Latest / MaxValue Podcast / (PART 2) Selling, Returning, and Rebuilding: Lessons from Jeff Gray

Transcript

(PART 2) Selling, Returning, and Rebuilding: Lessons from Jeff Gray · MaxValue Podcast

• 0:10
  SPEAKER_02: You're coming at it from a scientific perspective.
• 0:13
  SPEAKER_02: And you were coming at it from the perspective of keeping people safe uh in a lot of ways, making sure there weren't pesticides, making sure there weren't uh you know microbial agents in the products.
• 0:24
  SPEAKER_02: So that's what really spoke to me uh back then.
• 0:29
  SPEAKER_02: You're you're now 15 years in to Etsy Labs, but especially at the beginning, did you did you feel you know challenges and feel underestimated being in the industry, etc.?
• 0:42
  SPEAKER_02: Discussion in your search for a partner, for a finance partner, and in the discussions with them, you know, first off, you guys are very clear about what you wanted out of out of a deal.
• 0:53
  SPEAKER_02: And you know, there there are some things to negotiate and there are some things that are non-negotiable, and and you were very clear uh about what those things were, which was which is hyper important.
• 1:04
  SPEAKER_02: And then secondly, you know, what what what are you really thinking about, you know, once that deal closes, how do you react professionally, how do you react personally, you know, what what what was going on with you?
• 1:17
  SPEAKER_02: Well, and and talk about that a bit.
• 1:18
  SPEAKER_02: I mean, it definitely the the fortunes of the industry just could change on a dime, the the regulatory environment changed on a dime, you know, you expect some a particular set of rules to come out and something kind of different can't comes out, you know, those those sorts of things which just make it incredibly difficult.
• 1:40
  SPEAKER_02: You know, it'd be like you know, a a general contractor having to meet a new building code every you know eight months or something.
• 1:48
  SPEAKER_02: You could do it, people would do it, but it would be it'd be much tougher.
• 1:51
  SPEAKER_02: And to your point, you know, even getting normal banking, let alone you know financing from people, was just not doable for a long, long time.
• 2:02
  SPEAKER_02: So, you know, you were kind of stuck cobbling a lot of uh a lot of capital together by yourself until you had the the finance partner.
• 2:11
  SPEAKER_02: So the you one thing you mentioned is kind of stepping back and stepping back in.
• 2:18
  SPEAKER_02: I mean, what what was that process like for for you and for the business?
• 2:25
  SPEAKER_02: How long was it?
• 2:28
  SPEAKER_00: Um so I think I I when the deal closed in um February of 2022, it was about two years until actually what showed him that it was May of 2023, where I ended up taking back over, and in that time we had three CEOs.
• 2:50
  SPEAKER_00: So I think at the time, you know, I I had a conversation at one point about possibly coming back, and I was asked, and I said, made a commitment to my family.
• 3:03
  SPEAKER_00: I I I I I had a vision of what I wanted post-transaction that wasn't really a part of it.
• 3:10
  SPEAKER_00: Um they, you know, the the private equity firm recruited and and got a um you know CEO who really, I mean, he was really talented, he had a great background, he he really understood business.
• 3:22
  SPEAKER_00: He, you know, um, but I think the challenge was he didn't understand this particular business.
• 3:29
  SPEAKER_00: And that was right, it's a it's such a nuanced space.
• 3:33
  SPEAKER_00: This is lab testing, but this is more the cannabis industry, and the cannabis element of lab testing here dictates all, right?
• 3:43
  SPEAKER_00: So in places where there's no one you know, as a as a as a uh we're heavily subject to, like you said, the regulatory requirements and regulatory enforcement.
• 3:54
  SPEAKER_00: Now think about that same dynamic you just said.
• 3:58
  SPEAKER_00: The rules change in the contractor every eight months, but imagine if in certain places nobody ever enforces those regulations on the other contractors.
• 4:10
  SPEAKER_00: You, as a contractor, have to decide whether you're gonna follow the rules or you're not, because everybody else is blowing through projects because they don't meet spec and it doesn't matter, and you decide that you're going to take the route of every project that you make is gonna be a quality, it's all gonna meet, it's all gonna meet spec, it's all gonna meet every every regulatory standard.
• 4:32
  SPEAKER_00: That's what we had decided.
• 4:33
  SPEAKER_00: That was a harder road, it was the right one, but there wasn't another way for us, but that was the right one, and so right.
• 4:42
  SPEAKER_00: I mean, that's a that's a that's a that's a tremendous challenge, and you have to be able to for somebody who's um you have to be able to charge a premium in a space where nobody has any money and everybody and a lot of times they don't understand the value of like look, I'm gonna I just need this, I just need I just need the pass.
