us saying ambiguity.
Ben Larson (06:59):
I know that in of itself is controversial in some,
but at the end of the day, ifwe're having to revisit the
language periodically, it'sambiguous.
You know, it's like our futureis ambiguous, and so what we
need to be driving towards isfinality and clarity, certainty.
All those things.
AnnaRae Grabstein (07:20):
Yeah, use the thesaurus.
That is what we want.
We want to know an outcome thatwe can depend on.
Well, so you know, ben, youwrote a bit of a manifesto
recently talking about the past,of how we got here in terms of
a bunch of legislative history,which I was really happy to read
(07:45):
and got me thinking about wherewe're going also, and you and I
talked about it and we thoughtthis is a great opportunity to
really speak to people wholisten to this podcast and who
are turning to us, for ourthoughts to turn towards the
future a little bit.
Do you want to set the table bygiving us a little bit of what
(08:08):
was your reasoning behindtalking about where we came from
and what were some of the bigtakeaways?
Ben Larson (08:14):
Yeah, and I appreciate you subscribing to my
infused insights newsletter.
So thank you for reading.
Totally.
Look, I mean it was.
It was inspired by just the,the emotional responses to
what's been happening in texas,and anytime something like what
happens was was senate bill 3 intexas, the banning of hemp or
(08:39):
any other kind of movement oncannabis or hemp?
There seems to be a lot ofpointing the finger, blaming,
complaining, and what oftenhappens is we're being pitted
against each other hemp versuscannabis, hemp beverages versus
the rest of hemp, licensedcannabis operators, dispensaries
(08:59):
versus brands Like it's justhappening perpetually and think
we're we're put into thisterrible situation where people
are fighting for theirlivelihoods and that is forcing
them to lose kind of perspectiveon the greater scope of of our
overall objective as an industry.
And so you know, the one thingI've always confidently fallen
(09:23):
back on, and why I haven't beenafraid to be outspoken about my
perspectives, is that at the endof the day, I want to see the
plant recognized for what it isand completely normalized and
destigmatized and made availableresponsibly to society.
In fact, that's embedded intoour company's mission.
(09:45):
You know, our purpose as acompany is to unlock the healing
powers of the plant and createaccessible or create access to
people responsibly around theworld, right.
So it's like, as long as we'redoing that and we're on the
right path.
And so I always kind of try toask myself, like, how did we get
here?
And if we look at the greaterarc of cannabinoids and people's
(10:08):
familiarity with them, you haveto look all the way back to the
drug wars.
You have to look at those times, those decades, where cannabis
and hemp were both on theControlled Substances Act,
essentially being treated as thesame plant as we often like to
talk about.
And it wasn't until recentlywhere we had this bifurcation
right.
We had the 2014 Farm Bill thatkind of started to signal the
(10:32):
separation of hemp and cannabisand created some interesting
pathways.
2018 is what really kicked offthe CBD boom and it wasn't
really until, like the pandemicyears and beyond, where we
really started to understand theopportunities with intoxicating
compounds and all this and soisn't it interesting it took
that, it took a few years.
AnnaRae Grabstein (10:53):
These, these legislative shifts in the farm
bill, both in 2014 and in 2018,did open doors, but it was not
immediate.
People weren't paying attentionto the language.
And then what opportunities thelanguage provided, like they
are today Because now there's somuch riding on it Once the door
became open.
(11:14):
Now we've got hawks looking atevery word, making sure the door
stays open or trying to closethe door.
Ben Larson (11:21):
It's like someone cracks the door open and then a
bunch of people walking by, it'slike one person stops like, hey
, is that door open?
And then a little bit like, andall of a sudden they're like
peeking around through the doorslike anyone in here, and you
know it's like, and then onceit's open, it's like boom, kick
it open, like, and theneveryone's like hey, everybody,
this door is open and nowthere's a festival inside now
(11:45):
there's a rave and this.
We're having a great time.
It's like we should do this allthe time, and you know, as mark
hauser said, I don't want to beflipping um, but it's kind of
been like this great experimentopportunity, uh, to create
access to cannabinoids, toleverage the normalcy that the
(12:05):
legalized movement has created.
And, going back to mymotivation for the piece, like
just trying to point out toeveryone that we all need each
other.
We're all here today because ofthe work that each other has
done.
And when I say each other, Imean hemp and cannabis and all
these disparate groups that Iwas previously talking about.
But I wouldn't be building thecompany that I am today if I
(12:29):
didn't believe eight years agothat low-dose hemp beverages or
low-dose THC beverages were abig opportunity for normalizing
the plant as a whole, right, andso, whether you call it hemp or
cannabis, for me, whole right,and so, whether you call it hemp
or cannabis, for me theopportunity is about creating
(12:50):
legal clarity in creating accessto the plant for people.
Right, and I see beverage as areally big opportunity for
taking that incremental stepforward.
