Cannabis & Tech Today -- Spring 2020

INNOVATOR PROFILE: LEIGHTON WOLFFE | THE ART OF THE POTCAST | BUSINESS PROFILE: SEED & SMITH

LEADERSHIP TIPS FROM TODAY’S MOST SUSTAINABLE COMPANIES HOW SECURE IS YOUR DATA (HINT: NOT ENOUGH) GREED AND GROWTH: BIG BUSINESS ENTERS THE CANNABIZ MAKING YOUR COMPANY INVESTOR READY

AL HARRINGTON Holds Court

Spring 2020

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FROM THE PUBLISHER

Inspiration Through Collaboration The cannabis industry has changed so much over the years, with a newfound acceptance completely redefining the past decade. Suddenly, cannabis is being embraced by mainstream entertainment, technology is evolving, and new ventures are developing. But as much as you can focus on the media, products, and business of cannabis, it’s important not to forget the driving force of it all: the people.

Charles Warner, Publisher/Editor-in-Chief

Since the launch of our publication, we have had the pleasure of putting the spotlight on the personalities that have driven our industry throughout the past few decades. Ricky Williams gave us a perspective on cannabis use in athletics and its continued prohibition.

Wanda James discussed the importance of social justice in the cannabis industry. Cheech Marin and Tommy Chong showed us how their groundbreaking comedy helped the modern acceptance of the substance. And that’s just the tip of the iceberg, considering we’ve been blessed with cover stars such as Jim Belushi, Dr. Sue Sisley, Julian Marley, Kevin O’Leary, Cassandra Farrington, and Gary Vaynerchuk.

Speaking of Vaynerchuk, I still have great memories of our discussion. It was the second time we had spoken, as I also had the pleasure of conversing with the entrepreneur for our flagship publication Innovation & Tech Today. And, while he may be known more for wine, Gary Vee certainly had a perspective on the cannabusiness. He gave a blunt, and extremely true, warning for those trying to enter the space: “Smoking a bong for four years of college and now deciding to start a cannabis business is a really bad f***ing idea.” Well said, Gary.

Getting these different voices has been one of the missions of our publication from the very first issue. In fact, the issue you’re about to read is very reflective of our focus on the personal side of the cannabusiness. Take our cover story with Al Harrington, who entered the cannabis business after being inspired by how the substance helped his grandmother.

Harrington’s companies focus on social equity and positive change, and that passion really shines through in his interview. And alongside Harrington, the new issue features in-depth conversations with GrowFit Analytics President Leighton Wolffe, the leading cannabis podcasters, and our very own Sustainable Leadership Award winners.

The cannabis industry is filled with hard-working, passionate people. The people we interview, our contributors, our sales team, and of course our creative staff make this publication possible. Being able to collaborate with the people that make up this incredible industry is an honor and a privilege, and one that I do not take lightly.

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Cannabis & Tech Today // Spring 2020

SINCE LAST ISSUE… LETTING OUR VOICES BE HEARD Cannabis podcasting is on the rise, with more and more shows focusing on conversations about the culture, legislation, and business around the substance. Hosted by Joe Dolce, Brave New Weed is a cannabis-focused podcast with the tagline “Adventures into the Uncharted World of Cannabis,” which is a perfect explanation of the show’s focus on guests from various backgrounds. Our own Associate Editor Patricia Miller made a special appearance on Episode 70, where the discussion focused on the mysterious illness connected to cannabis known as cannabinoid hyperemesis syndrom. Search “Brave New Weed Podcast” on your platform of choice and give it a listen.

SPEAKING OF… And as long as we’re on the subject, why not check out the official Cannabis & Tech Today podcast? Available on all major platforms, Cannabis & Tech Talks features short discussions on the modern cannabis industry, with a focus on science, business, and technology. Some recent guests include Santé Laboratories Chief Scientific Officer Brian Sloat and President Mike Sandoval, Ruffhouse Studios producer Matt Lamb, and TribeTokes founders Kym Byrnes and Degelis Tuft. There are plenty more episodes on the horizon, so make sure to subscribe to Cannabis & Tech Talks wherever you listen to your podcasts!

SPECIAL THANKS TO: Robbie Wroblewski, Mike Lempert, Seed & Smith, Danny Murr-Sloat, Courtney Greenberg

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Nicolas Arkells John Brunstein Kevin Campbell Neill Dixon Mary Jane Gibson Mike Glazer Dan Greene Tami Kamin Meyer Andrew Myers Ross O’Brien Alex Rogers Dave Roberson Laurie Wolf

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Cannabis & Tech Today // Spring 2020

OPEN

contents

SPRING 2020

SPRING ISSUE COVER 56 Al Harrington: From the Court to the Cannabusiness

By Anthony Elio Cover Photo: Viola Brands

Departments 10 By the Numbers 12 E vent Wrap-ups 14 Know Before 16 Hemp 18 International 20 Event Spotlight 22 Legalization

82 Product Revolution 84 Something Edible with Laurie Wolf 86 Event Calendar 87 Coming Next Issue 88 The Lighter Side

24 Innovator Profile: Leighton Wolffe 26 Sustainability Greener Growing: A Sustainability Panel 32 Five Myths About Indoor Growing 36 Selective Breeding for Sustainability

40 Business If You Legalize It, They Will Come 42 Quality & Community

Photo: iStockphoto.com/SchulteProductions

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Cannabis & Tech Today // Spring 2020

contents

SPRING 2020

48 Investing Investors Wanted: 10 Tips for Success 52 Defining Cannabis Entrepreneurship 54 What is a Capital Raising Strategy and Why You Should Have One

60 Legislation Cannaprivacy 62 Thin Green Line

68 Health Numbness, Spasticity, and CBD

70 The Lab An Extract Evolution 74 Marker Assisted Selection: What MAS Can Do for Cannabis Breeding

78 Media+Entertainment To Market, To Market, To Buy Cannabis with My (Adult) Kid 80 The Art of the Potcast

Photo: iStockphoto.com/adogslifephoto

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Cannabis & Tech Today // Spring 2020

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A look at the metrics shaping the cannabis business market — and our lives

The passage of the 2018 Farm Bill opened up the hemp market to new horizons. This resulted in a big 2019 for the hemp industry, and the trend will likely continue going into 2020 and the new decade. Hemp is one of the most versatile crops out there, with potential to improve sustainability efforts and personal healthcare. Here, we’re highlighting the major strides hemp has made in the last few years and will continue to make in this new decade.

Market Watch

43 in 2018.

million

USD Statista

368

Domestic hemp acreage increased by

%

5.73 in 2020.

U.S. industrial hemp market may exceed

billion

USD Market Watch

Total sales of hemp-based products are forecast to reach

270 by 2025†

million

USD Statista

150000

120000

from 2018 to 2019, according to the United States Department of Agriculture (USDA).

2.61 by 2022.

138,000*

Acres of Hemp Grown by Year

90000

78,176

60000

Hemp-derived vs.

Marijuana-derived CBD in 2017

%

0

Marijuana-derived

Statista

Amount of Acres Licensed to Grow Hemp in 2019

Vote Hemp 2019 U.S. Hemp License Report

Industrial hemp defined as hemp grown as fiber or seed crop.

†

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Cannabis & Tech Today // Spring 2020

25,713

30000

45.1 % 54.9 511,442 Hemp-derived

billion

9,770 2016

*estimated

2017

2018

46

2019

States Have Legalized Hemp

Vote Hemp 2019 U.S. Hemp License Report

USD

Global sales of hemp estimated to hit

Vote Hemp 2019 U.S. Hemp License Report

Industrial hemp fibers market from pulp & paper applications was valued at over

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DEPARTMENTS // EVENT WRAP-UPS

Emerald Conference Located at the Loews Coronado Bay Resort in San Diego, the sixth annual Emerald Conference was a unique cannabis industry event that put science at the forefront. Tailor-made for those in the industry with a focus on topics such as extraction science, cultivation science, analytical testing, and pre-clinical research, the Emerald Conference is a go-to for cannabis science. The conference also marked the debut of the Quality Summit, a workshop where individuals collaborate on a whitepaper in order to systematize cannabis industry nomenclature. The conference also hosted numerous experienced speakers, such as MediPharm Labs Scientific Advisor Matthew Archibald, Chemist Susan Audino, Ph.D, and Emerald Scientific Founder Ken Snoke.

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Cannabis & Tech Today // Spring 2020

NCIA Northeast Cannabis Business Conference The new year has already proven to be a successful one for cannabis, as shown by the debut of the NCIA Northeast Cannabis Business Conference held in February. The event’s purpose is a vital one, uniting over 3,500 experts from across the industry to discuss where different regions stand on the substance when it comes to topics such as business trends and specific regulations.

Additionally, the event’s agenda contained such educational sessions as: “The Future of Cannabis Packaging,” “From Seed To Sale: The Global Supply Chain,” and “Compliance is Critical: How To Avoid A Costly Mistake.”

MJBizCon 2020 Known as the absolute biggest trade show in the cannabis industry, MJBizCon united over 35,000 individuals from 75 different countries to focus on the cannabusiness. Taking place in the massive Las Vegas Convention Center, the event welcomed approximately 1,300 exhibitors with different areas of expertise, from law and startups to vaporizers and CBD. With a keynote speech from Netflix founding CEO Marc Randolph and additional speakers from numerous fields within the industry, MJBizCon showed once again that the cannabusiness continues to climb.

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DEPARTMENTS // KNOW BEFORE

Know Before You Vape

By Alex Moersen

So, Is Vaping Dangerous?

In short, it depends. The main problem stems from the quality of the materials used in lowgrade vaping technology, such as vitamin E acetate, heavy metals, etc. With vaping’s sudden popularity, it lead to a lot of people trying to make a quick buck in the new industry, subsequently resulting in a number of low-quality vaping products and concentrates.

Peter Calfee, CEO of leading vaping company Gofire, explains it like this: “The investigations are revealing the cause of these horrific cases are for a number of reasons, all of which have to do with the integrity of the concentrate being ingested and the quality of the technology being used to ingest it.”

So, no, vaping in general isn’t necessarily dangerous. (Although, it should be acknowledged that anything in excess has the potential for adverse effects.) But, there are lowquality products out there that have the potential to cause more harm than others.

What Do I Need to Look for in a Vaping Product?

Whether it be cannabis, food, or any 14

Cannabis & Tech Today // Spring 2020

consumable, you should always know the ingredients and quality of what you are putting in your body. If you’re looking to purchase your first vape product, you need to do your research. What kind of company are you purchasing from? What are their manufacturing processes? What do they put in their vaping products and concentrates? These are key questions to ask, especially in a sector that is lacking governmental regulation.

Because of this, the onus is on the consumer to make sure the product they’re buying is made without toxic additives.

It’s a safe rule of thumb to avoid any cheap, gas station e-cigarette. Besides that, there are a few ingredients and additives that act as red flags for low-quality vaping products. Vitamin E acetate is one of the major additives that you want to stay away from.

Josh Kaplan, a neuroscientist and science writer specializing in medical cannabis, describes vitamin E acetate as “a cheap additive that’s often used in low-quality products and found in illicit markets… While vitamin E products have long been used in topical

Photo: iStockphoto.com/HighGradeRoots

Over the past year, it’s likely that you’ve heard a lot about vaping.

Some have claimed it’s a healthy alternative to smoking while other reports have cited potential dangers. It’s confusing, especially if you are considering trying to vape cannabis for the first time. Here, we’re going to give you a quick rundown on the most important things you should know before purchasing a vape.

treatments such as hand creams, there is little research on the effects of heating and inhaling them… Vitamin E acetate resembles an oil, which, when heated, can stick to the side of the lungs and interfere with their function.”

There are other culprits here, too. Propylene glycol can be found in these products and can irritate the eyes and lungs. Additionally, toxic metals, such as lead, nickel, and manganese, can be found in the heating coils of some vaping products.

While not yet conclusive, especially due to lack of vaping research, those are some of the major red flags you can look for when considering purchasing a vaping product.

Final Words of Advice It may be easy to be afraid of vaping, and surely more research is needed into the effects of vaping on the body. However, if you do your own research and purchase well-made, highquality products without these additives, then you might just find the smoking solution you’ve been looking for. When in doubt, see if you can contact the manufacturer to ask about the quality of the ingredients in their products. ❖

DEPARTMENTS // HEMP

Oh, the Things Hemp Can Do!

The 2018 Farm Bill opened up the hemp industry to all new possibilities. At this point, it’s likely that most people know CBD can be derived from hemp; however, hemp has a lot of benefits that people might not be aware of. For instance, hemp can easily be manufactured into paper, making a more sustainable alternative to tree-based paper products. That’s just one example. Here are three other things that this versatile crop can do that you might not expect.

1

By Kevin Campbell

3

Save the Bees

Industrial hemp, then, could act as a potential solution for a steadily declining bee population. According to a report from Bee Informed Partnership, a nonprofit associated with the University of Maryland, between October 1, 2018, and April 1, 2019, 37.7 percent of honey bee colonies kept by commercial beekeepers experienced decline. If hemp provides a tasty treat for these important pollinators, we may see their populations bounce back as more hemp is planted.

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Fuel the World Bioenergy is one of the fastest growing forms of renewable energy in the world.

Recently living organic materials, known as biomass, are used to produce fuel, heat, and electricity. However, not all biofuel crops are sustainable. Some use too much water, displace people, and create more emissions than they save.

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Cannabis & Tech Today // Spring 2020

Build Homes You may know that hemp can create paper products, but it’s capable of so much more. Hempergy is an indigenous-owned and operated company that is turning hemp into construction materials. As Zaffia LaPlante, the founder of Hempergy, explained, “Hempergy is focused on improving the supply chain of waste management in the cannabis and hemp industries.

Our goal is to use hemp as a sustainable feedstock for construction, cosmetic, and textile purposes.”

Hempcrete, a hemp-based substitute for concrete, is mold-proof, nontoxic, fire-resistant, biodegradable, and doesn’t use chemicals or toxins.

As the hemp industry continues to put their heads together, more innovations like this will emerge, and it may not be long until all of our homes are built from hemp.

Photos: iStockphoto.com

Firstly, bees love hemp. A 2019 study published in Biomass & Bioenergy, titled “Bee diversity and abundance on flowers of industrial hemp,” set out to see if hemp, during flowering season, might be a valuable source of pollen for foraging bees. To test this, researchers set up almost a dozen traps around industrial hemp fields during peak flowering season and collected bees over the course of several days. In the end, researchers found nearly 2,000 bees from 23 different bee genera. They concluded that “industrial hemp can play an important role in providing sustained nutritional options for bees during the cropping season.”

This is where hemp comes in. Biogas production from hemp could compete with biogas production from corn, especially in colder climates.

Additionally, ethanol production is possible from the whole hemp plant, and biodiesel can be produced from the oil pressed from hemp seeds.

Since hemp requires limited amounts of pesticides, it could potentially begin to rival other biofuel crops on the market. As hemp spreads across the world and more money and time is invested in research, there will only be more discoveries related to what people are already calling the “Swiss Army knife” of plants. ❖

DEPARTMENTS // INTERNATIONAL

Cannabis Research Will Drive the International Industry Forward in 2020

By Alex Rogers projections were accurate and why some projections may have missed their mark.

Photo: iStockphoto.com/cyano66

Local market data is just starting to become available as industries around the world continue to mature. This year will be ripe with available data and analysis, and people need to keep an eye out to see what they can learn from the results of relevant studies for their particular market or niche, in addition to keeping a close eye on macro-focused analysis to see where the industry may be headed.

This year will be a pivotal one for the emerging international cannabis industry.

Cannabis is still prohibited in more countries than it is permitted; however, that is changing rapidly. 2020 will no doubt see more countries across the globe reform their cannabis laws and some will pass measures allowing legal cannabis companies to operate.

Cannabis policy reform will not be the only thing that contributes to the forward progress of the cannabis industry in 2020. Cannabis research, including cannabis industry data-based research, will also play a significant role in helping the emerging cannabis industry continue to develop and grow this year.

Some of the most popular panels and speakers at International Cannabis Business Conferences are those with presentations dedicated to cannabis research, especially anything involving

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Cannabis & Tech Today // Spring 2020

cannabis industry data. Math is the great equalizer, and analyzing cannabis industry data can provide tremendous insight into the industry at the macro level, as well as help people spot trends and potential opportunities at the micro-industry level.

Unfortunately, many entrepreneurs and investors in the cannabis industry largely base their decisions on subjective opinions and unfounded hunches. Having a particular instinct is useful in any industry, including cannabis; however, instincts can often lead people astray.

Data, on the other hand, is objective and unbiased, and therefore extremely useful.

It’s a very exciting time for cannabis industry data analytics and research. The amount of available data increases with every passing year, and 2020 was a popular projection target for data companies. It’s interesting to see which

Cannabis research is being embraced now more than ever before. However, policies and regulations in many nations are still in desperate need of improvement from a medical research standpoint. Fortunately, medical-focused cannabis research is not only being allowed in more countries than ever before, but it’s also being outright embraced and encouraged in some countries, such as Israel.

The entire world benefits when cannabis is researched objectively and comprehensively, including citizens who do not currently consume cannabis or have a desire to ever do so.

The cannabis plant is one of the most versatile plants on Earth. It has many uses and can be used to make many things, from building materials to batteries to fuel. That’s in addition to the plant’s medicinal properties. Because of that, the cannabis plant needs to be studied as much as humanly possible.

Earlier this year, new cannabinoids were discovered, which will no doubt lead to further breakthroughs. The coming year will presumably see a number of cannabis-based scientific breakthroughs occur, making this a very exciting time to be involved in the industry. ❖

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DEPARTMENTS // EVENT SPOTLIGHT

Delayed, but not Forgotten Networking events and corporate travel are on pause, but the event space isn’t gone for good.

By Ebby Stone

Sumit Mehta

Investments in cannabis companies aren’t a sure bet. The market is unsteady (particularly amid the COVID-19 economic crisis), the political climate has an ominous and everpresent hold on their future, and one company easily blends into the next as legal states become saturated with startups looking to cash in on the lucrative crop.