• 5:01
  SPEAKER_02: I just need a check mark.
• 5:03
  SPEAKER_02: Let's let's go.
• 5:03
  SPEAKER_02: Yeah.
• 5:03
  SPEAKER_00: I need a check mark.
• 5:05
  SPEAKER_00: So, you know, it's it's a it's a hard place to to to run a business and to come in and run a business and not really understand that dynamic, right?
• 5:12
  SPEAKER_00: And so, you know, that that didn't work very well.
• 5:15
  SPEAKER_00: I think what happened is sometimes in small businesses, you know, if there's an aggressive growth plan, you know, there's a um, you know, uh there's a decision made to hire people who come from those larger industries.
• 5:30
  SPEAKER_00: Um, and I'm sure in certain instances that might work.
• 5:34
  SPEAKER_00: But I think that the challenge is an entrepreneur, one of your greatest strengths is the fact that you're flexible, you can wear any hat, you can step in any room.
• 5:42
  SPEAKER_00: When stuff changes, boom, you don't push back against it, you roll with it.
• 5:47
  SPEAKER_00: If you can roll with it faster than other people, you have an advantage.
• 5:52
  SPEAKER_00: And that really isn't, if you're coming from a four billion dollar company, that isn't your background, or you have a team that you can hand that off to.
• 6:00
  SPEAKER_00: There's no team, you do that, right?
• 6:02
  SPEAKER_00: Come up with the idea, execute on it, and then move on.
• 6:05
  SPEAKER_00: I think that was what was challenging, right?
• 6:07
  SPEAKER_00: And so that you built a great fit.
• 6:11
  SPEAKER_02: I mean, and I built my team, yeah.
• 6:13
  SPEAKER_02: To your point, you you have to build the team when you're going from really, really small to less small to a you know a moderately sized business.
• 6:23
  SPEAKER_02: It's part of that, and and and staffing is always going to be a big consideration and how you manage your team and find the team and keep the team.
• 6:33
  SPEAKER_02: That's a huge part of leadership, generally speaking.
• 6:35
  SPEAKER_02: But it to your point, it looks a little different when you're coming from the Jeff show to a you know, a bigger business.
• 6:46
  SPEAKER_00: It does.
• 6:47
  SPEAKER_00: It does.
• 6:48
  SPEAKER_00: And like you said, you know, you have to understand the um, you have to understand your team.
• 6:54
  SPEAKER_00: You know, you you built your team around people with specific proficiencies.
• 6:58
  SPEAKER_00: Um, if you then ask them to do something else, um, you have to understand whether or not they really have that skill set.
• 7:06
  SPEAKER_00: You have to make a commitment that if they don't, you're gonna build it.
• 7:08
  SPEAKER_00: Or if that isn't gonna be your commitment, you're gonna find somebody who can either take a leadership position in that space and create that or fill that gap or something.
• 7:18
  SPEAKER_00: Like in some way, you can't just hope for it to be different and have a strategy where the pieces don't fit together, right?
• 7:23
  SPEAKER_00: Like to your point.
• 7:25
  SPEAKER_00: And I think that was a lot of what we saw.
• 7:27
  SPEAKER_00: So there's a disconnect, and then you know, small businesses sometimes push back against what they feel is a corporate environment.
• 7:34
  SPEAKER_00: You they're they're very different when the right, when the owner walks the floor and engages and knows everybody by name, you know, sits down and eats lunch with everybody, we're going out for a beer afterwards, or whatever it is, like that's a different dynamic than you know, uh you know, 65,000 person company leading leading a group that large.
• 7:56
  SPEAKER_00: You have to treat it differently.
• 7:58
  SPEAKER_00: And um, and so when by the time you know I came back, I think there was, you know, we had put ourselves in a position of being greatly overextended, right?
• 8:09
  SPEAKER_00: Really spending in a way that didn't suit a small company.
• 8:12
  SPEAKER_00: Um, we were just on a trajectory that didn't, and we were losing market share and and and revenue.
• 8:18
  SPEAKER_00: And so I think you know, not only were we spending all that money, but we're actually getting a lower return and a business performing more poorly than I had before.
• 8:28
  SPEAKER_00: And so I think, you know, my my coming back in, I think the thing is we had lost sight of, well, why are you here?
• 8:36
  SPEAKER_00: What are you doing?
• 8:37
  SPEAKER_00: What is your vision for what you're doing?
• 8:39
  SPEAKER_00: Why would somebody be more invested than their paycheck in in putting their energy into the business?
• 8:47
  SPEAKER_00: How do I get a sense of ownership among local leadership, among the managers and directors, not just C-suite above, to progress the business?
• 8:59
  SPEAKER_00: Um, they have to believe in that vision.
