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It's 2021, and there are a plethora of cannabis companies operating out of America, but not all of them are alike.
When it comes to the cannabis company
Red White & Bloom Inc. (RWB) (
CSE.RWB,
OTC:TDRYD,
Forum), the name itself makes you think of all things America, and that is not by coincidence.
RWB likes to do things big, and it is looking to have exponential growth in the coming years. One building, in particular, that is helping to launch them to the next level is the new cultivation facility in Illinois which is 3.6 million square feet.
In this vodcast, Red White & Bloom's CEO and Executive Chair, Brad Rogers, joins The Market Herald’s Brieanna McCutcheon to breakdown what Red White & Bloom is all about, where they see themselves going, and how they are giving back to communities.
TRANSCRIPT BELOW:
SH: For investors that might not be that familiar with you and Red White & Bloom, can you give us a quick rundown of yourself and the company
BR: Absolutely. Yep. So, myself - I'll be quick. It's a long history. You know, I started in Canada was one of the first licenses in Canada, started a company called Metrum. Metrum grew up to be a big player in the space that was taken out by Canopy [Growth] - I believe in 2016 - and that went to where it is today. So when you look at Canopy’s website, you have Tweed as their recreational brand and Spectrum as their medical brand. That's effectively who we are; we grew that up into one of the biggest medical companies in Canada, and really changed the conversation with doctors about how to dose and titrate, and communicate with cannabis. That was a great exit for everybody, and it was one of the biggest deals in the space at the time.
We had a lot of eyes on us and a great success being who we were at the time. I moved on to another company in the space that we became hyper-focused on medical. What we did was label claim every single product that went out the door. Very similar to alcohol or pharma, there was a way we could tell how much you were getting at every single dose and every single time you bought it. The variability in cannabis is quite big. We dialed that down and we paid - we became a food-label product, so it was a very disciplined approach to it, and it was then very easy to dock the dose and titrate for doctors.
They were able to say, “okay, you know what, take X amount and you're going to get that result every single time.” That catapulted us into being the number one medical company in Canada. From when I got there, [we went from] 2000 patients to about 75,000, we went from $0 market cap to about a billion and a half. What I wanted to do is be the first company to cross-border ourselves. We had a great foothold in the space, a great model, great big grow down in Pelham, in Niagara Falls. I wanted to take that expertise and that label claim and everything that we were doing down into the United States and be the first down there to standardize cannabis. I took it to the board and the board - they wanted to go a different way.
They wanted to apply this to, and go after, the big checks that were coming into the space at the time, like Altria [did with] Constellation Brands. I wanted to go South and they wanted to stay North, so we parted ways. I started down in Michigan as our beachhead, if you will. But I was very late to the game.
That was the birth of Red White & Bloom in Michigan. We started with two stores and because my building of companies and exits made quite a few dollars for a lot of people, we were able to raise about a hundred plus million dollars on $30 million without banks. That was very good for us at the time, because then we went still fully into Michigan, built our business there, and we had about 20 plus percent of the market in Michigan at the time. It was a really good foothold where nobody was; it was a nation space and it was very exciting for us to actually start in that one space where all the MSLs didn't have a foothold. We were one of the biggest ones now in that space, and then we spread our wings further. Well, that was a long answer!
SH: You recently went public with your company on the CSE in June 2020. Can you give us some insight as to what that was like for you initially and to date, what has that been like?
BR: We went out initially on the CSE – the CSE was a baby at the time when I first listed on it. I was the first billion-dollar company on the CSE, believe it or not. They were the ones that were actually providing U.S. cannabis and Canadian cannabis companies the ability to list and trade. Obviously, the CSE was our choice because at the time, that was the only exchange you could use to trade with US cannabis-touching businesses. The first time I listed it was pretty easy, but it was speculative to a degree. We had to go through all the jumps through all the hoops.
The second time it was a very disciplined process. They're great people. I was welcomed with open arms obviously because we built some great businesses there and had a lot of trading going on, which puts a highlight on them. I know all those guys, Roger and Barrington, everybody there is just a friendly face to me. We couldn't be happier to be listed on the CSE and trading on there as well. It's good, good times.
SH: How important is it for you that the products you carry stay consistent for consumers?
BR: That's my MO. Since we started in this game - the point of being consistent is getting the same thing every single time. Imagine going home with a bottle of alcohol and taking two shots and going, “okay, I feel nothing.” That's typical with marijuana, right? What we wanted to do is get a standard dose of everything every single time. So our 30% Gold Kush is 30% every single time you get it. That makes a huge difference to everybody who's buying it. When I talk on stage - here, let me get this [coffee] this right here. This is consistent wherever I buy it. Every single time I go on stage, I ask, “so who grew the beans in here?” Nobody ever knows, but it's consistent. That's why I spent $4 on it, that's what supports the brand.
When you think about branding and you think about consistency, you become that consistent purchaser. Whoever’s California buying my stuff is in Michigan buying my stuff is in Florida buying my stuff is in Illinois buying my stuff. I want the same experience every single time because it's going to be great and it's going to be consistent and you're going to want it everywhere you go. That name is going to ring true, wherever you go: if you get RWB, High Times, or Platinum Vapes, it’s going to be consistent. That’s key – that’s everything that stands behind and builds a brand.
SH: In June of 2020, you spoke about moving into your cultivation facility of 3.6 million square feet. Presently, what is the status of this move?
