WEBVTT - Growing a Weed Business

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<v Speaker 1>Pushkin. I'm Jacob Goldstein and this is What's Your Problem,

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<v Speaker 1>the show where entrepreneurs and engineers talk about the world

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<v Speaker 1>they're going to build once they solve a few problems.

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<v Speaker 1>My guests today are Raft and Joy Hollingsworth, the brother

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<v Speaker 1>and sister team that runs the Hollingsworth Cannabis Company aka

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<v Speaker 1>thhc Co. Joy and Raft run a farm in Washington

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<v Speaker 1>State where they grow and sell about six hundred thousand

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<v Speaker 1>dollars of marijuana a YEurope. Their problem, how do you

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<v Speaker 1>help more black people get into the legal weed business.

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<v Speaker 1>They've been working on this problem for a long time.

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<v Speaker 1>It started about a decade ago, right after Washington State

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<v Speaker 1>legalized recreational marijuana, and Joy and Raft decided to start

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<v Speaker 1>their own farm from scratch in rural Washington State, despite

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<v Speaker 1>having lived their whole lives in downtown Seattle at the time.

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<v Speaker 1>Their dad had just retired after a career at the

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<v Speaker 1>Seattle Parks Department, and he put up a big chunk

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<v Speaker 1>of his retirement savings to fund the farm. Joy and

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<v Speaker 1>Ralf told me, like a lot of entrepreneurs when they

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<v Speaker 1>started out, they really didn't know what they were doing.

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<v Speaker 1>You got to be a little crazy. You know how

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<v Speaker 1>they say entrepreneurs, you jump off a cliff and you're

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<v Speaker 1>going to figure out how to build your plane on

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<v Speaker 1>the way down. That's what it kind of felt like. Yeah,

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<v Speaker 1>and who started driving out found the property on Craigslist.

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<v Speaker 1>It was six acre plot of land in Mason County.

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<v Speaker 1>You know, we see this land, we like it. I say,

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<v Speaker 1>I'll take it. And the real estate agent, Larry at

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<v Speaker 1>the time, said, okay, we'll meet me at the Mason

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<v Speaker 1>County Title Office. Okay, great, Larry. So we go down

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<v Speaker 1>there and I had a Safeway bag, like a paper

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<v Speaker 1>bag full of cash. Oh my god, we're gonna pay

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<v Speaker 1>for this land. And we were so like EVA at

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<v Speaker 1>the time, we didn't want to tell anybody our plans.

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<v Speaker 1>What are these two black eyes from Seattle want with

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<v Speaker 1>six acres off of this private dirt road by the prison?

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<v Speaker 1>What do they want? It was ridiculous in hindsight, But

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<v Speaker 1>I mean, you're telling it as as funny, right, But like,

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<v Speaker 1>were there any other black people there? Was that scary?

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<v Speaker 1>Was it fine? Like? How was that part of that?

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<v Speaker 1>There's no other black people out there? And the neighbors

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<v Speaker 1>have been really nice to us to this day. They've

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<v Speaker 1>been great stewarts as neighbors, and so how did you

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<v Speaker 1>get from there to hear? Right? So you got your farm,

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<v Speaker 1>you get to know the neighbors. Kaus. It was chaotic.

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<v Speaker 1>We had a fence, we had cameras, we had a

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<v Speaker 1>couple of buildings, but the rest was just we're in

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<v Speaker 1>the open field. We don't really know what's going on.

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<v Speaker 1>We're gonna grow plants. We're gonna not only we're gonna

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<v Speaker 1>grow plants, We're gonna grow four thousand plants in the dirt.

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<v Speaker 1>We buy dirt from this guy down the road because

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<v Speaker 1>we heard from a friend that he has good dirt.

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<v Speaker 1>And it's like landscaping there. It's not even dirt you grow.

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<v Speaker 1>We like plants. It so like you bought the wrong dirt.

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<v Speaker 1>You bought the wrong dirt. Yeah, that sounds like a problem.

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<v Speaker 1>This guy would be like seven thousand dollars. It was

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<v Speaker 1>a problem. I mean, there was just so many different things.

