Editors’ Note: This is the transcript version of the podcast. Please note that due to time and audio constraints, transcription may not be perfect. We encourage you to listen to the podcast, embedded below if you need any clarification. We hope you enjoy!
This week we are joined by Jason Wild Chairman of TerrAscend to discuss :
- New Jersey Cannabis
- Terrascend’s east coast strategy
- Interstate commerce
- and so much more
About TerrAscend:
TerrAscend is a global cannabinoid company that delivers new and innovative products, formulations, and brands focused on the needs of patients and consumers. In New Jersey, we are working to maximize positive impact through our cannabis cultivation facility and medical cannabis dispensaries. Our focus is to improve access to quality medical cannabis and education for patients in a welcoming, non-judgmental environment.
About Jason Wild:
Jason Wild is the President and Chief Investment Officer of JW Asset Management, LLC, and the advisor for five investment partnerships with over $2 billion in assets under management. Mr. Wild received his license as a pharmacist in 1997, and subsequently founded JW Asset Management, LLC in 1998. The firm has a strong history of finding opportunities within the healthcare sector. He is a graduate of the Arnold and Marie Schwartz College of Pharmacy. Mr. Wild is the Chairman of the Board of TerrAscend Corp. and Arbor Pharmaceuticals. He is a board member of Vensun Pharmaceuticals and Vitruvias Therapeutics. Funds managed by JW Asset Management, LLC are the largest shareholders in TerrAscend Corp. Mr. Wild is also a board member of NETA NJ LLC where he will be actively involved in planning and directing the organization’s strategic and long-range goals.
At Eighth Revolution (8th Rev) we provide services from capital to cannabinoid and everything in between in the cannabinoid industry.
8th Revolution Cannabinoid Playbook is an Industry-leading report covering the entire cannabis supply chain
The Dime is a top 50 Cannabis Podcast
Contact us directly at [email protected] Bryan Fields: @bryanfields24 Kellan Finney: @Kellan_Finney
[00:00:00]Bryan Fields: What’s up guys. Welcome back to that episode of the dime I’m Brian Fields. And with me as always is Kellen Finney. And this week we’ve got a very special guest Jason Wilde chairman of Terreson. Jason, thanks for taking the time. How are you
[00:00:13]Kellan Finney: doing
[00:00:13]Jason Wild: today? Good. Good. How are you guys doing this morning?
[00:00:17]Kellan Finney: Doing well, Carolyn, how are you doing dude and wild dude.
[00:00:19] Well, looking forward to, uh, talking to Jason and pull down the west coast. I think it’s two east coasters
[00:00:24]Bryan Fields: we have today. Yeah. Jason, for the record, your location.
[00:00:29]Jason Wild: I’m in New York. Nice. So another
[00:00:31] east
[00:00:31]Bryan Fields: coast there let the record state. So, so Jason, usually when we start, we ask our guests how they got into the space and kind of a little background about them, but I prefer to kind of switch it up today and ask more about, take us through a week, the different hats you wear and the different conversations and ideas that are going through that are on your, your plate.
[00:00:51]Jason Wild: Yeah. So in a given week, I mean, I, uh, so I run a fund, uh, I a spent probably a good amount of my time on, [00:01:00] on the fund. And then our largest position is where I spend another large percentage of my time. And that’s, uh, uh, by being the executive chairman of terror center. I mean, I look at it that, you know, that I look at it as, uh, that it deserves Harrison deserves, you know, 50% of my time because it’s about 50% of the fund.
[00:01:18] Uh, and that’s just sort of the. That it, uh, that, uh, plays out, uh, you know, on any given day, it might be, uh, you know, uh, more of one than the other, but I would say on the whole that’s, uh, that’s how I’ve been spending my time for the last, uh, the last few weeks. And what that means in terms of working for the.
[00:01:34] Uh, is, uh, talking to, uh, investors, uh, working on, uh, uh, bringing in some potential new investors, you know, in terms of marketing. Although I probably spend a lot less time on that than most other fund managers do. And then the other time on the fun side is just, uh, uh, dealing with and keeping up with and interacting with, uh, with the management teams at, uh, at, uh, the, [00:02:00] uh, the companies that we’re invested in or companies that were looking at investing in.
[00:02:04] Uh, and then as it relates to, uh, terrorists, then, uh, in any given day, it’s going to be, uh, talking, uh, multiple times per day, talking to our PR our new president and CEO. Oh, uh, uh, Ziad got him, uh, just about, you know, things that are going on in any given. Uh, for the last five days or so, I’ve been actually going down and spending a couple of hours at our, uh, brand new, uh, or newly open for rec dispensary in Maplewood, New Jersey.
[00:02:30] And I’ve actually just been like helping, you know, work the work, uh, you know, the lines and, uh, and, and, and help out there. Uh, and I just, uh, th that’s a great way to, you know, see the business in action and, and, you know, uh, just know, know a lot more about what’s going on. Uh, other things that I do for terrorists and.
[00:02:48] Uh, I’m very active on the M and a and business development front in terms of talking to new companies, uh, finding new companies for us to, uh, potentially acquire or, or partner [00:03:00] with, uh, and that there ends up being some, some, uh, connectivity, uh, between there’s a lot of companies that, uh, that I meet through the.
[00:03:08] Uh, and, um, if I think that they’d be an interesting partner or acquisition for a terrorist center, I will usually, um, flip that over and, uh, you know, sort of, uh, put on my, uh, my terrorist on hat and see if there’s something that we can, that we can do there. Um, so it’s, uh, a lot of it is, uh, you know, sort of, uh, borders over into, uh, you know, sometimes I’m doing two things at once, I guess.
[00:03:34]Bryan Fields: I love it. So let’s stay with terrace. And can you kind of take us like an overview about the company and kind of value brings to this space?
[00:03:41]Jason Wild: Sure. So the company I originally, uh, invested in the company back in 2017, they were actually a Canadian LP, you know, like the canopies and co rays of the world. Um, we let a $52 million investment private placement into the company, uh, which, uh, [00:04:00] actually canopy growth co-invested in that deal with me.