Though persistent, these problems aren’t insurmountable. Entrepreneurs have several avenues for attracting investment, one of the most profitable of which are networking and business-to-business (B2B) events. The pandemic has ushered these valuable opportunities into hibernation, but they’re eagerly awaiting the go-ahead to resume operations, albeit with new safety protocols in place.

Despite the uncertainty, business owners and prospective investors will still have the opportunity to attend the world’s largest of these expos in New York City. Formerly scheduled for May, the Cannabis World Congress & Business Exposition (CWCBExpo) is now scheduled for October 1-3, 2020.

CWCBExpo is the leading cannabis B2B event 20

Cannabis & Tech Today // Spring 2020

nationwide. It offers crucial networking opportunities for entrepreneurs, retailers, farmers, medical professionals, government regulators, and investors looking to extend their reach.

The headline presentation for this year’s New York event is sure to keep attendees on the edge of their seats. MAZAKALI Cannabis Investment Firm Founder and CEO Sumit Mehta will dive into the complexities of cannabis asset management. His discussion, “Cannabis Capital Crossroads,” will focus on the current state of the industry, the future of the evolving market, and the challenges and opportunities facing investors.

If a riveting keynote from a former JP Morgan strategic consultant isn’t enough to draw you in, maybe some tips from the former CEO of Canopy Growth Corporation will pique your interest. Bruce Linton will be detailing his “Next Great Adventure,” in cannabis and revealing his plans for continued Canadian-market domination.

After learning from some of the most knowledgeable names in the space, you’ll likely want to discuss what you’ve discovered with

fellow colleagues and industry insiders at the event. Though social distancing may still be in effect, and masks will be a must, these opportunities to interact with other industry professionals and investors in person are vital to expanding your reach. In fact, research from Oxford Economics estimates the return on investment from participating in expos like this one is between $4-$5.99 per dollar invested.

Why is that? Because 40 percent of prospects met in person become new customers, as opposed to just 16 percent without a one-onone interaction.

Though the New York event holds a special place in the CWCBExpo line up due to the city’s status as the largest business market in the nation, there are two other events taking place this year. Los Angeles will host its own CWCBExpo in September and Boston is also set to host in late October, 2020.

For business owners, these events are an invaluable resource for expanding one’s brand.

Exhibitors and attendees will benefit from early registration as space is limited. Dates are subject to change. To purchase tickets for any of this year’s events, visit CWCBExpo.com. ❖

DEPARTMENTS // LEGALIZATION

Valuable Lessons from the Great Green North

By Neill Dixon The strength of the illicit market was bolstered by legalization; a temporary condition of a developing industry. As Canada finds its way and adjusts our policies, legal cannabis will continue to improve in price, quality, variety, and accessibility – which will replace the need for an adjacent competing industry. Ontario recently repealed the cannabis retail rules to make it easier and faster to obtain a retail cannabis license. Originally we began with a lottery system, which proved to be slow and overbearing. Stores were trickling out at a snail’s pace and couldn’t meet product demand for the size of our population, while other provinces with less population were launching stores by the hundreds. To date there are fewer than 40 operating retail cannabis stores in Ontario and hundreds in smaller provinces like Alberta.

However, this is rapidly changing since the rules were updated. Ontario now has almost 800 retail operator license applications in review.

It’s been almost a year and a half since Canada became the first G7 nation to legalize recreational cannabis and boy have we been through it. From euphoric highs and terrifying lows to promising market projections and plunging stock values, we’ve certainly learned a thing or two.

The Canadian cannabis industry was launched on the shoulders of a mature medical system that had been quietly working for almost two decades prior to federal recreational legalization.

But when cannabis legalization came into the spotlight as a political issue we realized that there were many things we still had to figure out.

Things like retail sales, the illicit market, production, community safety, advertising and promotion, and provincial jurisdiction. With the medical system, many of these things were nonissues because patients could only access legal 22

Cannabis & Tech Today // Spring 2020

cannabis via prescription and there were very few producers.

Once the promise of a new industry became infectious, investors poured capital into the space without knowing what the future of legalization looked like, but with the hope of huge returns. Early projections looked promising even by conseravative estimates and commercial cannabis startups began to appear and scale up quickly. This resulted in a huge upswing in licensed producers and a massive influx of capital. But cannabis consumers haven’t been impressed. Legal cannabis has, to date, been inferior to cannabis available on the illicit market due to inexperience cultivating cannabis at commercial scale. This resulted in too many producers growing underwhelming cannabis and buyers who preferred to shop at illegal dispensaries instead.

The past year was truly a reckoning for the cannabis industry in Canada. Many producers just failed to produce good cannabis at scale, were overextended financially, and disappointed investors to the tune of millions. This “shaking of the trees,” however, was bound to happen and will continue through 2020 as companies who produce high quality cannabis products rise to the top while, producers who can’t hack it will fall away. And that’s not a bad thing.

What’s next for Canada is a shift to cannabis 2.0 where beverages, edibles, and concentrates are king. These new product categories offer significant hope for an industry hungry for access. This year will be exciting as retail demand increases, product variety improves, and consumers find more choice, convenience, and quality than they’ve ever had before.

Our only advice to you dear neighbors, is a lesson in modesty. Scale should be earned, not assumed. ❖

OF THE

INNOVATOR PROFILE YEAR

Leighton Wolffe

By Patricia Miller

Leighton Wolffe: I am with a company that has been in business for 30 years. We have over 50 engineers and domain experts in a variety of technologies. Ten years ago, we adapted a data science platform in order to codify and document what different systems are doing in a time-series database. [The team] developed expertise in developing applications on top of this time-series database, in order to bring disparate pieces of information in from all kinds of different systems.

The cannabis industry has plenty of data floating around, but how much is put to use? As with most big data, it’s desperately underutilized. Lighting, irrigation, and HVAC systems could be transmitting information about crop health twenty-four hours a day, but those systems need a comprehensive platform to analyze what they’re reporting. What does a 10 percent increase in humidity in Grow Room B have to do with the overall performance of a facility? In the eyes of a potential investor, it could mean a lot.

That’s why we spoke with Leighton Wolffe, president of GrowFit Analytics, a data science and environmental technology company that’s changing the way cannabis companies look at their operations.

Cannabis & Tech Today: Your background is in data science.

How did you become involved with the cannabis industry?

24

It allows data scientists to look at diverse data sets in ways they were never able to before in an approachable platform. With this platform, we’re able to create applications and analysis for different market segments. We’ve installed our systems in more than 50 million square feet of facilities, focusing principally in healthcare, medical facilities, critical care, and mission critical facilities. We monitor all the environmental equipment and systems to ensure each are operating correctly.

C&T Today: How do you begin the analysis?

LW: We typically start by connecting to the different systems. We run the platform for two weeks and identify anomalies, which most facility managers have never seen before. In other words, our customers often only see this information as each stand-alone system reports it to them; it’s not unified or working together.

So in this context, we’re able to bring all of these different data sets together. It’s in a time-series format so facility owners can see who’s doing what, when, and where. When that happens, it brings a lot of “aha” moments.

Now they can use the platform to work with their vendors and technology providers to say, “I want the systems to be working in these different ways.” Not only for best practices, but also to meet the requirements for that facility.

We’re able to connect to the subsystems in a grow facility… It’s important to point out that

The GrowFit Analytics platform unifies data from a broad array of systems to provide a comprehensive overview of facility operations. These insights are valuable for investors as well as facility-owners, as the data can help identify problems, inefficiencies, or surpluses that may alter the company’s bottom line.

Cannabis & Tech Today // Spring 2020

GrowFit Analytics President Leighton Wolffe conversing with potential clients at CWCBExpo in 2019. “We’re pioneering a proven technology into a new emerging market,” notes Wolffe of the company’s data analytics platform. By applying tried and tested technologies to the developing industry, Wolffe’s team is elevating standards for every step of the cannabis lifecycle.

many of these subsystems, such as HVAC, lighting, fertigation, irrigation, were never designed to talk to other systems.

C&T Today: How did you enable the systems to communicate with each other?

LW: The value you provide is based on our ability to connect to each individual subsystem and bring that diverse data into one software platform. Once into the Growfit database, we apply analytics and data visualizations that become meaningful to our users. That allows us to create a common platform to see what these subsystems are doing, and how this all affects the growing environment.

C&T Today: To obtain information, do you have to install hardware into each device?

LW: Not necessarily. There’s a variety of software protocols and we can connect to hundreds of those. We install a gateway if it needs to be a direct connection. We can pull data from the cloud if there’s a subsystem that communicates up to the cloud like that.

So we have a variety of mix and match scenarios that we can bring to play right away. I marvel at the fact that many of these systems were not designed to play nice. We also find that

many of these systems were not designed to provide meaningful information. They’ll provide some trending capabilities, but they don’t have the ability to look back at a moment’s notice and compare this to that, or create the kind of “what if ” scenarios that would occur in someone’s mind.

performing. And again, if it’s out of range, then a Spark occurs in an email or a text message based on that, automatically. We’re connecting to the systems that actually manage and provide the environment, so we know if something bad is going to happen before it happens. We also know before it affects the crop. Our business is to connect to these systems and optimize all of the equipment that we’re connected to through powerful analytics.

Then by optimizing it, the customer is ensured that everything is working correctly.

So with our platform, they’re able to say, “I want to look at this data set and I want to synthesize with another data set. I want to see this time; I want to compare it to this other time.” And so it’s really easy to navigate and to see what’s going on at any historical point or in real time.

We’re pioneering a proven technology into a new emerging market. So that’s point number one. Point number two is we’re addressing the lack of standards in the grow facilities and we are improving the standards in the grow facility according to best practices, and in accordance with what we anticipate FDA regulations will be.

C&T Today: Though they may have access to data, it seems like it isn’t always clear how to use that data in the context of how the business is operating as a whole.

We recognized that we have no competitors in the market who have the same caliber of platform, and the same sense of providing a service to the industry. Several new market entrants promote a monitoring solution, but are limited because they only measure environmental conditions. We go further. Our platform continuously monitors the equipment and systems serving the grow facility. We integrate data from sophisticated technologies that measure THC, CBD, pollen, mold, and nutrients in real time so the cultivator, facility operator, and owner have unparalleled access to information. ❖

LW: We have several different ways to approach that. One is what we call Sparks.

Basically, anytime a sensor detects something is out of range of where it’s expected, like temperature or humidity, we alert the customer that this is going on.

We also use Key Performance Indicators, keeping a steady track record of where you are based on how you want the systems to be

Spring 2020 // Cannabis & Tech Today

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Greener

Growing Compiled by Alex Moersen Entering a new decade, the future is bright for cannabis. Legislation is changing across the world, innovations abound, discoveries are being made, and the winds of stigma are shifting. These changes are in no small part due to the businesses that are innovating the industry. In 2019, we awarded several companies with Sustainable Leadership Awards.

Now, we’re sitting down with each to dive deeper into the subject of sustainability and why it is so important to not only each company, but the industry – and the world – as a whole.

Award Category: Water Rich Gellert, President, HydroLogic Purification Systems Why was it so important for you to weave sustainability into the fabric of your company?

HydroLogic has been focused on water and all

Rich Gellert, President of HydroLogic

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Tips and insights from Cannabis & Tech Today’s Sustainable Leadership Award winners.

of its implications relevant to cannabis since I sold my first system back in 2005. I graduated with an MBA/Masters in International Environmental Policy, so conservation was part of HydroLogic’s mission statement from the very beginning. In fact, it was the poor quality and wastefulness of reverse osmosis systems of that time that gave me the incentive to build a better product. HydroLogic’s first commercially available reverse osmosis filter was 75-percent more efficient than its competition, achieving a standard that remains the benchmark for consumer grade filters to this day.

HyperLogic, we are currently involved with several industrial-scale, water conservationfocused grow facilities across North America.

One of the most exciting is co-designing a firstof-its-kind irrigation system with Coachillin’ Holdings, four million square feet of grow with zero wastewater. This will be made possible with multiple onsite cash-crops, each with a particular kind of bioremediation function within the larger system. The only waste produced will be drinkable water and dry fertilizer, which we be barreled up and resold/ reused.

How does HydroLogic work to make the cannabis industry more sustainable?

What are some of the most unsustainable practices impacting the cannabis industry right now?

HydroLogic went on to be the first to bring to market sustainable coconut carbon filters, condensate reclamation systems, nutrient reclamation systems for commercial farms, and containerized wastewater treatment systems.

What’s next? Through our commercial division,

From our perspective, much more water is going down the drain than is necessary. For instance, HVAC condensate creates an enormous volume of waste, as it is not consistent enough in quality to take the risk of

// SUSTAINABILITY //

recycling back into irrigation. Our ARCS technology recovers HVAC condensate, treats, sterilizes, and pH balances it, making it as good as typical reverse osmosis product water, perfect for nutrient formula mixing. In some cases, within sealed environments, this method can provide up to 80-percent of a grower’s daily water demand.

How does sustainability apply to the growth of one’s business, rather than just environmental benefits?

management infrastructure. So from a strategic standpoint, we’re also trying to address the greater systematic issues that have led to the degradation of our waste management infrastructure.

James Eichner, Co-Founder of Sana Packaging

Our commitment to sustainable practices at HydroLogic has attracted top-notch talent. With today’s new water regulations, we need the industry’s best people to help create systems that allow leaders in the field to do business. We firmly believe that much of what we are doing today will open doors to other parts of the larger AG industry, as water conservation becomes more than just lip service, but more a matter of long-term prosperity.

that drive me crazy are: (1) exit bags, (2) the use of mixed materials, and (3) the use of crappy materials like polystyrene.

How does sustainability apply to the growth of one’s business?

Without a healthy environment there is no such thing as a healthy business, so sustainability is a must. Looking specifically at packaging, consumers are demanding change, and packaging is becoming viewed as part of the product. It’s no longer just a commodity. And businesses that use sustainable packaging can make that part of their brand story and weave it into their marketing efforts. It’s a win-win for your business and the environment.

Award Category: Innovation Philip Preston, President, PolyScience Why is it important for your company to weave sustainability into the fabric of what you do?

Award Category: Packaging

James Eichner, Co-founder, Sana Packaging Why was it so important for your company to weave sustainability into the fabric of what you do?

To paraphrase Greta Thunberg, this is not the time and place for dreams but the moment in history when we need to be wide awake. At Sana Packaging, we’re wide awake and we believe sustainability is not just a responsibility but an obligation.

How does your company work to make the cannabis industry more sustainable?

What we’re ultimately trying to do is design and develop cannabis packaging for a circular economy. A circular economy is restorative and regenerative by design and adheres to three guiding principals: (1) designing out waste and pollution, (2) keeping products and materials in use, and (3) regenerating natural systems.

What are some of the most unsustainable practices impacting the cannabis industry right now?

The materials we work with include 100-percent plant-based hemp plastic, 100-percent reclaimed ocean plastic, and other innovative materials. That said, materials are just one piece of the puzzle. The other – more complicated – piece of the puzzle is our waste

Unfortunately, there are a lot of unsustainable business practices in the cannabis industry.

Some are due to the regulatory environment and some are due to producers not taking responsibility for their negative externalities.

Just looking at cannabis packaging, three things

The awareness of sustainability in our production facility has grown significantly in the last 10 years and our customers are demanding it. Additionally, it is very important to me on a personal level.

When you develop a product, do you look at sustainability as a part of the development process?

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Philip Preston, President of PolyScience

We do. We look at the product specifically and we look at all of the processes associated with it.

And with our latest release of Chillers, we actually exceed the performance of the prior product while utilizing half of the refrigerant gas, which is a contributor to global warming.

What are some of the most sustainable practices PolyScience is doing to impact the cannabis industry?

Well, I think most of the practices that we’ve put in place really impact all of our industries, in that we’ve reduced the amount of refrigerant gas, we’ve invested in the equipment to migrate to refrigerant gases that have virtually no global warming potential, but there can be even very simple things that we put in place. Our entire facility has been insulated and we do everything we can to build products with the least amount of energy put into it in terms of gas, electricity, etc. Additionally, we have a very structured ISO 14,000 system, whereby we’re recycling and minimizing waste. It comes down across the product from our choices in packaging material to how we recycle every piece of scrap metal.

How does sustainability apply to the growth of one’s business, rather than just environmental benefits?

Well, as a privately held business, I think we have the luxury to look at this from a very personal perspective as well as a business perspective. And for me, it is extremely important that we’re very responsible towards 28

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the environment. But just from the pure business perspective, I like to believe that customers will choose a company that has made the investment in the environment and in structured systems that reduce waste and reduce their impact. I think it’s a good indicator that they’ve also put that same level of diligence into the quality of the product and the innovation in the product.

sustainability, we make sure information and expertise are readily available for companies.

For those who wish to be good corporate actors and do what they can for sustainability, we provide the resources necessary to make that happen.

What are some of the most unsustainable practices impacting the cannabis industry right now?

Award Category: Event Robert Friedman, Founder, Cannabis LAB Why was it so important for your company to weave sustainability into the fabric of what you do?

One of the first questions we asked before starting this company was how to address and achieve sustainability. Not only is it one of the more important issues of our time, but also its meaning resonates throughout each stage of business development, or at least it should.

Sustainability for the environment, for our community, our employees, members, business practices, and more are critical components to weave into the tapestry of one’s personal and professional life.

Robert Friedman, Founder, Cannabis LAB

How does your company work to make the cannabis industry more sustainable?

As an education and networking association for the industry, we believe we are a front line weapon for sustainability. By constantly educating on best practices and benefits of

Staying focused on environmental sustainability, I would say packaging and illicit market sales are the most unsustainable. I do not think either requires much explanation here, but

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there is clearly a need to focus on less packaging that is also more eco-friendly, as well as stop the illicit market from putting out dangerous products which cause illness/death and other environmental concerns.

Brandon Newkirk, VP of Marketing at LumiGrow

How does sustainability apply to the growth of one’s business, rather than just environmental benefits?

From a business perspective, sustainability and growth should be considered synonymous.

Rooted in this commitment to sustainability, businesses doing community outreach, volunteerism, and philanthropy, while finding other ways to practice what they preach, ought to achieve the growth they desire.

