In the latest episode of the Cannacurio Podcast from Cannabiz Media, my co-host, Amanda Guerrero, and I discuss new cannabis retailer and dispensary licensing data during the first quarter of 2020. We also speak with Dawne Morris, Founder and Chief Marketing Officer at PROTEUS 420, a leading real-time, seed-to-sale tracking and point-of-sale system for the cannabis industry.
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Cannacurio Podcast Episode 5 Transcript
Amanda Guerrero: Thanks for joining the Cannabiz Media podcast, your source for cannabis and hemp license news. We’re your hosts, Amanda Guerrero and Ed Keating.
Ed, how are you since the last time we spoke? I wanted to check in and see what’s going on in the world of the data?
Ed Keating: Doing just fine Amanda, thanks. Hanging in there, managing the quarantine as best we can.
On the data side, the team’s still been busy. It’s interesting that states are still issuing licenses, so we always do our best to stay on top of that.
As I’ve been referencing for a bit, it seems to be hemp licensing season because everybody needs to get their crop in the ground, so almost all the states have gotten their licenses out to cultivators, processors and others.
A couple area… New York, we got 140 licenses that we’ve just added in. They all tend to be cultivators. Louisiana, which we’ve been tracking on the CBD side, now has issued their hemp licenses, and they include contract carriers, which is a new term for us, it’s distribution, along with growers, processors and seed producers.
Lastly, we’ve been trying to track down the Michigan licenses, which are really hard to get, but it looks like we’ve identified them, and we think that they may bring in about 1,000 updates into the database as the old licenses get essentially retired and the new ones come online.
Amanda Guerrero: Oh, interesting. I know that these licenses were submitted months prior to this COVID-19 crisis, but do you think the cultivators will be able to operate?
Ed Keating: It’s a great question. I think as we look at licenses, we’re the last in line. Obviously the regulator and the regulated work through that process…
Often the start time is in end of November, end of the year. January 1 they get this rolling, so they probably went ahead with big plans and paid their fees and said, “I’m going to grow this much,” and now they’re going to have to figure out how to get it done. What kind of farm workers are they going to have? So I think it’s definitely going to be a challenge for this kind of agriculture as well as the rest of the food chain.
Amanda Guerrero: Yeah. Curious to see how the agricultural world responds to this new remote work from home lifestyle that we found ourselves in now in the midst of what’s going on. But thanks so much for the highlights here, Ed. We appreciate it.
Ed Keating: Sure.
Amanda Guerrero: Yeah. On today’s show we’ll be joined by Dawne Morris from PROTEUS 420. She’s the founder and CMO, so stay tuned.
Welcome back to the show everybody. We’re joined by Dawne Morris, the founder and CMO of PROTEUS 420. She’s also one of Cannabiz Media’s power users. Dawne, welcome to the show.
Dawne Morris: Hey guys, how are you?
Amanda Guerrero: So, so good. So happy to have you on the show.
Dawne Morris: I’m happy to be here. Even if it’s virtual and podcast, we can still make this industry run, right?
Ed Keating: Exactly.
Amanda Guerrero: Yeah. Exactly. Exactly. Well, Dawne, I wanted to introduce you to our audience here and give them a little background on yourself. How long have you been in the cannabis industry and what were you doing before you got involved?
Dawne Morris: PROTEUS 420, itself, unofficially, has been in the industry since 2008. We took about two years, from 2008 to 2010, and beta tested in a non-active market with a first license for California. We utilized that two years to streamline our processes and work before we launched in 2010 to the open market, which was still kind of revolutionizing what the industry was doing, but we officially launched in the market in 2010.
Amanda Guerrero: Wow. What were you doing before you got into the cannabis space?
Dawne Morris: Wow. It feels like lifetimes ago, just depending on which lifetime we’re talking about. But David, my husband, and I… We actually are the co-owners. We both co-own… We founded and co-own PROTEUS 420.
With that, what we decided to do was we took our technology background… We have two other businesses that we run, and have been running since 1997. They are technology base. One is digital marketing and the other one is having a hosting platform.
So moving and utilizing that skillset and moving into the ERP space was something we had done back in 2001 in the eCommerce industry. So we took kind of that basis of technology, and when we decided to launch into the cannabis space we decided to take the basis of our backgrounds, which were both in technology, and mine further back was coming in from nursing and being the daughter of the grower, being able to kind of bring that into a light where we knew that a lot of change was going to be happening, so we wanted to be a major player in that.
Ed Keating: Wow, that’s a great background, and the fact that you started this in 2001 means you’ve already gone through a .com craziness, and now we’re going through a COVID craziness, so I guess this may be old hat for you.
