Russ Cersisimo was a guest on the Thinking Outside the Bud podcast. He spoke with Business Coach Bruce Eckfeldt about himself, the hemp industry and Hemp Synergistics. You can hear the podcast and view the transcript on the Thinking Outside the Bud site by clicking their logo.
Transcript:
00:00:01] You’re listening to Thinking Outside the Bud where we speak with entrepreneurs, investors, thought leaders, researchers, advocates, and policymakers who are finding new and exciting ways for cannabis to positively impact business, society, and culture. And now, here is your host, Business Coach Bruce Eckfeldt.
[00:00:30] Are you a CEO looking to scale your company faster and easier? Check out Thrive Roundtable. Thrive combines a moderated peer group mastermind, expert, one on one coaching, access to proven growth tools, and a 24/7 support community. Created by Inc. Award winning CEO and certified scaling up business coach Bruce Eckfeldt, Thrive will help you grow your business more quickly and with less drama. For details on the program visit Eckfeldt.com/thrive. That’s E C K F E L D T.com/thrive.
[00:01:06] Welcome, everyone. This is Thinking Outside the Bud. I’m Bruce Eckfeldt. I’m your host. And our guest today is Russ Cersosimo and he is founder of the Medical Cannabis Society, also an entrepreneur. We’re going to talk about his business Hemp Synergistics a little bit. I’m excited for this program. I think, you know that the hemp space is fascinating. I think in the medical space, it’s fascinating. We’re going to talk a little bit about Russ’s background, learn about his insights, what he’s doing in the cannabis space. With that, Russ, welcome to the program. Thanks for having me, Bruce. So why don’t we start with a little bit of your background. I’m always curious to hear how guests kind of got into the cannabis space, what they were doing beforehand. There’s always a good story there. Tell us yours.
[00:01:42] Sure. So I actually was in the, I had started a tech company out in California in 2009 and I had exposure to cannabis. You know, I remember specifically in 2009 seeing an adult smoking a joint near a kid’s playground and a cop was in a close vicinity enough that they could smell it. The world wasn’t ending. Nothing happened. And when I moved that tech company back to Pittsburgh and the stigma was still there. In fact, it was very strong. 2014 came along and there was a group of mothers that had started pushing legislators for medical cannabis program in Pennsylvania. My business partner and I teamed up with the moms and went out and really pushed our legislators, worked with legislators one on one. In fact, was often that we would get a call and say, hey, look, we need you on the phone call tomorrow.
[00:02:29] We’re going to have these Senators and these House reps in the room, and we need to compare and contrast how, you know, the Connecticut program, why it took so long versus the Minnesota program. If you could do that, it be great. So that that’s the kind of stuff we did. We teamed up the moms and we put on about 50 events we were part of over the last three and a half, four years, specific to just educating and leading the industry in Pennsylvania. So I really jumped in when I could. And from there we ended up being successful getting a dispensary permit. And then from there you kind of see the things that the industry needs.
[00:02:57] I ended up getting into my software roots and developing software that is going to help researchers tie cannabinoid constituent ratios to patient outcomes over time. So we slowly developed that and just recently I got into the hemp industry, which we’re going to talk about, I guess coming up. But that’s kind of my background in a nutshell. But I did get in because I had specifically, an 11 year old girl that had 10,000 seizures a year. Wow. We saw what the oil did for her, they gave her a 14 days for her organs were going to be shut down. Cannabis brought her back to life. That same girl is now 16, communicating with her mother and speaking for the first time in her life.
[00:03:30] And it was all because of this plant that was so demonized. So it’s nice to see it all come full circle. And yeah, that’s how I got into it.
[00:03:36] Well, a tough story to have to go through, but I think I see a lot of that kind of, you know, people that have seen firsthand, you know, what cannabis can do applied, you know, in the right way, you know, in the right context for these outcomes.
[00:03:49] So it really does the influencing, you know, I mean, when someone can see it, what it does, there’s not much negotiating you need. It’s a matter of people seeing what it does. Fill us in.