Award Category: Energy Brandon Newkirk, VP of Marketing, LumiGrow Why was it so important for your company to weave sustainability into the fabric of what you do?

We have an enormous opportunity in front of us with the creation of this burgeoning industry.

But, there is also great risk. Did you know that, even before legalization, one percent of all electricity used in the United States was consumed by cannabis-related operations? In some cities it’s almost as high as four percent.

I’ve seen too many news sites report stories on how we don’t yet have a better way forward. We do have a better way. We have the “know-how” and technology already developed and it’s being used on a commercial scale. The beautiful part of it is that saving electricity equates to saving dollars, so in this case there’s a real harmony between profit and sustainability. We’re just proud to be leading the way.

How does your company work to make the cannabis industry more sustainable?

At LumiGrow, we design smart lighting technologies and various sensor integrations specifically for growers. Our products are all designed to improve a commercial grower’s profitability, and each product does so in its own uniquely sustainable way.

It’s no surprise that our LED grow lights save electricity, since we all know that LEDs are more energy-efficient than any other fixture on the market. We’ve taken this savings a step further

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with our smartPAR Wireless Control System by being able to dim the light fixtures or adjust the light spectrum wirelessly from your smartphone, tablet, or computer. This has the added benefit of improving crop health by delivering the amount of light your crops’ growth stage and cultivar requires.

When we move smartPAR into a greenhouse, things get really interesting. You can easily set your light fixtures to automatically adjust to weather patterns and deliver the exact amount of light your plants need. We do this to ensure that every plant in your greenhouse gets the optimal amount of light it needs, every day of the year without using more electricity than necessary.

We’ve also just released our SporeCam, a disease detection sensor that alerts you of disease pressure before your plants get sick. Not only can you save yourself from the devastation of losing an entire crop, but it allows you to make more sustainable choices to prevent disease once you know it’s present, rather than resorting to treatment methods that may not be sustainable or all that effective.

What are some of the most unsustainable practices impacting the cannabis industry right now?

Irresponsible electricity usage is a huge problem in the cannabis industry. Namely, this comes down to lighting and HVAC. On the lighting side of things, HPS is the main culprit, using significantly more electricity than LEDs.

There was a time when LEDs were in their early phases and there were questions about how effective they could be. But, we’re now in a technological age where LED fixtures are both powerful enough and cost-effective enough to get the job done right. It’s just important that you go with an LED company that’s been proven effective, as there’s still a lot of low-grade equipment on the market.

How does sustainability apply to the growth of one’s business, rather than just environmental benefits?

The great thing is that with lighting, business and environmental sustainability go hand-inhand. We’re not developing technology just so that you can feel good about your environmental impact, though we respect organizations that are focused on conservation.

With our lighting you can make the right decision with your wallet first, and the environmental impact will follow. By delivering the right amount of light to your crops, you’re essentially growing the healthiest plant possible, and the money saved on electricity can go directly to your bottom-line. In a greenhouse, the benefit of smart lighting gets even better because you’re utilizing the full benefit of your sunlight, and it’s free. We don’t need to ask you to care about your electricity use because we’ve already done this for you. All you have to do is care about running your business and, with LumiGrow, the rest will follow. ❖

// SUSTAINABILITY //

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Busting Five Outdated Myths About Indoor Growing

By Andrew Myers

While growing cannabis indoors has steadily grown in popularity – due to state cultivation laws, grower preference, and proven benefits – myths continue to persist around this approach.

Here, we debunk some of the most common misconceptions about indoor growing and explore why indoor growing could pave the way for cannabis production in the future.

Myth #1: It’s Too Expensive Setting up an indoor grow facility isn’t cheap and requires an upfront investment of both time and money. Plus, when building an indoor grow facility that is appropriate for long-term commercial production, you’re better served by high-quality equipment made to last – ranging from lighting fixtures to environmental controls to good genetics.

However, the return on an indoor grow facility can be much higher than an outdoor grow site.

More control for better results: Improved control provided by the indoor environment can yield higher potencies, dazzling trichomes, and dizzying aromas to attract all the right attention.

Higher selling point: Cannabis grown indoors typically fetches a higher price on the market, and indoor growers can cultivate indemand boutique strains to respond to increasingly selective consumer tastes.

Year-round harvests: Growing indoors means harvesting all months of the year, regardless of the weather outdoors.

With the right approach and a little foresight, indoor growers can start turning a profit sooner than many outdoor operations.

All Photos: iStockphoto.com

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Myth #2: The Sun is Irreplaceable Cannabis plants have evolved for eons under the reliable light of the sun. Modern, full-spectrum LED technology is the closest thing to the sun for indoor plant cultivation, with comparable brightness.

Moreover, many growers prefer the unwavering, constant LED light to changes in the sun’s brightness, intensity, and spectrum over the course of the seasons.

Indoors, growers can deliver the ideal spectrum and intensity to nurture plants through each phase of their lifecycle. With control over the exact spectral combinations their plants receive, growers can elicit specific responses and even alter genetic expression.

Horticulturists are experimenting with the many benefits of LED spectral tuning, including how to stave off pests and mold, mitigating other challenges, or boosting flavonoid or nutrient contents. So, while LEDs might not be the sun, they do offer some advantages for indoor crops that our nearest star can’t.

// SUSTAINABILITY // Busting Five Outdated Myths About Indoor Growing Myth #3: It’s Impractical and Labor Intensive For some, operating an indoor facility can feel overwhelming. But, as technology has progressed and growing techniques have become more sophisticated, it’s becoming increasingly practical and less labor intensive. Here are a few ways growers can simplify indoor cultivation: Automating as much as possible: Automating your lighting cycles, nutrient distribution, watering, and more can free up hours of time in your team’s schedule to focus on other tasks requiring more of a human touch.

Integrating equipment: Integrating your environmental controls so they respond to each other without having to manually adjust them saves time and maintains proper conditions.

Honing internal processes: One of the best assets to any business is a knowledgeable team. Make sure employees know how to operate necessary equipment and instill best practices to protect your grow space from risks.

Getting expert advice: Keeping a professional relationship with vendors and other growers means you can rely on your network when issues arise, or you have questions.

Myth #5: Indoor Cultivation Cannot be Sustainable

Myth #4: Large Scale, Indoor Cultivation is Easy Indoor growing is accompanied by its own challenges. At an indoor grow facility, the grower is 100 percent responsible for creating the plants’ environment. There’s pressure placed on individual decisions that can make or break your harvest.

While technology has made commercial-scale indoor growing a lot easier, there are still several variables cannabis businesses need to consider. For instance, if you’re planning on expanding into edibles or extracts, you’ll need to plan that into your budget and consider that expansion during the design process. When investigating which indoor essentials you absolutely need – like lights or HVAC – it’s generally recommended to choose high-quality tools that may be more expensive but will perform like you need them to.

With proper planning, foresight, and knowledge, growers can set up a facility that mitigates risk.

Indoor cultivation simply requires more energy. Your crop relies on constant environmental control, including high-intensity lights that need to run for long hours. In comparison to an outdoor facility, indoor facilities use more electricity – which ultimately means a larger carbon footprint.

However, the technologies growers rely on at indoor facilities have improved in efficiency, performance, and affordability. Today’s LEDs provide ample light at a fraction of the cost to run HPS or fluorescent fixtures. They last 10 times longer than traditional fluorescents. They run cooler, meaning there’s less reliance on temperature controls, and prevent dramatic swings between hot and cold. Further, capabilities delivered by dimming and spectral tuning can lead to faster growth cycles. Combined with vertical racking, harvests can double or even triple – all within the same building and without exorbitant additional resources.

Plus, because you’re working with a closed loop, you can conserve water and avoid toxic runoff and soil degradation. With proper protocol, many indoor growers can cut down on pesticide usage, meaning a cleaner, healthier endproduct. It’s a win for cannabis businesses, for cannabis consumers, and for the Earth.

Myths about indoor growing are slowly (but surely) dissipating as more cultivators and cannabis industry professionals learn about the many benefits that can come with this approach. Leading industry innovators are pushing for better tools and techniques to make indoor growing realistic for both small, independent producers and large-scale cannabis enterprises alike. ❖ Andrew Myers is CEO of ProGrowTech, which helps commercial horticulture operations increase profitability, yield and energy efficiency with industry-leading LED lighting systems. For more information, visit progrowtech.com.

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All Photos: iStockphoto.com

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Selective Breeding for Sustainability

Cultivating specific traits may help create a greener, more resilient industry.

By Ebby Stone

When discussing sustainable cannabis, talk typically leans toward water conservation or energy efficiency. But, there are several overlooked areas of cannabis cultivation that are desperately in need of a sustainability overhaul.

Consider, for example, how much biomass is required to make cannabinoid isolates. Or, have you ever wondered how many outdoor plants are discarded every day due to mold, heat stroke, or wind damage? Selective breeding could hold the key to addressing some of these issues and developing more resilient, vigorous varieties.

CEO of Trilogene Seeds Matt Haddad shared how his company works to solve these issues by breeding customized plant varieties. They analyze the grower’s outdoor environment and determine which varieties will perform the best in those conditions. Haddad explains, “We work with farmers to find the right plants for their respective environments then bring the plants back to our facilities so we can do breeding to mimic those environments. Then the next year, we provide a superior product than the year before. That helps their quality, yield, pest resistance, and mold resistance.”

Why would different regions need different cannabis plants? Are the plants really so different from one another? Haddad explains it’s not always during the growing process that these differences come to light: “In the Southeast and Eastern side [of the U.S.], a lot of states that are growing are really humid. So their problem is drying and processing. They also get aphids, bugs, and different pathogens that affect the plant. We want to help create and stabilize varieties that are vigorous and really resistant to those molds and pathogens.”

High Times contributor Stoney Tark discusses some of the reasons why a grower might want to 36

Cannabis & Tech Today // Spring 2020

hybridize a plant: “Of course, a huge part of the commercial flower market is heavily focused on how to produce the highest THC and terpene profiles. But, there are other fundamentals that should be considered such as structure, rooting ability, wind-resistance, mold-resistance, and ability to fight pathogens, improving yield, increasing flowering time, trichome structure, CBD profile, how easy it is to train, and terpene count.”

After determining the right plants for a region, Haddad and his team can selectively breed those varieties to produce higher concentrations of desirable cannabinoids. One compound that’s growing in popularity is cannabigerol (CBG).

It’s valued for its antibacterial, antifungal, and

Outdoor growing environments vary by region. Some companies are selectively breeding varieties better suited to the unique climates in which they’re grown. Plants grown in humid regions are more susceptible to pests and mildew, so cultivating varieties that are resistant to those issues will ensure healthier, more robust crops.

antioxidant effects. There’s also promising research around its applications in treating Huntington’s disease, Parkinson’s disease, and inflammatory brain diseases. The compound may also hold a key to creating an entourage effect in products that do not contain THC. Dr. Cheng Ruan, medical advisor for PrimeMyBody, discusses some of the unexplored benefits of CBG: “The real question is, ‘Do we really need THC to have a beneficial entourage effect?’ That answer may be no, because CBG is the pin compound for THC. What if this compound has all the benefits and no psychological component like THC has?”

Though much more research is needed, the implications of cannabinoid-specific breeding

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The Trilogene Seeds team showcases an award at the CBD Mountain Expo in Denver, Colorado. From left to right: Yousaf Atalla, Dylan Johnson, Matt Haddad, Jen Wysocki, Tracee Paknis, Gary Kofman, Demetrius Cook.

are huge and could have a dramatic impact on the space as it evolves to meet the demands of a wider demographic of consumers – consumers who are far less interested in the high from cannabis than the medical benefits of the plant.

As demand for specific cannabinoids rises, so will the amount of waste generated by their production. Haddad noted the waste associated with these newly popular compounds: “A lot of varieties have lower concentrations of CBG. So, when it comes to isolated CBG products, they’re harder to make because it requires much more biomass. We’ve been producing different varieties that exist in cannabis and hemp to do cross breeding and selection to find the varieties that have high CBG content.” A higher CBG content in a single plant would result in less wasted biomass. It would also make CBG more affordable to use for research and development of new products. This should translate to lower costs for consumers as well, helping the industry as a whole to continue to thrive.

As the demand for compound-specific products continues to rise, producers will need a cost-effective way to provide them. Currently, extracting cannabinoids is a rigorous process.

After initial separation using supercritical carbon dioxide or ethanol-based extraction methods, individual compounds have to be separated from the rest of the extraction. This requires a series of washing and separating procedures. Finally, the compounds have to be refined further through preparative chromatography, which separates cannabinoids by putting them through various chemicals at different speeds. Then chemicals have to be removed before the product is ready for 38

Cannabis & Tech Today // Spring 2020

consumption. If the plant had a higher concentration of a specific compound, like CBG, this process would yield more of the final product. Selective breeding for higher concentrations would help make the entire extraction process more sustainable.

Haddad has seen the demand for these specialized compounds increase, but hasn’t seen the market step up to meet those needs.

“CBG, CDN, CDC, and some of these other minor cannabinoids are becoming more popular, but really there aren’t many seed providers producing seed that have those high levels of concentrations. That’s why we constantly have things in R&D [research and development]. We’re constantly sourcing seeds and genetics from different regions of the world. We have five different facilities in Denver where we do R&D, so we’re always bringing in new varieties that might help our genetic stock and help us improve what we can offer farmers.”

Everyone involved in the industry at this point, from growers to retailers, investors to consumers, has a responsibility to make this

space more sustainable. These decisions start with the seed and multiply as you move further down the supply chain. How the product was grown, processed, packaged, and even how it’s disposed of are questions that companies and customers have to consider. The cannabis space has an opportunity to help solve some of the most pressing problems facing the environmental movement, but it also has the potential to be a toxic, wasteful, resourceintensive faction of corporate agriculture. Our decisions, both as entrepreneurs and connoisseurs, will shape the future of this industry. How do you want it to look? ❖

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If You Legalize It, They Will Come

Big brands are coming to cannabis, but how will it change the structure of the industry?

By Alex Moersen

It’s inevitable. Like horses champing at the bit or a bull rearing up for a charge, big corporations have their eyes fixed on the cannabis industry. When federal legalization hits – and that is a “when,” not an “if ” – big business will charge head first into the space, pouring money into an industry already proven to be lucrative. It’s hard to predict exactly how this will affect the landscape of the cannabis industry, as there are a lot of factors to consider.

Photo: iStockphoto.com/SchulteProductions

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// BUSINESS INNOVATIONS //

The Current State of Cannabis Before we dive into what the future holds for cannabis, we need to understand where we are right now. Currently, the business landscape can mostly be divided into three tiers: craft businesses, state-wide businesses, and then a handful of national corporations. Due to cannabis’ state-by-state legislative structure, a pattern of locally-owned businesses has developed. Speaking to Robbie Wroblewski, Community Outreach Director of Colorado craft cannabis dispensary Seed & Smith, he explained this local aspect as such: “Colorado smokers stick with Colorado smokers, Cali smokers are in California, and then you’ve got the Oregon smokers … It’s been nice because we’ve been able to grow these industries separately and individually as states and as oneof-a-kind cultures. When federal goes legal, we’re going to see a nice mish-mosh of everybody.”

Different states have different regulations, which has made it more difficult (but not impossible) for companies to become national.

Once you get past craft dispensaries, with maybe only one or two locations each, then you see the state-wide companies. In Colorado, this is something like Native Roots, which has 21 locations across the Mile High State, but has no locations in any other state. Then, stepping up a tier, you have the likes of MedMen, with 32 locations across the country (only in legal states, of course) and more coming. In this tier, you’ll also find Canadian companies like Aurora Cannabis or Canopy Growth, that, because of Canada’s legalization of cannabis, have been able to experience easier growth.

Danny Murr-Sloat, owner of craft dispensary Alpinstash, explains these tiers in another way: “Right now, there are really large scale producers that are producing for as cheap as they can.

Then, there’s kind of the medium-quality producers that are somewhere in the middle.

And then there are the craft people, like us.”

Who’s Coming?

When it comes to which big industries or companies are ready to break into cannabis, there are four main dogs in the race: the tobacco industry, the alcohol industry, big pharma, and commercial agriculture. In fact, we’re already seeing this in different verticals. In 2018, Altria, which owns Marlboro and other cigarette

brands, paid $1.8 billion for nearly half of Cronos Group, a cannabis company based in Toronto. That same year, we also saw the alcohol industry make their own investments.

Constellation Brands, which owns Corona and others, paid $4 billion for a major stake in Canopy Growth. In the same month, Molson Coors announced a joint venture with HEXO, another Canada-based cannabis company, to create cannabis-infused beverages. There have even been rumors floating around since 2018 that Coca-Cola is interested in breaking into the cannabis market (although no official moves have been made yet).

On the pharmaceutical side, GW Pharmaceuticals is the producer of the only FDA-backed, CBD-based pharmaceutical on the market, Epidiolex, which helps in the treatment of epilepsy. When cannabis reaches federal legalization, there will be a rush of big pharma companies looking to monetize CBDbased medicine.

Finally, you have the likes of Bayer-Monsanto, Philips, and Scotts Miracle Gro – the major players in commercial agriculture who will likely have a hand in the national and international cannabis industry. According to Murr-Sloat, these companies, too, are already trying to get involved in the space. “There’s a company called Hopwood Investments, which is a subsidiary of Scotts [Miracle Gro], that over the past few years has been scooping up major manufacturers and suppliers of the hydroponic and fertilizer side of the industry,” he explained.

What Will Happen to the Little Guy? While pretty much everybody in the industry agrees that the big brands are coming, there are varying degrees of concern. Regardless, there will be shifting in the structure, and there will be winners and losers. “This is going to be painful, it will hurt a lot of people who have been in the industry for decades,” Steve DeAngelo, veteran cannabis activist and entrepreneur, told Inc. “It’s going to hurt the very people who have helped bring the industry to today.”

These big brands will be able to raise more money than the smaller, veteran players because they have better connections outside of cannabis. “Legacy cannabis companies will need to learn how to adapt to a much more intense competitive environment and changing cultural

landscape,” DeAngelo explained in the interview. “The folks coming in are not from the cannabis underground, they come with different values. There will be a process of adaptation for the legacy entrepreneurs.”