• 9:01
  SPEAKER_00: They have to believe in your mission.
• 9:03
  SPEAKER_00: You like they have to be attached to the business, the outcome of what they're doing.
• 9:07
  SPEAKER_00: I think we got pretty far away from that.
• 9:10
  SPEAKER_00: And um, you know, I think when given the opportunity, when I came back, it was it was twofold.
• 9:16
  SPEAKER_00: One was I understood it in the way that I understood it, which was, you know, that the business exists to accomplish its mission, right?
• 9:25
  SPEAKER_00: There's a financial requirement, set of requirements that we have in there, and we have to adhere to those.
• 9:32
  SPEAKER_00: And a lot of those require greater cost controls and greater sacrifice in certain areas, and definitely a smaller bureaucracy atop it, right?
• 9:43
  SPEAKER_00: It just can't afford it, right?
• 9:45
  SPEAKER_00: So that was that was that was part of it.
• 9:46
  SPEAKER_00: And then the other part of it was I also understood that there was a certain amount of, you know, I had I had built my people, I had invested in them, they had invested in me.
• 9:56
  SPEAKER_00: There was a level of trust, and I knew that after watching X amount of CEOs go by, are you really gonna buy into the next one?
• 10:07
  SPEAKER_00: Do you know what I mean?
• 10:08
  SPEAKER_00: Like you have to have something that brings you back, that re-centers you when you feel like in any way, shape, or form, whether it's your meditation or whatever it is, when you feel flustered, when you feel disorganized, and you feel that that you have to bring it back to center.
• 10:23
  SPEAKER_00: And I felt like maybe I could fulfill that role by giving somebody by putting leadership in front of people that they understood that felt like, okay, this is this is more akin to why we were here in the first place.
• 10:39
  SPEAKER_00: Um, that took some time, right?
• 10:42
  SPEAKER_00: And um, but over the you know, since that time, I think just financial discipline, looking at those spaces, you know, focusing on the spaces of the business where we felt there was real opportunity, being very critical about that, having a strategy that was again more specific to more aligned with our mission than just the financials, right?
• 11:03
  SPEAKER_00: I think that put us back in a place where we're turning the business around.
• 11:08
  SPEAKER_00: We've gone from losing an incredible sum of every month, some of money every month, to being profitable.
• 11:16
  SPEAKER_00: And that felt it's incredible.
• 11:19
  SPEAKER_00: We've had great years in the past.
• 11:22
  SPEAKER_00: That felt like such a win because I wasn't sure that we were gonna come back.
• 11:26
  SPEAKER_00: That was the other part that was a little daunting about taking that position.
• 11:29
  SPEAKER_00: I just wasn't I wasn't sure given the situation we're in, that we're gonna make it back.
• 11:35
  SPEAKER_02: That's a weird that's a weird position.
• 11:37
  SPEAKER_02: I mean, kind of kind of being in a turnaround in kind of your own company.
• 11:43
  SPEAKER_02: Uh so uh obviously you you kind of got things back in a certain sense back to basics, back to what the company had been.
• 11:57
  SPEAKER_02: Um, but what are some of the things that you did differently when you know you had you had a you know a second shot at it?
• 12:04
  SPEAKER_02: I mean clearly the the other CEOs had you know the the they they they had they wanted it and they had the uh you know ability to do it, but they didn't have the get it, you know, portion of that.
• 12:18
  SPEAKER_02: They they didn't quite have that grasp of it where whereas whereas you did.
• 12:23
  SPEAKER_02: And other than trying to make it back to you know SC Labs 1.0, how what did you do differently as Jeff Gray CEO 2.0?
• 12:39
  SPEAKER_00: It gave me, I think it gave me the opportunity.
• 12:41
  SPEAKER_00: So what I did is I you know it gave me one the the stepping back and and sort of watching other leadership and other leadership styles.
• 12:50
  SPEAKER_00: Um I actually thought some of it was really smart.
• 12:56
  SPEAKER_00: I thought some of it was very strategic.
• 12:58
  SPEAKER_00: Um these were people who had come from very sophisticated backgrounds, very knowledgeable, very smart.
• 13:05
  SPEAKER_00: I'm I'm not actually looking at the I think there's a right CEO for the right size and time in the company's life.
• 13:12
  SPEAKER_00: And um, I think that was probably that was probably the biggest issue at the time, right?
• 13:18
  SPEAKER_00: And so you know, I actually learned a tremendous amount.
• 13:22
  SPEAKER_00: Like I said, I wasn't just um it wasn't just a sound bite for the for the for the for the podcast saying like we were able to make good decisions because of the advisors that we had around us over time.
• 13:36
  SPEAKER_00: We had learned a tremendous amount.