One of the questions I wanted to ask is what makes PROTEUS 420 unique? As you know, we’ve been tracking a lot of technology in the space and there are a lot of entrants that have come in, and I think the fact you guys have been around is pretty interesting. But I’d like to hear it in your words, sort of what makes you unique in this space.
Well I always say, you know, we’re… In this particular industry, being one of the original three with two of our other competitors that we have, we often are duplicated. So we know that a lot of the new people in the industry have look at our software as well as others, and they take what they like and then they modify it. It’s kind of how the streamline of growth happens in any industry.
For us, you know, what makes us very unique is the fact that we, and we have always, operated as a partnership with our clients. So it’s in our best interest to put the best business practices with our clients. The more they grow, the more we can grow with them.
So we work very closely with each one of our clients in the industry so that we can streamline processes. We can make sure that instead of taking 10 steps to do something we turn it down to two. Maybe it’s a matter of having four people running an organization that would normally take 10.
So listening to our clients, listening to their pain points in previous softwares versus where they want to be in next three, five and 10 years, working on planning that out with them, it is a very unique position for us to put ourselves in, because we do work so closely.
When we say that we work closely with them, it’s listening to them. Because a lot of times what happens is we’ll have clients that come in and they’re like, “Oh, I would love for it to do this and do this and do this,” and we have to explain to them that’s very unique for you, so maybe we just customize it for you.
Then we have clients that come in and have a stream of open consciousness for a lot of great ideas and share them with us, and it’s something that we can launch out for all of our clients, so being able to determine what is considered a customization versus good for the whole community.
Ed Keating: That’s great. I mean it sounds like you’re able to straddle that high tech and really keep your clients happy and also take the best of breed ideas and put them out on the platform so that everybody can benefit.
Dawne Morris: Oh, definitely.
Ed Keating: As you’re looking ahead, any new product launches, new markets or new initiatives on the horizon?
Dawne Morris: So we have a lot of new products that we’ve been planning for the last year to two years. We try to work in a five to 10 year visual, so like when we’re looking at what our system is doing now, we don’t want to just think about what the trends are going to be happening in the next year. We want to look at what they’re going to be doing in the next five and 10 years so that we can pre-plan out for a lot of that.
A lot of what’s happening and what we’ve done and what is the basis of our business model is streamlining operations and compliance for the cannabis industry, so being able to build all of that into our platform that is already a one stop shop.
Some of the new product launches that we have are going to be taking things a little bit further out in the next five to 10 years in that operations platform, so being able to rely on the system not just as a seed to sale or a track and trace, but also being able to look at it as a wow, this whole system runs our entire business operations from budget forecasting to being able to see what total ROI is on products. So those are some things that we’re building in right now.
Ed Keating: Excellent. Now I think part and parcel of this is we watch as new states come onboard and enter the cannabis ecosystem often through maybe a new medical program or a rec program, or Oklahoma, which is kind of a rec program in disguise.
You talked about partnership before, so I’m curious, what is it like for PROTEUS 420 and your team to enter a new market, like Oklahoma is coming onboard. We’re going to go in there big. What do you do? How do you plan for that?
Dawne Morris: A lot of it requires looking at what the market is going to be doing, what some of the rules and the regulations that are going to be coming in to play from the state level.
So we do a lot of research in what’s happening on the documentation side. How is the state going to roll out? What’s the timeline look like? When we look at it from an internal perspective, what do we anticipate the licensee numbers are going to be looking like? Then, how can we support that area in that region?
So internally and externally, there’s a big process that happens. Internally, like I said, we’re looking at all of that information. Then we’re looking externally at how the growth of that market is going to happen.
Oklahoma, just using that as an example, happened to be a really big boom. It happened really quickly. The state was really pretty much onboard. They already knew what they wanted to do. The rules and regs kind of turned pretty quickly on that.
Then all of a sudden it was like the wild west of licenses, right? All of a sudden it exploded and like that. We also entered that space at the same time with Oklahoma, so we were there and we were able to see what was going to be happening and progress that, so we grew pretty big in Oklahoma.
Then you look at a state like Michigan, who, you know, we’ve been in Michigan for several years on the medicinal side of cannabis, but having them roll out with recreational has taken a few years. So having to deal with the changes and the fighting that’s been going on at the state level versus how it’s going to roll down into the cities and counties within Michigan has been a very interesting battle.
Again, using Michigan as an example, you could be in Detroit and you could be selling, but you can’t be in Kalamazoo. But you’ve got people who are pre-licensed in Kalamazoo and just waiting. So it’s kind of like you go forward, you move back, you go forward, you move back.