It makes sense that there will be growing pains, of course. When the dust settles though, Murr-Sloat predicts it will be similar to the beer industry – you’ll have your craft and you’ll have your major brands. “What I feel like it’s going to be, is either you’re going to have a billion dollars to compete with Coors, and if all you’re going for is a really, really cheap mass-produced product, you need an insane amount of capital to compete in that market … If you don’t have that capital, the only other way that you can be in a beer market is if you’re a craft producer.”

He went on to explain: “The reason why that middle is going to shrink, is because if Scotts opens up a grow and they own and supply the nutrients and equipment that you use, there’s no way that you’ll be able to compete with their price per pound … For the most part, beer is either craft or it’s Budweiser. There are very few, if any, in-the-middle guys. And so, I think that’s going to be the route that cannabis is going to take.” Even when you look at some of the socalled “middle ground” beer producers, Blue Moon for instance, many of them are owned by the major producers.

In a similar vein, Wroblewski sees a future balance of craft versus big brand. “You know, there are nights when I go out and have a Coors Light. There are nights when I go out and I can’t stand it … I have specific tastes, right? The connoisseurship will develop, so I’m not really afraid of it.”

The Coors of Cannabis, The Starbucks of Dispensaries It’s clear that when cannabis becomes federally legal, there will be many growing pains, not just in business, but legislatively and culturally as well. If you’re in the business currently, it’ll be important to brace yourself for the change and plan accordingly. If you’re a consumer however, it’s likely that there will still be cannabis out there to satisfy your tastes. Who knows, one day there may be a Coors of cannabis or a Starbucks of dispensaries. Maybe one day you’ll be able to walk into a gas station and buy joints – packaged just like a carton of cigarettes. ❖ Spring 2020 // Cannabis & Tech Today

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// BUSINESS INNOVATIONS //

Quality & Community We went behind-the-scenes at Seed & Smith, a rising craft cannabis dispensary in Colorado.

By Alex Moersen When I first saw the Dart, a sleek, black vape no larger than a USB drive, I had to learn more.

My roommate had been brandishing his new vape around the house, and when I gave it a try, I could see why he liked it so much. It was compact and discreet, and it hit smoothly and efficiently. I noticed the words “Seed & Smith” on the side, and just a few emails and a week later I found myself walking into the Seed & Smith dispensary.

What at first might look like a basic dispensary turned out to be a fully vertically-integrated craft cannabis facility. It’s indicative of the craft cannabis movement, which, similar to craft beer, is produced organically and lovingly. I spent most of the day with Seed & Smith Community Outreach Director Robbie Wroblewski, who offered to take me on a tour of the facility. I was surprised to find out this wasn’t a special insider tour, but rather something that anybody off the street can do – for free, at that.

Similar to the craft brewery experience, Seed & Smith is one of the few grow facilities that allows consumers an inside look into their operations.

“For a lot of us,” Wroblewski explained, “[cannabis] has been around for a long time, and we’re so used to it that we don’t realize that we have to have a good system to get this information out to the public. It was all born from that idea, that we wanted to make sure that people who were coming here got the right information. That way, we could turn them into informed citizens when they want to come and pick up some quality cannabis.”

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Cannabis & Tech Today // Spring 2020

Hence, Seed & Smith began offering tours. While people in the industry might know the processes and the technology that go into producing cannabis, the newcomer is likely not so familiar. But it isn’t just the amateurs who partake in these tours. “Our typical patron of the tour is going to be somebody that is

coming from out of state,” Wroblewski continued. “We’ve had a number of bachelor parties … We’ve had a number of home growers … Some people come out [to Colorado] and they haven’t smoked weed since the 60s and they’re really interested in it … And we even have connoisseurs that come in, and I tend to like that challenge of somebody who really knows the backdrop of what goes into making quality products.”

While Seed & Smith’s dedication to education is undoubtedly important, the company is much more than a tour service.

During the tour, guests learn about grow practices, cannabis processing, and even how different terpene profiles give off different smells and effects.

Their all-in-one facility grows both recreational and medical flower, processes cannabis oils and edibles, wholesales to dispensaries in Colorado,

// BUSINESS INNOVATIONS // Quality & Community

Seed & Smith Community Outreach Director Robbie Wroblewski (left) sits down with Editor Alex Moersen (right).

and sells directly to the consumer. At Seed & Smith, you’ll find pretty much everything you’d find at your major craft brewery – besides a place to consume on-site, but even that might be on the horizon.

Wroblewski cites diverse perspectives as the key to Seed & Smith’s success. “We have people in our company that don’t necessarily have a background in cannabis. They don’t necessarily even consume cannabis, so they are bringing in knowledge that comes from other industries that is only going to help us with our best practices, that’s only going to help us expand our frontier.”

While I spent the day with Wroblewski, it wasn’t long until our conversation shifted toward the Dart. Like me, Wroblewski also fell in love with the Dart at first sight. At a concert, a colleague of his revealed a prototype and he tried it out. “It was a home run for me, immediately,” he expressed. But they knew the vape market wouldn’t be easy to crack, with

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Cannabis & Tech Today // Spring 2020

both plenty of competitors and the recent “vaping crisis.” To combat this, the team set out to make the most high-quality product that they could.

“We wanted it to be discreet, easy to use.

When you pack a bowl, all you do is flick your Bic and you’re good to go. I want it that easy. I don’t want to have to deal with temperatures. I don’t want to have to deal with apps and make it play music while I’m smoking,” Wroblewski explained. But even more important than easeof-use was the quality of the product. “The last thing is the product that’s going in it. Distillate gets a pretty bad name because a lot of people in the past have used less than quality cannabis to make their distillate… Because of that, we started looking at our practices with our distillate… The terpenes in our distillate are all cannabis, and we only do our cannabis. We’ve already set our strict standards for what we’re putting into this device and then we’re only improving upon that.”

Seed & Smith’s strategy around the Dart echoes their wider philosophy. From my experience, the company is built on two major pillars: making cannabis approachable and highquality. Really, it’s these aspects that have built the craft cannabis industry into what it is. The passion for cannabis is emblematic in Wroblewski’s words. “It’s been like watching something grow, watching a kid grow. Eight years ago, it was all basement mentality. We thought we had it all figured out when we were in our basements, growing in tents, trying to keep the stink down. There was no branding, there was no marketing. You either grew good cannabis and people talked about it, or you failed… And the one reason I got locked in [at Seed & Smith] was because of the foundation that they want to set with the community and their education. That was why I chose to come here… It’s been an amazing ride, and I’m excited to see what else we have in store for it.” ❖

// BUSINESS INNOVATIONS // BROUGHT TO YOU BY POLYSCIENCE

Marketing a “Beige Box” to the Cannabis Industry Two industry experts share their marketing advice.

As the cannabis industry continues to grow, the number of companies vying for a foothold is growing exponentially on a daily basis. Philip Preston and David Wallach, President and Market Director of PolyScience, share their own strategies and advice for marketing in the cannabis industry.

Marketing to an industry in need was easy 10 years ago when Polyscience first broke into the cannabis industry, but today the market is saturated with myriad business solutions offering a wide range of services. How does a company, whose purpose is to operate in silence and not be noticed, stand out?

“Our first step was a step back. Instead of rushing to get a message out, we paused and did a lot of research – on our competitors, social media, video content, you name it – we dug deep and found a need,” Wallach explains.

By taking a pause and not throwing money at the wall, hoping for something to stick, Preston and Wallach found what they believed the industry needed: expert information that people could trust and was easy to understand. “Instead of dropping thousands on ads, banners, and social boosts, we started with a video series, providing viewers with expertise on topics that people in the cannabis industry were seeking out,” says Wallach.

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A behind-the-scenes look at the first video shoot that launched all of the Polyscience cannabis content.

decided to make our own version of a cannabis TED Talk. So, we sat Philip down with President of Summit Industries Elliot Kremerman. From there, we let them talk on an expert level about different topics that affect the cannabis industry.”

Preston explains, “There is a lot of noise out there, but well-produced, information-rich content is few and far between, so that’s where we started. David is an award-winning producer and used his team to create a series that would look and feel, for lack of a better term, professional.”

From there, Wallach and his team edited together five different videos they call “Riffs” of Preston and Kremerman sharing their expertise.

The results weren’t immediate – they didn’t expect or want that – it was more about the long game. “We didn’t want to be viral, we wanted to last. We wanted to position ourselves as a trusted expert in the industry that people could turn to for information… and it worked,” Wallach explains. More than putting the videos on YouTube and sharing them on social, the next step was to work with cannabis media outlets to create pieces that would include video and written content offering even more information.

Wallach explains the step that launched it all.

“As the saying goes, ‘content is king,’ so we

Preston says, “Numbers don’t lie. The amount of web traffic to the PolyScience website from

Cannabis & Tech Today // Spring 2020

the cannabis industry jumped up from a solid five percent each year to over 30 percent.”

Initially, it seemed like a reach to gather so much content you could use it for a year, Preston shares, but it worked and continues to work.

“David and his team shot everything to use for many purposes. They had all of the interviews transcribed and turned that into articles, white papers, social media, catalogs, tradeshow brochures, and more. We have a massive foundation that we continue to build on for sales and marketing.”

Once you have a plan in place, then it’s time to be creative. “When we were studying, we noticed that many brands talk to the customers they already have or just go with the ‘typical’ ads, which use the plant and either a green, white, or black color palette. It starts to become a blur, and we wanted to stand out,” Wallach shares.

“We made a conscious decision to go in a complete opposite direction: never show the plant, never show anyone smoking, use our

// BUSINESS INNOVATIONS //

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(Above) Some examples of Polyscience ad campaigns. (Right) Tommy Chong mans the Polyscience booth at MJBizCon 2019.

colors, and talk about the specific benefits we offer. The goal of all of our content is to stand out from the crowd, be different, and engage in a way that will at least capture the attention of the people engaging with it.”

Being a little lucky doesn’t hurt either, Preston admits. “David has a horrible poker face. When he gets excited, he will literally jump out of his seat, it’s what makes him great. While we were conducting our initial interviews, I said, ‘If your chiller is down, you’re not making money.’ I remember this like it was yesterday, he jumped out of his chair and yelled, ‘That’s it!’ and our tagline was born.”

Wallach and his team were then able to use this idea as a bridge to showcase the benefits DuraChill offered to the cannabis industry and how it would make their jobs easier, profitable, and better for the environment. Wallach takes old world ideas and incorporates them into marketing plans and development. “I believe in the plan because it’s your guide, but it also allows you to feel free to create. My team holds old-fashioned brainstorms and we pull people in from every department in the company to ideate with us. As we were planning for the big launch of DuraChill and MJBiz, it was one of our youngest team members who walked up to a white board and simply wrote ‘You’re Welcome,’ and the plan got stronger. We had a massive library of content, now we could take this new

tag line and incorporate it.”

Preston admits their latest direction is something he would have never predicted 60 years ago when his father started PolyScience, but it’s working. “We had the opportunity to work with Tommy Chong to create original content, completely different and fun, the reaction has been incredible.”

“One of our mantras in marketing is ‘get there first.’ Sure, one of our competitors could hire Cheech, but we were there first. This opportunity was something we are capitalizing on from now until we host CannaCon in July in Chicago. We got there first as well and locked up the title sponsorship to the entire convention,” Wallach explains.

The content suite of expert advice is something PolyScience is rolling out in the laser industry and will be working with the automotive industry later in 2020.

As far as the cannabis industry goes, Wallach offers up a last few bits of advice: • First and foremost, take a deep breath, the money will be there and there will be more money if you are strategic.

• Don’t pander to the low hanging fruit. Be

proud of your brand, what you offer to the industry and the community, and let that shine through.

• Don’t be cheap. I know it sounds like marketing speak, but really don’t be cheap.

Make a solid investment in your brand and vision.

• Hire experts, not pals with cool toys. The industry today reminds me of the tech industry of last century: people in their garages. But at a certain point, the tech industry had to stop relying on “buddies and friends” for help and had to hire experts for all of their infrastructure.

Preston concludes, “Many of the companies that PolyScience works with that are providing solutions for cannabis extraction are moving at an extremely rapid pace. This market is emerging, and technologies are evolving very, very quickly. I see it as our job to stay current with the latest products and the latest innovations, but with a plan to be successful for ourselves and the growth of the industry with the best possible solutions specific to this market.” ❖ Spring 2020 // Cannabis & Tech Today

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// INVESTING // Presented by

I N V E STO R S WA N T E D :

10 Tips for Success

By Dave Roberson

The investor landscape in cannabis keeps evolving. Big-name investors with deep pockets fairly recently caught on to the potential of fastgrowing cannabis companies, opening up the possibilities for funding expansions or making changes to the business. At the same time, high valuations dropped toward the end of 2019, and several companies reported layoffs and course corrections to finish out the year. With valuations being less speculative in nature and larger and perhaps savvier investors becoming more active in this space, how can your company grab and hold their attention?

Preparation counts. Appearances matter. At the very least, you’ll need a finely-tuned pitch deck that anticipates their scrutiny, but behind that needs to be a company made of substance, discipline, and integrity. Companies that can show they are viable, smoothly operating entities — and have credible data to prove it — are set up to ace the pitching process and convince investors they are worth funding.

Address the following 10 areas of the business to keep their attention: 1. A smooth-running operation: Cannabis companies experiencing rapid growth can end up sputtering if they lose sight of what’s happening, can’t predict what’s likely to happen, or make hiring mishaps. Can your financial systems keep up with your growth or are you trying to make sense of things from multiple spreadsheets? Are the right employees in the right positions, or do some people lack the skills and experience they need to do their jobs effectively? Smart investors will wonder.

2. Accurate information: Investors want to see that the company has access to real, reliable data that can be used to inform decision making.

That means having regularly prepared financial statements in addition to relevant data points on key metrics. For example, dispensaries should know how long it takes for a product to sell.

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Cannabis & Tech Today // Spring 2020

Specializing in finance solutions, the team at Kukuza Associates help cannabis companies grow their operations, find investors, and scale operations at pace with the fast-moving industry.

(Left to right) Director of Business Development Chris Vane; CEO Dave Roberson; Vice President Maureen Ryan.

Farmers should know yield per plant. Suppliers should know the percentage of their revenue that comes from each customer and who their biggest customer is. Then, how is this data viewed and analyzed?

3. True understanding of costs: This is where a conversation with a potential investor can fall off the rails. They want to know not only what goes into each product you sell but that you actually know the information and can knowledgeably talk about your margins. Have you factored in marketing and sales costs? How much of a drain do slow-moving products have on your storage expenses?

4. Built-in accountability: There’s no way around it — our industry is under heavy scrutiny from all angles, making accountability a top priority. By adopting a culture that values taking a disciplined approach to the business, including the finances, you can confidently stand by the projections you share with investors. Budgets and forecasts can be carefully created and then tested out over time.

Employees should have key metrics and targets to aim for and be held accountable to the results.

5. A clear view of the cash: With many companies accustomed to bank denials and dealing with large amounts of cash, our industry

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// INVESTING // Presented by

faces a special challenge. Cash could be parked in multiple locations, making it difficult to know how much you have at any one time. Investors want confirmation you can pay your bills and to know how you’ll do it. A typical question you may hear is, “What kind of payment terms have you established with suppliers and can you meet them?”

6. Trustworthiness: Investors need to know they can believe in the information you’re telling them. Do you have controls around how financial information is recorded? Or does everyone follow their own process? The way information is gathered, the systems that are in place to monitor it, and a track record of timely, accurate information can significantly affect how hopeful investors will be about your business.

7. Comparability and predictability: Are you able to pinpoint any patterns that may show up from week to week or quarter to quarter?

This information gives investors an idea of what they can expect from the business and whether that fits into their goals. They’ll also be curious 50

Cannabis & Tech Today // Spring 2020

to know whether you can accurately project future results.

8. Future plans: Be ready to talk about where the market and your company are headed.

Investors will be interested in understanding your insights about customer behavior, potential expansion, and possibly your exit strategy. Even if that’s a way’s off, they may want to know that you’ve gone through enough scenarios, that you have the ability to come up with realistic plans, and that you’ve decided which routes are worth contemplating or pursuing.

9. Clean financial statements: Anticipate being asked for audited financial statements and know that getting these together can take up more time than you might expect. If you haven’t established a habit of regularly closing the books, a drawn-out process of looking back over the past couple of years will become a must-do.

This is a common struggle. Start with getting the financial house in order so you know where a company stands before deciding how to reach out to investors.

10. Transparency: The investor relationship won’t end once you get the funding. Your investors will want to know where the money is going and they expect updates. That means coming up with how you’ll keep them informed and assuring that your company will operate with integrity.

Adopting an “investor ready” mindset Whatever the reason you’re seeking capital – whether your dispensary wants to add a new location or your cultivator aims to ramp up production – give consideration to how your business will be viewed by potential investors.

In a volatile market among tight competitors, companies can stand out if they go to the pitch table as prepared as possible. It takes a great deal of time and effort to become the kind of company that can confidently seek out a strong valuation, but the alternative is no investment at all. Be prepared. ❖ Dave Roberson is the CEO of Kukuza Associates, a finance and accounting consulting firm that scales cannabis companies. To learn more, visit www.kukuzaassociates.com.

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// INVESTING // Presented by

Defining Cannabis Entrepreneurship

By Ross O’Brien

An entrepreneur plays a critical role in their organization – to be responsible for the idea that the company was founded on commercializing it. The core competency is not to emphasize ideation, but rather be the leader who is responsible for bringing together resources and developing value for customers, employees, partners, their community, and ultimately investors. The type of person who can identify and access resources, such as capital and people, and then manage the deployment of those resources for profit is the model of a successful business owner and operator.

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number-one issue facing operators and investors in cannabis today: The number-one issue in cannabis is hubris.

And that cuts both ways. People coming from other industries tend to assume that they can show – and I hate to use this word – the “potheads” how to run a better business. This marginalizes the experience that legacy industry practitioners bring to the table and almost always they are overwhelmed with how hard and complicated it is to run a cannabis company.

of the industry are equally important.