[00:04:04] Uh, and I became the, uh, the chairman. This was back at the end of 17, uh, at that point. Uh, on the fun side, we were only comfortable investing in, uh, in Canada. Uh, so we assumed that, uh, Sarah Stan would be, you know, that we would run it and just look for deals in Canada and everywhere, essentially, not at the U S because it was illegal, uh, you know, federally in the U S uh, about seven months later, or so we decided to pivot the company into the U S it was right when John painter went on the board of acreage.
[00:04:31] If there are, you know, if they’re going to rust anybody that could fill the rest of him before they, before they arrested. So, so we, uh, you know, we decided to move into the U S uh, our first acquisition was the apothecary dispensary chain in San Francisco, which is considered by many to be, you know, sort of the first of the really nice dispensary’s and, and, you know, out there in California, uh, and still, you know, some of the nicest dispensaries.
[00:04:56] So we acquired. Uh, in the spring of [00:05:00] 19, that’s when essentially terrorists then entered into the, uh, entered into the U S a few months later, we acquired one of the largest, uh, operators, uh, cultivators and manufacturers and retailer, uh, in, uh, Pennsylvania called Elara healthcare. Um, also around the same time or a little earlier, we had applied terrorist and had applied for a license in New Jersey in the summer of 18.
[00:05:23] Uh, and we actually came in number one or number two by score out of 150 applicants. So we got a license for the Northern region of New Jersey, which is, you know, uh, believed by many, to be the best region of Jersey. Cause it has the most people and the biggest part of the economy. So that is, uh, those are the main, uh, states where we are now.
[00:05:43] In addition, uh, recently, uh, terror center acquired gage county. Which is one of the top operators in Michigan, and that was about a $450 million, uh, deal. Uh, so that is another, uh, large, uh, you know, uh, asset of ours, uh, you know, [00:06:00] our approach, which has been different. And I think, uh, most of the other, uh, multi-state operators.
[00:06:07] We decided, you know, three years ago or so that we didn’t want to just have lots of flags on the map and be able to say that we’re in, you know, 25 states or, or 20 states. Uh, our belief was always that the, the best way to build the best business, uh, is to. Be, uh, focused and only, uh, really, uh, enter a state.
[00:06:30] If we think that we can be one of the top, uh, you know, two or three players in that state over, you know, some short time period. Uh, and we felt that that would, uh, afford us the best margins because we build more scale in less places. Uh, and also it just give us the best chance of being a successful. You know, if we’re ever in four or five states, uh, which you know, where we are now, or we’re in five states, uh, and we’re competing with another, uh, operator that’s in 15 or 20, we think that there is a, you [00:07:00] know, an inherent advantage.
[00:07:02] Uh, the other thing, the other reason we, uh, do it this way is because our view is that, uh, if and when, uh, these states, uh, get more competitive, uh, especially if the limited license states where, you know, where we have most of our operations, uh, Our view was that when they got more competitive, uh, there might be a price at which, uh, a 20, uh, a grower that’s only in 15 or 20,000 square feet.
[00:07:27] Uh, they can’t, uh, turn a profit, but if we’re one of the most skilled operators in the state and we have more like a hundred thousand square feet of canopy, that we will still be able to have a sustainable profitable business. So that’s been the main, uh, I think that’s been the main difference. Uh, we’ve also been.
[00:07:47] You know, very, uh, what’s the word? I don’t know, picky in terms of, uh, acquisitions, uh, we’ve stayed away from the acquisitions that are, uh, you know, like of all the other say multi-state operators, uh, guess [00:08:00] I guess that would just. Go against the whole strategy that I, that I just mentioned of trying to be focused.
[00:08:05] Uh, and our view is that we’ll do best and we’ll be, we’ll be able to build out the map for ourselves over time, uh, the best way by going in and trying to pick, you know, uh, from the best operators in each specific state, like more, you know, essentially, uh, by, uh, different single state operators. And we feel like that’s the best way to build the strongest, the strongest.
[00:08:27] Yeah, I want to get into a little bit of the
[00:08:29]Kellan Finney: nuts and bolts of the business. So Tara center is vertically integrated,
[00:08:33]Jason Wild: meaning that it, uh,
[00:08:35]Kellan Finney: operates in every sector of the supply chain from seed to sale, if you will. So what aspect of the cannabis supply chain do you believe your organization is
[00:08:43]Jason Wild: the strongest at right now?
[00:08:45] Jason? Good question. I mean, you know, I look at it as, you know, pretty much there’s cultivation, manufacturing, and then there’s. Uh, and I, uh, I don’t want to come off sounding like, uh, arrogant, but I, but I, I feel like we’ve really focused a [00:09:00] lot on making sure that both of those sides of the business or, uh, the strongest that, that they could be, that they don’t sort of depend on the other side of the business.
[00:09:07] Um, so I mean, I think. Apothecary in a dispensary chain, which is now, you know, we have a five in California and six, uh, in Pennsylvania and, uh, two going on three in New Jersey. Uh, I think, I truly believe that they are amongst the best dispensaries in the, uh, in the country. Uh, and when it comes to cultivation and manufacturing, I feel like.
[00:09:30] Very strong there because, uh, I guess we’ve focused on it. And we really, really, uh, you know, uh, have a, uh, w we, we placed high importance upon, uh, making sure that we produce the highest quality, uh, flour that, that we can. And that is, uh, that’s easy to say. Uh, it’s a lot harder to actually do, uh, growing cannabis, especially when you’re trying to grow amongst the best cannabis in the.[00:10:00]
[00:10:00] Uh, it is a very, very difficult, uh, and, uh, you know, there are, you know, there’s, there’s tons of powers that were out there of, uh, of different groves that have had, uh, you know, different, different issues. Uh, I can tell you firsthand that it is a, uh, it’s a really, uh, it’s a really tough, a tough thing to do to grow, uh, you know, the cannabis that sort of the, the, the true kind of soars, uh, think is great.
[00:10:28] Uh, but we think that that is the most important part of the market. Uh, in my view, like the 20, 80 rule as it applies to cannabis is 20% of the people buy, you know, 80% of the cannabis. And I would say that the majority of them. High-quality uh, you know, they’re kind of stores of high-quality, uh, indoor, uh, flour.