So being able to be really flexible has helped us be able to determine how we’re going to enter that market, like I said, both internally and externally. It’s a dance. It definitely is a dance.
Ed Keating: Related to that, sometimes a state will adjust their licensing requirements or they’ll make something else available to their license holders. One of the trends that we’ve been keeping an eye on is the onsite consumption licenses that we’ve seen in Oakland and in Colorado and Illinois, Massachusetts. Some of these places are under work, or they’re trying to get to that launch.
But what does that mean to you? Is that a challenge for your customers, or is it something easy for you to do in the software from the ERP standpoint, that it’s an easy thing for you to comply with?
Dawne Morris: One of the things that… You know, going back to the previous question, what makes us unique, the ERP aspect of that is what really truly helps be able to quickly adapt and modify our system based on the rules and regulations from each county, state to county to inner city.
When you look at consumption versus purchasing, being able to utilize and build those in very quickly and launch them effectively is really important, and that’s something that we’ve done very well over the last few years.
Because we don’t have to deal with an application process or have to resubmit to applications like Apple or Google Play, it allows us to kind of put the code in place, Q&A it, make sure that it tests, go through the R&D process of it very quickly, and then launch out to the teams that are going to be utilizing it in those areas.
So when we look at someone like LA County that has… Or Oakland, for example, who has a consumption on location as well and medical and recreational, each one of those acts as an individual license. So someone could purchase within their limit and then go and smoke, but being able to go in and check into that smoke lounge, checking in the amount of product that’s being carried over versus who the person is, whether it’s anonymous or if we’re tracking that.
So it all comes down to that regulation and being able to use that guideline to kind of track through the different processes on that, and that’s what we’ve really been able to do.
You look at places you can eat, you can smoke, and you can purchase in LA County, and there’s a location that’s… It’s been booming. But when you look at it, when you eat, you can’t purchase and then eat and smoke in the same place. You have to move to a lounge type of location.
So being able to track that flow, it’s something that we’ve been able to do very easily, and what has helped us is because we are in the beer and wine industry as well with our software, so being able to take someone from… Someone who is maybe doing a flight of wines or a flight of beers and transferring them into a purchaser of that, we’ve been able to like modify that process for cannabis, so being able to check someone in and then follow their purchase power all the way through to maybe becoming a patient or becoming a rec purchaser.
So being able to kind of follow that flow and see where trends are, we’re able to add that ROI so that people can see where they’re actually spending and wasting their money at.
Ed Keating: That’s great. And having that other industry, just being able to work with your clients to say we’ve got this covered, we’ve been doing this in other industries for a long time, I’m sure is a great boon as you have to incorporate these regulations, which we also view as essentially rules that we have to build into our software too, so that totally makes sense.
One final question I wanted to ask you is, you know, as you look back on the last 12 months, what’s been the biggest achievement for PROTEUS or for yourself, Dawne?
Dawne Morris: Wow, that’s a good question. I would say for PROTEUS one of the biggest things we’ve done here is being able to work a little bit more in the compliance realm, providing SOPs for a lot of our clients and assisting our clients in the last 12 months in being able to become a legitimate business operation.
A lot of things I always tell people is like, you know, we’ve got 50% of a market that they know how to sell, smoke, grow the plant, but they don’t know how to run the business part of it, and then the other 50% know how to run the business but they don’t know how to grow, sell or smoke the plant.
So being able to kind of… You know, what we’ve been able to do is kind of combine both of those in a very strategic way both through partnerships, consulting, and with our software being able to teach people the proper way to do business, whether it’s a widget or the plant, it doesn’t matter.
So that’s been a really big achievement for us in the last 12 months, being able to work with our clients and helping them know how to do proper business in the cannabis space, because it is something that is still a learning process for many of the people, depending on the state.
Personally, I have to just say… You know, I’m a grandmom on top of all this, so watching my granddaughters grow and just watching them go through their steps the last 12 months… Both of them are going from just being little girls to now being students in school, and watching them just kind of change in personality and grow and thrive, and getting those big giant hugs every time they come in, so I love it.
Ed Keating: That’s great. That’s great. Well thanks for sharing that with us.
Amanda Guerrero: Yeah, that’s so sweet. You bring up a really good point Dawne, about knowing how to do business properly within this industry. It’s such a big hurdle that I think a lot of newcomers and new businesses kind of underestimate, because there is a way to do that.
I wanted to kind of ask you what are some of the ways that you and your team utilize Cannabiz Media?