One group straddling the line between history and innovation are advocates. The cannabis startup explosion is also being fueled by a migration of founders who were historically cannabis advocates focused on social and regulatory progress, transitioning into the role of cannabis entrepreneur. Were it not for the advocates who did the hard work to start the momentum towards legalization, showed up in their local elections, and voted in favor of legalization, the cannabis economy would be at best theoretical. Instead, it is a driving force for expanding global markets.

From the legacy cannabis company operators’ perspectives, people who have been in the industry tend to dismiss outsiders, stating that this is just how things are done. This creates a lack of ability to adapt to the transparency and communication that is needed to operate larger companies with more competition.

In addition, we are now seeing top talent transitioning from other markets and industries to start and run great companies in cannabis, enticed by the market possibilities and financial potential as much, or even more so, by any affinity for cannabis. One of the management teams that Mitch Baruchowitz of Merida Capital Partners, the “CEO Whisperer,” described to me was made up of an experienced team that had people with operational cannabis expertise, financial management backgrounds in other sectors, and a lot of proactive interaction with regulators – a strategy that came from experience in other sectors as well. In other words, they had an affinity for strong execution. ❖

Emily Paxhia from Poseidon Asset Management describes the dynamic between cannabis and non-cannabis operators as the

Thus, it’s important to remember that openly welcoming new ideas and outside perspectives while honoring the longstanding best practices

This is an excerpt from Cannabis Capital by Ross O’Brien, currently available where all books are sold.

Cannabis & Tech Today // Spring 2020

Photo: iStockphoot.com/jacoblund

It is your job as a founder to identify the behaviors and characteristics of successful business strategies and experiences from other industries and adapt these best practices to your journey in cannabis entrepreneurship. Don’t fall into the trap of believing that because your company is a cannabis business that the people with whom you do business from other backgrounds “don’t know cannabis.” This fatal flaw assumes that just because someone isn’t as versed in the minutiae of the cannabis company, they don’t have the ability to understand the business of cannabis. There is simply a new set of problems to solve and a new set of evolving business conditions to operate within. Those are common challenges for entrepreneurs in any industry.

// INVESTING // Presented by

What is a Capital Raising Strategy

and Why Should You Have One for Your Cannabis Startup?

By Nicolas Arkells, JD, MBA, CSO of Wrazel commit only a smaller amount of capital for their first investment into your company. The investor will then invest further capital in larger amounts and sometimes even bring other investors into the deal once they are satisfied that your agreed upon milestones can be achieved. Doing a conventional multiple round strategy also means you can raise more capital with less dilution to the founders’ ownership stakes because each subsequent capital round gives you greater leverage in your investor negotiations as there is less perceived enterprise risk.

A capital raising strategy is a long- and shortterm plan to determine who, what, when, where, why, and how your company will obtain the outside funding needed to be successful. There are basically two approaches that can be utilized in planning for your capital raise. You can attempt to raise all the money needed in one round or plan on setting up multiple rounds.

You will then need to coordinate with legal counsel regarding what type of securities regulation will work best to perform the raise.

Why You Shouldn’t Try to Raise All of it at Once Trying to raise all the capital that will ever be needed in one round is tempting for many founders because of the simplicity it offers. In theory, it means that once the capital raise is concluded, the founders can focus on running the business instead of participating in further capital raising activities. However, in my experience, this “go broke or bust” strategy is almost never successful.

Early stage companies are usually unable to rationally sustain the business valuation needed to successfully accomplish this approach.

Further, this approach will ultimately cost you more in equity than a multiple round capital raise because your company’s bargaining position is at its weakest in the early stages.

Investors also tend to have many concerns about the venture being extremely high risk at an early stage, which is why it is very difficult to raise capital for a newer company. Investors also tend to favor the accountability and control that comes with multiple rounds because capital is only released in tranches based upon achieving pertinent milestones.

The only startups that tend to successfully raise a large amount of initial capital in the cannabis space tend to have substantial tangible assets and/or celebrity founders who usually have an extensive track record of prior successful exits. In most cases, early stage venture valuations simply cannot sustain a “go broke or

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Cannabis & Tech Today // Spring 2020

Nicolas Arkells, JD, MBA, CSO of Wrazel

bust” approach to the capital raising process.

Having a considerable capital infusion all in one round also tends to produce tremendous waste and inefficiency as seen in some of the larger publicly traded cannabis companies.

Raising Capital in Multiple Rounds Although more challenging, taking the time to establish a well-planned multiple round capital raise tends to yield the best results in the shortest amount of time. This type of strategy also prepares you at the onset for the typical investor situation where the investor tends to

The Different Stages of a Well-Planned Capital Raise As your company advances into each round of its capital raise, different capital sources will become relevant. The diagram below shows what funding sources are the most appropriate at each round. There are of course exceptions to every rule, but time is something startups never have very much of, so it is critical to be as targeted as possible when determining what sources to pursue. The diagram purposely excludes capital aggregators such as investment banks because they do not manage any funds, instead they pursue these same sources on your behalf. ❖

Friends & Family

Retail Investors

Angel Investors

Founders

Venture Capital

Friends & Family

Family Offices & HNI

Venture Capital

Retail Investors

Venture Capital

Debt Providers

Family Offices & HNI

Hedge Funds

Initial Public Offering

Family Offices & HNI

Debt Providers

Private Equity

Private Equity

Hedge Funds

Founders

Angel Investors

Hedge Funds

Debt Providers

Family Offices

// COVER STORY //

From the Court to the Cannabusiness Longtime NBA player-turned-cannabis entrepreneur Al Harrington opens up about the important reasons he entered the cannabis industry.

By Anthony Elio In over 16 years in the NBA, Al Harrington played in more than 1,000 total games, made an appearance in 55 playoff matches, and scored over 13,000 points. However, just by speaking to him, you’d be convinced that he wants to be known more for his success as a cannabis entrepreneur than his time on the court.

In 2011, while the former first round pick was still playing for the Denver Nuggets, Harrington launched Viola Brands, a cannabis company with a focus on social equity, named after his grandmother. The move showed tremendous foresight by the former player, especially considering the widespread cannabis boom the city would see just a few years later. He followed up by launching the CBD company Harrington Wellness as well as an investment in Butter Baby, a minority-owned, female-led edibles company based in Los Angeles. In addition to business interest, cannabis also played an important role in Harrington’s playing career, as CBD was instrumental in bouncing back from a botched knee surgery.

what originally fueled his interest in cannabis, how his company is attempting to increase diversity in the industry, and the interesting parallels between his playing attitude and his business ambitions.

Cannabis & Tech Today: Tell me a bit about the origins of Viola Brands.

One of the most fascinating moments of Harrington’s adventure into cannabis was his 2017 discussion with David Stern, the former NBA commissioner that notoriously increased the strictness of cannabis policies throughout his tenure. The discussion featured the 30-year commissioner’s new views expressing the importance of cannabis in the battle against opioid addiction. As Stern said himself, “I’m now at the point where, personally, I think it probably should be removed from the ban list.

You’ve persuaded me.”

In this exclusive interview, Harrington reveals

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Photos: Courtesy of Al Harrington/Viola Brands

Al Harrington: What inspired me to get into the space is the way I saw cannabis help my grandmother. She suffered from glaucoma, and she came to see me play when I was playing for the Denver Nuggets in the 2011 season. When she got there, she was complaining about being in pain. I was telling her about some stuff I was reading about cannabis in the newspaper and

// COVER STORY //

“ Our purpose is about uplifting, empowering, and educating to create opportunities for people of color and minorities.”

I had her try it. An hour and a half later, I go check on her and she’s crying downstairs. She’s reading the Bible. She said it’s the first time she’s been able to do it in over three years.

So when I saw cannabis help my grandmother, that really inspired me to start learning and educating myself more about the business. And as I did that, I got to the point where I was comfortable enough making an investment in 2011. The rest is history.

C&T Today: How would you describe the mission of the company?

AH: When we first started, we didn’t have a mission, right? I was in more of a survival mode, just trying to figure out an industry where you didn’t know where you could really go and get advice. So, as time went on and I continued to get bigger in the space, I realized that a lot of the rooms that I was in, I was the only person that looked like me. And if you know anything about the history of cannabis with black and brown neighborhoods, cannabis arrests have pretty much destroyed our

communities. And 96 percent of the industry is run by white males. I had to figure out a way to include minorities in this process. And that’s now our purpose. Our purpose is about uplifting, empowering, and educating to create opportunities for people of color and minorities.

C&T Today: Did you go into the cannabis business thinking that legalization was on the horizon?

going full speed in one direction, and we can stop and pivot according to issues with regulations and different things like that when they arrive. I feel like five years from now I’ll be way more knowledgeable than I am today. So it’s really unique, and we’re pioneers.

C&T Today: How did you see that stigma firsthand as a professional athlete?

AH: No, hell no. I really didn’t know, man.

I tried to educate myself and realized how unbelievable this plant was – and obviously the stigma, most of [the public view] is all incorrect. It was just like, “Wow. This is an amazing opportunity to do something that I think is way bigger than anything I think I’ve ever accomplished as a basketball player.”

AH: Guys that I played with that smoked weed regularly, everybody talked bad about them. Like they weren’t focused, they didn’t really care about their career. And I can’t lie, I was one of those guys that kind of believed that. You know what I’m saying? But at the end of the day, I did have teammates that did consume and were really, really good players.

Like, all the time. A couple of them are NBA champions. So the stigma was real.

So that’s what really just inspired me to keep pushing and get us where we are today. And so obviously, things continually change. I think that because I got it so early, I’ve seen that. I’ve been able to kind of operate at a pace where I’m

C&T Today: Your interest in cannabis stemmed from your botched knee surgery. Do you believe those types of injuries commonly lead athletes to CBD and cannabis?

Spring 2020 // Cannabis & Tech Today

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// COVER STORY // From the Court to the Cannabusiness

AH: Yeah, for sure. Impact sports are tough. But I think that, guys being able to have that first experience, that having a good one is key. Because I had a bad experience. But after I learned about cannabis, I’ve realized that this is somewhat of a trial and error thing sometimes.

I had to learn that to be open to it. So I think that with players... that have to deal with pain and have tried to wean themselves off of opioids and stuff like that, I think that when they do have this first experience with cannabis, they realize there’s definitely a better way, an alternative way to medicate themselves. Like I said, CBD or hemp is just one way.

THC is another, and then obviously you can combine those to create a better feeling, a better outcome.

C&T Today: You’ve said before that you believe 70 percent of athletes in all major sports smoke cannabis. Do you see a time when that 70 percent will be able to be totally open about their usage?

AH: Yes. But, I just think about the kids.

These kids’ parents, they definitely don’t want their kids thinking that their favorite players are sitting there quietly smoking weed all day, and things like that. So I think that it’s going to be interesting, the way that they include it. But I think if they will include it, maybe start with CBD. And then more of the consumption products, meaning edibles will be allowed, followed by tinctures and capsules.

C&T Today: How did the path of Al Harrington the athlete fuel the path of Al Harrington the cannabis entrepreneur?

AH: I think it was just the work ethic. I started playing basketball as a freshman in high school.

And my freshman year was really a wash. I didn’t train for anything that year, I just played right after the football season, because I was tall.

But after that is when I started taking it seriously, and in three years, I was able to go pro out of high school. So I think that during that 58

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“ This is an amazing opportunity to do something that I think is way bigger than anything I think I’ve ever accomplished as a basketball player.” time, the amount of work I put in is just amazing. And for me, it was a lesson of, you put in hard work, look at the success you can achieve.

So I take the same work ethic in cannabis. I always remember looking at the older players that were on my team, making more money, [playing] way more seasons, and I thought I was better than them, you know? Like, nobody could tell me any differently. So I always remembered that. Like, guys behind me are going to be looking at me the same way. Like, “Al Harrington? No way he’s better than me.” So I’m saying all that to say, I could never be comfortable. I always felt like somebody’s always chasing, and always trying to take my spot. So, I’ll keep that same lesson from the NBA from when I was a younger.

So, that’s why I just keep my head down, treat every year like it was a contract year. And that’s the same thing in cannabis. I got to keep surviving, we got to keep growing, got to keep creating opportunities. We just got to keep this thing going. And that’s the connection.

C&T Today. What do you think it’s going to really take for cannabis to be accepted across major sports?

AH: I think it’s going to be sooner than we think. I have to say that things will be a lot sooner than we may think. Because I mean, all these teams are playing in these states where it’s medically legal for them to consume, and they receive medicine from the state that they pay taxes in. So I just feel like I think we’re at that point. You know, I think it’s going to happen pretty quick. I think it’s going to be all in the wording, you know. I look at the way that baseball worded it. I think if they word it right, then now it’s available to the players, and we kind of move on.

C&T Today: What are you looking forward to in the future of your work with cannabis?

AH: I’m just looking forward to continuing to build a national brand. You know, we’ve pushed forward in four states now, should be six by the end of this year. Just licenses that we would control. And we’re looking for licensing opportunities. We just want to make our brand available to the masses, and we’re going to continue to dial in our products and continue to keep making them better. Continue to push for consistency, and just continue to build this brand.

Build up the recognition and that goodwill. All the initiatives that we’re trying to do for the people. And just do it with excellence. ❖

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// LEGISLATION //

Cannaprivacy

The cannabis industry’s rapid accumulation of data and potential privacy risks

By Dan Greene

The cannabis industry is harvesting another valuable crop: data – and lots of it. The boom of cannabis industry growth across the country is fueled by zeros and ones. California’s cannabis market grew 23-percent in 2019, due not only to farmers and dispensers, but also those who support the industry, including software developers and tech vendors. With this expansion of cannabis-oriented software offerings comes rapidly growing lakes of consumer and industry data, which in turn create questions of security and privacy about that data. Emerging state privacy and data security laws, including the California Consumer Protection Act (CCPA) and New York SHIELD Act, impose corporate requirements for protecting consumer privacy and implementing security safeguards and the cannabis industry is not immune.

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Certified Information Privacy Professional Daniel P. Greene of Beckage Law Group

Members of the industry should take notice of this opportunity. Regulatory compliance could equal better market share. By adopting best practices for safeguarding data and incorporating regulatory considerations into operations and policies, the entire cannabis

industry stands to grow faster and wider and further innovate. The alternative is lost business opportunities, business interruption, and industry contraction due to slower contracting cycles, more frequent breaches, and more regulatory enforcement actions. Below are some considerations on how to seize on opportunities instead of encountering obstacles. There is a convergence of law, tech, and cannabis that requires a particular and specialized approach and consideration.

Some Simple Steps to Achieve CannaPrivacy Compliance Regulations require sophistication, and sophistication means proceeding with knowledge and experience. Whether it is New York’s SHIELD Act or the CCPA, the cannabis industry, like all others, must now examine the

// LEGISLATION //

potential impact of new consumer-oriented privacy and data security laws and proceed correctly. While looking to understand the expectations of new laws, companies can take the opportunity to assess where their practices stand and how they can be improved. There are many fundamental and practical steps that can help mature privacy and data security practices, including:

legal counsel to assist with proper IT contracting.

• Implement security and privacy policies, and then put them into practice. Bullets one and two are easier to address if a company already has policies that it follows in place.

Policies can both improve leverage in contracting and show regulators that a company takes steps to safeguard itself.

• Take stock of technical, physical, and administrative access controls. Companies can continually monitor that its controls are sufficient. Risk assessments in advance of contracting are now routine. More states are focusing legislation on how businesses are safeguarding data, so if a company is not continually reviewing access controls, a building block of data security, it is potentially impeding its ability to land contracts and meet regulatory expectations.

• Build a culture to last. Whether it’s training dispensary staff to understand privacy rights of customers (be careful about photos in the dispensary) or getting everyone on board with multi-factor authentication (it’s just one extra step), company culture is the bedrock for data privacy and security.

• Practice data diligence. When assessing a potential partner, vendor, or client, question their data security practices and work to understand how and where they protect data. Additionally, understand how and where company-controlled data is, too – whether by mapping it, reviewing current vendors’ practices, or instituting new protective practices.

• Anticipate tougher contracts. Agreements are focusing more terms around confidentiality, data incident notice, data rights, and representations of regulatory compliance. The new focus on these terms represents the rapidly expanding privacy regulations and data security landscape and demands more attention. Use sophisticated

What Do Data Security and Privacy Threats Mean to Cannabis?

Businesses are better situated to grow with awareness of security threats and breach consequences, not in fear of them. All industries are feeling the sting of increasingly more sophisticated bad actors. Cannabis has a wealth of data and industry members can take necessary precautions by better understanding how threats are evolving and the potential consequences of a breach.

• Small businesses have become primary targets. According to a 2017 Symantec Internet Security Threat Report, from 2011 to 2016, the rate of breaches annually for businesses that employ under 250 people nearly doubled from 18 percent to 35 percent of all breaches. Employers of 2,500+ individuals saw breaches drop from 50 percent to 31 percent of all breaches in the same period of time. Startups and existing small businesses cannot rely on the myth that they are not interesting to bad actors,

and instead should consider appropriate safeguards to prevent breaches or other data incidents.

• R ansomware attacks on businesses have increased. Ransomware attacks have increased by 195 percent from the last quarter of 2018 to the first quarter of 2019, and 2018 saw a rise in business ransomware detections by 500 percent, according to the Q1 2019 Malwarebytes Cybercrime Tactics and Techniques Report. While ransomware has become a global enterprise and small businesses are more the target of attacks, companies can take a multitude of steps to prevent being impacted by ransomware or having to pay ransom, including routinely creating backups and encrypting data.

• The consequences could be significant. The consequences of a breach or incident vary by context but generally can include a mix of payment of fines to state and federal regulators, reputational harm and loss of business, litigation, and/or significant costs associated with responding to a breach.

Perhaps dollars and cents best quantify the risk: the cost of response to a breach on average comes to $150 per impacted file, according to the IBM Ponemon Institute 2018 Cost of a Data Breach Report. In which case, even in an unusually small incident where only 200 files are impacted, the result is a $30,000 unplanned expense.