[00:10:49] And that is really, uh, the consumer that we are looking to, uh, uh, appeal the most to, uh, because, uh, you know, I guess they’re probably 80% of the products, right. Um, so [00:11:00] that’s what we’ve done on the cultivation and manufacturing side. And I think that we. Uh, where, you know, uh, amongst the best at that, but always, always looking to get better.
[00:11:10]Kellan Finney: What’s your favorite portion of the supply chain?
[00:11:12]Jason Wild: What’s my favorite. I love the, I love the cultivation side. I just love, you know, I remember the first time I ever went to out to, uh, grow up in Canada, back in 2014, just like the, the smells just like hitting me like a ton of bricks when I walked in and ever since then, I still get, I mean, I go out to our Rutgers, you just sell them.
[00:11:31] Uh, I’m not there at least every week. And every time I walk in the door, it like, uh, I still get the same feeling when that, when that smell hits me in the face. So I love that. That’s incredible.
[00:11:40]Bryan Fields: I want to stay on Jersey. I saw you say that when there was a pause between the announcement that tariffs on one, the license, I want to know what that feeling was like in that pause.
[00:11:51] And then what you felt emotionally after they announced Harrison and then expanding on. What’s the next step. Take us [00:12:00] inside that room. Is it, how do we deploy New Jersey and get everything ready to go? Or are you focused on Maryland, Michigan and other states for expansion?
[00:12:09]Jason Wild: Sure. So, yeah, I’ll tell you inside that, uh, uh, or on that call, it was, it was interesting.
[00:12:15] They had already gone through like the other six operators that they are, that they approved. And the process was, I believe that the chairman would, uh, would, you know, uh, state the name of the operator and say, buy, have a motion to approve. And then somebody would come on. It must have already been chosen.
[00:12:31] Who was, you know, which other commissioner would say a motion to approve and then they would vote. And then they got. to TerrAscend And we felt really good about, uh, you know, getting approved, even if it was a smaller number than seven, uh, you know, ended up, uh, getting there. Uh, and they said, uh, uh, the TerrAscend end and, uh, the chair woman said, uh, do I have a motion?
[00:12:51] To approve and nobody like said anything and it felt to me like, you know, it must’ve been like, you know, 10 seconds. It felt to me, [00:13:00] like, I was like, like, I don’t know, everything, everything froze. I went through all these emotions. I was like, you know, did my line just die? Uh, you know, like I wanted somebody to jump in and say something, but then it meant, you know, at some point, if they said something, then it meant that it wasn’t just my phone that died, which I was almost hoping that.
[00:13:18] Uh, and it actually even took me to tell you the truth, you know, this, uh, you know, it might be a little insight, uh, or, uh, you know, it feels like a little bit of a therapy session here talking about it, but it actually took me back for some reason to like high school and feeling like everybody, like. Went out and went to the party and like, they left me at home and I was still alive, you know, sitting there waiting by the, waiting by the phone or something like that.
[00:13:45] And all of that happened in 10 seconds or so. And then, uh, and then, uh, the chairwoman repeated it again. And somebody came on and said, uh, you know, I make a motion. Yeah,
[00:13:55]Bryan Fields: it’s gotta be just overwhelming joy, knowing, you know, the types of [00:14:00] investments that went into it, the emotional investment and knowing that obviously the east coast is, is a massive opportunity.
[00:14:05] And then exactly like you’re saying, if everyone else is kind of planting their flags, that’s definitely where you want to compete. So staying on that after, after it’s approved, are you looking for other opportunities, like take us through the strategy for you and the role you play with.
[00:14:18]Jason Wild: Yeah, absolutely.
[00:14:19] So New Jersey. I mean, what I was so excited about is that we have been spending, you know, we’ve spent, uh, you know, about $40 million of the last, uh, over the last three years or so building out our facility, uh, we didn’t know originally that it was going to go, uh, that wreck was going to be on the ballot, but that was obviously a huge positive for us, uh, when we, uh, when that happened to a year and a half or so ago, uh, and we had been ready and we thought the program was going to launch, you know, in the second half of last year.
[00:14:46] So, and. You know, we were building up supply and getting it’s like every time it got delayed, uh, even though we, you know, Sort of intellectually, we knew that it was going to come at some point it’s like, it [00:15:00] almost felt like it was, it was never going to come her. I wasn’t going to believe it until it actually happened.
[00:15:04] Um, so having, you know, having that phone, uh, was just a huge relief, uh, and it ended up being, it was, it was a little bit, you know, I guess better than expected because we, uh, we were going to be able to launch within like, uh, uh, like after that vote, we launched, I think like eight days later or something.
[00:15:23] Originally there was supposed to be a 30 day notice period. And that’s when we were going to go be able to tie up all the loose ends and be able to, you know, manufacture at you. Don’t want to manufacture everything. I guess if it gets delayed, then the product, you know, could expire and all the rest. So, uh, we originally thought we were gonna have 30 days to, you know, run a hundred miles an hour, but it ended up that it was going to be seven or eight, uh, and you know, uh, Ziad our new president and the team really pulled together, uh, that digital.
[00:15:49] Daily, uh, daily meetings about, uh, what they needed to do to be ready. Uh, and you know, we opened up, uh, we opened up last week, last, uh, last Thursday. [00:16:00] And it’s been as you know, uh, it’s been as amazing as we thought it would. Uh, we had worked on lots of, uh, different scenarios and things that could go wrong.
[00:16:09] And we knew that some things would just pop up that we hadn’t thought of, uh, necessarily, but it actually knock on wood, everything. Everything went really well and came off without a hitch. And I think part of it was, you know, and being out there w which, which is, what’s been so amazing, is like, like, I dunno, who’s more excited.
[00:16:27] Uh, our staff out there, or the customers that are coming to this. I guess it’s not like, you know, on the west coast, you know, so tons of people have already been to legal dispensaries. They’re on the east coast. The majority of people have not, and you just see them, you know, they can’t see into the dispensary from the outside.
[00:16:43] So you see them walking through the door and they get through the doorway and their eyes just sort of get big. And they’re so, uh, and they’re just so excited and everybody is like, everybody’s been in a great mood. We’ve been able to get these long lines, but we’ve been able to get. You know, through the doors, uh, and you know, [00:17:00] uh, past the registers and all that really, really quickly.