[00:03:58] What is the status of Pennsylvania in terms of cannabis medical? This is a medical program?
[00:04:03] So it’s medical. In fact, our governor just last week, he brought up the point that he was OK with the recreational program. Right now, it’s medical, we are in, I believe it’s the full first year is passed. And I think the numbers just came in and they did about 200 million in dispensary sales through August.
[00:04:19] And how many dispensary licenses, roughly, are they located in specific places or what’s the geographic?
[00:04:25] I believe there’s 60 that are up right now. And that’s the way the state did, is they did a limited model where, you know, they only gave out so many. And it was a competitive application process. And it was you know, it was everything it was supposed to be. But at the end of day were up and running. And we’re over that hump and things are moving.
[00:04:41] I guess having been involved in that process, what were your surprises or insights in terms of actually getting the legislation passed?
[00:04:50] Yeah, I’ll tell you, it’s interesting working with legislators. You know, I had no idea what I didn’t know, you know, and there were some there were some good stuff, too. Like, I remember whenever the bill did get passed, a lot of people were up in arms over the fact that it didn’t include flower and it did not include edibles. And one of the senators that worked with us on the bill gave us a wink and said, hey, give it literally one year and you’re going to see flower come in. We wrote special things in the bill to let that happen. And he was right. You know, a year later, flower just made it in without any fight. So I got to see kind of how that process all goes. But, you know, at the same time, there are bad sides of politics. I saw that in the application process, too. But I mean, at the end of the day, it was it was majority positive and we’re up and running people have medicine and I’m happy. Yeah.
[00:05:31] Yeah. I think a lot of a lot of the people that have spoken to that have been kind of part of various state legislative processes, it’s kind of, you know, it’s making sausage. Like you don’t watch it being made. Just enjoy the outcome. It’s like it can be a little grizzly.
[00:05:44] And so tell us about the research side. I mean, I guess that, you know, to the extent that you’ve been involved in helping kind of click down around those, I mean, I guess there’s a general kind of feeling or discussion in the industry that there’s a lack of medical real kind of scientific underpinning or data, you know, studies and things like that. I mean, I guess what have you seen? What data do we have out there?
[00:06:04] Because I came from the data realm, I went into this look for the, you know, where’s the data at? Where’s the stuff that people want, where they see value? And it’s really tying cannabinoids to an outcome.
[00:06:15] In fact, I had been in touch with researchers at Johns Hopkins that were working on that exact thing, trying to tie cannabinoids to once it’s in someone’s bloodstream, how’s it affecting them? And the software just wasn’t up to speed. They were trying to use things that they had been using for years to do this. But because the Schedule 1, because the fact they couldn’t touch the patient, you know, there’s so many there’s handcuffs in every direction. So basically what we did is we started developing software that utilizing the lab in Pennsylvania was a really neat. It was good because they pushed for a high level of testing. What we knew as software developers that there was going to be that that kind of machinery, that analytical equipment in the state and that, you know, cannabis is going to have to pass through these three different machines to pull out all this different information. And if we could tie that information then to a patient outcome. And that’s what that’s what we’re currently building on the software side now. So what we would do is hand somebody a phone and say, you know, there are other groups that are doing it. But the big problem is that they’re not tying into those actual cannabinoid ratios at software level. They’re asking a human being to type in all these decimal points in regards to cannabinoids and terp ratios. And, you know, it’s a great idea and we’re almost there. But, you know, that’s where you draw people. So I think we’re trying to find a really good solution for the industry and we’re really going down that research path with it.