The mix of state-by-state regulations that currently applies to the cannabis industry is mirrored by the patchwork of privacy and data security laws enacted by various states. It is an amazing moment, as the industry is witnessing the growth of two tech disciplines (security and privacy) alongside the evolution of data security and privacy threats, each intertwining and impacting the others. As a result, it is important to stay up to date on new and pending laws while improving safeguards in order to make greater opportunity out of this transitional moment.

Sophisticated technical and legal counsel should be retained to assist in the process of navigating the laws and security improvements applicable to businesses in evaluating regulatory requirements and technical safeguards. ❖ Spring 2020 // Cannabis & Tech Today

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// LEGISLATION //

Thin Green Line Cannabis Attorneys Walk a Thin Line Toiling in an Area Prohibited by Federal Law

By Tami Kamin Meyer Cannabis lawyers not only have to counsel their clients how to adhere to their state’s marijuana laws – assuming there are any – they also advise their clients how not to violate federal statutes governing that substance.

cannabis law, agrees a tension exists but for a different reason. “The tension is essentially a client education conversation as to how it is difficult to work in marijuana as it is banned federally,” he says.

“You can only counsel to the applications of state law and [you] can’t advise them under federal law, because it’s illegal,” says Josh Horn, co-chair of Fox Rothschild LLP’s cannabis law group and a partner with the firm. Cannabis attorneys must also advise their clients of the legal implications of certain behaviors that may be legal under state law but prohibited under Federal jurisdiction, he says.

Such are the perils facing cannabis lawyers as they counsel clients how to navigate the startup business culture that is the current state of the legal cannabis industry in the United States.

Tensions Raised by Practicing in a Federally Banned Industry Practicing cannabis law in the United States is complex, made even more so because cannabis is illegal under federal law.

“I have to be the bad guy telling clients they can’t do something they want to do because they can’t escape the fact marijuana is still illegal under Federal law,” says John Fraser, an associate with Grewal Law PLLC in Lansing, Michigan.

He is also the practice group leader of the firm’s cannabis law division.

“Caution is the name of the game. Marijuana is still a Schedule 1 drug,” says Fraser. “I counsel clients; I have failed them as their attorney if they face jail time rather than celebrate a store opening,” he adds. However, that’s not to say Fraser would turn the other cheek if a client violated federal law. “I will not assist in the furtherance of a criminal enterprise,” he says.

Marshall Custer, a partner with Denver’s Husch Blackwell who focuses his work on 62

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Photo: iStockphoto.com/Darren415

According to Custer, a cannabis lawyer must carefully weigh two considerations when crafting what he calls “the educational component” of the attorney-client relationship.

First, determine the client’s appetite for risk and then understand how that risk tolerance will

“ The fact that cannabis is not legal under federal law makes it difficult to substantiate claims,” warns Walter Blackham, associate with the law firm of Mac Murray & Shuster LLP.

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// LEGISLATION // Thin Green Line

affect the client’s business vertical.

But, he says, “the only real tension we see today boils down to banking issues, especially for new players in the industry.”

Meghana Shah, a partner in the litigation group of Eversheds Sutherland and colead of its Cannabis Industry Group, interprets the tensions differently. “Advising a cannabis business is not much different from advising any business except for the added layers of complexity,” she says.

Those additional considerations are: • The fact that marijuana is Photo: iStockphoto.com/lionvision still banned federally • Tensions within state laws Horn, whose 27 years of practicing law permitting or banning the includes the past five in cannabis law, says medical or recreational use of marijuana lawyers toiling in cannabis law “should not • The newness of the industry dabble.” One reason is that the 11 states Greg Kaufman, who holds the same posts with permitting recreational cannabis and the 33 Eversheds as does Shah, but in D.C., says it is allowing some form of medical marijuana incumbent on attorneys to help a client enacted their own set of laws governing its use understand the risks inherently associated with within the state. “If you dabble, you will the American marijuana industry. malpractice,” says Horn.

Advice for Attorneys Considering Fraser agrees. “If you are not 100 percent Cannabis Law aware of all of the moving pieces in the local, There is no doubt cannabis law is a growing state, and federal levels, how can you give advice field, attracting both attorneys to work in it and to your clients?” Fraser posts. clients needing their counsel. One way for a lawyer to be prepared for what they will face is Moreover, because cannabis is illegal under to read ethical opinions on the topic from their federal law, there have been limited medical jurisdiction. studies defining its impact on users. According According to Kaufman, it is imperative for cannabis lawyers to be certain the Engagement Letter they use with cannabis clients includes a section reminding them of cannabis’ illegality under federal law. It is also noteworthy that cannabis law attorneys cannot be paid directly from the proceeds of an illegal activity.

“We can’t take money from them unless they are complying with state and local laws.

Everything our client does is federally considered,” he says.

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to Walter Blackham, an associate with the Columbus-based law firm of Mac Murray & Shuster LLP, “The fact that cannabis is not legal under federal law makes it difficult to substantiate claims, because studies indicating how recreational or medicinal marijuana [impacts the user’s health are limited] in America.”

Ethics, Shmethics Due to marijuana’s status as illegal under federal law, states that have enacted recreational

“ Everything our client does is federally considered,” notes Greg Kaufman, partner in litigation group of Eversheds Sutherland and co-lead of its Cannabis Industry Group.

// LEGISLATION // Thin Green Line

Photo: iStockphoto.com/labuda

or medical marijuana legislation have also taken steps to protect the attorneys who work in the cannabis law realm, so they won’t face prosecution for doing so. For example, in Fraser’s native Michigan, the state’s Rules of Professional Conduct was amended to shield lawyers in the state who counsel clients on cannabis-related matters.

The Upside to Cannabis Despite the stresses associated with working in an area of law banned federally, attorneys were effusive about practicing in this burgeoning arena.

For Fraser, it’s personal. In 2007, his mother was diagnosed with MS. He said he knew his mom would be reluctant to adopt to medical marijuana, but he is still very active in promoting its ballot initiative in Michigan. Permitting the use of cannabis “adds another tool in the toolbox. I’ve always been a proponent of ending prohibition,” he says.

Custer says he got involved in cannabis law “because of the people. I like the people who work in this industry. I’m agnostic on the product but the people in it are entrepreneurial and passionate.”

Fraser also enjoys the leadership opportunities cannabis law has afforded him. For example, he is a member of Michigan bar association groups 66

Cannabis & Tech Today // Spring 2020

focusing on cannabis law. He says he also devotes “a ton of my time combating misinformation about what’s permitted and what is banned.” He decries public misinformation about cannabis, saying it “reinforces stigmas of the very things we try to fight.”

“Creating something out of nothing” is what drew Horn to practicing cannabis law. He says it is extremely satisfying to work in a new and burgeoning area of law. He enjoys the people and the work he does so much that he claims it “reinvigorated” his career.

Are there any downsides to practicing cannabis law?

Not to Horn. “There is nothing unique to a cannabis practice that is a downside. I am having too much fun and experiencing no two days alike, which for me, are huge upsides.” ❖ Tami Kamin Meyer is an Ohio attorney and freelance writer whose byline has appeared in Forbes, MarketWatch, Next Avenue, Your Teen, Ohio Magazine, and Columbus Monthly. She is the Social Media Chair of the American Society of Journalists and Authors and tweets as @girlwithapen. Her web site can be found at www.tamikaminmeyer.com.

“ Caution is the name of the game.

Marijuana is still a Schedule 1 drug,” advises John Fraser, associate with Grewal Law PLLC.

BROUGHT TO YOU BY @SHATTERGURLJACQUELINE AND MCGRANE L AB SYSTEMS

The Science of Change A hemp and marijuana processing lab’s guide to surviving in a market downturn and how to position yourself to thrive on the way back up Of the many challenges facing the cannabis industry, the 2020 market correction is the biggest. Economists believe the downturn could last an entire year or more. The fundamental question many processing labs are asking themselves is, “How do we survive?” On the hemp side of the industry, this usually means dropping prices weekly to try to cover costs.

The problem for businesses who chase pricedriven contracts is that it is a race-to-the-bottom with virtually zero sustainable options.

Processing labs that compete solely on pricing are signing their own death certificate.

Before labs waste another minute chasing phantom opportunities, liquidating assets, and losing money on the rare deals they close, there is something every lab owner should know. But first, we need to be clear that the problem labs are facing in 2020 is not that prices are crashing.

Crashing prices are a symptom, and we all know real remedies address root causes. Economists and seasoned business pros know these cycles happen in every new industry. If we accept that bubbles are how markets are birthed, then the question is, how can we learn from the success and failures of others that have gone before us?

Let’s look at a few things we do know: 1) The best labs in the world are still figuring out their business model. 2) Most don’t have a strong product roadmap. 3) Very few have a true pricing model (and no, we don’t mean a pricing sheet). 4) Almost no one has a professional sales program or a go-to-market strategy in place. 5) Large buyers will only buy from FDA-compliant labs, and those regulations are still being written.

If you’re like many lab owners, you’ve found yourself chasing trends, which are often little more than broker idiocracy perpetuating fake opportunities. If a 10,000 KG/mo order did exist, the retail value would be about $12 billion a year, which is more than 10x the entire 2019 US consumer CBD market.

The real problems are that demand hasn’t caught up with the 511,442 acres licensed in the US in 2019, and labs aren’t positioned to compete. Nothing is more heartbreaking than when a lab goes to a tradeshow, buys equipment, and expects to actually perform at the throughput goals and margin levels they need to survive.

We see so many labs purchase equipment that is already obsolete, inefficient, or simply

inadequate. Most equipment sales companies can’t create a fully optimized solution because they don’t adequately understand the myriad issues associated with equipment integration, process and throughput optimization, and compliance in a highly-competitive and everchanging environment.

“If you think you’re going to turn the lights on and generate revenue at the levels an equipment spec sheet or sales rep quoted you, you’re likely closer to going out of business than you are to printing money,” says fourth-year lab owner Will C. from Colorado.

Most labs simply aren’t positioned to survive.

The good news is that @shattergurljacqueline and McGrane Lab Systems have planned, built, and optimized dozens of labs, and, in addition, have created a free Lab Survival Guide to share their learnings with lab owners and operators like you. ❖ McGrane Lab Systems (McGrane.co) is a fullservice consulting (lab design) and equipment sales company; offering installation, training, SOPs, optimization oversight, and innovation-as-a-service to the hemp and marijuana industries.

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Spring 2020 // Cannabis & Tech Today

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// HEALTH //

Numbness, Spasticity, and CBD A look at the relationship between cannabinoids and multiple sclerosis

By Patricia Miller

Multiple sclerosis is a demyelinating disease in which the insulating covers of nerve cells are damaged. Microglia cells (orange) attack the oligodendrocytes that form the insulating myelin sheath around neuron axons, leading to the destruction of the myelin sheath and to the loss of nerve function. Photo: iStockphoto.com/selvanegra

When Celeste Miranda woke up on a sunny morning nine years ago, she didn’t dream that day would be the start of a life-changing journey.

In the chilling words of Miranda herself, “I woke up one morning and couldn’t feel anything from my waist down.” It was the first day of her battle with multiple sclerosis (MS), a debilitating disease with few treatment options. She couldn’t have known then that her struggle would become the foundation for her work with cannabidiol (CBD).

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After waking up numb, Miranda was hospitalized for eighteen agonizing hours before doctors diagnosed her. The disease affects the central nervous system, disrupting the flow of information within the brain. It often has an unpredictable effect on the body with a wide range of potential symptoms.

In brief, the disease works as follows: nerve fibers are coated in a protective sheath called myelin. When the myelin is damaged by MS, nerve fibers are also damaged and can’t properly

transmit signals between the brain, spinal cord, and the rest of the body. This can result in walking difficulties, fatigue, numbness, spasticity, weakness, vision problems, dizziness, cognitive changes, pain, seizures, hearing loss, and depression. And those are just some of the many symptoms associated with the disease, depending on which course the MS has taken.

There are four disease courses, or types, that have been identified so far.

In Miranda’s situation, her first symptom was

// HEALTH //

I said. This is crazy. It’s gum! I tried it again.

Sure enough, it happened again.”

She found a solution to her spasticity that didn’t involve heavy doses of pharmaceuticals.

She stopped taking all the muscle relaxers and switched to an exclusive regimen of CBD and Tysabri. But why did it work? Miranda posits: “MS is an autoimmune disease that is very much linked to inflammation, which is one of the reasons CBD helps so much.” She’s referring to the anti-inflammatory effects of CBD.

Dr. Leslie Apgar

numbness. She explained, “I could see myself scratching my leg, but I couldn’t feel it. It was the weirdest perception thing ever.” After her diagnosis, Miranda began several years of medical experimentation. Doctors would prescribe one medicine after another, attempting to hone in on a reliable treatment plan for the erratic illness.

Miranda detailed her initial therapy, “They put me on an MS therapy called Tecfidera. I was on that for a few years before it started giving me a rare brain infection, so they immediately took me off that. I went on to a med [sic] called Copaxone. The first one was a pill. This one was a self-injection and it wasn’t strong enough; I had two relapses immediately.” She continued: “They then put me on, about two years ago, Tysabri. Tysabri is a monthly IV infusion. It’s a chemo med [sic], so you go to the chemo center to get it. It’s worked so far, from what we can tell.

I haven’t had a relapse in two and a half years and it hasn’t given me any side effects.”

Though she’s found a therapy that’s working to curb her symptoms, her initial experience wasn’t so seamless. Doctors prescribed a litany of muscle relaxers to battle the spasticity in her legs. She recalls, “I was just so looped; it was crazy. I couldn’t even function.” It was at this point a friend offered her a piece of CBD gum.

“Within fifteen minutes my spasticity went away,” she confided, her face mirroring the shocked expression on my own. “‘This can’t be,’

According to a research paper titled: “Cannabinoids as novel anti-inflammatory drugs,” cannabinoids seem to disrupt the regulation of cytokine production, which are signaling proteins responsible for inflammation.

Oddly, THC can have both pro-inflammatory and anti-inflammatory effects depending on the cells to which it’s applied and the concentration used. When treating MS, the result is antiinflammatory, according to most research.

For example, a study conducted in 1994 with 112 people afflicted with MS showed cannabis improved symptoms in more than 90 percent of patients. Dr. Leslie Apgar, former OBGYN and founder of Greenhouse Wellness in Ellicott City, Maryland, finds cannabis to be an effective treatment for many types of inflammation. She explains, “Inflammation is the root of disease… and cannabis and all of its terpenes are incredibly good anti-inflammatories. Full spectrum options, rather than just CBD, often have an augmented effect. Myrcene, for example, is a terpene that will potentiate the effects of CBD and really help the medicine cross the blood-brain barrier, which is something that never happens in medicine.”

According to Dr. Apgar, there are several terpenes and cannabinoids found in fullspectrum products that work together to fight inflammation. “Linalool is a terpene found in lavender as well as cannabis that has direct effects on seizures and spasticity. So there are certainly different compounds that actually target disease processes and that’s what is so vital about research — I need to know what everything does. I want to know what all these things do and the only way we’re going to get there is if we continue to study it.”

It’s a recurring theme with medical cannabis: more research is needed. Though there’s enough

anecdotal evidence to fill a library, the rigorous clinical research just isn’t there yet. The National MS Society (NMSS) says it best in their statement regarding cannabis for multiple sclerosis symptoms: “Despite its use by humans for thousands of years, the scientific study of cannabis and its components is still in its infancy. High-quality research in the United States remains limited.” Yet, regardless of the lack of adequate study, the NMSS also states: “Based on existing evidence, cannabis products are probably effective for treating patientreported symptoms of spasticity and pain.”

Celeste Miranda

Though CBD has transformed Celeste Miranda’s life and helped control her MS, she doesn’t think it’s a miracle drug. “I think it has its uses and I think it helps certain things, but I don’t think it helps everything and everyone.

I’m just being realistic. But, I think it’s very good for inflammation-based problems. I also think down the road, what they’re going to find is that CBD will just be the tip of the iceberg. It’ll be about CBC, CBN, CBG, and all these other cannabinoids that are just now being researched and isolated.”

Celeste Miranda is now the CEO and founder of MACE Media Group and The Original CBD Expo Tour, one of the largest CBD-focused expos in North America. ❖ Spring 2020 // Cannabis & Tech Today

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// THE LAB //

An Extract Evolution Breakthroughs in extraction technology are creating cleaner concentrates.

By Patricia Miller Most cannabis extraction techniques rely on a solvent to extract cannabinoids and terpenes into a refined, potent substance. Unfortunately, most of these methods also concentrate toxins from the cannabis, like pesticides, herbicides, aflatoxins (from mold and mildew), or heavy metals.

air, it’s a gas smoke, which contains all the cannabinoids and terpenes that you would get if you were smoking or vaporizing cannabis. We then condense this through a series of solubilization chambers, which creates a pure oil. There are a number of remarkable benefits to it.

An increase in scientific research is helping to create better technologies, resulting in better and safer products for consumers. We spoke with Dr. William Levine, our 2019 Innovator of the Year, to learn about the proprietary extraction technology he’s currently developing with his company CannRx. He and his team develop scientifically-based medical and recreational cannabis products with a focus on consistent therapeutic effects and precision dosing.

Number one, we’re getting the best therapeutic profile because that’s exactly what you would get if you smoked or vaporized it, but it’s clean. There are no harmful ingredients.

Number two, we actually remediate all the pesticides so you can actually grow with pesticides, but they won’t be in your oil. Not in any form or fashion. They would get left in the biomass. The third aspect that people are concerned with is killing mold and mildew.

That’s fine, but the actual issue is not the mold and mildew, it’s the toxins, those aflatoxins which already reside in the material. Even if you kill the mold and you don’t clean out the toxins, you’re going to get sick from it. Our extraction technology leaves the toxins in the biomass. It’s 100 percent aflatoxin free, and there’s no other extraction process that can do that. All the other systems actually concentrate and make the aflatoxins more harmful. We eliminate them completely.

Cannabis & Tech Today: During our last discussion, you told us about CannTrap, a cannabinoid delivery system that increases bioavailability up to 100 percent. But, CannRx is also working on extraction technology. What’s unique about your approach?

