5 Things I Wish Someone Told Me Before I Started Leading a Cannabis Business, with Dr. John Oram and Fotis Georgiadis
Keep focused. Decide on a strategy and stick to it. The business culture in the US is one of controlled risks. Hedged bets. But that is antithetical to true entrepreneurship. A true entrepreneur has an idea or strategy and strives daily to make it happen. This takes guts and dedication. Do your homework, decide on your strategy, and ignore the noise. People will pull you in different directions. They might call you crazy. But what truly successful entrepreneur hasn’t been called crazy at some point. So, I guess my advice is to live and die by your strategic vision. You will either make it big or not.
I had the pleasure of interviewing Dr. John Oram, Ph.D., CEO & Founder of NUG, an Oakland-based, vertically-integrated cannabis company with strong historical growth and performance. Founded in 2014, NUG continues to expand and diversify its portfolio, which includes world-class R&D, state-of-the-art cultivation, extraction, and distillation facilities, one of California’s largest wholesale cannabis distributors, and the new, unparalleled NUG retail store experience.
Can you share with the ‘backstory” about what brought you to the cannabis space?
My background is in science: I earned Ph.D. and M.S. degrees in environmental chemistry and engineering from the University of California Los Angeles and bachelor’s degrees in analytical chemistry and biochemistry from the University of Colorado at Boulder. I also worked as a scientist at the San Francisco Estuary Institute before transitioning into the cannabis space in the early 2000s. In 2009 I was able to fully connect my background in chemistry and engineering with my experience in the cannabis market by co-founding CW Analytical Laboratories to establish standardized testing and certification protocols for medical cannabis to ensure quality and safety. NUG was born in 2014 and we haven’t looked back — it has become one of the largest and fastest-growing cannabis brands in California with revenue, staff and output all consistently increasing.
Can you share the most interesting story that happened to you since you began leading your company?
A new story begins every day. We have been involved in this industry in some capacity or another for over ten years now. You would think we have seen it all. But that is not the case. This industry is moving so quickly that every day brings new challenges and new stories.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
Unfortunately mistakes for start-ups are never funny. We try to be as efficient as possible and thus have not taken on much investor capital. That can be good (e.g., preserves equity) but can be challenging in that mistakes can be costly. We don’t have the luxury of paying our way through mistakes. So, we strive to make as few mistakes as possible.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
My two original partners helped me immensely. I really could not have built a business without them. They are Dr. Robert Martin (CW Analytical) and Jamie Besaw.
Dr. Martin is a brilliant microbiologist with a long record of providing quality testing for consumer goods. He and I started CW Analytical in 2008 with the intention of brining standardized quality assurance protocols to the Cannabis industry. At that time there were no scientific methods for analyzing cannabis products; we had to develop them ourselves. Those same methods are in use in some form or another by every major cannabis lab in the country.
Jamie Besaw was involved with us during the early days of CW Analytical. He was, and still is, one of the best cannabis cultivators in Northern California. He helped provide the material we needed to develop our laboratory procedures. He was also an early adopter of product testing. His involvement helped build initial interest, and eventually full adoption, of lab testing for cannabis products.
This industry is young dynamic and creative. Do you use any clever and innovative marketing strategies that you think large legacy companies should consider adopting?
The industry used to be entirely word-of-mouth. We started there. Then we started adding the media that would allow us — mostly small local rags. Of course, social media is important for building brand engagement. Instagram is our primary platform. We do a lot of billboards and glossy magazine adds. More recently we started contributing articles to national magazines and newspapers and will be presenting at national and international conferences.
Can you share 3 things that most excite you about the Cannabis industry?
Taxes, regulations, and the unlimited future. I know it is weird to list taxes and regulations as two things that excite me. Especially when I also list them as two things that concern me (see below). But the fact that we are being taxed and regulated means cannabis is a game changer for those of us that have been working for normalization for years. We are now a legitimate industry, one to be reckoned with. We are paying our dues and we are providing great products and great services. This leads me to my third most exciting thing, an unlimited future. I truly believe that the sky is the limit for the cannabis industry. There is no telling where we are going from here. But I am excited about the growth of the industry and the innovative products and services that are in our future.
Can you share 3 things that most concern you?
Taxes, regulations, and the black market. Taxes and regulations are a business challenge that I am actually thankful for. They both mean that the industry is here and we have a pathway towards normalization and acceptance. However, the taxes in California are simply too high. A State excise tax of 24 percent is levied on all cannabis products that enter the marketplace. Add local taxes and sales taxes and the consumer can see a combined tax rate of near 40 percent on their receipts. This is simply too high. The result has been the growth of the black market in California. It is very difficult for legitimate businesses to compete. It has created a situation where only the well-capitalized businesses will survive. It is a feeding frenzy for venture capitalists and private equity groups. They can, and do, use their capital to change the shape of businesses and their products. And not always in a good way. Fortunately, there is a solution: the State can lower taxes (even just temporarily), simplify regulations, and enforce regulations against the black market.
Can you share your “5 Things I Wish Someone Told Me Before I Started Leading a Cannabis Business”? Please share a story or example for each.
1. Control expectations.
The cannabis industry has too much hype surrounding it. And the hype leads to unrealistic expectations on growth and profit. In actuality, this is a difficult, highly-competitive, cut-throat business. One must enter with eyes wide open. If you are chasing the quick buck, you are in for a big surprise.
2. Surround yourself with good people.
Work should be enjoyable. You need good people that you like to be around for that. And when work is not enjoyable you still need good people around to help you navigate the mess. And by good people I mean in all aspects; you need people you like to be around and people who are not afraid to give you tough advice. It all starts with good people.
3. Talk to an attorney and accountant first.
Don’t wait until the last minute to get legal and financial advice. Spend the time and money up front to organize the legal and financial aspects of your company. This will save you many headaches in the future!
4. Develop a solid strategy and stick with it.
You are probably interested in the cannabis industry for its perceived endless opportunities. Don’t make the mistake of trying to do everything. Pick a lane. Develop a solid strategy and work diligently to make it all happen.
5. Buckle up … it’s going to be a long bumpy road.
It is not all roses in the cannabis industry. Be ready for a crazy ride. Every day will present new challenges. Keep your head on straight. Don’t take things too personally.
What advice would you give to other CEOs or founders to help their employees to thrive?
Keep focused. Decide on a strategy and stick to it. The business culture in the US is one of controlled risks. Hedged bets. But that is antithetical to true entrepreneurship. A true entrepreneur has an idea or strategy and strives daily to make it happen. This takes guts and dedication. Do your homework, decide on your strategy, and ignore the noise. People will pull you in different directions. They might call you crazy. But what truly successful entrepreneur hasn’t been called crazy at some point. So, I guess my advice is to live and die by your strategic vision. You will either make it big or not.
Are you working on any exciting projects now?
Yes, 2019 is shaping up to be an extremely exciting year for NUG and we’re undergoing an unprecedented period of growth. February saw the rollout of new products utilizing our highly pure extract including NUG Gummies, a line of micro-dosed edibles, and NUG Refined, a new line of concentrates that are both potent and consistent. We are also opening our first retail store in Sacramento, which is led by an all-women management team, and plan to open four additional retail locations across California this year complete with sophisticated designs never before seen by the industry. NUG is one of the first brands to oversee our products every step of the way, from the cultivation and extraction to the in-store experience, and we are looking forward to the continued elevation of the brand.
Thank you so much for joining us!
5 Things I Wish Someone Told Me Before I Started Leading a Cannabis Business, with Dr. was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.