• 13:38
  SPEAKER_00: What we did with those advisors, we filled gaps that we knew.
• 13:41
  SPEAKER_00: Oh, I don't have a skill set, let me bring that in.
• 13:43
  SPEAKER_00: Because if I don't bring that in, we're the the the business environment is gonna be missing something.
• 13:48
  SPEAKER_00: They weren't always advisors just to me either.
• 13:50
  SPEAKER_00: Um, you know, I had I had sales leadership that I knew that I didn't have a pedigree in that sales space, and I didn't have a really organized sales method and set up sales methodologies.
• 14:02
  SPEAKER_00: So I brought people in who did, and we both learned and both grew as a result of that.
• 14:07
  SPEAKER_00: And so seeing these leadership styles and seeing what worked and what didn't, I think I was a better, I was a significantly better version of myself than I was when I when I when I when I stepped away.
• 14:20
  SPEAKER_00: Um I think you know, I think the thing that that that I had to be different was it was a different animal.
• 14:28
  SPEAKER_00: Cannabis has evolved over time, have it's evolved over time, those markets have evolved, the regulatory environments have evolved, and we as a company were different.
• 14:36
  SPEAKER_00: Um, it wasn't just the team I put together at SC Labs, it was the you know, the aggregated team over the larger business.
• 14:46
  SPEAKER_00: And I was able to pull in, I take the time because no people understand what their skill sets were and were not, was able to kind of pull that together.
• 14:53
  SPEAKER_00: Um, I think I had done that better.
• 14:56
  SPEAKER_00: I think I had a better um understanding of how to interact with a more sophisticated board.
• 15:01
  SPEAKER_00: It's not what we did previously.
• 15:03
  SPEAKER_00: Previously, the founders were the board members, and we had one of the investors on as the board member, but there were five of us, and they were one of them, and there were four of us, and it was gonna go like we said, right?
• 15:17
  SPEAKER_00: And we knew each other, we were family, we had we had grown together all that time, and so that whole dynamic of of the interaction between the board and management was very different, right?
• 15:30
  SPEAKER_00: And is very different.
• 15:31
  SPEAKER_00: And I think it's uh I think it's a strong one.
• 15:33
  SPEAKER_00: I think I think it's a I think it's a better, I think we're a better, stronger organization for it.
• 15:38
  SPEAKER_00: So, you know, and in sure, what I do, I I evolved, right?
• 15:41
  SPEAKER_00: I mean, I I I I took time that I was not in the position to learn more about how, you know, there are other ways to approach this, and took the learnings of a greater business environment, a more, more uh a larger, more sophisticated business environment, and try to incorporate that both in the interaction with board and and deal team and private equity firm, but also with my own directors and own leadership team and the business itself.
• 16:08
  SPEAKER_02: So and definitely one of the things I really respect the most about you is your both the your combination of confidence is at the same time being humble and being in a learning mode all the time.
• 16:26
  SPEAKER_02: And I think that's just really, really cool about you as a person.
• 16:29
  SPEAKER_02: And it's definitely come out as as you as the leader, because of course the leader can't do everything and doesn't do everything themselves and doesn't know everything.
• 16:38
  SPEAKER_02: But your your your ability to or your really your willingness, that's what it comes down to, right?
• 16:44
  SPEAKER_02: Your willingness to take whatever's going on and and create lessons for yourself out of them.
• 16:51
  SPEAKER_02: Uh it's that's that's awesome.
• 16:54
  SPEAKER_02: I've I've always loved that about you.
• 16:56
  SPEAKER_02: Um you touched on oh yeah, of course.
• 17:00
  SPEAKER_02: Um you touched on something.
• 17:02
  SPEAKER_02: Um in fact, let's let's let's just do a couple of really quick questions right here at the at the end or getting towards the end here.
• 17:09
  SPEAKER_02: Um and and you know, just get out a couple of a couple of things.
• 17:13
  SPEAKER_02: I mean, you touched on something, you know, the the founders were family and uh you know a found family, and they you know, the leadership and control and it was all of the things, uh, you know, including the the composition of the board.
• 17:28
  SPEAKER_02: I mean, but were all four of you always aligned?
• 17:36
  SPEAKER_00: Um no, absolutely not.
• 17:40
  SPEAKER_00: But but okay, so you know, yeah, before and after the deal.
• 17:44
  SPEAKER_00: Absolutely not.
• 17:45
  SPEAKER_00: So I think we're a strong company because we weren't aligned.
• 17:50
  SPEAKER_00: Like we were maybe it could have happened under sort of a more organized dynamic, but we would be screaming at each other having these discussions about what we do.
• 18:01
  SPEAKER_00: I will say this all four of us were aligned and that we're invested.