William Levine: Sometimes you have to take a step back and look at where the industry came from. What makes cannabis so exciting to the world is that you have 3,000 years of ethnobotanical history of an extremely pharmacologically active plant. How we benefit from this plant depends on how we are able to access the bioactives from the cannabis plant.

Most manufacturers utilized extraction systems from the food industry that are not specifically designed for cannabis. If you use CO2 extraction, alcohol extraction, or butane extraction, what you’ve done is said, “Let me use a food excipient ingredient extraction system and I’m going to use it on cannabis.”

Cannabis is not carrots or broccoli. No one would ever imagine smoking carrots or broccoli, 70

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There are some unique aspects of it, including the therapeutic profile, the cleanliness, and the quality of the product, which make it different from every other extraction system out there today.

Photo: iStockphoto.com/adogslifephoto

you eat it. We need a system that is designed to utilize 3,000 years of positive data and create a system to extract the bioactives from the cannabis plant.

At CannRx, we’ve created an extraction system which vapes, or smokes, cannabis. You create a cannabinoid and terpene rich plume of

C&T Today: How will cleaner extraction technology and greater bioavailability help improve medical cannabis research?

WL: Physicians now have to grapple with the biologic effects of cannabis. They’re afraid though, because how do you tell your patient to take something when you’re not sure what it contains and you can’t control the dose? As a result, you don’t know how much they’re

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Dr. Levine and the CannRx team in Israel are constantly working to enhance their extraction technology and create more precise cannabis formulations.

getting. You don’t know if they’re going to have a bad side effect because they’re getting a material that’s not clean enough, or a dose without sufficient bioactives for a therapeutic effect, or a type of cannabis oil that is not focused on their particular therapeutic need.

For example, let’s say I’m suffering from terrible lower back pain. Well now what you gave me is putting me to sleep. That’s not what I wanted. I wanted to have less pain and not sleep all day.

You have to be able to give a targeted formulation that’s answering those needs.

When we can successfully do that, which are the exact technologies we have created, then physicians will buy in. The next stage will be data. We’re actually taking these processes through the pharmacological testing process.

As such, we go through all the toxicology testing and all the preliminary in vitro testing, or what they call preclinical testing. Then we go 72

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into clinical testing. We want the doctors, consumers, and ourselves to have enough clinical evidence to make everyone feel confident in the product.

C&T Today: How do these advancements work together for CannRx’s proprietary formulations?

WL: What we do with formulations is very simple; we break the cannabis plant apart into its various components and we figure out what’s active in which indication. Essentially, we are isolating cannabinoids and determining how they affect the body. I’ll give you an example, which is indicative of the way we work. A lot of people out there have sleep disorders, which include a wide range of specific problems. Some people can’t fall asleep, can’t stay asleep, or sleep well through the night but wake up tired and are tired all day. We have to address all those issues. We have successfully identified which cannabinoids are

“ Let’s take this plant, let’s use the benefits that we were given, and let’s make it into a great product. It can help everybody feel better.” responsible for onset of sleep, for staying asleep, and which are responsible for a restful sleep.

Not only have we identified them, but we’ve actually compared them to the standard pharmaceutical drugs that are prescribed for sleep. What we’re getting is a better, stronger effect. This means the sleep industry, which really has insufficient solutions, can be well served by a cannabis-based solution that’s efficacy-based and safe.

We’re really living through an interesting time in the cannabis evolution. I like to call it the “evolution of the revolution,” but the revolution is gone. We did it, we broke through. Now, where are we evolving to? Are we going to stay the same way we were 10 years ago, smoking cannabis in an uncontrolled way? Let’s take this plant, let’s use the benefits that we were given, and let’s make it into a great product. It can help everybody feel better. ❖

BROUGHT TO YOU BY JUL ABO USA

How JULABO USA Uses Technology to Help Cannabis Extractors When people think of technology they often think of revamping old systems, collecting and navigating data, and replacing human activity with robots or machines. For JULABO USA, technology isn’t about replacing anything or anyone, it’s about improving experiences and connecting people.

JULABO USA provides temperature control equipment that’s used for extraction, winterization, solvent recovery, decarboxylation, and distillation. Like most scientific equipment, JULABO units have built-in technologies to help customers communicate and identify potential issues. Some of the bells and whistles include data logging, external communication, safety alarms, and multilingual interfaces. While these standard technologies are great, JULABO’s service technologies are taking things a step further, and making the experiences more personal.

Better Service & Experiences through Technology According to Dirk Frese, vice president of sales, marketing, and service for JULABO USA, the company is interested in technologies that enhance personal experiences. It’s about more than building better equipment or making an application easier, it’s about better communication and better service.

“We’re investing in technologies that lead to greater efficiency and growth for customers by helping them access the support they need, when they need it. We do this through remote and virtual offerings that allow us to communicate directly and immediately with customers in new ways, making it more convenient and more personal for them,” Frese explained.

JULABO’s Use of Technologies JULABO is using several technologies to enhance customer service and elevate experiences. vDelivery uses well-known applications such as Apple Facetime and Google Duo to connect face-to-face with customers for equipment installation, technical support, and training.

LucaVision helps the company reduce service wait times through the use of augmented reality and smart glasses. LucaVision provides comprehensive and up-close views of parts and components as well as hands-free access to manuals and technical drawings. The smart glasses also allow people in different locations to collaborate, making it easier for JULABO technicians and service partners to troubleshoot, diagnose, repair, and service equipment. The company is exploring ways to use LucaVision for customer support, installations, and training.

JULABO also uses holographic display technologies to enhance the way they showcase products and educate customers. The technology allows JULABO to create an immersive, 360-degree view of equipment that eliminates the need for shipping and reduces the company’s carbon footprint. Visual content can be changed and updated to create unique,

personalized experiences that customers enjoy and remember.

The company is also interested in predictive maintenance technologies. JULABO Crystal is a new fluid testing option that helps predict potential equipment failures, corrosion, and fluid expiration.

“There are lots of ways to apply technology in the cannabis industry. Safety, communication, education, product testing, and retail experiences can all be enhanced with the right technology. We’ve seen great results using technology to collaborate, connect, and communicate with customers. The possibilities for the future are nearly endless,” Frese concluded.

JULABO plans to launch several more technology-based innovations that will help them better serve customers in cannabis and other industries. ❖ Spring 2020 // Cannabis & Tech Today

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Marker Assisted Selection:

What MAS May Do for the Future of Cannabis Breeding

By John Brunstein A Quick History Lesson Humans have been engaged in selective breeding of plant species – that is, the fostering of human desired traits and the suppression of undesired ones – for millennia. For corn, one of the best studied examples, published evidence suggests Mesoamerican farmers began selectively replanting the seeds of the best examples of a grass with 5-10 hard, not very tasty grain kernels per ¾” cob around 7,000 years ago. After a mere 3,000 years, average cob sizes were a whopping 1”, meaning something a bit over 25-percent more yield per cob. Things picked up speed a bit after that and modern corn cobs yield around 1,000x the food per cob compared to the original wild plants and have gained a host of other desirable attributes as well (softer, faster cooking ears, higher sugar content). Corn is one of the modern world’s Photo: iStockphoto.com/jxfzsy

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most important starch crops, a role only made possible by all of the diligent work of breeders across that time span. Lest we think this is a oneoff story, it could be repeated on similar lines for apples, rice, and many other common agricultural crops.

Cannabis is estimated to have diverged from its closest cousin, hops (of beer fame), at around 28 million years ago, somewhere roughly in the region of modern day Mongolia, and we have archaeological evidence of its use by humans – probably initially only for fiber and oil – more than 4,000 years ago in China. There are some claims in the literature of evidence of ritual burning of cannabis going back to earliest usage, but analysis of the associated residue in these sites suggests these plants contained too little psychoactive compounds (THC, THCV) to

have had any noticeable effect on those inhaling the smoke. By 2,500 years ago, however, we have good evidence that at least in parts of western China, cannabis plants with significant levels of THC were being selected and burnt in enclosed spaces in funerary rituals. Whether this was primarily for psychoactive results or for the pungent aroma as a means to mask the smell of decaying corpses is currently debated, but it seems quite plausible selective breeding for aroma might have happened first with discovery of psychoactive properties coming later. In any case, it was around this time that there appears to have been spread of the use of cannabis as a drug from the Far East through the Middle East and into eastern Europe.

The Problem with Selective Breeding The first moral of this history lesson is that

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cannabis, just like any other plant crop, can be subjected to selective breeding to alter its chemotypic profile to something more desirable to humans. The second lesson is that if you’re just doing this by propagating seeds of the “best” plants from a crop cycle after cycle, it’s a long process. Today’s cannabis breeder isn’t interested in diligently propagating plant lineages a few thousand years to get a desirable novel cultivar! Of course, they also have the benefit of a better grasp of biology, meaning selective manually-directed crossing between varieties each having some desirable traits is now the norm, followed by growth and assessment of progeny for best combinations of parental traits. These small number of progeny are then normally backcrossed and/or self crossed in an effort to “fix” the phenotype (make it reliably appear in all, or at least most, progeny). From a genetics perspective, what’s actually being done in fixing is to remove heterozygosity and in effect make relevant parts of the resulting genome all either maternally or paternally derived (depending on which parent of the cross provided the desirable gene form).

In other circles we call this “inbreeding,” and it’s generally frowned upon, because it often also leads to emergence of diseases and lack of health. Having diversity in one’s genes leads to something biologists call ‘hybrid vigor’, which is

a good thing; generally, there is a balance between amount of backcrossing/fixing, and plant viability.

Compared to a multi-millennia timescale, this more modern directed crossing, selection, and fixing is orders of magnitude faster – but it can still take years of diligent effort to grow hundreds or thousands of cross seedlings to maturity, assess each for properties, select the best, and then repeat as needed to optimize genetic stability versus health. In addition to the time investment, there’s actual resource costs as well (grow space, lighting, fertigation, and the like) for all of the plants being screened. As the majority of these will end up being discarded in favor of the few selected progeny, that’s effectively all wasted resources. In other words, on a modern business timescale, traditional selective breeding programs remain both costly and slow.

Enter “Marker Assisted Selection” To address this, we can look to apply molecular biology techniques. Well established in other aspects of agricultural breeding programs, Marker Assisted Selection (MAS) works on a relatively simple principle. Many physically expressed traits (phenotypes) are influenced by variant sequence forms (alleles) of single genes (we call these monogenic traits,

as opposed to polygenic traits where multiple genes interact to create the phenotype).

Cannabis is normally a diploid organism, meaning it has two copies of each chromosome (one from the father and one from the mother), and thus two copies of each gene.

For sake of argument, let’s imagine there’s a cannabinoid called CBX, and it’s produced by an enzyme called CBX synthase from CBGA. There are two alleles of the CBX synthase gene: CBX-H (it’s a fast, efficient enzyme, which produces a lot of CBX); and CBX-null (this is an inactive form of the enzyme, which toothlessly gums on CBGA but doesn’t catalyze any CBX formation). These two alleles vary from each other in only one amino acid, meaning their respective DNA gene versions each has a single distinct nucleotide difference from the other. Now, we don’t start knowing any of this – what we do know is among all of our cannabis cultivars on hand, we find some have a lot of CBX, some have about half that amount, and some have none. What we can do through DNA sequencing is uncover that the varieties with two copies of CBX-H (annotated as CBX-H/CBX-H) are the high CBX ones; the varieties with one copy of each allele (CBX-H/ CBX-null) are the “half CBX yield” varieties; and the CBX-null/CBX-null varieties, as expected, produce no CBX.

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Now that we know these particular gene forms are responsible (or “markers”) for certain phenotypes, what can we do with this information? Imagine you have a cannabis variety “Purple Space Monkeys” which has great characteristics, but produces no CBX, and you’d like to breed a new variety CBX Space Monkeys which is pretty much like Purple Space Monkeys except it has high CBX content. With traditional breeding, you’d cross a Purple Space Monkey with some CBX-containing variety, get thousands of seeds, then spend time growing them up and looking at phenotype in hopes of finding one plant with the right combination.

Of course, to do that you’d have to grow them all the way through flowering and pay for chemotypic analysis on each; slow and costly.

Where MAS can assist would firstly be in selecting the CBX-containing parent – you’d sequence the two alleles to confirm it’s a CBX-H/CBX-H plant as opposed to a CBX-H/ CBX-null. This will, as a first step, ensure that all of your progeny – the F1 generation – will be CBX-H/CBX-null, since we know Purple Space Monkeys is CBX-null/CBX-null and they had to get one CBX-H copy from the other parent.

That’s already better odds than if you’d blindly used what was a CBX-H/CBX-null parent, where only 50 percent of the F1 progeny would express any CBX. (“Aha, but I would obviously have used a high CBX parent,” you say. Yes, in this perfect imaginary scenario that would have told you it’s CBX-H/CBX-H but reality is never so clear cut.

Variable penetrance and variable gene expression and things called epistatic effects affect the real world, so this hard knowledge that the parent is homozygous for the allele wanted and all progeny will carry one copy of this gene, is very useful).

Now, if you’re happy with a mid-level of CBX expression, you can proceed to pick any one of these clones to propagate onward as your new variety; but what if you want high CBX levels?

Now you’ll want to start crossing F1 x F1 progeny (both CBX-H/CBX-null), and this is where MAS really begins to get helpful. Only one quarter – 25-percent – of these F2 progeny will be CBX-H/CBX-H. Without MAS, you’re stuck doing the cross and growing up, let’s say, 76

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Photo: iStockphoto.com/zokru

1,000 progeny for flowering and chemotyping.

With MAS, once you have little sprouts of plants, you can sample a tiny piece of each and immediately detect which 250 are the progeny of interest worth keeping; you just saved all of the space, trouble, and expense of growing the 750 plants you know won’t be high CBX. If you want to also test for a gender – another simple example of MAS – you can cull a further 125 male plants leaving only the females to follow. You’ve cut your work (and propagation and phenotype testing expenses) down by a factor of 7/8.

MAS in Practice So, is that how MAS works in real life? Well, sort of. It’s presented above as an overly simplified example with perfect numbers, just like Gregor Mendel’s original work*. In cannabis, the so-called THCA synthases and CBDA synthases both, really, seem to produce a mixture of products with minor allelic variations (changes in single amino acids in the protein sequence) changing the yield ratios. MAS will have the ability to distinguish all of these and their combinations in potential parents where simply looking at the THCA/CBDA levels can’t, giving better insight into what crosses to set up and what allele forms to track in progeny to get desired results with regard to these major cannabinoids. Similar data is being uncovered for the complex web of terpene synthases, many of which as well are capable of producing multiple products. Many other traits such as resistance to particular pests will likely be amenable to MAS. By combining examination of multiple trait markers in a single cross, MAS becomes increasingly useful. Want a particular combination of multiple specific traits split

between two parental varieties? The bigger the list, the more selection can be done on sprouts, narrowing the field smaller and smaller to just the handful of likely candidate offspring.

Sequential crosses between multiple cultivars aimed at bringing in alleles unique to each source are similarly possible in an informed fashion.

To add a bit more complexity, while we’ve considered an imaginary marker here which is directly, mechanistically responsible for the phenotype, it’s possible to have ‘linked markers’ – things like single nucleotide polymorphisms or SNPs – which may in and of themselves have no direct impact on a gene, but are physically closely associated on a chromosome with the gene; different forms of the marker will then statistically associate with certain allelic forms of the gene, allowing them to act as surrogate markers. Polygenic traits – those influenced by many genes – are another layer of complexity, where often several markers will have to be tracked together to get a desired result.

By combining biochemistry, MAS, and aspects of traditional breeding, the development of new cannabis varieties with directed traits can be done in orders of a few crossing and growth cycles (months), as opposed to thousands of years. For the breeder trying to make the next “big thing,” it’s a quantum shift in feasibility. ❖ *Mendel’s “selective” observation practices, while frowned upon now, were essential at the time in allowing him to determine major statistical trends in crosses leading to the formulation of a viable (and correct) theory describing genetic trait transmission. Since then we’ve uncovered many of the nuances behind the samples he “didn’t record observing.”

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To Market, To Market, To Buy Cannabis with My (Adult) Kid Home again, home again. Open that lid.

By Tami Kamin Meyer When Johnathan Kluding was growing up in Iowa, he got arrested on cannabis-related charges four times. Now 24, Kluding is happy to celebrate the second anniversary of his move to California in April 2020. That’s because today he can walk into any California dispensary and legally purchase and possess any marijuana product he chooses. Even with his mother in tow.

“ Teaching my mom about different strains was a bonding experience, and it’s nice to enjoy together.” ~ Jonathan Kluding

According to Melissa Drake, Kluding’s mother and a California resident since relocating there from Iowa in July 2017, her son’s marijuana usage was a source of intense angst for her as he grew up. “It was our number one argument when he was growing up,” she says. Ironically, she says she was more supportive of Kluding if he drank alcohol, because at least that was legal.

Since moving to California, Drake has become a devotee of marijuana edibles and other products that help alleviate her physical pain and anxieties that conventional medicine was unable to ease when she lived in Iowa. When Kluding visited his mother in December 2017, the pair “went straight to a dispensary right after he landed.”

That experience broke down a lot of barriers that had hampered their relationship when Kluding was a child. “It was fun,” says Drake.

While browsing the dispensary together, discussing various products, strains, and more, the two chatted, laughed, and enjoyed.

The experience proved such a positive influence on their mother-son relationship that Drake described it as “transformative. It helped 78

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Photo Lawrence Crandall

me accept this part of him. I realized pot isn’t the big deal I once thought it was.” She also became a certified life coach in 2017.

Meanwhile, deciding to move to California was a huge decision for Drake because up until then, she had been a lifelong Iowan. Leaving her beloved home state meant selling her beautiful home, quitting her high-paying job, and saying goodbye to cherished family members, like Kluding, and longstanding friendships.

But a divorce and other misfortunes drove Drake to a depression so deep that she was

practically bedridden from 2007-2014. In 2012, she and her son visited family in California. At the time, Drake had a steady job, a house, and was “comfortable in my uncomfortable life.”

Drake has since stopped taking prescriptions to ease her discomforts, relying fully on cannabis to help alleviate the depression and pain that plagued her for much of her life.