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<v Speaker 1>We're freaking out. I moved to the farm. I'm living

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<v Speaker 1>in the construction trailer that we have, you know, put

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<v Speaker 1>on the farm as our office space. I'm sleeping in

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<v Speaker 1>the office. We hire a guy on um Craigslist. We

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<v Speaker 1>hire everybody that first year from Joy tell me, Yeah,

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<v Speaker 1>it's been all Rafts so far. Tell me what what

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<v Speaker 1>listening to? Yeah, No, I'm I'm sorry. We're still on

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<v Speaker 1>year one and I think you want to get from

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<v Speaker 1>year one now, So Joy, you pick up the story here. No,

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<v Speaker 1>I love it, but Joy, you pick up the story.

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<v Speaker 1>Get me over the next nine years. Here. I'm listening

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<v Speaker 1>to year one right now, Jacob, and I'm like, bro,

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<v Speaker 1>we'll get us to twenty twenty one. Lad. Hey, Joy,

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<v Speaker 1>you got it, you got it. Joy, this is your moment.

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<v Speaker 1>I want to hear you're good. I'm sorry, No, I

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<v Speaker 1>mean it. I mean it. Joy, you tell me the

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<v Speaker 1>story of the next nine years. Raff is right. It

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<v Speaker 1>was such a learning piece and a learning curve with everything,

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<v Speaker 1>and it felt like an experiment for year one, and

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<v Speaker 1>we didn't know what we were doing wrong. We just

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<v Speaker 1>kind of like it just felt like it was this

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<v Speaker 1>whole entire thing of solving problems one after the other.

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<v Speaker 1>So every year it felt like we got better. It

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<v Speaker 1>just kept continuing to get better and better until that

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<v Speaker 1>moment right in twenty seventeen, which I think switched us

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<v Speaker 1>when we were on and got to have dinner with

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<v Speaker 1>Anthony Bourdain and crew. And that was really the year

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<v Speaker 1>that really, you know, put us on the map for

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<v Speaker 1>so many different reasons. And just to be clear, here,

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<v Speaker 1>a producer for Anthony Bourdain's CNN show read an article

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<v Speaker 1>about your farm in a in a Seattle newspaper and

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<v Speaker 1>then like a month later there's a TV crew filming

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<v Speaker 1>you at the farm and you're having dinner with Anthony

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<v Speaker 1>Bourdaine and you wind up on his show on CNN.

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<v Speaker 1>What does that do for your business? Right after that show,

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<v Speaker 1>all these people hit us up and said, hey, we'd

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<v Speaker 1>love to buy your product. Can you ship us a pound?

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<v Speaker 1>I live in Texas, I live in California. It's like, no,

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<v Speaker 1>that's actually illegal. We can't do that. And so it's

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<v Speaker 1>hard to monetize that piece when you can't be close

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<v Speaker 1>to the consumer. But on that branding piece, absolutely absolutely,

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<v Speaker 1>it gave us a lot of credibility in spaces that

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<v Speaker 1>we weren't really we didn't know existed. So let's just

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<v Speaker 1>talk about the business today, like sort of what it is,

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<v Speaker 1>how it works. I pulled it up on Google Maps

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<v Speaker 1>on the like satellite images one. If you just Google map,

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<v Speaker 1>Hollingsworth cannabis company. It comes up and like I'm zooming in.

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<v Speaker 1>But first of all, it is clearly like way out

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<v Speaker 1>in the middle of nowhere, right, it's just trees and

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<v Speaker 1>farms and what is that maybe a creek all around.

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<v Speaker 1>But if I zoom in more like I can actually

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<v Speaker 1>see like it looks like mostly greenhouses and that's where

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<v Speaker 1>you grow the weed, grow the cannabis. Correct. So we

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<v Speaker 1>have eight greenhouses. We have three shipping containers, and we

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<v Speaker 1>just modify them to the buildings like wired and with doors.

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<v Speaker 1>So there, I mean they feel like you know, steel

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<v Speaker 1>frame buildings. But then we have a converted construction trailer

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<v Speaker 1>and that's where we do all the processing and it's renovated, hardwood,

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<v Speaker 1>floors is painted. It's nice. Tell me about the plants.