And, and I think the challengeright now is, if you narrow the
lens, that feels like things arebeing taken away from this hemp
movement.
But in the greater arc ofcannabis in general, I see
(13:13):
there's actually been a lot ofadvancement that's been made in
the last year because of justall the activity that's been
occurring.
AnnaRae Grabstein (13:22):
So I think it leads into and thank you for
that, thank you for thatreflection on what you wrote
about, and I hope that it makessense then for us to be thinking
about where we go from here andwhere we go from here and where
we are now.
I think you've started to openup a train of narrative that's
(13:42):
really interesting about hempbeing a great experiment to
prove cannabinoid interestbroadly.
As someone who started mycannabis career in the medical
space and then in the adult useregulated cannabis space in
California, I really looked athemp as it was beginning, as a
(14:03):
major threat, and over time myperspective has shifted, not
necessarily to let's free all ofthe hemp and not have
regulations, but exactly whatyou said of wow, this has been a
great experiment.
That's undeniable to prove thatthere are unique pathways for
(14:25):
cannabis to exist in a morenormalized way.
That moment when we went out todinner in Minneapolis and got to
sit at a fancy restaurant andthere was THC beverage on the
cocktail menu was reallymeaningful for me.
It was like holy cow.
This is what I've been workingfor for 15 years to be able to
(14:45):
enjoy a five star meal and toget to choose whatever it is
that I want to drink, whether itwas tequila or water or THC all
of those things, or God forbidall of the above, all of the
above, and so I love this pointthat one of the things that hemp
(15:06):
really has done has shown thatthere is this broad interest in
products made with cannabisinside of them.
And how we get there, how theycome to market.
What the regulatory pathwaylooks like yes, it's complicated
for a lot of reasons, but itwill never truly go back in the
(15:30):
box to be able to say thatpeople don't want this anymore.
Even if Texas fully shuts downtheir hemp market and SB3 gets
signed by the governor, nobodycan ever say that Texans don't
like cannabis, because it'sclear that Texans really enjoyed
buying THC and they've beenbuying a lot for a couple of
(15:52):
years.
Ben Larson (15:53):
Whether it's $2 billion, $4 billion, $8 billion.
I've heard lots of numbers overthe last several months.
55,000 jobs in Texas, we'veheard.
What has happened over the lastsix months in particular is
that the community has shownthat they're very supportive of
these products and that theywant these products in the most
(16:15):
conservative of states.
We also have a lot of externalforces that when something like
this would typically happen,we'd be fearful of what it would
signal, like how it wouldreduce the forward-looking
sentiment for the category.
It's not what I'm seeing rightnow.
I'm seeing people moremotivated than ever to fight and
(16:38):
people writing hundreds ofthousands of letters to the
governor in Texasxas and andlike mainstream media, both
conservative and and liberal,like speaking up and being like
this is not how to, how weaddress this.
Like we've talked about this onprevious episodes, bans are not
the answer, especially when thecat has been this far out of
(16:58):
the back.
You know, again, taking thelonger lens on everything.
This is like a ban may come inTexas.
It's not official yet, ithasn't been signed, a veto is
required and I hope that doeshappen.
But if it were not to happen,we're not done in Texas.
It's like there's a two-yearlegislative cycle, which is
(17:19):
painfully slow, but you betterbelieve that we're coming in
full steam two years from now.
No-transcript.
AnnaRae Grabstein (17:48):
And the challenges that hemp faces at
certain states are different butnot dissimilar to the
dysfunction that regulatedcannabis faces in some states,
due to the ways thatoverregulation has challenged
the industry, to the ways thatover-regulation has challenged
(18:09):
the industry.
And so we have these market bymarket challenges.
But there's a differencebetween chaos and transition,
and I think that the companiesand the leaders that are going
to really show resilience inthis next chapter for the sector
are the ones that are wearingthat lens of of transition and
(18:30):
adaptation.
Uh, because, because if there'sone thing that I've learned in
cannabis is that reinvention issomething that you can almost
depend on as a human and as acompany.
It's that there is going to bechange, and so we have to build
that into our DNA.
We have to stay open to, likewhat you said, ben, this long
(18:53):
view that we know that theproducts that we're creating are
having an impact on people'slives.
The plant is creatingalternatives to different types
of intoxication that is lesshealthy for people than ours
over here, and it's going towork itself out.
But it's this space in themiddle, and how do we get
(19:16):
through that?
How do we evolve and thrive?
Through transition andreinvention.
Ben Larson (19:23):
Yeah, I'm curious though You're right and I could
speak to that about how we'vedesigned our business and happy
to jump into that but I'mcurious about your perspective
about the operators that are inthe space and the ones that are
showing the ability to adaptversus ones that are less likely
(19:44):
to.
And as we kind of look at thedifferent segments of operators
in space, like you know, I talkabout how the, the beverage
brands, have shown the abilityto kind of be pretty fluid
across the various supply chains, be it, you know, regulated
states, hemp or canada.