• 18:05
  SPEAKER_00: All four of us were aligned and that we um we had a vision for the company, that that vision is what drove us, and that we were willing to sacrifice.
• 18:16
  SPEAKER_00: We didn't take pay, we did all did the didn't take paychecks for three years, and we started this and all you know, lived off credit cards and did the thing.
• 18:22
  SPEAKER_00: So we're all willing to commit, and we all we all had a very good idea about the priorities, right, for the business.
• 18:33
  SPEAKER_00: The integrity of our science, the integrity of our name, right?
• 18:38
  SPEAKER_00: Authentically being part of the cannabis industry where so much exploitation is happening, doing those things, making real partnerships with you know different sectors of the community.
• 18:53
  SPEAKER_00: Um, that was all very meaningful for us.
• 18:55
  SPEAKER_00: And I think it's around those things that we can always coalesce and always come back together.
• 18:59
  SPEAKER_00: So whether we argue on a particular strategy or not, or a particular hire or something like that, you know, we could see through that.
• 19:07
  SPEAKER_00: We can get beyond that because we knew, right, the more meaningful stuff that binded uh that binded us together and and and kept the company going.
• 19:17
  SPEAKER_02: Well, that goes back to rewind 15 years ago and you're all sitting around for beers.
• 19:22
  SPEAKER_02: I mean, would knowing what you know now, you know, would you have done this?
• 19:27
  SPEAKER_02: Would you have embarked on the same adventure?
• 19:35
  SPEAKER_00: Interesting.
• 19:36
  SPEAKER_00: Um yes, right?
• 19:39
  SPEAKER_00: Uh yes, I think it's it's it's hard though.
• 19:42
  SPEAKER_00: You you can't ever go back 15 years and not make different decisions, you know.
• 19:46
  SPEAKER_00: I want to say in my way that it wasn't, it was still a good decision, but like, no, it would have turned out like this.
• 19:52
  SPEAKER_00: You know, we would have done things very differently because you know, we we would have known a lot better.
• 19:57
  SPEAKER_00: We would have we would have had the maturity and the and the experience and all that good stuff.
• 20:00
  SPEAKER_00: But um yeah, I mean, the best, you know, one of the best decisions I I I I made in terms of something to commit my time and energy to, and people to commit my time and energy to.
• 20:13
  SPEAKER_00: Right.
• 20:13
  SPEAKER_02: Well, and one thing you've you've told me in the past is that you know, hindsight is undefeated.
• 20:17
  SPEAKER_02: So you you don't you you can't second guess yourself about you know a what seemed like a good decision at the time, and turned out to be a pretty good decision too.
• 20:26
  SPEAKER_02: So in in this adventure, what were what was a particularly high point and a particularly low point?
• 20:37
  SPEAKER_00: Um particularly high point, the uh moments within the adventure itself that aren't necessarily that that are like these meaningful experiences we had in in making this happen.
• 21:00
  SPEAKER_00: Winning our first big deal.
• 21:03
  SPEAKER_00: You know what I mean?
• 21:04
  SPEAKER_00: We had a concept that didn't necessarily resonate with people, right?
• 21:10
  SPEAKER_00: There's a transactional cannabis business, and people you will come to me and I will give you cannabis and you will give me money, and a transaction is had, and that that makes sense, but that's not what I'm selling.
• 21:23
  SPEAKER_00: What I'm telling is no, no, no, you give me cannabis and you also give me money.
• 21:30
  SPEAKER_00: Both come this way, and I'm gonna give you data.
• 21:35
  SPEAKER_00: What do I do with this?
• 21:37
  SPEAKER_00: Well, you can inform your clients and and or or hone your craft or right, but now you're empowered with the information that can give you stronger decision making capabilities and blah blah blah.
• 21:50
  SPEAKER_00: All pass.
• 21:52
  SPEAKER_00: There was a lot of that.
• 21:54
  SPEAKER_00: And what we did initially is we we we uh there was this uh company called Weedmax.
• 22:00
  SPEAKER_00: Who is this online?
• 22:02
  SPEAKER_00: Uh uh, you know, cannabis could not be advertised on the internet.
• 22:05
  SPEAKER_00: So you can't go on Google Maps and find dispensaries.
• 22:08
  SPEAKER_00: We maps is displaying all the dispensaries and 95% market share.
• 22:12
  SPEAKER_00: They're showing dispensary menus.
• 22:14
  SPEAKER_00: This is what you can buy.
• 22:16
  SPEAKER_00: And all it showed was a funny name, like super bubblish OG and a price.
• 22:23
  SPEAKER_00: And so most people, right?
• 22:25
  SPEAKER_00: And a location, this is where you can go get it.
• 22:27
  SPEAKER_00: So most people, what information do you really have to go make a decision whether to go to one store or another, whether you get one product or another?