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<v Speaker 1>They're living, breathing beings. They are very much alive, and

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<v Speaker 1>at one point in time we'll have two thousand, one

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<v Speaker 1>hundred plants alive growing and it's like it's a symphony.

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<v Speaker 1>It's beautiful and they're very resilient too. A plant can

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<v Speaker 1>look a hot mess one week, give it a little nutrient,

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<v Speaker 1>little sunlight and figure out what's wrong, and it looks

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<v Speaker 1>like a million dollars the next week, so they bounce

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<v Speaker 1>back really fast, and like Raft said, they're actually living

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<v Speaker 1>and breathing organism. We play the music. What music do

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<v Speaker 1>you played? The plans? It was like two straight weeks

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<v Speaker 1>he was playing gospel music and I was like, oh,

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<v Speaker 1>he's going through something right now, no please, okay. And

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<v Speaker 1>then the next day he's playing just you know, some

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<v Speaker 1>nil soul music. Now he's good. So it just really depends. Okay,

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<v Speaker 1>are you okay? Raft? You came through it, Okay, Yeah,

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<v Speaker 1>that's accurate. How like, how is the business doing? Like

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<v Speaker 1>is your dad's life savings safe? Yeah? When we started,

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<v Speaker 1>our first order was for two thousand dollars and it

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<v Speaker 1>took that joy way to take us three weeks to Yeah,

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<v Speaker 1>it was three weeks to process it. That's not a

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<v Speaker 1>living between four people, not going to make a living

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<v Speaker 1>that way. So how about now we could probably get

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<v Speaker 1>a two thousand worder out in like a day, maybe

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<v Speaker 1>less right the same day annually more or less. How

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<v Speaker 1>much do you sell? About five to six hundred thousand

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<v Speaker 1>dollars wholesale? Okay in marijuana which was quatest like twelve

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<v Speaker 1>hundred pounds, and that's that's grown and sold grows, right,

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<v Speaker 1>so that minus your costs is your profit exactly. And

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<v Speaker 1>so there are people in Washington who sell millions of

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<v Speaker 1>dollars a year certainly, right, million dollars a month? Yeah?

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<v Speaker 1>Oh wow? Okay, So how do you compete? Man? I

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<v Speaker 1>feel like this is like small business lessons here, like

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<v Speaker 1>how do you compete against a business that's more than

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<v Speaker 1>ten times your size? Joy? How do we compete with business? Like?

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<v Speaker 1>We really have to focus on our brand, what we

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<v Speaker 1>do better than anyone else? You ask Joy, but then

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<v Speaker 1>you answered Joy, how do you compete? There's a demographic

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<v Speaker 1>and people they want cheap weed, people like going to

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<v Speaker 1>Walmart and Costco. But there are people that really value

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<v Speaker 1>knowing who grew their weed, who grew their weed, how

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<v Speaker 1>did they grow it? And then when you can connect

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<v Speaker 1>to the consumer with that via Instagram, online story connecting,

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<v Speaker 1>building relationships, then they feel like, you know what, I

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<v Speaker 1>want to be connected to them and I want to

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<v Speaker 1>support them. I want to support this black business, this

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<v Speaker 1>family owned and operated business. And a lot of people

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<v Speaker 1>have told us they see their family in us. Every

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<v Speaker 1>time they look at us, are like, you remind me

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<v Speaker 1>of my sister or my mom. Is or I love

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<v Speaker 1>your mom, she's smokes, she's really funny. Or your grandmother

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<v Speaker 1>she's one hundred and one, I love her. We connect

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<v Speaker 1>people on that family piece, and that's really huge. You

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<v Speaker 1>mentioned your mom and your hundred and one year old grandmother.

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<v Speaker 1>Are they part of the business. They certainly consume part

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<v Speaker 1>of the business. They're part of the cost side of

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<v Speaker 1>the revenue side. Yeah, my mom's a designated tester. You know,

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<v Speaker 1>we have name tax for everybody, and that's her title.

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<v Speaker 1>My kids want to grow up to be ice cream testers.