They's still largely being abrand.
(20:05):
Some of them are, arevertically integrating and
getting into to manufacturingand all that.
But then we have, like the MSOs, and then we have the, the, the
licensed operators in theregulated States, like the
dispensaries and the licensedbrands, and so I don't know if I
see a lot of adaptability.
(20:27):
I see, you know, the themlocked into these frameworks,
that that have been establishedthrough the legalization process
, and feels kind of stuck Rightand it changes on state level,
market and you know, what'shappening in California is
(20:52):
substantively different thanwhat's happening in Florida and
that's substantively differentthan what's happening in New
Jersey and Missouri.
AnnaRae Grabstein (21:00):
But in terms of your question of my thoughts
of what are the type ofbusinesses that are able to
reinvent themselves and to beresilient in the face of all
this change, I think that whenyour business model is dependent
on regulatory capture, it is alot more challenging to shift
(21:21):
and change, and a lot of theearly MSOs that went into
limited licensed states and thatvertically integrated are who
I'm talking about.
I think that if your businessmodel is dependent on not having
competition, you are notnecessarily setting yourself up
to be able to compete.
(21:41):
You are in this sort ofengineered monopoly and it it
represents a moment in time, andit might be the moment in time
that we are now, but what I'mseeing is that the businesses
that are in more competitiveenvironments and are still
(22:03):
winning with profitability andthey exist, and I think that we
don't talk about them a lot.
The headlines are about thefailing cannabis businesses and
there was headlines this weekabout the decline by top line
sales of the California market,and that might be true, but
there are still businessesinside these markets that are
(22:24):
growing and are profitable andwhat is the difference?
That are growing and areprofitable and what is the
difference?
I think that some of the thingsthat I see inside of the
businesses that are thriving andare profitable is a leadership
quality that I think the newterminology is multi-hyphenate.
(22:48):
These are leaders that arewearing lots of hats, they have
lots of different types ofskills, they are getting their
hands dirty, doing a lot ofdifferent things, and also these
are businesses that areinvesting in humans and taking a
long view, as opposed to whiteknuckling through making really
fast, impulsive decisions, towhite knuckling through making
(23:11):
really fast, impulsive decisions, but really doing the opposite
of that Investing in humans,investing in process, investing
in leadership and creating deepauthenticity and integrity as
underlying foundations to theirbusiness, knowing what their
business foundation is, leaninginto their purpose, their
mission and their value andvalues, and then making
decisions that sit on top ofthat, just like what you were
(23:33):
just saying in terms of the waythat you delineate what is
supporting your long-termpurpose versus what isn't, and
and if you're moving forward inthe right direction.
Ben Larson (23:45):
Yeah, I want to dig into this.
What is it in the rightdirection?
AnnaRae Grabstein (23:50):
Yeah, I want to dig into this.
What is it?
Hyphenate?
What's the word Multi-hyphenatethe less sexy term of that?
Could that be like a generalist, or is that?
Yeah, cross-functional leaders,and really what this is about is
we've talked about how some ofthe larger MSOs have gotten
(24:11):
really large at the top, andwhat that has meant is that they
have a lot of corporate fat andthat they've had trouble
competing with a mom and popbusiness.
Well, let's stop calling it momand pop businesses businesses.
(24:32):
Let's call these leanbusinesses that are really doing
what they need to do to stayefficient and operationalize in
a way that makes sense for thecosts and prices that exist in
the market.
I spent time working in themeat industry, and in the meat
industry there's no burning cash.
It's like you watch yourmargins they're thin and you're
either making money or you'renot.
(24:52):
And if you're not making money,then you're going to figure out
a way to shift your operationsin order to make money.
And that is the same kind ofprofile that I'm seeing, with
leaders that are doing whateverit takes shifting into different
roles and responsibilitiesinside of their company to truly
understand the elements of thethings that are going to push
(25:13):
success forward.
Ben Larson (25:14):
Yeah, one of my favorite metrics to be tracking
in our company is just revenueper employee and we track it on
a trailing 12 months, so it'snot too reactive or anything
like that.
But growing that over time andseeing how much we can do with
each person in the team has beenat least a big focus for the
(25:35):
last two or three years.
And it's funny how trackingcertain metrics really just
changes your mindset aboutcertain things and like
decision-making, and every timewe start considering like a new
resource allocation, have wethought about all the ways that
we could actually execute onthat before we throw more cash
(25:56):
at it or more bodies at it?
I think it's put us into areally kind of healthy mindset.
But what you were saying alsobrought up kind of a another
topic for me is how we react tothe dynamics in the market and
how we kind of predict them sothat we're able to manage that
cashflow month over month and wedon't find ourselves six months
later like having flown off acliff without knowing it and, I
(26:23):
think, being in the business andunderstanding what are all the
metrics that you're tracking forevery department, how do you
know you're kind of on track andwhat adjustments need to be
made, like every month, to beright, sizing your efforts based
on what the market's doingchapter that is very metrics
focused, it's very based inrealism, it's based in market
dynamics, it's based in solidfinancial leadership, because
(26:59):
there is not the type of capitalthat there was six years ago
coming into the industry.