• 22:34
  SPEAKER_00: And so we you know, we pitch to them marrying test results.
• 22:41
  SPEAKER_00: We pick up samples, we put test results on the menu as well.
• 22:44
  SPEAKER_00: Now people can actually have a little sense of what it is that they're buying.
• 22:47
  SPEAKER_00: I mean, that was the that was an amazing idea to us at the time.
• 22:53
  SPEAKER_00: And in and in really what we spent all of our money, we raised a tiny bit of money,$80,000.
• 22:59
  SPEAKER_00: That's it.
• 23:00
  SPEAKER_00: Like if you brought me$80,000 and want to start a lab here, you you just have no business starting a lab, right?
• 23:07
  SPEAKER_00: And so a lab right now costs you a million dollars at least, right?
• 23:11
  SPEAKER_00: Finance some of it, whatever, but still.
• 23:14
  SPEAKER_00: So we bought all of our stuff at Aucha, and we spent all of our money on the lab because we had to.
• 23:22
  SPEAKER_00: Well, now, how are you gonna sell and market something that's brand new to people?
• 23:27
  SPEAKER_00: And so Weedmask was our leverage, and so to us, it just it was the perfect culmination.
• 23:34
  SPEAKER_00: That doesn't happen, this doesn't happen.
• 23:37
  SPEAKER_00: So when I think back about some like really high point, like and it was an adventure going down there.
• 23:42
  SPEAKER_00: We we we a friend of mine's little brother was a pilot.
• 23:46
  SPEAKER_00: Well, I didn't understand, it's like 17 years old.
• 23:49
  SPEAKER_00: He's flying us in this tiny airplane, you know, we're all packed into it, dab it.
• 23:52
  SPEAKER_00: Like it's this awesome adventure about the stuff that you do when you're trying to spit up business, you know.
• 23:58
  SPEAKER_00: And um yeah, man, it was it was uh it was a it was it was an amazing time, and there's so many of those ones.
• 24:04
  SPEAKER_00: Those are my high moments about this business.
• 24:06
  SPEAKER_00: Funny enough, it's not a check, it's not an amount, it's not whatever, it's it's those experiences.
• 24:12
  SPEAKER_00: Um, and then you know, uh low points.
• 24:15
  SPEAKER_00: I mean, we we've the the swing, the pendulum in in cannabis is significant, and with every um almost with every new uh president or a g sitting in whether it's California or the federal government or what have you, has this different perspective on cannabis and what that's supposed to mean and how that's supposed to go.
• 24:45
  SPEAKER_00: And there have been times where like I remember after after Obama left office, or when Obama first took office, sorry, the the sitting um you know uh uh heads at the DOJ actually put out these letters all around California to the landlord saying, shut down the cannabis businesses here, we'll confiscate your property.
• 25:09
  SPEAKER_00: They didn't do anything, they didn't take any action after that, but they did send out these letters.
• 25:13
  SPEAKER_00: I mean, for two, three months, nothing, right?
• 25:17
  SPEAKER_00: Like, no business at all.
• 25:18
  SPEAKER_00: That's hard to run when no, no client, every client of yours shuts down, right?
• 25:23
  SPEAKER_00: Right.
• 25:23
  SPEAKER_00: So, I mean, there are these devastating moments that scared us that we almost lost the business.
• 25:27
  SPEAKER_00: And I think that's where you're like, it's not necessarily that the the we're our profitability is going down.
• 25:33
  SPEAKER_00: I mean, we're almost losing the business.
• 25:35
  SPEAKER_00: Five years in, we put all our time and all our energy, we finally started getting a paycheck.
• 25:40
  SPEAKER_00: I'm making a this amazing$30,000 a year to run this business.
• 25:47
  SPEAKER_02: Don't calculate the per hour on that.
• 25:49
  SPEAKER_02: It doesn't, it doesn't feel good.
• 25:52
  SPEAKER_00: So, yeah, I mean, those are those were stressful times, and I remember really stressing like, okay, it's payroll.
• 25:58
  SPEAKER_00: Where do I go get money?
• 26:00
  SPEAKER_00: That kind of thing, you know.
• 26:02
  SPEAKER_02: Yeah, yeah, you go get it because you don't have it and it's not even in the safe in dollar bills.
• 26:08
  SPEAKER_02: Yeah, yeah, yeah.
• 26:11
  SPEAKER_02: So you you weather those storms, which truly are worse, I'll say, than most.
• 26:20
  SPEAKER_02: I mean, it it's uh an uphill battle because you basically did have to create your own market to sell into because there wasn't a regulatory environment back then, and then you have to you know go through all the uh just sometimes whimsical changes in the regulatory environment.