[00:07:28] But so far, so good on feedback and we’re doing the right thing. But it is a it’s a monster. And there’s a real there’s a reason that people haven’t done it yet. It’s very difficult. A lot of moving pieces, a lot of different legacy technologies that need pulled together and then standardized, normalized and it spit out for these different applications. So we’re getting there. But it’s really data, you know. I mean, I got up when I spoke at a spectroscopy convention, which, you know, I’m not a scientist. I just get thrown into these things. And, you know enough to be dangerous. Yeah, exactly. Exactly. So knowing that I was to be in front of all these scientists, I brought my scientists waiting for that one audience question that says, hey, well, how could you claim all this? There’s no there’s no research. And my response is there’s not enough data. You know, I’ll talk to you afterwards. And once you get a chance to sit down with these scientist, let them know. Look, it’s just we just haven’t had a chance to pull this information. You guys like the research. You know, so far we have some anecdotal stuff. And here is that the research that we’ll pull together that they’ve done, but there’s no really central database in their definitely not teaching that stuff at medical school. They’re starting to talk about it, but they haven’t been taught it. So it’s there is that cognitive dissonance in bringing these things in. Unless the data is there, it’s hard to buy into it.
[00:08:31] Yeah. Do you think I mean, if there were, you know, any kind of big changes you could make to the industry, now either, you know, a state or federal level that would really help with the whole, you know, the ability to collect data, analyze data, you know, bring data to the actual kind of application process, you know, helping people make decisions, you know, diagnoses, things like that.
[00:08:50] What do you think are the big hindrances? Hemp being a Schedule 1 drug is a big problem. I mean, that’s literally it. You know, usually these guys are able to access these drugs, are able to have a clinical study that they put together. But because there’s you know, we don’t know who’s you know, we don’t know what’s going to happen yet. Everyone’s kind of nervous about it. And, you know, the best way to do it, it would just be get someone that has a medical card and start to ask them questions. But again, they’re one removed from the researchers because there’s that medical card involved. You know how frustrating it is.
[00:09:17] And I think that, you know, there’s so many just kind of interesting dynamics of this industry because we have this kind of legal conundrum or quagmire that we’re in. But, you know, unfortunately, I think it really it does hurt our ability to use it as a positive medical tool. I mean, you know, it prevents doctors from getting too involved in prescribing. It’s not even a prescribing, you know, the authorized condition process and actually selecting a product and the products themselves. I mean, we just don’t know. You know, we’re dealing with an agricultural product that, you know, has a huge amount of variation. And so, you know, once you start processing it and then you know how these cannabinoids actually interact in different ways, you know, we just we know so little about really what’s going on. You know, it has so much potential positive benefits. I mean, we know anecdotally and we know in these kind of extreme cases, you know, it’s clear that it’s having this, you know, this positive impact. Interesting. So let’s talk a little bit about the hemp side, because I think that, you know, from a business point of view, from an industry point of view, is huge. So tell us. I guess maybe just educate the audience a little bit what’s going on with hemp and then why has been so interesting for you.
[00:10:14] So, I mean, basically, we had the ability that to, you know, do certain amount of things under the 2014 Farm Bill. They then came out with a 2018 Farm Bill that right now has been sent to the White House for approval and changes. So we’re kind of working off of the old one. But yeah, I mean, when you look at it, you know that the marijuana industry is kinda limited because of the state rules and because it is a Schedule 1. Now the fact that, you know, hemp can be bought, sold, shipped, grown, you know, it really opens things up. And, you know, I like to look at it as a biological and scientific level. We all have an endocannabinoid system now. Right. So I think market right now is really going to, I mean obviously I’m not the only one, but it’s going to it’s going to boom. And that’s because people are you know, they’re getting this somehow, whether they hear about on the news, whether they have a friend, you know, whether they stopped by CBD store or whatever it is they’re getting in their system. And all the benefits, even the benefits they would get if they had smoked cannabis are coming because there’s other cannabinoids are in there. So, I mean, it’s I think that the industry is going to be huge because the limitations, aren’t there, and we all still have an endocannabinoid system. I think the last statistic I read is that seven percent of the country is on some sort of CBD or hemp product.
[00:11:19] Yeah, that’s crazy. I’ve seen it at the malls and everything. Pretty much everyone’s advertising CBD products.