While Drake says her move to California has transformed her life, it has also altered her views on cannabis. “Any time we can reduce shame around something normal and natural, it’s a

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beautiful thing. I think it’s normal even though it doesn’t look normal and I’m fine with that,” she says.

Today, Drake and Kluding share a lot of laughs rather than a wheelbarrow of woe. “We’re funny, in general, but now I’ll call him with questions about what I’ve taken. We have a lot of off-thewall conversations. He didn’t expect he’d ever take a hit with his mom. It all comes down to acceptance and I love it’s safe for him to be who he is,” she sums.

Kluding agrees. “Growing up, I got in trouble because marijuana was illegal in Iowa. Once I moved out here, it changed everything.

Teaching my mom about different strains was a bonding experience, and it’s nice to enjoy together,” he says.

Hyapatia Lee suffers from a chronic medical condition eased by marijuana use. The Pueblo, Colorado resident moved to The Centennial State from Indiana nine years ago “for my health alone. I knew when I didn’t use cannabis, I didn’t feel well,” she says. The lure was so great that she chose to sell her 18-acre ranch full of rabbits, horses, and other animals, as well as

leave her grandchildren to move to a state where cannabis is legal for recreational use.

“I had no choice but to leave my three grandchildren and two sons in Indiana,” to move to a state where recreational pot is legal.

Another son lives in California. Since moving to Colorado and partaking in cannabis on a regular basis to alleviate her pain and discomfort, Lee’s life has changed.

As a daily pot smoker, Lee describes herself today as feeling better, enjoying life and a clearer mind. But, she laments, “I can’t visit [my family] in Indiana because if I don’t take my medicine, I will die.”

Part of the treatment she endures to combat hypopituitarism, a rare disorder in which the pituitary glands fail to produce one or more hormones, are steroids. However, if she takes steroids at the prescribed level, Lee says she is vulnerable to an asthma attack. That alone could kill her. So, she supplements it with cannabis.

She has been smoking since the late 1970s and does not get out of bed before smoking cannabis via vaporizer.

Lee patronized a Pueblo dispensary with a son when he came visit with his then three-year-old son in December 2018. He came to visit because he knew she could not leave Colorado and be without cannabis, but she also wanted to spend time with her grandson.

Of the experience, Lee says her son was “was amazed at the variety of strains and merchandise, such as pills, smoke, and dabs, available for purchase.” In fact, he was impressed by the array of products available for purchase, more than is even available to him in California, where he lives now.

“He knew I moved here because of cannabis, but I felt badly about my use in Indiana because of its illegality, but he knew how much it helped me,” says Lee. Visiting the dispensary together was “funny and bizarre. I wanted to tell everyone there, ‘This is my kid!’”, she says. Lee says while she and her son had bonded on the issue of her marijuana usage before his visit, it was a “nice experience to share with him in public. Being totally open and honest was wonderful.” ❖

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The Art of the Potcast A roundtable discussion with cannabis-focused podcast hosts

By Anthony Elio According to Statista, there are 88 million podcast listeners in the U.S., with that number expected to almost double by 2023. Looking through your typical platforms such as Stitcher, Spotify, and Apple Podcasts, you can find podcasts about pretty much every topic, including but not limited to junk food, Power Rangers, tabletop games, the films of Mike Myers, and even ballpoint pens. And yes, those are all real. One of the many podcast topics growing in popularity is cannabis. Because of its fairly open format, podcasting has allowed for more education and discussion around the substance, something most traditional media outlets would avoid. In this exclusive roundtable, we spoke with numerous cannabis podcast hosts about the ins and outs of discussing marijuana behind the mic. time job, and it’s expensive — audio equipment, social media, booking guests, recording twice a week, recording ads, promoting sponsors, and editing… Thank God for weed.

Mary Jane Gibson and Mike Glazer

Technology: Shout out to Zoom! They hooked us up with a beautiful audio package for our live show at SXSW. It’s a great company that isn’t scared to support a podcast with “weed” in the title. Zoom wants to support quality content made by people who believe in themselves.

First Episode Vs. Latest: No change. We’re perfect. (We’ve learned a lot about backing up our audio files though.)

Mike Glazer - Comedian & Host at Weed+Grub Mary Jane Gibson - Writer, Actress & Host at Weed+Grub Podcast Description: Weed+Grub are the cornerstones for cultural conversations. If you love comedy, cooking, cannabis, and news from the front lines of weed culture, then we’re for you.

Cannabis brought us together (shout out rooftop joints at sunset!). We love to interview people who smoke like Jim Belushi, David Crosby, Ron Funches, Laganja Estranja, and Thug Kitchen, but we also talk to folks who don’t consume, like Trixie Mattel or Animaniacs creator Tom Ruegger.

New Episode Process: We write a 150-page script, send it to Rian Johnson for notes, and then 80

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write a second draft based on his thoughts. After we submit the script to the Writers Guild so no one steals our ideas, we set up our mics, open our Apple laptops (this is not an ad for Apple), and carefully read each page. Sometimes we do two or three takes per page to make sure we’re getting the most out of each sentence, but we try not to overthink it. (We actually just smoke, snack, and have a great time.)

The Unique Nature of Cannabis Podcasting: We were early to the cannabis podcast table, and it’s incredible how fast Weed+Grub became one of the top entertainment sources for cannabis culture news. We’re really proud of how we’ve grown and continue to grow.

Cannabis Podcasting Obstacles: It’s a full-

Recommended Episode: If you’d like to hear a free-flowing conversation that’s just us, check out “Origin Stories & Shower Techniques.” If you’re interested in a juicy cannabis-infused chat with an industry leader, check out our Spotlight Series episode with Quim CEO and co-founder Cyo Nystrom. If you want to hear a dazzling chat with a celebrity, check out our episodes with Jim Belushi or David Crosby.

Tad Hussey Cannabis Cultivation & Science Podcast Podcast Description: The podcast is really designed as a way of bridging the gap between the information that’s available to cannabis growers and what’s already out there in the horticulture world, in the academic world, what sort of science supports a lot of the stuff that we’re doing in cannabis cultivation. Because being something that was underground and black market for so long, there really wasn’t a lot of great information.

Your resources were fellow growers, possibly stuff in forums. Now people use Instagram or you’d

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book is usually a good idea if you want to have a podcast because you know a lot of subjects doing a nonfiction book like I did, right? So, I had a lot of people who liked my work and trusted me, so knew they would talk to me. I think I just plopped myself in his office with a tape recorder. Very simple, very basic.

But at the end of the day, it hasn’t changed all that much. The recording devices have changed.

The microphones have changed. I’ve upscaled the equipment, you could say, but the process is pretty much the same.

Recommended Episode: I love the episode with Julie Holland on how to access the pleasure chemicals of your brain. I loved that. I

Tad Hussey

love the most recent episode we did on walk down to your local hydro shop and try and find out information from the grower down there. But there wasn’t a lot of good actual data or research to support what people were doing in terms of cultivation. The goal of the podcast was really to bring on more academic, scienceminded folks who could share that information with growers.

Recommended Episode: It depends a little bit. If they’re really interested in cultivation and they’re interested in organic cultivation, I think my episode with Justin McGill, Episode 52, is probably the best one for people to check out. If they want to hear some of the studies and science that’s being done in cannabis, the one that I did with Dr. Alison Justice is really good.

And then lastly, the one that’s been really popular is with Jeff Lowenfels, who wrote Teaming with Microbes. He’s just a really great speaker and he talks about the microbial interactions in the soil. Those are what I would highlight for people who are checking out the podcast for the first time.

The Unique Nature of Cannabis Podcasting: It’s good and bad. I love the fact that we’re targeted towards growers. I think it’s great because the cannabis industry has been really welcoming and embracing of this information and it’s been really humbling how well received the podcast was. I had never in my wildest dreams thought that we would have this many listeners and this sort of a following for the podcast, so I’m very humbled by all of that. The

biggest challenge, I would say, is the stigma around cannabis. I’m not even growing cannabis right now. I have in the past, but when I go to apply for a bank loan, if you Google my name, a lot of cannabis stuff shows up and so there’s a lot of stigma. I’ve been denied loans, things like that, even though I’m not technically in the cannabis industry. I’m hoping that stigma will keep going away over time, but I think it still exists for a lot of us.

Joe Dolce The Brave New Weed Podcast Podcast Description: We call it highminded conversations for the post-prohibition era and that’s fine, but we’re also looking at the future, we’re talking to the real leaders who are leading the way of thought, leading the way of research, leading the way of science and commerce.

Obstacles for Cannabis Podcasting: Well, you can’t socialize it easily. You can’t sell ads on Google AdWords. You can’t do that sort of stuff. I know Google and Facebook are very anti-cannabis still, so it’s hard to make big leaps forward that way. That is a fact.

biosynthetics, it came out today actually. It’s called “Marijuana from Microbes” because I think it’s super controversial and that’s really the point is to raise interesting, controversial topics.

I thought the episode we did with Ethan Nadelmann, the second episode we did on the Vapegate was also great. We called it Vapegate, which is how politicians are turning vaporizing into the new war on drugs.

Listen, I like them all for different reasons. But I’m lucky because the people I talk to are really smart and well-spoken and really sick about the topic and really have a passion for it. So, those are three that stand out in my mind, this particular day. But I feel very privileged that I get to talk to really smart people about pretty interesting topics. ❖ Joe Dolce

First Episode Vs. Latest: Oh, my God. I would say it’s a zero to 10. I mean, yeah, the first one was with a great subject, Ethan Nadelmann, founder of the Drug Policy Alliance, one of the great anti-prohibition fighters in America, maybe the world. I knew him because I interviewed him for my book. I mean, doing a Spring 2020 // Cannabis & Tech Today

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// PRODUCT REVOLUTION //

Sunday Scaries Gummies – The tagline for Sunday Scaries is “The Remedy That Makes Life Not So Scary,” which is a perfect fit for these relaxing gummies. With every one packing 10 MG of CBD, these grown-up gummy bears will help you melt off the stress. $39

The Seed & Smith Dart – Just because you have a high-end vaporizer doesn’t mean it has to be jam-packed with buttons and extraneous connectivity.

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The Heir Waterpipe – Featuring a design that’s modern, efficient, and easy to clean, the Heir Waterpipe completely reimagines the classic glass waterpipe. Available in white, silver, and gold and utilizing coldfiltered engineering, these waterpipes will enhance your experience and look good doing it. $260 Green Jay E-Lighter – An ideal alternative to the common blowtorch, the Green Jay E-Lighter features a design that’s both sleek and discreet.

Rechargable, windproof, and fuel-free, this e-lighter is built for the modern cannabis consumer. $17 Icky Stick XL – A completely anodized metal design helps the Icky Stick XL resist wear and corrosion, proving yet again that quality materials matter. With twice the herb capacity as the original Icky Stick, the XL remains compact while doubling smoke time. $50

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Cannabis & Tech Today // Spring 2020

// PRODUCT REVOLUTION //

G2 CannaMold – Providing a positive alternative from the classic joint, the G2 CannaMold allows you to create a cannagar (cannabis cigar) with ease. Depending on the size you choose, the CannaMold lets you pack in everywhere from two to 14 grams for an extremely smooth experience. $44-49 TriBeauty CBD Collagen Boosting Serum – Helping your skin to naturally produce collagen, the TriBeauty CBD Collagen Boosting Serum is packed with effective ingredients such as cannabidiol, hyaluronic acid, and vitamin B5.

Providing tone, hydration, and protection to the skin, this CBD-enhanced serum belongs in your beauty routine. $70

Mountain High Suckers – A tasty take on the classic edible, Mountain High Suckers offer THC-infused lollipops in flavors such as cinnamon, caramel apple, and butterscotch toffee. Additionally, the company has partnered with comedian Josh Blue to integrate his favorite strain, Blue Dream, into an exclusive flavor, “Josh Blue’s Dream.” Prices vary

Mary Jane on Main Street CBD Starter Kit – Everything you need in one convenient package, the Mary Jane on Main Street CBD Starter Kit is perfect for CBD newcomers and veterans alike. Containing CBD balm, chocolate, coffee, honey, a tincture, and more, this starter kit is the ideal wellness gift. $567.95

Tom’s Tumbler Python – Showcasing the ability to process 500 pounds of material each hour, the Python has a higher capacity than any other dry trimmer on the market. The high quality trimmer uniquely doesn’t utilize blades, and stands out from the competition for its quiet operation and easy approachability. Price TBA

Spring 2020 // Cannabis & Tech Today

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RELAX // Something Edible With Laurie Wolf

Strawberry Streusel Muffins Crumbly, buttery streusel topping takes plain baked goods to a new level.

Using plump, juicy, in-season strawberries makes these muffins especially delightful.

Makes 1 dozen muffins Serving size: 1 muffin Difficulty: Easy For the muffins: • Cooking spray, for greasing the paper liners • 2 eggs, lightly beaten • 1/2 cup almond milk • 1/2 cup sour cream • 3 tablespoons canola oil • 2 tablespoons canna-oil or butter • 2-1/4 cups all-purpose flour • 1/3 cup sugar • 2 teaspoons baking powder • 1/4 teaspoon salt (kosher or sea) • 1-1/2 cups hulled, chopped fresh strawberries For the streusel topping: 1/4 cup all-purpose flour 1/4 cup packed brown sugar 1/2 teaspoon ground cinnamon 2 tablespoons cold canna-butter, cut into small cubes

Eager to discover the joys of cooking with cannabis?

Check out the CBD granola and infused coconut oil at LaurieAndMaryJane.com. Just say that Laurie sent you!

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Cannabis & Tech Today // Spring 2020

Directions: 1. Make the muffins: Preheat the oven to 340°F. Line a standard-size muffin tin with paper liners, spray the liners with the cooking spray and set the pan aside.

2. In a medium bowl, beat together the eggs, almond milk, sour cream, canola oil, and canna-oil.

3. In a large bowl, whisk together the flour, sugar, baking powder, and salt.

4. Add the wet ingredients to the dry ingredients, mixing well.

5. Gently fold in the berries.

6. Spoon the batter into the prepared liners, filling each three-quarters full.

7. Make the streusel topping: In a small bowl, combine the flour, brown sugar, and cinnamon. Work the butter into the dry mixture with your hands to form a crumb topping. Top the muffins evenly with the streusel.

8. Bake the muffins until they are golden brown, 20 to 25 minutes.

9. Remove muffins from the tin and cool on a wire rack.

You can make the batter ahead and just bake when you are in the mood. It will last a few days in the fridge. You can also use the fruit of your choice. I mean, I wouldn’t use cantaloupe, but any berry or peaches would be lovely. If CBD is your jam, that’s a mindful choice. I find that starting the day with CBD makes a difference in both my energy level and my mood. ❖ Laurie Wolf is the author of such cannabis cookbooks as Marijuana Edibles, HERB, The Medical Marijuana Dispensary, and Cooking with Cannabis. Her recipes have been featured in High Times, Dope Magazine, Culture, and more. She is also the founder of Laurie + MaryJane, an edible company offering everything from almond truffle bites to vegan chocolate cookies. And remember, #Don’tFeartheEdible!

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events Our cannabis event partners care about the health and safety of their attendees. In light of the COVID-19 pandemic, the schedule for this season’s events is changing rapidly. Please check each event’s official website for current information regarding show dates, venues, and ticket prices. Some of the spring and summer’s most anticipated events are listed below:

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International Cannabis Business Conference Bern, Switzerland

Expo Cannabis Business Conference Cartagena, Colombia

Cannabis World Congress & Business Exposition

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New York, NY

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You can’t be everywhere and we understand that. If you feel like you’re missing out, stay tuned to our website and social channels for premier event coverage.

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Cannabis & Tech Today // Spring 2020

// COMING NEXT ISSUE //

CANNABIS IN CRISIS Whether positive or negative, there was not a single industry that didn’t feel the effects of COVID-19. How has the cannabis industry responded to and been affected by the coronavirus pandemic? In our summer issue, we’ll take an indepth look at how the pandemic adversely affected cannabis, while highlighting those companies that stood up to help in the fight against coronavirus.

DIVING INTO DISPENSARIES One of the first Cannabis & Tech Today cover stars was Wanda James, who taught us some fascinating details about running her dispensary Simply Pure.

Looking back at that interview, our team has realized how many other questions we have about cannabis retail. What are some of the obstacles when it comes to breaking ground on a dispensary?

What’s the most vital strategy to retaining a customer base? What’s a typical day in the life of a dispensary owner? Our exclusive roundtable will answer these questions and more.

PEST PREVENTION Cannabis cultivation can be a difficult process, as maintaining proper lighting, watering, and fertilization is vital. However, one threat that isn’t always apparent to the cannabis consumer is the large number of invasive pests such as crickets, aphids, and mealybugs. For our summer issue, we’re looking to compile a guide for aspiring cultivators to get rid of cannabis-chomping insects sustainably, without resorting to harmful pesticides.

CANNABIS GOES TO COLLEGE As the cannabis industry gains more traction and viability, universities across the country are picking up the subject. From business and law to agriculture and engineering, cannabis classes are taking over our colleges. In this upcoming issue, we’ll take a look at these curriculums, speaking to the professors training the next generation of cannabis leaders.

Photo: iStockphoto.com/wildpixel

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RELAX // THE LIGHTER SIDE

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By Mike Glazer and Mary Jane Gibson, Weed+Grub Podcast Cannabis is all about branding, and Weed+Grub is here to help you unlock your company's success. The number-one mistake people make when starting their cannabusiness is asking themselves the wrong question. Stop asking yourself “What is my brand?” and start asking yourself “What is the ‘Who’ I want to reach, and How plus Why?” Sure, it’s easier said than done, but thanks to three years at the top marketing firm in Jyväskylä, one TED Talk, and thousands of hours on TikTok, Weed+Grub has developed a fool-proof methodology called DOMINATE THE CLOUDS™ that will rocket your billion-dollar weed company to the top of the marketplace.

When our system unlocks your brand power, share your triumph on your Instagram and tag us (@weedandgrub), and we’ll celebrate your victory on an upcoming podcast.

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