BR: It took us a while. What we wanted to do was get a foothold in Illinois, a big market. We knew it was a big market. It's providing huge results for a lot of the big boys there in terms of revenue and I wanted to be there. What we did was get a facility and it's one of the biggest facilities in America, believe it or not, 3.6 million contiguous square feet under glass. It’s effectively 80 acres under glass. I wanted to make sure that you can't even fathom it until you’re there. We call it “The Green Mile.”
It's crazy, it just looks like a loop, but it's not. We're driving a golf cart and that's probably what you saw. It's just crazy. I wanted to have a foothold there and make sure that when the time comes [and we got a license], we're hopefully able to be able to move it there. What was happening in Illinois at the time was that there was the 22nd license, the 21st license - it's done by police jurisdictions, 22 police jurisdictions. The 22nd police jurisdiction was the toll road. You can't grow on a toll road. Maybe some people can, but I can't. We were lobbying for that license to be put where our greenhouse was, so that was a strategy, to begin with.
I started high-yield, high-quality CBD, and started that business. We’ve got quite a bit of traction there as well. Believe it or not, there's a CBD business where you can buy CBD in gas and convenience stores, roll it, and smoke it like a joint. So, I mean, it's a really interesting business that we found basically by doing what we are doing. But that facility is ready and prepped for cannabis, staffed, and ready to go. There's an economic footprint there already that we're doing what we're doing right now. We got another license, we’re just closing that license right now, as in closing the business transaction. Once we get the business transaction closed, we're going to apply to move that into the 3.6 million square feet.
It’s well on its way – that’s a fact. But what we want to do also is make sure that we keep that facility as a micro grow, where we are with the current licenses. We’ll have that, processing, the whole gamut. We have all the licenses available to us and that's what we bought, but we want that grow license moved over to the 3.6 million square feet. Provisionally, you only get 210,000 square feet, but it's ready, it’s up, it’s going, and we’re going to on that ASAP. There’s a functioning grow right now in Shelbyville [Illinois], where we bought the license. We’re going to continue that operation, to put High Times and Platinum Vapes there, and start distribution. Then we'll have that traction already with our brands that we already have plus others.
SH: Are you looking to expand the company into the Canadian market, or will you continue to focus and strive for growth in the United States?
BR: You know what, I would love to go to Canada. It's my Alma Mater, it’s where I'm from. But when you look at the opportunity in cannabis in the United States, this is where all the homework is happening right now. It’s such an opportunity that we have to go in inch-wide, mile-deep. We call ourselves “SSL”, superstate operators. Wherever we go, we go big and we just own that space wherever we can. That’s what we're going to be doing. When we pillar ourselves in Michigan, we're going to pillar ourselves in Illinois. We're pillaring ourselves in Florida – where we just bought a license, by the way.
We've got a deal in Arizona. That's just turned [recreational], and the numbers there are crazy. We’re also in Oklahoma, and nobody knows this, but Oklahoma is doing 800,000,000 right now with 4 million people – it’s a great market, and we're very excited to be there as well. We've got all these pockets that are doing strong business, and we're moving on down, we're very stealth. We've been still for a while, but now we're making big, big moves with Illinois, with Florida, and we’re growing California as well. So, I mean, I couldn’t be happier.
SH: Being the big company that you are, is giving back a part of your business model? And if so, which ways does RWB give back to the communities it serves?
BR: Our corporate social responsibility programs are in place. Our social equities are in place. Absolutely. We are big on giving back. We’re initiating a great vet program right now, so we’re giving back to veterans in the communities that we’re in. When you think about the ripple effect, for example, when we open up for business in Detroit: it’s not just the grow, it's the employment that we have there, it's the families that we serve. We just did a beach clean the other day over here at Mission Beach [California]. We got our groups together, it was a bunch of cannabis companies, and we went around the beach, picked up garbage with the community, with a little bit of a banner around it. We all feel good about those initiatives, and about giving back as well. We donated a lot of money to regional charities around Michigan, where we started.
Social equity is an important initiative for us. When you have that diversity - we're equal opportunity all around. Our President of MAG in Illinois [Anna Hyde] a female; I couldn't have asked for a better person in that position. This is the best industry to be in because there's no “no” for anybody right now; this is an open space for anybody to get in anywhere. When you look at who we are and what we do, how we give back has no boundaries either.
SH: RWB has a massive footprint in the cannabis sector with brands such as Platinum CBD and cannabis products, pet products, and Pura H&W Skincare, a biopharmaceutical company. Is there anything you guys won't touch?
BR: There's a lot of verticals and saying no is the hardest thing. But we're very disciplined in what we do. When you look at what we're doing concerning our product lines and our verticals, what we’re into is a big piece of the market. We look at vapes, at pre-rolls, at flower, those are the three components that we're in. You take derivatives out of that, and you look at CBD and you look at what's selling. There’s a lot of skincare, there’s a lot of pain management, so you look at those market segments and you say, “okay, there's a huge return on those very good products.”
We have formulations that outweigh everybody else on so many of these levels, for us not to go in there, take advantage of it, and return that value to shareholders that value would be silly, especially given the market and the market growth that's happening right now. What we won't get into is “lost leader” stuff - little fragments, niche pieces of business that really won't return for us. We’re kind of going up the middle right now, and if we fragment off and do something that really makes sense then great, but we're sticking to core elements. It's going to return big dollars for shareholders and a lot of value for customers as well.
SH: And finally, is there anything I did not cover which you'd like to add?
BR: I think we think we covered pretty much everything. I think we, you did a great job, you know, listening to me, I just ramble on, but thank you very much.
For more information, visit
www.redwhitebloom.com.
FULL DISCLOSURE: This is a paid article produced by Stockhouse Publishing.