[00:11:24] And you know, when I look at it like, you know, it’s like saying magnesium is now available. You know, go ahead and get it. And people have something to. Vitamin C? Yeah. There you go. And you know, so you’re getting all this good stuff that’s happening.
[00:11:36] I mean, we all need it. So eventually everyone’s going to get on it somehow. And that’s kind of the life cycle that I’ve seen is once they try it, it remedies something. It makes them feel better. I mean, you know, I look at my father was on Ambien for 20 years and, you know, his doctor told him it was OK. And he is now off the Ambien and he’s on some sort of CBD product just you know, and it does all the same thing.
[00:11:57] You know, now we’re finding out that it’s CBN in half amounts at five milligrams of CBN is got the same, it does the same thing as Valium or Ambien at 10 milligrams. So, you know, these little things that are coming out as we find them, you know, where do you get that stuff? You get it from hemp. And you know, and it’s not going to be limited. So I think, you know, all ultimately then isolating these ingredients as they come up is going to be a big thing that we see in the next couple of years, too, because we are finding this stuff out.
[00:12:20] And just so people understand. I mean, hemp is basically cannabis with less than 0.3 percent THC content. I mean, it’s the same fundamental plant.
[00:12:30] It’s just right now, you know, you’re just, you know, manipulating the THC levels in it so that it falls below this 0.3 percent. And then now I know the Farm Bills 14 and 18 Farm Bill that it’s now federally legal to grow, to process, to sell products derived from hemp. That’s correct.
[00:12:49] Correct. Now where you’re going to see. So I’ll use this opportunity to kind of give you. Right. So right now and right now they grow the plant and it’s got typically a 0.3 percent THC. What’s happening? That’s legal, right. So, you know, when we look at the crime lab reports, we’re seeing a nearly all hemp as it’s grown is falling below that 0.3 percent THC. When we look at what’s been extracted, so you take the plant, you run it through a machine. I mean, these machines, anybody could get a two hundred thousand dollar apex machine. You know, anybody really doesn’t matter. It’s like operating a commercial washing machine. You know, you turn it on. You put your stuff in, out comes your stuff. Well for 20 years, let’s say back in 1996 when this was legalized in California, you could take Blue Dream, put it into a CO2 extractor as it was, extract plant material, and then you have Blue Dream oil. Right. Well, now that hemp’s legal, if you did that same thing with it with a hemp plant that was legal, meaning it was under the 0.3 percent THC, but you remove just the plant material, you’re going going to bump that
[00:13:50] 0.3 percent at weight. Now you’re probably 1.3 percent, 1.5 percent. And that’s what we’re seeing at the crime lab. So when we looked at the last one hundred lab tests that had come into the forensic crime lab fifty percent of them were well over the THC limit. And what that means is these first wave extractors don’t know what they don’t know. And what’s happening is, is they’re selling the extract of the manufacturers, the food or the manufacturers of the different, you know, nutraceuticals. And these people who thought they did their diligence don’t know what they don’t know in regard to the testing or the science. And their getting in trouble. So you have a lot of CBD raids where these you know, these store owners are getting busted when, you know, they’re saying hey I did my diligence as a retailer, the same I’ve done for 30 years. What’s different? And it’s that the guy that extracted it, sold it to that guy that made the bottle to put the label, had no idea that these were going to convert to an illegal substance over time.
[00:14:39] So that’s to say you know, within regulation is to say that the concentrate has to stay within the 0.3 percent as well?