[00:17:02] I mean, I think we were pumping through her, like, uh, you know, uh, like a thousand patients, not patients, I’m still thinking a medical, a thousand customers per day, uh, at the dispensary where, where I was working over and over a Maplewood. So I’m going to keep, that’s a huge opportunity for tower San, because we don’t have, you know, back to our strategy of not wanting to go deep.
[00:17:24] You know, we wanted to go deep in that. We don’t have a big footprint. And so New Jersey where, you know, we aim to be one of the, one of the top one or two players. Uh, it has so much more of an impact on our numbers and we’re so much more leveraged to Jersey than, you know, all of the other, uh, uh, operators that are, that are.
[00:17:44] So definitely I have definitely been focusing, uh, even after the approval focusing a ton of my time and attention there. Uh, but you know, like being in this business, you gotta, you have to keep a lot of balls in the air and certainly Maryland. We are building a large-scale [00:18:00] facility down there that should be.
[00:18:02] Uh, or it should be operational at least, uh, in, um, you know, uh, the late summer of this year, uh, hopefully, uh, rec will be on the ballot in Maryland. It looks like it will be. So that could be a state that turns a wreck, say, you know, sometime, uh, next year, uh, Pennsylvania, where we have, uh, uh, our largest power facility, uh, there is, uh, a lot of talks that that will be.
[00:18:25] Going, uh, go rec next year as well that that’ll be done legislatively. Cause I think they can’t do it with ballot. Uh, but you know, um, you know, you got to, uh, w you still have to focus on, uh, all aspects of the bit of the business, even though New Jersey is now generating, you know, many multiples, uh, uh, per day or per month versus what it was.
[00:18:46] Uh, you know, we still, uh, we still have to be able to, uh, uh, pay attention to, uh, to the other places. And we’re still, and that’s what we’re still, we’re still doing. I think, uh, I think that it’s going to be, you know, our portfolio. [00:19:00] What, what, what excites me overall about our portfolio is that it is, um, it’s sort of like if you look at it like a, uh, uh, uh, MBA basketball team we at, because we have all of these states that are medical going to.
[00:19:14] Uh, wreck and in Michigan we have, uh, you know, Detroit still hasn’t gotten, even though the state of Michigan has gotten a wreck, uh, Detroit has not. And we have, uh, we have, uh, stores there. Uh, but in terms of. PA and Maryland, it’s like, to me, those are, those are all states that are, that are medical or in the case of Jersey was, uh, where you can eat while you dream under the medical program and, you know, make good money.
[00:19:39] And then when rec comes, you know, your, your business, you know, hopefully goes up, uh, you know, four or five X. So I started looking at it. Uh, our portfolio folio is like a team of, uh, first round draft picks, uh, that are, uh, you know, you know, that they’re going to have a huge future and they’re awesome now, but you know that they’re going to be even better in, uh, in five years.
[00:19:59][00:20:00] And you compare that to, you know, a lot of the other footprints that most of the other operators, they have more, uh, you know, assets or they’re in more states where it’s already gone. Which means that, you know, sort of by definition, there were already a, the most mature, a mature markets. So, um, that’s, uh, that’s very exciting to me when I feel like we have a very, a long runway of growth for, for many years.
[00:20:22] So from
[00:20:23]Kellan Finney: a strategy standpoint, the medical dispensary, uh, aspect of entering a state has to be huge from a. Managing manufacturing and production. Right? Because I was just thinking of like the dialogue that goes on with the state, when they’re, they have to tell you exactly the date that they’re going
[00:20:39]Jason Wild: to let recreational sales.
[00:20:42] Go through
[00:20:43]Kellan Finney: because I mean, cannabis doesn’t grow overnight, right? Like you guys have to take weeks and weeks to grow it, to prep it, to get a tested, all these other things. So like, what is that dialogue like and how beneficial is it to be in a medical state operating to manage that
[00:20:58]Jason Wild: manufacturing aspect [00:21:00] before it turns rack?
[00:21:01] Yeah. So, I mean, I think being either being in these programs on their medical certainly gives you a bit. A big, I think leg up because also it must have these states that, you know, they let the first ones that they let operate as, as reca cultivators or stores or the medical operators. So, uh, so that’s definitely the best, uh, the best position to be.
[00:21:24] Uh, I mean, in terms of Jersey, I mean, we had, uh, I think we had like four or 5,000 pounds of flour, you know, uh, in our fall off waiting for, uh, waiting for. Uh, and you know, the, uh, we, we have, uh, we have companies here. We have our , which is our California brand. We have them out in, uh, in Jersey. They’re actually called, we’re not supposed to call them commies.
[00:21:45] I think they are called soft last inches medical programs.
[00:21:54] Then there’s differences between. Rec, uh, uh, I think those could be called companies. The new [00:22:00] rec gummies have to have like a, an imprint of like a warning sign in the gummy. So like, that’s actually why we haven’t launched the, our gummies yet. Uh, because, uh, you know, we just got that imprint, uh, you know, a couple of weeks ago we had to go get the mold made.
[00:22:15] I think it was made in China. Uh, and I believe it’s, uh, uh, at a port in, uh, maybe a new or something like that, uh, being taken that supposedly is going to get delivered today and we’ll be able to launch with our gummies, but you know, the whole thing with all of these, uh, you know, these are super complicated, uh, operations and the timing is, uh, has to be just right in terms of scheduling when you’re, uh, you know, uh, production.
[00:22:40] But that’s, what’s, that’s, what’s exciting to me because, you know, if you’re, uh, you know, if you care more about that than your competitors there, where you have, you know, uh, better people who are good at navigating complicated, uh, processes, then, you know, that’s what gives the better operators, uh, uh, You know, if we have, [00:23:00] uh, you know, hopefully we’ll have, uh, we’re going to be launching our, our concentrates line in Jersey, uh, hopefully next week.
[00:23:06] So that would be live resin babes and butters, batters shatter and all that kind of stuff. Uh, we think we will be the first ones on. Uh, if we do that will be, uh, that will be huge for us because we’re only going to really sell them in our own, in our own stores in Jersey. And that’s going to pull people from, you know, from all over the state.