AnnaRae Grabstein (27:01):
I think the perspectives about the venture
opportunity in cannabis haveshifted.
Whereas we had people coming inand investing in seed stage
companies years ago, now ifthere's going to be investment,
that investment tends to begrowth, growth capital.
Sometimes it's growth debt,sometimes it's growth equity,
but either way it's.
(27:22):
It's that capital wants to seethat these are companies that
have traction, that understandthe metrics that run their
business, and that any moneythat's going to come into the
business is for a specificpurpose.
That is going to come back asgrowth and profit and cash flow
to support the business, andthat is a very major shift
(27:44):
compared to where we were whenlegalization and some of these
early markets started coming on.
Ben Larson (27:50):
Oh yeah, I'm guilty of having taken on some investor
dollars with just really starsin the eyes and high growth well
at least mapped out on the proformas.
But this timeline has just beenmuch longer than anyone
anticipated.
We don't have many comps or any.
I really don't believe we haveany comps when it comes to M&A
(28:14):
or acquisitions.
It just feels very chaotic andeither opportunistic at the time
or sometimes lucky.
Finding any trends in any ofthat has been hard, and so I
think early stage venturecapital, or at least series A um
, is going to be near zero.
You know for the foreseeablefuture that you might get your
(28:35):
seed capital, but you got toturn yourself into kind of a
profitable, sustainable businessreally quick From from that
moment.
AnnaRae Grabstein (28:41):
Absolutely.
Ben Larson (28:42):
Like series, a crunch is known as a thing in
Silicon Valley.
AnnaRae Grabstein (28:46):
it's going to be like series, a void uh in in
the cannabis industry yeah, butthen within that context, I am
curious of where we both thinkthat exits land in the coming
years, because I do see someinteresting things happening and
, uh, within the context of the,those quiet heroes that are
(29:10):
operating in markets withprofitability, I think that
people will have options to selltheir companies.
I just talked about that.
I'll be talking about sellingyour company at Benzinga next
week, so I think that it's easynot to get screwed if you can't
sell.
Yeah, exactly.
All you have to say is no, andthen you're not screwed.
That's, that's the, that's themy panel for dummies.
(29:32):
But I mean, who do you think,or do you think there are
acquirers in the next 24 monthscoming into the space, be it
regulated cannabis, hemp, what,what's?
What's happening from yourperspective?
Ben Larson (29:48):
oh man, um, I mean, look it's.
I'm in a weird mental spacetoday just because of the
appropriations bill, uh, that Igot to read through yesterday,
and so if we don't have like anexistential crisis on our hands
in september, that I do thinkbeverage is like.
There's just really interestingopportunities in beverage, my
(30:10):
company included.
We are in that middle kind ofgrowth stage profitability,
focusing on just providingbetter and better service and
innovation to the marketplace,and we have great relationships
with large ingredientmanufacturers, like the large
beverage entities looking at thespace.
And so whenever that time comes, whenever there's a little bit
(30:32):
more certainty about the runwayand I do think there's some
general sentiment that even ifwe did get status quo from the
farm bill and appropriationswhich we were also discussing
that, the challenges of statusquo but if we did get status quo
, that would be kind of a signalthat it's like all right, well,
we have another several yearsto further ingrain, ingrain this
(30:53):
marketplace, and so that wouldbe looked at as an opportunity
by these bigger companies.
The brands, too, the brands thatare being built.
There's some serious revenuebeing done by by some of these,
the, these hemp brands, and sothe reason beverage is so
interesting is, they're alwayson the bleeding edge of
introducing new categories, newingredients, like this is how
(31:16):
red bull was created beverageswilling to push the envelope
more than any other cpg category.
So I think that's where, for amultitude of reasons, that's
where we'll see a lot of uh, m&a.
To start, there's also justinternally, uh, you know, the
cannabis and hemp companiescoming together to get bigger
and more sustainable.
So I think there's, you know,the, the investment bankers are
(31:38):
probably going to be really busytrying to, in a more
intelligent way than than, say,the past, like you know, weave
some of these companies togetherto create healthier companies
well you.
AnnaRae Grabstein (31:48):
you highlighted that a lot of the
opportunity on the hemp side ofthe market is dependent on
legislation and I think you'reright and I think that with some
level of certainty there willbe massive opportunities for
some of the companies at the topwho have really gained traction
and proven themselves to tohave some nice exits.
(32:10):
But there is more certainty inthe regulated cannabis part of
of the sector.
And while the regulated cannabiscompanies have experienced more
pressure, be it downwardpricing pressure, complex tax
structures, a lack of efficientsupply chains.