[00:14:46] Correct. And that’s where legislation is really going to come down, because there’s been kind of this well we don’t know or we’re not sure, or nobody’s looking. That’s going to change because what’s happening is you see people from the I mean, I have my hands in both industries and the people in the legal marijuana industry that have gone through all this state regulated, you know, this application process, they put all this money up. Now you have groups that are infringing on that THC based product. So we have a feeling there’s going to be a big you know, there’s going to be regulation, obviously, and I think on top of it there’s going to be lawsuits that come down soon. It’ll kind of put a halt on the guys that are out there just selling, and I don’t want to say snake oil because it works, but we also don’t know what’s in it. There could be heavy metals, there could be other things. And it’s all going to come into a level of testing, and what that regulation says we have to do and we think, you know, that’s where the White House is going to go. They’re definitely going to have regulation on what we call decarboxylated product in its actual product form. So THCA that might be legal once it’s heated, it turns to THC and that’s what’s happening. So people cook their stuff. They got too much THC. Yeah.
[00:15:47] And how? I mean so I guess. Tell us a little bit about the testing. Why is the testing so difficult then? What are some of the technologies or issues around the testing process that either drive cost or drive complexity?
[00:15:58] Yeah. So there I mean it’s definitely going to drive costs, which I think is why you see a level of testing that’s inadequate. So you know where Broker A might just say that his buyer needs to know if there’s an illegal amount of THC. You know, they might be OK with just that, you know, 11 panel tests that shows the THC levels below. But you know, hemp remediates soil. So it pulls up heavy metals, it pulls up toxins. It does, you know, pulls up things that you shouldn’t be putting into your body. Now, that’s where secondary and other levels of testing are going to tell you what kind of heavy metals, what kind of pesticides and things of that nature in that, and people just don’t know that they should be looking for. I mean, how often you go to the grocery store to buy tomatoes, you don’t even think about, you know, the fact that they’re tested or whatever. But, you know, they’ve gone through a certain level stuff to be classified organic and we don’t even have that stuff yet out there for this industry. So there’s a lot of bad stuff that could be could be in this. You know, for instance, you know, you give a seizing, kid, you know, CBD drops, it’s going to help. But if it has heavy metal in it, it’s going to exacerbate things. So, you know, it seems like.
[00:16:53] I mean, we’ve got all this scare right now at the vaping products. And there’s this these health concerns, you know, and it sounds like mainly that things that are introduced in the actual processing. So it’s not only what the plant has in it, but you need to take out in order for it to be a safe product, but then actually the processing of that stuff introduces other issues and compounds and things into it. You know how I guess how do you see this ultimately playing out in terms of how the industry gets regulated from, you know, the agricultural side, from the processing side, from the actual consumer side?
[00:17:25] Ok. So, yeah, so here’s what I believe going to happen. And we kind of have an idea that this is how it’s going to go. But CBD managed to slip in as a pharmaceutical product before the USDA took over hemp. So basically, if you isolate CBD, if you remove just that molecule, you’re going to probably be in trouble long term because that is now pharmaceutical. Now, if CBD is in with the rest of the plant, which we would call broad spectrum, it’s legal because it’s then regulated by USDA as a food extract. Got it. So as long as it’s there as it was in the plant and then the THC is gone, you know, no heavy metals and pesticides. That’s where it’s going to be headed. You know, they just they got to really watch over that THC. That’s going to be the big thing and then isolates. So they’re they’re going to delineate what’s a pharmaceutical and then what’s a nutraceutical or food. And I think that’s how they’re going to delineate broad spectrum as the plant left it. You just remove the THC to stay compliant. But if you remove that CBD and put that on something or in something, I think that’s where you open up potential problems.
[00:18:20] So and then goes in the FDA and so this is the whole thing, does it fall under the USDA or the FDA in terms of a regulatory body?
[00:18:26] And from a business point of view, then what’s your guess? How do you see people navigating these or how do you think that’s going to structure the market or, you know, the products we end up seeing from a consumer point of view?
[00:18:35] Well, first and foremost, what I think’s going to happen is I think the first wave and I like to delineate the first and the second wave. You had your first wavers that that jumped in. I have a feeling a good amount of those are going to get squeezed is a bad word, but they’re going to get, the regulation is going to hurt them.
[00:18:49] You know, let’s say they’re going to be unprepared for the regulatory challenges.