[00:23:26] Uh, those are the kinds of things that, uh, that sort of get me, get me excited because. Uh, it’s just a matter of like, uh, everybody doing their job the right way. Uh, and you know, then things come together and put you at a, at a big advantage out in the market, especially in, uh, you know, uh, the overall the cannabis space has, uh, you know, our growth in cannabis has had, you know, slowed down a little starting last June when people started leaving the house, you know, and they had other things to had other things to do other than sit at home and you’re not smoke weed and they added other things then that like going to, you know, [00:24:00] restaurants and things like that.
[00:24:01] Um, so in a, uh, in, what’s not as easy of an environment as it was a year ago, uh, you know, when all the companies now don’t have the, the wind at their backs, uh, you know, what excites me is, uh, you know, if, you know, if, and when, when we’re, when we do things, uh, uh, when we can do things a little bit more efficiently, uh, you know, like that’s the, that’s the way that you felt the great brands like.
[00:24:29] Like, uh, you know, uh, great. The great things happen when you’re going through tougher times. Not when everything is easy for, for everybody, if that makes sense. Right. Fuels innovation too.
[00:24:41]Bryan Fields: So staying on Maryland, right based on the location is, is that like a key strategic move and understanding its location to the other east coast markets and the demographic kind of resembles similar Pennsylvania.
[00:24:51] So is there a interest to speed to market to get there, or is it more placement in the opportunity? Can you kind of shed more light?
[00:24:59]Jason Wild:[00:25:00] Sure. So Maryland is, we bought a smaller grow. A Cara leaf had to divest a cultivation facility because they bought a grassroots and you’re not allowed to have two. So we believed.
[00:25:12] Um, it was a good deal based upon, you know, the revenues and profits that were coming out of there, but it was, uh, not the size of, you know, I mentioned earlier that we always, we want to always aim to be the top in the top two or three in a market. And this facility is a small issue, but we got it for a good.
[00:25:32] Uh, in terms of the business that was doing, and really, uh, we also looked at it like we were buying a piece of paper that we can take and, you know, go out and build a much larger facility and, uh, you know, have it attached to that, to that license. Uh, and we entered Maryland, uh, last year through that acquisition with, uh, cultivation and manufacturing only, not with retail.
[00:25:51] So we, we we’re, we’re not, we’re not a verdict we’re not currently vertically integrated in Maryland. Uh, and our view was, uh, the, you know, there’s a four [00:26:00] dispensary cap. Uh, Maryland’s a little bit more over dispensary than other states. Like they have a, I think they have like around a hundred dispensary’s for 6 million people, uh, you know, compare that to Pennsylvania where there are like, I want to say 135 dispensaries for over 12 million people.
[00:26:19] So little more over dispensary, meaning an average dispensary does, uh, you know, probably three or 4 million in sales versus, you know, seven or eight and some other states. And we felt like we didn’t need to be in a rush to get to own the dispense. ’cause uh, the real prize was going to be wrapped when that came and we just felt like we wanted to be there by then.
[00:26:37] Um, so that’s, that’s what we, uh, that, that was the approach we took when we entered there. We just announced a few weeks ago that we’re buying our first dispensary, uh, in, um, it’s called the Allegheny medical it’s. It’s cool. I hadn’t really looked at the map of the U S uh, I dunno, closely, I guess, or understood that Maryland has a weird shape, like the Northwest corner of Maryland.[00:27:00]
[00:27:00] Super super skinny. Uh, and that’s where Allegheny medical is. I believe it’s within six miles of three different states. So if Maryland goes rec when we think it’s going to, uh, and we think it’s going to be before most of those other states that we border on, we think that that’s, uh, an amazing location, uh, and you know, we’re discussing.
[00:27:19] Multiple other dispensary acquisitions, uh, in Maryland, uh, so that we can get ourselves to that, uh, that cap of four. And we think that we’ll be there by the time that, um, that rec, uh, kicks in. So that was, that was the approach we took in Maryland. Um, I guess, you know, I guess the point is we will, we want to be vertically integrated, but you know, it doesn’t always work out that way where you can get it all in one place.
[00:27:42] And we will enter with cultivation and manufacturing first, but we will not enter with retail first because if you’re a retailer in an under-supplied market, you’re always going to be at a disadvantage because you’re only going to get products from the, uh, you know, from the other, the other players that are vertical.[00:28:00]
[00:28:00] If they have extra product they’re that they’re willing to sell you. So during like the, during the best times, you know, when the market is sort of, uh, earliest on, and there’s the most demand relative to. Uh, you’re at a major disadvantage, if you only all retail and you’re also at a disadvantage, if the market gets more mature and you’re competing with these vertically integrated operators that can afford to make less margin at retail because they’re making, you know, they’re making money on the manufacturing.
[00:28:29] If you’re, if you only have retail, you know, it’s really hard to compete, you know, from a price perspective, you and I think manufacturing, you can.
[00:28:37]Kellan Finney: Create more revenue streams
[00:28:39]Jason Wild: from like totalling and other opportunities to that create a better, like a more stable business from a
[00:28:44]Kellan Finney: startup perspective.
[00:28:45]Jason Wild: Diversified business. Yeah. Oh yeah. A hundred percent. What is one
[00:28:50]Bryan Fields: factor statistic that would shock 90% of the people who work in the cannabis industry?
[00:28:57]Jason Wild: Shit. You put, you’re putting me on the spot here. [00:29:00] One factor specific or a
[00:29:22]Bryan Fields: off? I think I’m in the 90%. I think that’s why I’m asking you what, that, that other 10% would know when the industry becomes global. Do you see overseas being a challenge?
[00:29:33] Let’s say for, for mass production.
[00:29:37]Jason Wild: Uh, no, I don’t think so. I don’t see that happening anytime soon. And I don’t think that. Like high quality flour. There’s no, um, there’s no reason to grow that or there’s no cost advantage. Let’s, let’s just talk about us, you know, people ask about, you know, interstate commerce and all that.
[00:29:54] Right. Um, and that a lot of this stuff’s going to come from California, but there is, uh, [00:30:00] you know, that’s because California has, you know, sort of perfect weather conditions and all of that, but there’s no advantage to growing super premium indoor flower in a warehouse in California. And. Shipping it Say to the east coast.