(32:30):
Those that have clean balancesheets, who didn't take on too
much money and have gotten to aplace of profitability, have
options, and I think thatprivate equity is becoming more
comfortable coming in to thesetypes of companies, and we're
seeing that more and more and Ithink we will continue to.
And then the other model whichis really interesting, and I am
(32:54):
seeing more and more, isemployee stock ownership through
ESOP models.
Oh yeah.
Ben Larson (33:01):
Shout out to Darren.
AnnaRae Grabstein (33:03):
Yeah, we had Darren Gleeman on the show.
It was a pretty new concept forme at that time and since then
there's been more announcementsof more cannabis companies doing
it, and I've even been a partof a discovery process with a
client who is a company thatreally bootstrapped and didn't
take on a lot of capital and asa result, they have a clean
(33:25):
balance sheet and they'reprofitable and it's a really
good option to be able tocontinue to invest in the
culture that a company hascreated the people as opposed to
selling through a process wherethe leadership shifts and
changes and could reallyactually change the internal
(33:53):
culture of a company.
I think ESOPs are a great wayto do that and it can all be
done with seller's notes, and soif a company can take on the
debt of being able to pay offthe owners over time, over
certain terms, it can be a greatway, I think, to maintain
continuity of mission andpurpose while also providing an
(34:14):
out for the early founders orcapital partners into the
company.
So I'm excited by that pathalso.
Ben Larson (34:23):
It's episode 38, if anyone listening wants to go
back and listen to the ESOPepisode.
So yeah, 55 episodes ago, soprobably over a year now oh yeah
, over a year wow, time flies itis really interesting I if I,
if I recall correctly to beeligible or to have it make
sense, you would want to bedoing, you know, at least 20
(34:44):
million in revenue and and notbe growing a rapid pace.
So like if you're happy with 10to 15% growth year over year,
you have a clean balance sheetand you're doing, like I said,
in excess of 20 million, thenit's a really good option and
provide some liquidity to thefounding team.
And again, like you said, putsthe ownership into the hands of,
(35:07):
hopefully, a unified employeebase.
And I do want to kind of jumpinto that part of the
conversation like how to buildthose companies and build those
cultures for this phase of theindustry that we're entering,
right, how do we build strongcultures and how do we make sure
(35:28):
that we're building a companythat the employees would want to
own anyway?
What are your thoughts?
AnnaRae Grabstein (35:34):
oh, oh, I wish you'd warned me on that one
ahead.
How do we build culture?
I, I truly believe you don't.
Ben Larson (35:42):
You don't have to like call anyone out.
I'm in fact.
I encourage you not yeah uh,but I know you work with a lot
of different companies ofvarying culture and success and
I'm just curious what are youseeing in the industry?
What do people need to befocused on?
AnnaRae Grabstein (35:57):
Well, it starts at the top,
unquestionably, and that meansthat if a leader is not truly
living the purpose and thevalues that the company is
espousing, it's a hard stop, itwon't work.
But when a leader does trulymetabolize the values and the
mission and the purpose intotheir actions on the daily, it
(36:21):
actually becomes pretty easy tofilter that down through all the
rest of the company and so whatpercentage of companies do you
think, actually have a solidbrand foundation to refer back
to?
Ben Larson (36:35):
Like when you go and engage with new companies, do
they say here's our brandfoundation, here's what we stand
for, here's our purpose, here'sour mission, here's our habits?
Do companies do this?
AnnaRae Grabstein (36:45):
No, and I'd say that most companies and I
don't wanna call anyone out, butoften say that they do.
They say they have a mission inplace, or they say they have
values, or they say they havesome pieces of it.
And I'll be clear I call it thefoundational pillars, you call
it the Brown Foundation.
What I'm talking about ispurpose, mission, vision and
(37:08):
values and, as this underlyingstructure, that if you have that
, then you can build a strategyon top of and a company on top
of it, and so usually peoplethink that they have some piece
of it, and then I'll say well,can you share it with me?
It would be really helpful, asI'm getting to know you and and
sometimes they can't even findit, or it's not written down,
(37:30):
and and or it is, and it's ait's a page long mission
statement that reads like like achapter out of out of you know,
a book written in the 1920s.
So almost nobody has has that,and so I think that it's really
important to have that solidfoundation, but then, not only
that, you don't just create itand then put it in a folder in
(37:52):
your Google Drive.
You figure out how to embed thatpurpose into all of your work.
How is it effectuated inside ofyour meeting structure?
When you do quarterly businessreviews or monthly business
reviews, are you remindingpeople about the mission that
the company is after, who yourconsumers are, how you're
(38:12):
centered on them, how you'reshowing up for them?
All of those elements likecreating a vessel for humans to
have purpose is almost one ofthe most important elements, so
that people remember why theirwork is a part of something
bigger.
It's just part of a humanimpulse to be a part of
something that's meaningful.