[00:18:53] And, you know, in some of those problems are, you know, scaling something like a THC free product is very difficult. And in fact, no one’s you know, that’s not something that everybody is doing. And when you look at the market right now, there’s a shortage of THC free product. But ultimately, that’s where I think it’s going to go. I think that THC free broad spectrum is going to be something we’re going to be seeing in food. We’re going to see it nutraceuticals, specifically broad spectrum. But I think we are going to see it in food and nutraceuticals big time. I think that’s how people are going to want to take it.
[00:19:19] Yeah, and from a market point of view, I mean, I guess it seems like it can apply to so many things.
[00:19:23] I mean, how do you think this is going to break down in terms of, you know, what the products look like, who’s taking it for what reasons? Brands that develop. I mean, how do you see it?
[00:19:31] I mean, that’s a great question. And that’s really all over the board. Again, I’ll look back at, you know, I’ll refer to magnesium. I mean, how everybody needs this in their system. Right. So when I look at, you know, the elderly community, you know, they’re going to need a certain type of products, you know? Arthritis is a big thing. Topicals, you know, this stuff’s working for them. They like to take pills because that’s what they’ve been used to. You know, you see the younger generation that relates it more to a marijuana so they like it in foods. I mean, ultimately, I like to throw stuff in my coffee. That’s how I dose myself with anything in the morning, because I know I’m going to have my coffee. You know, it’s I think there’s different ways. And I think people will find their way ultimately. But, you know, once they get it in their system, that’s up to them. Then, you know, figure out how I want to take it. But I think it’ll be different products for different people.
[00:20:14] Now, any particular markets or segments that you think are, you know, have the most growth potential or not?
[00:20:22] I think the elderly, I mean I’ve got to tell you, they’ve been around the longest without cannabinoids in their system. And I think what’s happening is, is when they get this, they’re seeing the benefits and those benefits are things that they have problems with, you know, pain, arthritis, you know, inflammation, you know, so. So once they get in their system, that stuff starts to go away, you know? So I think elderly is a big one. You know, really everyone I mean, I look at I look at my parents. I look at friends of them, you know, like the generation above me. They’re all getting on it. So it’s you know, I look back at everyone has an endocannabinoid system. Once they could get over the stigma and get it into their system, they’re probably going to be, you know, putting this in their system for the rest, their life one way or another.
[00:20:58] I’m curious, I have always kind of been fascinated about the changes to people’s kind of social and, you know, connections and friends and stuff as they’ve gotten in the cannabis space. I mean, as you, you know, kind of got involved in cannabis, did it affect, you know, relationships, either family or friends?
[00:21:15] Yes, common goal and common enemy or two very powerful drivers. You know, once you start to team up with the cannabis people, they bring you in. And it is a family because we’re all fighting for the same thing. You know, you have your stigma. But what I noticed, it was a very clear, it was a very clear change when the state went legal. You know, a lot of people that say, you know, this is bad. Once an authoritative figure says it’s good, you know, AKA their doctor or their politician, you know, they tend to be open to it. And there was a very clear differentiator in our state as to when that, because you have the news, you know, the news is on constantly talking about it. So we do a lot of events in different states. And it’s actually it’s really funny. I’ll give you a story. So, you know, we did over the course of three years, I think we did something like 35 events up to that point in Pennsylvania.
[00:22:01] And, you know, we did things like destigmatize the word marijuana, but just using the word cannabis, like people don’t have any kind of emotional tie to the word cannabis. And so when we went to West Virginia, then after three years of this, I went down to the Marriott. I set up a big event, spent about two weeks, getting it all ready. And I went to sign the paperwork and the lady said, “By the way, what is cannabis anyways?”
[00:22:23] And I laugh because it’s literally Groundhog Day. I mean, it’s you could see these programs as they come on, all of a sudden, everyone starts to get educated. People are radically opposed at first and then they know somebody that it fixed and they can’t be too radically opposed. And then they see it again. They see it and they start to, you know, come around.