[00:30:12] So I, you know, our view, uh, for, you know, and for a lot of other reasons that we think, you know, high quality, premium flour, uh, is the way to go. Uh, but our view on interstate commerce is that that would be the least impacted, uh, by, uh, you know, interstate or, you know, sort of global, um, you know, commerce in, in, in the, uh, in the cannabis space.
[00:30:36] I think, I don’t think it’s going to happen anytime soon though. Uh, product coming in from, from overseas. I mean, even in terms of, uh, uh, pharmaceutical prescription drugs, like any controlled substances, uh, generally I need to be made in the U S you can ship in the API or the active pharmaceutical ingredient, but, uh, you can’t ship in, um, you know, [00:31:00] manufactured, uh, product, uh, into the U S and I think that that will probably, uh, remain the same or be similar.
[00:31:06] Uh, if cannabis was really.
[00:31:09]Bryan Fields: With your pharmaceutical experience, what can cannabis operators learn from? Let’s say the technology for a real-time process control to let’s say ensure a clean product to avoid recalls and other, other concepts like that in the future.
[00:31:23]Jason Wild: Yeah. I think that overall people from pharma, that what I find about, uh, when I, when I run into where, when I work with people that came out of pharma that are in the cannabis space, uh, Often a little bit of, uh, or there’s more of a focus on quality, uh, and safety.
[00:31:42] There is, uh, you know, like if somebody comes in from real estate or something like that, they don’t, I find the often there, those companies have less of a culture of, uh, of compliance, uh, and, and of quality. So I think that, I think that [00:32:00] overall, you know, there’s, there’s tons of things that having, uh, you know, more.
[00:32:04] Um, experienced people, uh, in cannabis, uh, where, where, where it helps, because these are essentially, you know, pharmaceutical manufacturing, plants. It’s just that they’re, you know, also a growing, uh, live, live, uh, plants. Um, but there, uh, there’s a ton of advantage to having people. We have, we have multiple people that are, uh, you know, uh, at all of our facilities that came out of, uh, that came out of pharma because they just understand the science, uh, uh, Um, but you know, I think that that varies from company to company.
[00:32:38] I have a quick question. So traditionally from a manufacturing
[00:32:43]Kellan Finney: perspective, pharma has a different set of guidelines. They have to follow, right from a CGMP perspective and nutraceuticals kind of have their own
[00:32:51]Jason Wild: rules that they follow. Yeah. Do you think that
[00:32:53]Kellan Finney: there’s going to be that hard line in cannabis from a recreational and medicinal standpoint?
[00:32:59] Um, [00:33:00] or do you think that they kind of should all follow the same
[00:33:02]Jason Wild: manufacturing guidelines? Yeah, I think they’ll all fall under the same guidelines for as, as long as the FDA doesn’t take control. You know of regulating, which, you know, I don’t see that happening anytime soon. Uh, but in the meantime, I th I think that they will stay the same because the biggest, the states are going to be the ones that are in control of the licensing.
[00:33:24] And these are the programs that they’ve already laid out, you know, whatever the medical program is. I mean, that was, uh, that’s, you know, you’re, you’re following, uh, uh, the state, uh, rules and it will, uh, my, my view is that it will remain that way in the future, even if we have, uh,
[00:33:41]Bryan Fields: When you started your journey in the cannabis space, what did you get?
[00:33:45] Right. But most importantly, what did you get wrong?
[00:33:49]Jason Wild: What did I get? Right. I got right that, you know, that there’s a huge demand for this product, that more and more people were going to be consuming it, uh, over time. [00:34:00] Uh, and you know, therefore this industry, uh, you know, had to win that it’s back from a gross perspective, especially relative to regular pharmaceuticals.
[00:34:09] But I guess I got wrong was, I mean, we did really well on the, you know, for the first four years we only did Canada. Uh, and my view was that that was going to be the. Uh, place that would be able to attract institutional investors and therefore, you know, the stocks would, uh, the stocks, you know, should, would do better than the U S ones.
[00:34:29] And that works really well over that period of time. Say from like 14 to, uh, to 18, uh, I guess I, uh, maybe in Canada, we outstayed our welcome, uh, a little bit too long. Like once I, once I realized that the Canadian market and the structure of the Canadian. Uh, was, you know, not conducive to being able to, you know, have a strongly profitable company.
[00:34:53] I probably stayed a little bit too long. Um, but you know, that was probably a mistake that we made, you know, as I mentioned, we [00:35:00] did, uh, we did pivot into, uh, into the. Uh, you know, starting in, uh, in 18 and 19. And I think, you know, I think that was definitely right. I mean, it’s like the us is the best market and practically, you know, every, every, every market, the U S is the best in terms of, uh, uh, the revenue potential and things like that.
[00:35:19] That’s definitely the case in, uh, in cannabis. And I think that, uh, you know, the fact that we were the only Canadian LP that pivoted, uh, fully into the U S. Which, you know, we had a choice to make, you know, some people thought we were crazy because we were going to be giving up, being able to be listed on a us exchange.
[00:35:38] You know, if we were, uh, actively involved in the U S uh, but to me that was a no brainer. It’s like the whole, uh, I told everybody that was on the first day after we made our fifth to $2 million investment a couple years earlier. Uh, The, uh, I think it’s a Warren buffet quote, uh, you know, long-term, the market is a voting machine and, uh, I’m sorry, short term, the market is a voting machine [00:36:00] as long-term, it’s a weighing machine.
[00:36:01] And the only way that we’re going to get paid is if we built something that weighs a lot. And to me, going into the U S that was built building the company, weighing machine and knowing that we can build the best business that we could. Uh, and we were giving up the voting machine. It’s.
[00:36:23] so all of these other companies that stayed up there, it was like, uh, they just sort of, uh, most of them had sort of died on the vine. It’s uh, it’s been an extremely, extremely difficult market up there.
[00:36:34]Bryan Fields: Yeah, it absolutely has. We’re sitting here a year from now. What has your team accomplished
[00:36:42]Jason Wild: or what has
[00:36:42]Bryan Fields: the modern, sorry, what has your team accomplished in let’s say one year.
