Make It

Here’s what makes our marijuana ‘top shelf’ – and worth a 25% premium

In 2015, my brother-in-law, who had been growing medical cannabis since the mid-1990s, called me to ask whether I'd finance a potential opportunity. Five months, 1,331 company names and several hundred spreadsheet lines later, we co-founded Canndescent to cater to the premium, adult-use, cannabis consumer.

At the time, my brother-in-law and I felt a deep calling to build Canndescent. I was the Santa-Barbara-living, Upper-East Side-born, Hermes-wearing, Harvard MBA who had been building start-ups all his life, yet hadn't found his business unicorn. In contrast, he was the long-haired, highly tattooed, plant-growing savant with lifelong ties to the cannabis industry, who still wanted to prove he was among the best cultivators on the planet.

We had basically been training independently to build Canndescent our entire lives; together, we decided to attempt to disrupt the market and deliver solutions to the high-end cannabis consumer.

Back in 2015, our detailed, market audit revealed the following consumer pain points in California and much of the United States:

1) scarcity of exceptional cannabis flower

2) products with identical names delivering inconsistent outcomes

3) confusion and intimation over thousands of strains names and technical jargon

4) branding with misogynistic and counter-cultural tones

5) opacity with consumers unable to identify or know their grower

6) toxicity with a significant portion of flower testing positive for pesticides and microbials

Identifying these problems, we set out to create Canndescent with a simple value proposition: 1) superior flower quality, 2) consistency, 3) ease-of-use, 4) aspirational lifestyle, 5) transparency, and 6) health and wellness.

Fast-forwarding to 2017 and $10 million in investor capital later, we've aligned thousands of operating choices to deliver against this value proposition.

To cultivate consistently exceptional flowers, we operate a municipally-permitted facility in Desert Hot Springs, Calif., that monitors and regiments seven environmental variables down to the electrical conductivity in the grow medium. We standardize cultivation "recipes" by strain, use six sigma techniques for quality control, and routinely update our several hundred pages of proprietary standard operating procedures. We harness organic pest management and test products to ensure they are always microbial free. Just-in-time, we harvest fresh flowers every 10 days and hand-trim all product under a jeweler's magnifying lense. Furthermore, we jar-finish flowers with humidity packs in child-resistant glass to preserve the structure and freshness.

On the marketing and usability side, we've eliminated the thousands of intimidating strain names like Durban Poison and Train Wreck and have replaced them with our effects — Calm, Cruise, Create, Connect, and Charge. Instead of Cat Piss and Chernobyl, we offer Calm No. 101, described as "sedates the mind and body, allowing everything to melt blissfully away" and Create No. 301, described as "focuses the mind and settles your body, making it ideal for crafts or computer work." Curating effects and experiences through naming and product descriptions, we hope to put the consumer in control of his or her experience. Quite like the graphic user interface humanized technology in the early 1980s, Canndescent humanizes and, hopefully, destigmatizes cannabis flowers by making them intuitive, approachable and elegant.

Canndescent marijuana for sale at the Sunnyside Collective, a medical-marijuana dispensary in Los Angeles.
Canndescent marijuana for sale at the Sunnyside Collective, a medical-marijuana dispensary in Los Angeles.

As part of the process of trying to transform cannabis into a luxury good, we also needed to reimagine packaging to help shape consumer perception. Practically speaking, this meant eliminating anything like the Ziploc, dime bags I picked up as a teenager in Sheep's Meadow and developing color-coded, magnetically-sealed, orange boxes with design inspiration from Chanel, Tiffany's, Tori Burch, Louis Vuitton, and Hermes. Additionally, to improve usability and the product experience, we included rolling papers, crutches, matches, hemp wick, and a vellum welcome letter in each box set. Tying it all together, we developed the tagline, "The Art of Flower" and created aspirational, lifestyle trade ads using an Elle cover girl and an internationally renowned photographer.

No doubt, it is thousands of branding and operating decisions like these that have earned us a price premium of 25 percent above most other top-shelf flower in California. Call us the "Courvoisier of Cannabis."

Like Starbucks redefined coffee, a commodity product, in the 1980s, team Canndescent similarly hopes to elevate the basic standard of service to ultra-premium and democratize access to "top shelf" product.

As more consumers trade in their glass of Chardonnay for 0-calorie, 0-headache, higher "buzz for the buck" cannabis flower, I suspect we'll have a more than decent chance of sighting that unicorn sooner or later.

Commentary by Canndescent CEO Adrian Sedlin, a life-long entrepreneur who co-founded his first company at age 20. He has built and sold five companies. Sedlin resides in Santa Barbara with his wife and 3 children and earned his MBA from Harvard.

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Tune in to CNBC on Tuesday, August 8 at 10pm ET/PT for "The Profit: Marijuana Millions," as "The Profit" host Marcus Lemonis explores California's marijuana industry boom.