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<v Speaker 1>I feel like your mom really hit the jackpot on

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<v Speaker 1>that one too. After the break, the problem Joy and

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<v Speaker 1>Wrapped are working on now, how do you help more

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<v Speaker 1>black people get into the weed business. That's the end

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<v Speaker 1>of the ads. Now we're going back to the show.

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<v Speaker 1>Back before weed was legal or quasi legal whatever it

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<v Speaker 1>is now in America, black people made up a disproportionate

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<v Speaker 1>share of the people arrested on marijuana related charges. Now

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<v Speaker 1>that weed is legal or quasi legal, black people are

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<v Speaker 1>underrepresented in the marijuana industry and this is a problem

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<v Speaker 1>that Joy and Raft are working on now. We wanted

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<v Speaker 1>to use our platform of being one of the only

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<v Speaker 1>black farmers in the SATA Washington. Not the only, but

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<v Speaker 1>one of the few to use our platform to help

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<v Speaker 1>bring attention and awareness to that. Did I read raft

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<v Speaker 1>that you were on some kind of a state committee

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<v Speaker 1>that recently changed a rule that was keeping people out

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<v Speaker 1>of the legal weed business. Yeah. One of the things

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<v Speaker 1>that we talked about, amongst a million other things, was

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<v Speaker 1>this rule that the Liquoring Cannabis Board had that would

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<v Speaker 1>disqualify you from owning a marijuana business essentially if you

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<v Speaker 1>had a non violent drug offense conviction or charge in

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<v Speaker 1>your past. And they changed that rule finally, which is

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<v Speaker 1>a step in the right direction, but it is not enough.

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<v Speaker 1>And you've also worked on this Washington state law that's

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<v Speaker 1>addressing some of these some of these social issues. Right.

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<v Speaker 1>We helped, you know, draft the bill. Connect with people

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<v Speaker 1>will help lobby the bill. We were out there testifying.

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<v Speaker 1>It was a big heavy lift and it passed. Yeah,

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<v Speaker 1>we can't take all the credit for it, it was

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<v Speaker 1>It was definitely a community push. And the biggest piece

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<v Speaker 1>is Washington brings in over They've brought in over the

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<v Speaker 1>last two years over a billion dollars in tax revenue,

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<v Speaker 1>and so a lot of those funds. We have been

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<v Speaker 1>using our platform to try to get those back into neighborhoods,

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<v Speaker 1>which is important. And how this, you know, how amazing

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<v Speaker 1>would it be that these neighborhoods that were torn up

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<v Speaker 1>by the War on drugs, affected poverty, homelessness could go

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<v Speaker 1>back into those communities from cannabis tax dollars and continue

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<v Speaker 1>to repair those communities with those tax dollars that were generated.

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<v Speaker 1>I think that is really the goal. And Jacob I

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<v Speaker 1>just want to give a shout out because yesterday the

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<v Speaker 1>governor came out with his proposed budget and it allocated

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<v Speaker 1>one hundred and twenty five million dollars for disfortunately impacted

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<v Speaker 1>groups community reinvestment from the cannabis tax dollars. I mean,

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<v Speaker 1>that's a huge The effects of the bill are going

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<v Speaker 1>to be felt for generations. Great. So people are sort

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<v Speaker 1>of talking about this idea that marijuana might be legalized

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<v Speaker 1>at the federal level. Right right now, clearly you're operating

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<v Speaker 1>and you know under all these state rules. What would

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<v Speaker 1>it mean for your business if we were just legal

0:12:52.676 --> 0:12:57.356
<v Speaker 1>in America? Oh my goodness, what would it mean? Itould

0:12:57.396 --> 0:13:00.716
<v Speaker 1>be amazing. You know, right now, we grow twelve hundred

0:13:00.716 --> 0:13:04.796
<v Speaker 1>pounds to fifteen hundred pounds depending on the weather of marijuana,

0:13:05.636 --> 0:13:07.916
<v Speaker 1>you know street, if that was marijuana we can sell

0:13:07.956 --> 0:13:13.756
<v Speaker 1>directly took the consumer, I can imagine. I mean, look,

0:13:13.836 --> 0:13:16.556
<v Speaker 1>a thousand pounds convention has kind of put that at

0:13:16.556 --> 0:13:19.676
<v Speaker 1>ten dollars a gram, one pounds, four hundred and fifty

0:13:19.716 --> 0:13:22.276
<v Speaker 1>four grams, you're talking about forty five hundred dollars a pound.