[00:36:47]Jason Wild: Oh one year from now. Okay. Um, New Jersey will be, you know, uh, the, a huge driver of our business one year from now. Hopefully we have three stores that are, you know, run rating [00:37:00] in Jersey at over $40 million, uh, in re. Uh, and, you know, we should have a strong, uh, uh, wholesale business selling to the other, uh, uh, operators in the state as well.
[00:37:11] We will, uh, have, uh, uh, finished our, uh, expansion, uh, in, in New Jersey in terms of our cultivation, uh, expansion where we’re going to, uh, we’re going to over double our footprint there. Uh, so that’ll be in Jersey, Maryland, uh, you know, rec will live a. Started or be about to start and we’ll have that completed that facility and the, uh, be fully ready to be one of the top players, uh, uh, there in that market and Pennsylvania will be ready for, uh, we’ll be ready for, for rec as well.
[00:37:40] I mean, we have like three huge, huge drivers coming up, uh, over the next. You know, uh, Gage will, will be much larger than it is now. They’ve, uh, there’s some amazing deals out there for small to buy small mom and pop dispensary’s for like low single digit, uh, uh, EBITDA multiples. So we’ll be, we’ll go from 17 [00:38:00] dispensary’s right now to, I dunno, closer to closer to 30 or so.
[00:38:04] Uh, and you know, we just, the, the main thing is to just continue to. Uh, one of the best companies in the space from, from an operational perspective, uh, our view is, uh, we want, we don’t necessarily want to be the biggest cannabis company, uh, in, in the country. We want to be the best, uh, cannabis company in the country.
[00:38:26] And if we’re the best, there’s a good chance that at some point we’re going to be the biggest. Not necessarily by next year, but, uh, you know, I gotta, you know, I got like a 10 year, 10, 20 year, uh, you know, time for us.
[00:38:38]Bryan Fields: Let’s do a quick rapid fire product category. You’re most bullish on over the next five years.
[00:38:44]Jason Wild: Flour
[00:38:46]Bryan Fields: psychedelics as a medicine, yay or nay under the radar state, you have your eye on.
[00:38:54]Jason Wild: I can’t, I can’t, uh, if I, if I talk about[00:39:00]
[00:39:01] figure, uh, all the states sort of, uh, east, from Michigan going east towards New York and then up and down the east coast, there’s a bunch of good opportunities there.
[00:39:09]Bryan Fields: That’s fair. What mega policy causes more disruption in the cannabis industry, federal legalization or interstate commerce.
[00:39:18]Jason Wild: Ooh. Uh, federal legalization.
[00:39:24] That one’s tough because I don’t think interstate commerce will, interstate commerce would be phased in if we have legalization from the people that I’ve spoken to, uh, interstate commerce would be phased in over a three to five-year period. It makes sense
[00:39:37]Bryan Fields: with your experience in relationships, in this space, what is one area of the industry you think you think is completely untapped that eager entrepreneurs should consider to enter?
[00:39:49]Jason Wild: Hm, uh, cannabis, you know, the, the technology. Of, uh, of cannabis, you know, whether it’s, uh, you know, uh, software or, uh, or hardware in terms of gross [00:40:00] systems, things, things like that, you know, things that, uh, are actual, you know, major improvements and that are best in class products that, that, you know, can, that can help the industry be more, uh, more profitable.
[00:40:14]Bryan Fields: The biggest misconception since you’ve been in the cannabinoid.
[00:40:18]Jason Wild: Uh, biggest misconception just overall that like, uh, you know, I think this is all changing, but that like that people that are cannabis consumers, that they’re, you know, lazy and unmotivated, uh, you know, the people that I know that are in the cannabis industry and especially the ones that also consume cannabis, I find them to be, uh, you know, some of the hardest working, uh, you know, most, uh, you know, some of the most principled, uh, people, uh, that, that I’ve ever met and, and extremely.
[00:40:47] You know, uh, creative, uh, as well
[00:40:50]Bryan Fields: before we do predictions, we ask all of our guests, if you can sum up your experience in a main takeaway or lesson learned to pass on to the next generation, what would it be? [00:41:00]
[00:41:01]Jason Wild: Not around cannabis, just overall like life, lesson, uh, patients. You know, you don’t need to go at, you don’t need to be in your job.
[00:41:11] You don’t need to be a huge success within a one year or two years or five years. You know, it’s a long road I’ve been doing, you know, I’ve been running my fund now for 22 years, we started with it with 80 grand. Uh, and. You know, we D we didn’t hit a billion dollars in AUM and told, you know, like 20 years later.
[00:41:30] So I think the more patient that you could be, uh, you know, the more successful that you’re going to be in a sort of, one thing I would add to it, it’s sort of like, you know, don’t be focused on that. You need to make a lot of money, be focusing, be focused on being great at whatever you’re doing. And then the money is the by-product of that.
[00:41:48] That’s really
[00:41:49]Bryan Fields: well said. All right. Prediction time, Jason. The cannabis industry is fighting battles across multiple fronts between banking, stigma, and regulations. What negative [00:42:00] scenario or event keeps you up at night?
[00:42:03]Jason Wild: Oh, what keeps me up at night? Nothing. Uh, I, I, I think things can’t really be worse than they are right now in terms of, uh, things that, uh, sort of act as roadblocks all the time.
[00:42:16] Like. You know, having to do everything within the state and, uh, and all of these different regulators and, and things like that, like where we’re at a we’re at maximum, maximum level of difficulty right now. And I think that, I actually think, I think the thing, you know, get better in the, uh, in the coming years.
[00:42:35] Uh, so, you know, back to what I was saying earlier about tough times, Uh, making you stronger. There’s a, there’s a quote that I had read a few weeks ago that I thought was really good. I don’t know if I can get it right, but it’s, uh, something to the effect of, uh, hard times make strong men, strong men make good times, good times make a weak men and weak men make hard times.
[00:42:59] Uh, and [00:43:00] I think that we’re right now in the, you know, it’s all a cycle, I guess. Uh, I think we are in the right now. Hard times, you know, are going to make strong, uh, company. Uh, and then, you know, there should be some good times ahead, I guess, before, before things get, uh, before we screw it up. But yeah, that, that over the course of 20 or 30 years, uh, I think that we’re, uh, nothing, nothing really keeps me up at night other than just like, you know, sometimes I’ve gone to bed and I’m like, oh crap.