Dawne Morris: One of the ways that we’ve utilized Cannabiz Media is one from a licensing perspective, of being updated on any change in information. We’ve been with you guys for many years now, pretty much since you guys have started, so we’ve grown with you guys as you have added more information and allowed us to market through the system, and that’s been a huge, huge plus for us.
What it’s been able to do is not only are people able to see us on the state reporting side as a validated software, but they’re also now seeing us from the beginning. From the moment that their licenses are put into place and we see they are pending, all the way up to them becoming an active licensee holder, we’re able to stay in a level of communication with them.
So Cannabiz Media has been a really big piece of… A plus really for us as far as communication and marketing. One of the ways that I personally love using it is the fact that I can actually get to the main decision maker. A lot of times what happens is you’ll find that cannabis companies will put their location, phone number, and you’re getting the budtenders that are answering the phone.
So what it’s been able to do is get our footprint and our name and our process of what we do in front of the main decision makers there, and that’s been something that’s been very, very helpful for us over the years.
Amanda Guerrero: I’m so happy to hear that. We really want to provide you guys with the best available information possible. It’s great that you guys have been able to do so much with us. How does this tool compare to other sales tools that you’ve used before?
One of the things that’s actually really nice, with our system – with PROTEUS 420 – we have a built in… It’s almost like Salesforce, built into our system, so you can follow patients or consumers that are coming in. For us, we use it as a lead generator, so leads that are coming in from the website go into our database and we’re able to put that chain of command into place, and how they’re going to be followed. Then we’re able to follow that process through.
What we’ve loved being able to do, and something that Cannabiz Media has helped us with, is being able to make that initial onset, so once the person who is the decision maker is wanting to do a demo… Once they’ve reached back out to us, being able to kind of automatically put that information into our system, so once they reply they’re then added into our system and we’re able to see that they started in Cannabiz Media and then we fulfill.
So we get to see the entire focus or the life cycle or life chain from the moment we start that initial communication with them out to the final sale. Being able to do that is huge.
But to go back to your question, one of the things that I think is really important and what has helped us is being able to just be able to look at the information and not only put our best business practices into play, but also being allowed to say okay, Cannabiz Media has best business practices and now we have our best business practices.
We kind of make them merge together, and it just allows us to kind of have a stronger footprint in the industry, where people are able to say, Yeah, that’s where we saw them and this is where we’re ending up and now we’re super happy.”
Amanda Guerrero: That’s beautiful and very well said. Thank you so, so much, Dawne, for your feedback and for your answers here, because it really… You know, the purpose of this podcast is to help give our audience a better understanding of not only the data, but also too how our current subscribers are utilizing the platform, and giving you an opportunity to share your success. So with that in mind, are there any tips or tricks that you’d like to share with our subscribers here?
One of the things that’s great is just being able to organize how you’re going to communicate with people. Obviously, there’s a lot of information within the Cannabiz Media platform itself, so when you’re breaking it down between hemp and CBD and cannabis, being able to organize those lists in a way that makes sense to you.
Then when you’re going through those lists, being able to communicate out. There’s a great email campaign tool that we utilize quite a bit, and from that initial communication, the thing that I love about it is not only just when we’re organizing our communication and how we’re going to communicate. When we get into the email part of the campaign, being able to look and see who’s opting in, who’s opting out, who’s following the link of information out from the email.
So there’s a lot of information that you can get from there, but when you go back to your organizational lists, being able to follow that flow, so that’s a big part for me. I’m always keen on making sure that I tell people from a tip and trick aspect make sure you are organizing how you want to communicate with people, and then from there, everything else just kind of falls right into suit.
Ed Keating: Great. Great. Given your multi-industry perspective and longstanding in the cannabis industry, are there any trends you’re seeing play in the industry now or any markets that you think are going to be interesting?
Dawne Morris: It’s kind of funny, you know. We’ve got the whole COVID-19 thing happening right now, and as far as trends what I’ve seen is that most of the shops, since we’ve gone into an essential personnel type of situation with most states, we’re seeing that most shops are doing 420 numbers on a day-to-day basis, so it’s kind of interesting to see how that is playing, which means we’re in April right now, which 420 is our biggest day in the cannabis industry, the second biggest being 710.
It’ll be interesting to see how the numbers relate from a trending point since we’re doing currently those 420 numbers – what 420 is going to look like. So from a COVID perspective, everybody has moved to more of a virtual format, right? So everybody is doing virtual talks, virtual meetings, virtual conferences, and it looks like a lot of people are moving into the 420 stashes for giveaways and live bands.
So I’m seeing that as something that’s going to trend very heavily even after we move out of this COVID-19 situation. I think it’s opened up the door for a lot of people to say, “Hey, I don’t have to physically be at a location to be a part of things. I can still be a part of things virtually.”