[00:22:39] And it’s a matter of time. And that’s really how it goes with really any kind of influence. I mean, you get hit with radical opposition, you know, with any new idea. And then as you bring in, you know, supporting information, people come around. And it seems to be just a life-cycle thing as to when the states come on board. I like to joke.
[00:22:54] I have a couple of kids and friends of theirs, their parents. You know, it used to be that, you know, it’s like, oh, no, don’t hang out with that guy. You know, he’s in the cannabis business. Now they come to me for a job, you know? Yeah, exactly. It’s such a shift. And I think that’s why I think the national legislation, federal legislation is going to be so fascinating, because I think when that goes, it’s going to be a big, a big social and cultural shift in terms of acceptance and adoption.
[00:23:20] I mean it really is, I think at that point it becomes, you know, beer. Yeah. Yeah.
[00:23:24] Well, beer that’s good for you. Right? Right. Like not only is it no longer this kind of, you know, illicit drug, but it actually has all these health benefits.
[00:23:32] Interesting. So I’m curious that, you know, for people that are kind of interested in getting into the space or either, you know, want to start cannabis business or have businesses that could pivot into cannabis in different ways, what are some of the things that you suggest they, you know, think about or be aware of or ponder hard before they actually make a move into cannabis?
[00:23:50] I mean, I would say look for a market need. You know, one of the things I noticed is everybody gets kind of blinded by the gold rush and they’re out there buying the picks and shovels to go find the gold when they should be looking at what kind of picks and shovels they should be selling. And, you know, I’ll just take hemp as an example when everybody thinks they’re going to become an extractor. You know, there’s a lot of science in it. You know, there’s an opportunity in going to these food manufacturers and selling yourself as a cannabis science expert or a formulation expert or someone that could help them bring their product into this world. And that’s what I’m starting to see, is, you know, where people should kind of focus is if you do something good and you could find a way to bridge the gap between, you know, the vanilla world for lack of a better way to put it, and the cannabis world, find it because there will be a need for you. It’s all these all these ancillary products and services that I’ve found, you know, in the course of being in the business and doing the podcast that are just fascinating.
[00:24:43] I mean, you just you never think about some of these things, but, you know, everything from packaging to consulting services, you know, it’s just there’s so many little parts of this industry that, you know, that need professionals, that need experts in different ways that you can come in, and, you know, you just add you layer in a knowledge, understanding, experience with dealing with cannabis market, you know. Again what are some of the things about the market itself? I’m just kind of curious, as you know, people that are coming out of, you know, different industries that are, you know, mature and developed and have, you know, ways of working and cultures and stuff, you know, coming into the cannabis space can be a little jarring. Yeah. What have you noticed?
[00:25:19] I mean, it’s culture shock. Yeah. So tell us a little bit about that. Well, I mean, it’s tough sometimes the shed that. I go into a lot of rooms and I have to explain that we are the adults in the industry, you know, because of the stigma in some of the people that did jump in. You know, you get a lot of un-savvy investors. I noticed that in the industry, a lot of people that say, hey, look, I never invested anything, but I see this gold rush and I’m going to throw everything I have into it. Oh, as their first investment.
[00:25:44] And it’s bad, yeah, it’s bad. That caused a lot of problems. But, yeah, it’s an interesting industry. That’s for sure, all around. But yet the adults are finally starting to come into the industry.
[00:25:54] I think as you see things like banking, you know, in, you know, federal regs change and things like that, that’s where the people that have been sitting on the sidelines. You know, the big boys, I think are in a jump in without any kind of impediments, because right now, everybody’s lawyer and accountant are still saying no.
[00:26:07] Yeah. You know, it just goes off the rails. I mean, people saying, hey, look, it’s not worth the regulatory uncertainty and the market uncertainty to get into this. You know, but that’s as those things start to change. Yeah. I you know, we’re in the middle of kind of the banking reform. And, you know, certainly if things start to either de-schedule or reschedule from a drug point of view, it is going to dramatically change the environment.
