- Online wellness brand Recess opens its first store, in New York.
- The company sells sparkling beverages infused with hemp extract.
- Founder Ben Witte says he has a much bigger vision for Recess beyond just drinks.
Recess is just the latest internet-born retailer to begin opening brick-and-mortar stores so customers can experience the brand, and buy its products, in real life.
The company, which markets itself as a wellness brand, sells sparkling beverages infused with hemp extract and L-theanine, in flavors such as blackberry chai, that promise to keep buyers "calm, cool and collected." The drink has been described as the "LaCroix of cannabis."
Recess hopes to tap into the seemingly booming market for CBD, short for cannabidiol. It's a compound found in the cannabis plant that promises to deliver the calming benefits of marijuana without the high that comes from THC. Most CBD is now federally legal thanks to the farm bill President Donald Trump signed in December. CBD is showing up in products from coffee and cocktails to skincare.
Founder and CEO Ben Witte tells CNBC the company shouldn't be written off as just a beverage business, as it plans to expand with other products. With its first store opening in New York on Wednesday, Recess is just getting started, he said. And though the company initially signed a lease for only a few months there, Witte said Recess will likely extend its stay. "It's a little bit of an experiment."
The "digital to bricks" movement is "just getting started," said Michael J. O'Neill, executive managing director of retail services at commercial real estate firm Cushman & Wakefield.
"I don't know if we are in the first inning but certainly in the early stages," O'Neill said. "Warby [Parker] and Bonobos were two pioneers in this category. As they began opening stores, some others followed. ... And now there is data to better serve this belief" that stores can play a huge role in customer acquisition.
With a check in the box in New York, Recess plans to head to Los Angeles for its second store. And Witte said the company is considering rolling out vending machines with its drinks across the country.
"In the future, we will also go much deeper into content," Witte said. "Think of us as more of a media company." He said the goal of Recess is to give adults outlets to be more productive and less anxious, something he said he noticed many people struggle with, as he did when he was creating the business.
Step inside Recess' neon-lit store, at 680 Broadway, and you'll find a number of ways to "chill out."
Not only are Recess' drinks for sale, but the company has planned community events in the space. There's a lounge area in the back where people can hang out.
"In this space I want you to feel like you are walking into Instagram ... or walking into a billboard," Witte said.
Recess has shunned traditional advertising, relying on Instagram and word of mouth on the internet to raise awareness about the brand.
The company has raised $3 million to date but hasn't disclosed its investors.
— CNBC's Angelica LaVito contributed to this report.