[00:43:26] I forgot to call back, you know, XYZ, like just have a million things to do, but there’s nothing that keeps me up at night from a, uh, you know, anxiety point of view. Uh, that’s a tough
[00:43:37]Kellan Finney: question. I would probably say
[00:43:39]Jason Wild: just, uh, global events that
[00:43:43]Kellan Finney: deter the attention of our politicians from pushing like federal legalization and baking through from a legislative standpoint, they have other things they’re worried
[00:43:53]Jason Wild: about, unfortunately right now.
[00:43:55] Yep. Yeah. I agree with that. I agree with that. I mean, it’s that sort of, I don’t know if that’s [00:44:00] what keeps me up at night, but it’s just sort of, it makes me sad that so many you. Americans are supportive of cannabis and that we just can’t, you know, in this country, we all seem to be able to get anything done federally.
[00:44:10] That, that definitely makes me sad. It’s crazy. Um, I’m, I’m more
[00:44:13]Bryan Fields: fearful, like another vape gate opportunity. I think something like that with like the negative stigma that comes with it, it’s just such a nother challenge to an industry that’s kind of. Like challenges on all unprecedent levels. So concepts like that kind of gave me concern because it kind of hurts the industry as a whole, even if it doesn’t have anything to do with, let’s say some of the bigger operators or some of the players that are doing things the right way in this space.
[00:44:36] And I think what we need right now is less of those like, uh, distraction techniques that hurt the politicians on the concepts and less of our friend, governor Rick is saying that if you legalize cannabis, it’ll kill your kids. And more people like yourself, Jason, that are champion like the industry and then the positive benefit.
[00:44:52] And hopefully some more of this research that comes out that allows people to kind of remove that,
[00:44:56]Jason Wild: that stigma. Yeah. I agree with that. [00:45:00] I absolutely agree with that. I guess the offset of that is, you know, there could be another vape gate or something like that, but I also think that. That in the coming years, we have data start to come out that, uh, about, you know, even more of the benefits of cannabis.
[00:45:14] Like, like I believe that that, that not only is say for, uh, for cancer, not only is it good, uh, for palliative care, but, but that, I think there’s going to be some studies that come out that, that show that CA that cannabis actually has. Anti-cancer anti-tumor. I think if we start seeing more of that data that, uh, you know, like, like I almost feel like there’s a better chance that that happens then that we have another vape or I hope, I hope that’s the case.
[00:45:40] Yeah.
[00:45:40]Kellan Finney: I mean, that’s what the clinical trial and Israel is for. Right. They they’re showing that that one strain is very effective against a specific type of
[00:45:47]Jason Wild: cancer. Um, so yeah, absolutely. That’s a glioblastoma. I
[00:45:53]Kellan Finney: was, I was trying to think of it and I was looking to fumble over it. So I’m so glad she
[00:45:57]Jason Wild: remembered the name.
[00:45:57] I was like, well, is it again? [00:46:00] Yeah. Yeah. And that’s, uh, I mean, that is like at the drug company that I, that I mentioned earlier that we sold, we had one of the only, uh, approved products for glioblastoma and because it’s such an unmet need, it was the, you know, there wasn’t a, a real high, uh, hurdle that we had do.
[00:46:16] Uh, get past, I think we had a show that we extended life by like, you know, 30 days or something like that, which is not the best, but the, I mean, at least what I saw, I haven’t seen any data recently, which concerns me, but a couple of years ago I saw some, the data from the phase two trial, uh, that, uh, what’s the company in the UK that got sold to jazz.
[00:46:35] I’ll think of it as a second. They had a glioblastoma trial. We have THC. And, um, compared to the standard, the standard of care was a 350 day average. You know, life expectancy and the cannabis arm was 550 days. Oh, wow. That’s pretty powerful. Huge, especially for such a tough, tough, uh, type of cancer to treat so [00:47:00] TW farm and that’s how it was.
[00:47:01] Exactly. Yeah, yeah. Yeah. But they’ve been I’ve I haven’t heard much from how did it a couple of years. So sometimes when that happens to me and said, uh, you know, the phase three, didn’t go quite like the face to tip. Uh, but we’re going to, I believe we’ll start to see, uh, uh, other data, uh, in other. You know, uh, disease states that that shows, uh, you know, the benefit benefits as well.
[00:47:21]Bryan Fields: So Jason, for our listeners, they want to learn more and they want to try some Metayer sense products. Where can they find.
[00:47:27]Jason Wild: Sure. Cal in California, in Northern California, we have a three, three dispensaries in San Fran, one in Berkeley and one in Capitola. Uh, and PA we have, uh, six, uh, scattered. I’m not, I can’t, uh, uh, name all six locations, but scattered around Pennsylvania, uh, and in New Jersey.
[00:47:48] One dispensary and Philipsburg, which is on the Western edge of PA. And we’re actually like, like less than a hundred yards from the bridge that goes over to, uh, Bethlehem, Pennsylvania. So amazing location for rec or for anybody. Then you [00:48:00] get a PA that would want to come over. Uh, and, uh, our other location is in a.
[00:48:05] Uh, and we’re going to be opening a third location Jersey is we share the parking lot with the bot of being from the Sopranos. So we have very high hopes for that. Uh, for that site, it gets like 220,000 vehicles per day that, that drive by and everybody. Pretty much, you know, remember the bottom of being from the Sopranos and everybody’s sort of remembers it that’ll be our third location.
[00:48:27] And then in Michigan we have 17, uh, we have 17, dispensary’s pretty much covering, you know, uh, practically the whole state. Uh, so those are our locations. Those are, uh, the ones that Michigan are branded as either gage or cookies dispense. Uh, and then all the other ones are apothecary AMS, and we also have a cookies dispensary that we own in Toronto.
[00:48:49]Bryan Fields: I visited that facility. It’s an awesome facility and the people there are. Awesome. So appreciate you taking the time. Thanks so much, Jason.
[00:48:56]Jason Wild: Thank you. Thanks guys.