[00:26:31] I’m curious on the finance side. I mean, have you seen, you know, investment coming into the space or,
[00:26:37] I mean, what’s your perception of capital available for companies that are in or getting into cannabis and need capital to grow and scale the business?
[00:26:45] Is it there? Is it not there? I mean, it’s everywhere. It’s everywhere because you’re going to get you know, you have your people that are passionate about this.
[00:26:53] You know, that’s one thing I see. A lot of people that, you know, secretly smoked it or put it in their system, you know, and now they’re coming out. They’re saying, look, I get it because I get how it made me feel. So they will you know, I don’t want to say blindly, but they’re the ones that will put in the money. That’s what I’ve noticed. Like at the state level, when you’re out raising money with these capital groups, I mean, they have tons of money. You know, I don’t know that they’re doing the right thing with it all.
[00:27:13] But, you know, the money’s there, you know, because it’s so exciting when you look at, you know, any image that shows where we are right now in 2019 and then where the industry is supposed to be by 2000, let’s say twenty eight, twenty thousand thirty. I mean, it is a straight climb to the top. And I think that’s exciting for a lot of people. And, you know, that’s you notice that when you’re out there, because I got to tell you, it’s always difficult to raise money.
[00:27:36] But with cannabis, it’s been interesting because you do get people that jump in somewhat blindly and say, I’m in, I’m just in and I just want to be in and I don’t want to miss it.
[00:27:44] And I think a danger or one of things I certainly spent a lot of time doing, advising cannabis companies that are looking to raise money as you have to be a little more careful about who you’re taking money from, you know, both in terms of where’s the money coming from and what is the nature of the money? Who are the investors? But also in terms of the savviness, kind of the business in this and the investor savviness that the money is because there is so much money out there that’s just kind of, you know, an unexperienced investment dollars and certainly unexperience in the cannabis space, you know, that can cause a lot of a lot of drama.
[00:28:11] If you don’t, it’s I mean, hey, I could take it. I could tell you it happened to me that, you know, un-savvy investors, it really is a it’s a whole different ballgame. To anybody out there. Don’t get an un-savvy investor.
[00:28:23] I promise. So tell us where your kind of future focus is. What are you most excited about? Where are you spending your time focusing on?
[00:28:31] There is an industry need for THC free products. That’s where it’s going to go. That’s where regulation is going to take it. So we are focused. We’re putting a twenty thousand square foot lab right now in Pittsburgh and we are going to specialize in really THC free custom formulations, because where I see everything going is these researchers. They want the data, but then once they have the data, they want to start tweaking the formulations.
[00:28:52] And, you know, right now there aren’t groups doing that. It’s very complicated. It requires a very in-depth level of science and people that have done this, you know, in other industries and things, you know. So that’s where I see it going. And ultimately, we’re going to focus is providing these custom formulations for the pharmaceutical industry, the nutraceutical industry and the food industry. Those are the three we’ll be focusing on.
[00:29:14] And if people want to find out more about you, about the work you’re doing, about the company, what’s the best way to get that information.
[00:29:20] So our non-profit, the Pennsylvania Medical Cannabis Society, has converted to a national model and we are at MedicalCannabisSociety.org and Hemp Synergistics is up. They could reach me there. Russ@HempSynergistics.com is my e-mail address and our Web site is hempsynergistics.com. But yeah feel free to hit me up there.
[00:29:38] I’ll make sure that those links and the e-mails are in the show notes. People click on them. Russ, it’s been a pleasure. Thank you so much for taking the time. Great insights for our audience. It’s really been a pleasure. It’s been great Bruce, thanks for having me.
[00:29:47] You’ve been listening to Thinking Outside the Bud with Business Coach Bruce Eckfeldt to find a full list of podcast episodes. Download the tools and worksheets and access other great content. Visit the Web site at thinkingoutsidethebud.com. And don’t forget to sign up for the free newsletter at thinkingoutsidethebud.com/newsletter.