We have to create meaning inour work, Otherwise we won't
(38:36):
feel good about investing ourtime and energy in it and
staying a part of it, right,Right.
Ben Larson (38:43):
Which is, I think, why so many people are committed
to the industry itself, zoomingback out, like if you are
serving the progression of theindustry through advocacy,
through entrepreneurship, weinherently are part of something
bigger, and so it's like if youhave a company within that, you
(39:03):
need to be able to mirror thatand be able to point to, like
how, how you're a part of that,or else, like, the cracks are
going to start to show right.
And and I think that's where Iget into these frustrating
conversations sometimes on onlinkedin, where I know that, yes
, sometimes when I'm speakingfrom a place, it is speaking
from a place that benefits mycompany.
(39:24):
I just see that as aresponsibility as an
entrepreneur to kind of likebuild something that's viable in
the way that I see the world.
However, the way that I see theworld does go back to this
place of like progressing theindustry, creating access and
like trying not to lean onsomething, like, you know,
regulatory capture to do so andI think that's what keeps my
(39:45):
team so motivated is that, like,every time we make a decision,
every time we post something,it's always built and rooted
into that brand foundation andif it doesn't have that
integrity at any point in time.
It can be called into questionby anyone on my team and I'll be
the first to stand up if I makea mistake.
(40:06):
If I do something that's out ofline with our foundation, then
I owe a great number of peoplean apology.
AnnaRae Grabstein (40:13):
Yeah, it's interesting Culturally.
Right now we're at this funnyplace and you know I always make
connections to the broaderreality of the world.
But people are looking forsomething to believe in and it's
coming out in our politics.
It's coming out in actuallypolitics.
It's coming out and actually aresurgence of people are
becoming more religious.
(40:33):
In America, for the first timein a generation, we're starting
to see certain religions startto bring more people into the
fold.
Younger people are starting togo back to churches and
synagogues and mosques at ratesthat are actually kind of
turning after years of decline,and I think that people just
(40:57):
truly need something to believein, and we look for that first
in the things that we do mostoften, which is our work.
So having something to believein is really meaningful, but
that isn't enough.
So having something to believein is really meaningful, but
that isn't enough.
It can't stop there, becausethose foundations are often
lofty and broad, and so when youtalk about how do you create
(41:21):
the right culture and how do youbuild a company, I think more
and more we're not building fromscratch.
In the cannabis sector, we arebuilding from an existing base,
whether that foundation isstrong or not.
Got a foundation, but you haveto build something on top of it,
(41:49):
and that's like what are thewalls, what are all of the
elements that really are thebackbone of success?
And I think that that's reallywhat business strategy is, is
what comes after the foundation.
It's figuring out what your realobjective is, these more
concrete, execution-orientedgoals that you can put numbers
(42:16):
on, that talk about yourtraction in the market, the ways
that you're going to guideinnovation in pursuit of very
specific business goals, whattypes of margins you're going to
demand in the market, howyou're going to regionally focus
or how you're going todistribute all of these
questions that then become waysthat you can take that mission
(42:39):
and put it in the hands ofpeople to focus their work.
And people are looking for that.
They want to be successful,they want to know if what
they're doing is contributing tothe big goal.
And so you start at the topwith that lofty goal, and it's
not just lofty, it's also withthe people.
You know it's like the leadershave to embody it and then the
(43:00):
structure has to support it, andthen that goes all the way down
to all the individualsunderstanding what what winning
looks like here for them andseeing how it relates to that
purpose that we talked about.
Ben Larson (43:12):
I think the biggest challenge is that a lot of what
you were just saying oftenrelies on having a decent
understanding of where you'regoing and what the future looks
like.
And what we know in establishedmarkets is that we can go into
the press and we can figure outroughly how large a market is
(43:33):
and what the TAM is and how toexecute and how to differentiate
and all that and generally whata timeline should look like.
You know you put X amount ofresources in.
This is how many customers youcan get in front of and you can
make some assumptions.
You can make some assumptions.
The problem is with with withcannabis in particular, is that
we've just had to make way toomany assumptions as far as what
the forward looking pathway is,and in doing so, sometimes we
(43:58):
start to believe thoseassumptions and we build
business models that just travelthat kind of narrow path where
I think things are just verydifferent.
And I'm curious as to yourthoughts on, like removing this
certainty of the future andunderstanding that it can go a
multitude of different ways onmultitude of different timelines
(44:19):
.
Like, how do you build yourbusiness differently from like a
kind of a strategy perspectiveto make sure that you're not
falling into these traps of likeoh, I built my business on this
cost structure, understandingthat, oh, maybe legalization is
going to make things a littlebit easier over time.
(44:41):
It's not.
And what have we learned overthe years?
And how do we like enter aspace and responsibly build a
business where we're not quitecertain how big the total
addressable market's going to bein a certain given amount of
time?
AnnaRae Grabstein (44:51):
Yeah Well, to not answer your question, but
we do need legislative clarity.