• 26:39
  SPEAKER_02: But once you got there, and you had the big wins too, once you got there, uh got through uh the deal with private equity.
• 26:47
  SPEAKER_02: Did did you get yourself a did you reward yourself in some way?
• 26:54
  SPEAKER_00: I did.
• 26:56
  SPEAKER_00: Um, you know, we we bought a house that was uh let's just say on par with the size of our family.
• 27:06
  SPEAKER_00: Everybody's got their own bedroom now.
• 27:09
  SPEAKER_00: I mean, I'm not talking luxury.
• 27:11
  SPEAKER_00: I don't think that's how you define luxury, but we did that.
• 27:15
  SPEAKER_00: And in California, in Santa Cruz, that's not cheap.
• 27:19
  SPEAKER_00: So um, yeah, and and yeah, you know, honestly, I I I what I did do that that is I gave myself time, you know, during that transition period when I was when I was no longer working as CEO.
• 27:35
  SPEAKER_00: I mean, I'm not doing seven days a week, 10 hour days.
• 27:39
  SPEAKER_00: I'm actually taking, I'm actually saying no, taking a weekend, taking time off.
• 27:44
  SPEAKER_00: I've never taken like vacations and took some vacations, took some, right?
• 27:48
  SPEAKER_00: I think and that was probably the most meaningful thing.
• 27:50
  SPEAKER_00: I got to do some amazing, take some amazing trips with my family and um take some time.
• 27:54
  SPEAKER_00: And and what's what's good about that is I've uh I've I've stayed with that, I've stuck with that.
• 27:59
  SPEAKER_00: You know what I mean?
• 28:00
  SPEAKER_00: Like I we we take vacations each year, right?
• 28:02
  SPEAKER_00: I mean, we're not jet set around the world, but we're spending time with each other.
• 28:06
  SPEAKER_00: That's that's uh that's something I probably should have done a long time ago, right?
• 28:10
  SPEAKER_00: I mean, keep that balance, but it is what it is, you know, and that's that's the trade-off.
• 28:18
  SPEAKER_02: Well, speaking of, I mean, I'll I'll get into now a couple of just getting to know you questions for for everyone.
• 28:24
  SPEAKER_02: And some of these answers I actually don't know.
• 28:26
  SPEAKER_02: Um, but we're all constantly learning, right?
• 28:30
  SPEAKER_02: That's that's part of the process that you're you're explaining now.
• 28:34
  SPEAKER_02: Hey, you're you're a better dad than you than ever, you're a better CEO than ever, you're a better partner than ever, etc.
• 28:41
  SPEAKER_02: And I mean, hopefully that you know continues until we all we all uh kick off.
• 28:46
  SPEAKER_02: But one of the ways that I really try to learn and improve myself is is through reading.
• 28:53
  SPEAKER_02: And and are are you reading something now or or learning something or in you know in in a class or anything like that to to improve you?
• 29:04
  SPEAKER_00: Yeah, so um I you know, I think there was a time when I was spending a lot of time reading business books, and I honestly think that what I had done is I I had spent so much of my time during the day focused on my business, business itself, learning about just it felt narrow to me, right?
• 29:26
  SPEAKER_00: And so what I needed to do is I need to exercise, exercise the other muscles and you know, the other facets of my personality that that makes sense.
• 29:34
  SPEAKER_00: And so, you know, just beginning to read books that have absolutely nothing to do with business, but really to do with the world around me and what I'm seeing, and maybe how I could have better conversations with my kids, right?
• 29:46
  SPEAKER_00: And so, you know, the last the current book I'm I'm reading is this book of a hundred years war, right?
• 29:51
  SPEAKER_00: And it's oh about this conflict, right?
• 29:55
  SPEAKER_00: The conflict in right, if you're gonna characterize it as that in in in in in in Palestine and in Israel.
• 30:02
  SPEAKER_00: And that's uh right, it's something that you know when my my kids are getting to an age they're asking me questions, and the truth is I have these beliefs that I'm not really sure I can, right?
• 30:10
  SPEAKER_00: And so I'm just spending as much time reading and trying to, you know, trying to trying to get as rich an understanding of the world around me as I can because I'm having to answer more questions to to young people who they're really looking for answers, they're really trying to understand it, and I'm challenging my own understanding of things.
• 30:31
  SPEAKER_00: And so um that's that's what I'm spending a lot of my that's what I'm spending a lot of the time on.
• 30:37
  SPEAKER_02: That's awesome, that's awesome.
• 30:38
  SPEAKER_02: And I think it's really interesting in that the there's even a tie back to what you're doing, because there's always a degree or two only of separation between any topic, it seems like, because Israel is a Mecca for cannabis research, and so there's Israel's gonna come up, you know, in in conversation, even in bit in your business, let alone with your family as well.