When we go back in time and we look at MTV and VH1, they’ve been doing this for years, right? Even Dick Clark, nobody was ever really on that stage at that particular moment. There was pre-recordings, there was moving off to those areas. So when you look at that, I think that’s where this industry is going to start moving into.
I think the COVID situation has pushed that trend a little bit quicker than most people would have liked. I also see that once this goes away, I think things in this industry, in the cannabis industry, is going to – from a trend perspective – it’s going to weed out a lot of the people who just couldn’t hang in the potential or the what if situation.
Ed Keating: Agreed.
Dawne Morris: Kind of what the .com boom failures did and kind of what the mortgage industry failures did. We were already on a down slide trending with the markets as a whole, and overinflation of investors and things like that and a lot of big money that came in, and then they couldn’t figure out how to spend the money the proper way. Now all of those industries have… All those parts in this industry are going to start kind of making their way out.
So what I see in the next year, I really see a lot of the real businesses that have been able to hang onto this being able to work very closely with each other, and I think we’re going to get back to what is initially the foundation of what cannabis is, and that’s a grassroots, neighborly situation where we all work together for an end process, and I think we’re starting to see that now through this virtual streaming of where we are.
Ed Keating: Yeah, I would agree. It’s interesting, one of the ways that historically we’ve looked at the industry is with unique market segmentation, where there’s canna-clueless, canna-curious, and then canna-serious, and I think those first two groups are just not going to be able to make it sort of to the model that you gave of… They just don’t have the wherewithal to withstand what we’re all going through right now.
Dawne Morris: Yeah. And I think in the last few years, doing as many trade shows as we’ve done and working with a lot of people that we work with, one of the things is we get a lot of people on the canna-curious side and they’re always saying hey, I know I want to be in the industry, I just don’t know how.
I tell people… I’m like, where’s your passion? It has to be passionate. You can’t just jump into any industry and just assume you’re going to be successful.
The cannabis space – up until this last year – has been the complete opposite. People could just jump in with no information, no understanding, and they could jump in and just all of a sudden think that it’s going to be successful, and I think that’s where we’re finding that kind of serious side of things are going to weed all those out.
Amanda Guerrero: Yeah. I think that you’ve provided so many great insights, especially given your tenure within this space, you know, here on this podcast today, Dawne. Thank you so, so much for joining us on our virtual podcast. It’s been truly a pleasure getting to know you, getting to learn more about your business, as well as hearing what you have to say about the industry, because you’ve brought up some really great points.
Dawne Morris: It’s my pleasure. I enjoy the industry. I love being a part of it, and I enjoy being a part of this podcast, so thank you very much.
Amanda Guerrero: Yeah, thank you. We’ll have to, hopefully, catch up again after quarantine, or maybe do another virtual class.
Dawne Morris: There you go.
Amanda Guerrero: All right. Let’s check in one more time on what’s coming next on Cannacurio.
Ed Keating: The quarter just ended, the first quarter of 2020, so we’re going to be doing some lookbacks on different activities within the cannabis space.
The first one we do is on retailers and dispensaries. How many were added in Q1? Based on our numbers so far, it looks like 355 dispensaries and/or retailers were added in the quarter.
Not surprisingly, most of them were in Oklahoma. Somehow they just decided they don’t have enough, they need more, so 155, or 44%, were there. 69 though in Michigan and only 24 in California and 22 in Florida. So we’ll dig into that in next week’s Cannacurio blog post, and we’ll share that out to all our readers and listeners.
Amanda Guerrero: Wonderful. Wonderful. You heard it here first, folks. We’re transitioning to a virtual world here, and we wanted to thank you all for joining us on today’s podcast. We’re your hosts, Amanda Guerrero and Ed Keating. Stay tuned for more updates from the data vault.
Ed Keating is a co-founder and Chief Data Officer of Cannabiz Media and oversees our data research and government relations efforts. He has spent his whole career working with and advising information companies in the compliance space. Ed has overseen complex multijurisdictional product lines in the securities, corporate, UCC, safety, environmental and human resource markets and focuses on workflow products over the last twenty five years. During that time he has worked for both startup and established information companies where he has led marketing, product management and sales organizations. These companies include Wolters Kluwer/Commerce Clearing House, CT Corporation, EDGAR Online and Business & Legal Reports. At Cannabiz Media Ed enjoys the challenge of working with regulators across the globe as he and his team gather corporate, financial, and license information to track the people, products and businesses in the cannabis economy. Ed graduated from Hamilton College and received his MBA from the Kellogg School at Northwestern University.