The industry deserves it.
We need to keep fighting for it.
We need to build some level ofclarity of what the laws and
regulations are that we existinside of.
(45:12):
So we can't give up doing that,but knowing that we exist in
this place of lack of clarityand, putting that aside, of how
do we keep moving forward.
I think that we look at thingsin amounts of time that we still
can depend on realistically,like six and 12 month increments
(45:36):
of truly being able to plan,but based on what is in
existence today.
And, granted, we're talkingabout an appropriations bill
that could have significantimplications.
But broadly, we could talk aboutthe next six months in our
industry with some level of trueunderstanding of what the
(45:56):
market opportunities look likeright in front of us, and make
some clear plans, not gettingtoo far in front of our skis,
not over-raising, notover-promising, standing next to
and building relationships withpeople that we think are going
to be long term partners to our,to our business, just doing the
right thing, always in theshort term that supports the
(46:21):
long term, while just buildingthe DNA of reinvention, of
making it okay to realize thatthe thing that you were doing
before doesn't have to be thething that you keep doing in the
future, because that is thecycle of denial that we have to
get off of.
Yeah, you just this concept, youknow.
(46:43):
I know you want to talk aboutit next, so I'll let you take it
, but I think that what we haveto do is we have to get to a
place of normalizing the realityof what's right in front of us,
still having lofty aspirationsthat are that's where our
purpose and our vision landsabout the world that we hope to
(47:04):
get to live in one day.
But what about the world thatwe're living in today?
Staying grounded in that,planning for that in ways that
we can control?
Six months, 12 months we gotthat.
It's hard to plan financiallypast 24 months in cannabis, so
don't do it.
Ben Larson (47:20):
Don't do it.
I I've historically refused todo like detailed three to five
year models as like the you know, the detailed three to five
year models.
As, like the, you know the theinvestors always like to ask for
, I'm like I will give you asomewhat accurate, hopefully
projection for what the nextyear looks like.
Here's what it could be, with abunch of asterisks, over the
(47:40):
next two years.
Three to five years is yourguess as good as mine.
As long as we're not, you know,crashing into the earth, we're,
we're in a good place exactlyit's just.
AnnaRae Grabstein (47:49):
Don't spend your time on that.
It's just not worth it.
Ben Larson (47:53):
Okay so.
So one thing I wanted to get at, just because it kind of keeps
going in my head and and kind ofhelps us kind of circle back to
like, where are we in in thisphase of the industry?
And I keep thinking about theTuckman model and if you're if
you're not familiar, the Tuckmanmodel and if you're not
familiar, the Tuckman model isoften described as a way that
teams develop and so, like,every time you added a
(48:15):
significant new team member oryou're bringing a team together,
hemp and cannabis industry wewe kind of jumble this up
sometimes like cannabis wasgoing through the forming stages
(48:36):
, this very painful, iterativekind of process of implementing
new rules.
There was the storming period.
A bunch of venture capital camerushing in and then we started
figuring things out.
And we're in this normalizationperiod where we're trying to
figure out how to runsustainable, successful
(48:57):
businesses and how to like kindof really kind of emerge from
this doom and gloom, if at allpossible In 2018, and the years
that followed possible in 2018and the years that followed,
hemp had this opportunity to doa bit of storming without a lot
of the forming, and there have,as we said, been a lot of
(49:19):
benefits that that this hascreated for exposure of
cannabinoids to society andnormalizing of the plant, and it
was built again a lot off a lotof the progress that we'd been
making in the regulated cannabisspace.
And so, after the storming, whatis happening now is this
combination of forming andnorming at the same time.
(49:40):
People are believing that theyshould have access to it, that
it's kind of normalizing, butthe rules are being formed as we
go and anyone that's out thereraising their hand saying we
already have rules, it's alreadylegal, it's like it's not clear
, like you have to use thestructure that's given and we
have to have the right rules inthe right places, and so that's
(50:02):
why there are organizations thatare pushing very hard for
regulatory clarity.
So I just wanted to kind ofbring this up because it's
breaking my brain a little bitas to like why we're in the
situation that we are and it'sjust like this whole, like
forming then storming, notstorming then forming.
But here we are.
I don't know what are yourthoughts on this?
(50:23):
Are you familiar with theTuckman model, and am I bringing
this out of nowhere?
AnnaRae Grabstein (50:27):
Totally.
It's definitely come up and Ilike this idea of normalization
of cannabinoids being an outcome.
That is the result of what wecalled today the hemp experiment
.
But you are absolutely rightthat the storming happened
(50:48):
before the forming and I don'tblame the humans involved.
I think that there sometimes isan opportunity that arises and
the instinct is to grab it, andthat's what that storming was.
It was holy cow.
There is an opportunity forhemp-derived cannabinoids to
fill a void in the market rightnow.
(51:10):
Let's go do it, let's go getthem out there.
But because the forming didn'thappen, we are feeling the pain
overall.