• 31:06
  SPEAKER_02: So that that that's really interesting.
• 31:09
  SPEAKER_02: Uh almost done here.
• 31:12
  SPEAKER_02: Uh what is something that is not on your LinkedIn profile or on your about page or or whatever?
• 31:20
  SPEAKER_02: Uh something that you know what something I don't know.
• 31:26
  SPEAKER_00: Um you got me racking my brain trying to think of what you know and what you don't.
• 31:31
  SPEAKER_00: Don't worry about that.
• 31:34
  SPEAKER_00: Um, I think one of the uh one of the perspectives I have is that I think you a lot of times you you you're understanding your life through the lens of the few things that you really understand well.
• 31:46
  SPEAKER_00: And if you have mastery of something, maybe that gives you greater insight because you're looking at things more dynamically, the principles behind something, you know, that maybe some greater truths.
• 31:57
  SPEAKER_00: Like, you know, I spent uh, you know, time I was four, so I was in my 30s, you know, I practiced martial arts with um with my father, who is my teacher.
• 32:08
  SPEAKER_00: And my father's teacher is is is a legend in Japan, you know, was president of the all-Japan Karate Federation, right?
• 32:16
  SPEAKER_00: And so I when I was young, I would train before school.
• 32:20
  SPEAKER_00: I'm talking about in grade school.
• 32:22
  SPEAKER_00: I would train in the mornings when I woke up for an hour.
• 32:25
  SPEAKER_00: I would train at my dad's school for two, three hours a night.
• 32:28
  SPEAKER_00: Um, I would train on the weekends, seven days a week, I would train from four until I was 30 something.
• 32:33
  SPEAKER_00: I mean, I invested so much time and energy and and and and and emotion into into that that it defined a lot of how I understand the world, right?
• 32:44
  SPEAKER_00: And um, yeah, I mean I I I don't practice anymore.
• 32:50
  SPEAKER_00: Um, but to this day, I think it's how, again, like it's it's my it's my native language, if you will.
• 32:55
  SPEAKER_00: I don't know if that if that if that makes sense, but sure.
• 32:58
  SPEAKER_00: Um yeah, and that's something I don't or I don't I don't think I I I share often or or many people know about me.
• 33:06
  SPEAKER_02: What that you can kick their butts, yeah.
• 33:09
  SPEAKER_00: Uh it's a way to frame it, but yeah, just the martial experience and you should start every negotiation like that, right?
• 33:17
  SPEAKER_02: I mean, I studied martial arts for 25 years.
• 33:21
  SPEAKER_02: Let's negotiate.
• 33:24
  SPEAKER_00: Break the table in half, and then you know, yeah.
• 33:28
  SPEAKER_02: Yeah, exactly.
• 33:30
  SPEAKER_02: There we go.
• 33:31
  SPEAKER_02: Well, all right, Jeff.
• 33:32
  SPEAKER_02: I'll I'll finally, finally, finally let you off the hook.
• 33:34
  SPEAKER_02: I think this is probably the the longest and awesomest recording uh that we that we've done so far.
• 33:40
  SPEAKER_02: But uh last thing, where can people find you if you do actually want to be found?
• 33:45
  SPEAKER_00: Um yeah, I mean, uh LinkedIn, you know, uh uh email, just Jeff at SE Labs, right?
• 33:53
  SPEAKER_00: I mean, I'm I'm uh right.
• 33:56
  SPEAKER_00: I mean, I I'm I'm still open and and um we're still small and I'm still learning and we're I'm still engaged with as many people as possible just to kind of expand my my my learnings and my professional network.
• 34:10
  SPEAKER_00: So no.
• 34:12
  SPEAKER_02: Awesome.
• 34:14
  SPEAKER_02: Well, Jeff, this was really incredible and I really, really appreciate you doing this.
• 34:18
  SPEAKER_02: Uh obviously everybody should feel just the authenticity and passion that that I know is there.
• 34:27
  SPEAKER_02: Uh and yeah, I mean, hopefully everybody got something out of this.
• 34:31
  SPEAKER_02: Like and subscribe.
• 34:33
  SPEAKER_02: Thank you.
• 34:34
  SPEAKER_02: Thanks for having me, Ben.
• 34:36
  SPEAKER_00: Let's talk.
• 34:37
  SPEAKER_02: Listeners, thank you for tuning in.
• 34:39
  SPEAKER_02: This has been an episode of Max Value.
• 34:41
  SPEAKER_02: Find us on YouTube, Apple Podcasts, and other streaming services.
• 34:45
  SPEAKER_02: Please like, subscribe, and follow.
• 34:47
  SPEAKER_02: And we'll see you for the next show.