Everybody, whether you're anoperator that started a business
or you are a regulated cannabiscompany that feels that you're
competing with the hempbusinesses- or you're just being
lumped all together in thesepress conferences that are
(51:32):
happening down in Texas, whereit's just reefer madness all
over again.
Ben Larson (51:35):
It's hurting all of us, right.
AnnaRae Grabstein (51:37):
But norming is certainly what we're going
for here, and I think that theexperiment has proved that
normalization is something thatthe consumers want.
But can we get the ecosystem tosupport what it is that the
(51:57):
consumers clearly want?
You know, we'll see.
Wow, we've been talking aboutsome big things here.
I hope that people are enjoyingit and that we're not too out
there and thinking about thefuture, but the thing is, if
you're listening to this, whatyou need to know is that Ben and
I are both in this.
We are so deep in it.
(52:19):
Ben is building his ownbusiness and I am working inside
of multiple businesses helpingthem navigate all of this, and
we're both not going anywhere,and so there's a lot of
challenge no matter how much youwant me to.
Yeah, it's like yeah we're goingnowhere.
We're here this is, this is mygreatest and best use is to help
(52:40):
solve problems in cannabis andand make marriages between
cannabis companies and all thethings that we're all doing.
So I think we're not given up,and I know I'm here because I
believe this work matters.
But I also love the challengeof it all.
I love that we're getting toplant the seeds for what is the
(53:04):
future, and I love that I ampersonally being challenged to
constantly reinvent myself andreinvent businesses, because
that's just endlesslyfascinating, even if it's hard.
But we can do hard things right.
We can do hard things, people,and if you're listening to this,
you know that cannabis is hard.
(53:25):
There is nobody that isexisting in cannabis today that
thinks that it's easy.
But we can do hard shit and wehave to wake up every day with a
resolute commitment to diveinto the shit and to somehow dig
our way out of it, becausethere is a future that is like
what Andrew Livingston said lastweek that is affordable,
(53:46):
accessible, with a greatassortment for consumers.
I believe that we're moving inthat direction.
It just there is some painalong the path Hell yeah, hell.
Ben Larson (53:54):
Yeah, annarie.
Yeah, you're still bullish,right?
Ben?
Absolutely yeah.
I mean, look, on the grandscheme of things, everything is
up and to the right.
It's just it gets a littlevolatile the closer that you
that you zoom in.
I I think what we have proventhis year in particular is that
people want cannabinoids.
(54:15):
Cannabinoids still generallydon't kill people.
We're on the right trajectory.
Everything is generally stillup and to the right and the
public sentiment that we have isthat people want to fight for
this, like we have peoplefighting for hemp, for cannabis.
That we've never had in ourcorner before and after doing
(54:36):
this for the last decade.
It is.
It is tangible, like how muchmomentum that we actually do
have, despite any legislativeheadwinds that we're feeling in
the current session and in thesessions ahead, all intents, and
we are getting more access tomore people every year that
passes.
So still very bullish.
AnnaRae Grabstein (54:58):
Stay strong.
People Face the hardest things.
Ben Larson (55:02):
Yeah, to that end, it is important that, in some
way or another, get involvedwith the federal movement,
whether it's hemp or cannabis,both are constantly being
deliberated at this point.
There are very tactical ways todo it.
Creating more voices in theroom isn't necessarily the way
Any of the existingorganizations doing good work.
(55:24):
On the Hill the ones that speakto you most get involved,
contribute your dollars.
The hill the ones that speak toyou most get involved,
contribute your dollars,contribute your support.
And, yeah, let's get someserious change, clarity
implemented at the federal levelin the coming year.
AnnaRae Grabstein (55:39):
Amazing.
So we hope you liked thisepisode and, if you did join the
conversation, a bunch of peopledid comment during this live
recording, so thank you to allof you.
We pay attention, we listen andwe will reply later.
Ben Larson (55:55):
Being that it's our 91st episode and there are a
number of you watching, soplease go and subscribe to our
podcast.
Like, share, review.
Leave five stars.
Please Help us get seen.
Our listenership is growingevery week, every month, and we
just are thrilled with with theprogress.
I don't know what we're gonnado for 100th episode.
(56:16):
It'll be big, it'll be thebiggest, it'll be big and
beautiful, so tune in.
Thank you so much.
AnnaRae Grabstein (56:23):
Beautiful episode.
Ben Larson (56:25):
A big, beautiful BBE .
We don't have enough reviews onApple, though.
AnnaRae Grabstein (56:28):
Guys, we need more reviews on Apple, so
please go on and give us areview.
It would be really meaningful.
Ben Larson (56:35):
Absolutely.
Thank you to our teams Evertosaand Wolfmeyer, Thank you to our
producer, Eric Rossetti, andthank you for tuning in.
Until next time, folks Remember, stay curious, stay informed
and keep your spirits high.
That's the show.
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