0:13:22.636 --> 0:13:27.196
<v Speaker 1>If we could produce four to five million dollars in marijuana,

0:13:27.436 --> 0:13:30.676
<v Speaker 1>actually six million dollars in marijuana every year, it would

0:13:30.716 --> 0:13:33.956
<v Speaker 1>change dramatically. Would it also mean you would have to

0:13:33.996 --> 0:13:38.516
<v Speaker 1>compete against you know, these giant even in some cases

0:13:38.556 --> 0:13:41.596
<v Speaker 1>publicly traded weed companies that have been kind of building

0:13:41.636 --> 0:13:44.236
<v Speaker 1>up in Canada and waiting to like sweep into the

0:13:44.316 --> 0:13:48.476
<v Speaker 1>US when marijuana is legalized here. Yeah, I think we would.

0:13:48.716 --> 0:13:50.436
<v Speaker 1>But at the end of the day, everyone has to

0:13:50.516 --> 0:13:55.556
<v Speaker 1>grow the plan. We focused on efficiency in growing it

0:13:55.796 --> 0:13:59.436
<v Speaker 1>for an environmentally friendly impact. You know, we grow for

0:13:59.556 --> 0:14:02.236
<v Speaker 1>nine dollars a day in power, and I don't think

0:14:02.236 --> 0:14:04.756
<v Speaker 1>anybody really can compete with that in terms of price

0:14:05.116 --> 0:14:09.116
<v Speaker 1>in economies of scale. Now, obviously people can produce more

0:14:09.196 --> 0:14:13.116
<v Speaker 1>or marijuana, but I think what we offer that those

0:14:13.156 --> 0:14:18.796
<v Speaker 1>other companies don't. It's just that authentic, lovingly produced product

0:14:19.396 --> 0:14:24.236
<v Speaker 1>that corporate marijuana really can't replicate at that scale. It's

0:14:24.316 --> 0:14:27.876
<v Speaker 1>like craft beer your craft weed. That's exactly right. We

0:14:27.916 --> 0:14:29.796
<v Speaker 1>don't produce a lot of it, but what we do produce,

0:14:29.836 --> 0:14:33.476
<v Speaker 1>we produce it, you know, with love and attention and

0:14:33.636 --> 0:14:36.556
<v Speaker 1>dedication and service. And we really care about what you

0:14:37.036 --> 0:14:39.316
<v Speaker 1>experience when you use our product because we put our

0:14:39.436 --> 0:14:43.116
<v Speaker 1>name on you know, so basically you can't wait until

0:14:43.196 --> 0:14:45.916
<v Speaker 1>we It is just legal in America, Me and everybody

0:14:45.916 --> 0:14:51.836
<v Speaker 1>else in a minute, the Lightning Round, including Joy and

0:14:51.956 --> 0:14:54.876
<v Speaker 1>Rap's favorite things to do when they smoke, and the

0:14:54.956 --> 0:15:04.076
<v Speaker 1>best and worst things about working with your family. Okay,

0:15:04.116 --> 0:15:06.236
<v Speaker 1>let's get back to the show. We're going to close

0:15:06.236 --> 0:15:08.636
<v Speaker 1>with the Lightning Round. Are you ready? I want you

0:15:08.636 --> 0:15:11.316
<v Speaker 1>guys both to answer. We can interrupt each other, you

0:15:11.356 --> 0:15:15.076
<v Speaker 1>can talk over each other, but I want everybody on

0:15:15.116 --> 0:15:19.036
<v Speaker 1>this one. What's your favorite thing about working with your family?

0:15:19.836 --> 0:15:25.276
<v Speaker 1>You can't get fired. You spending time with my dad

0:15:25.276 --> 0:15:28.036
<v Speaker 1>and my sister and my mom. What's your least favorite

0:15:28.076 --> 0:15:31.156
<v Speaker 1>thing about working with your family? Same answer, Joy, Yeah,

0:15:31.236 --> 0:15:34.476
<v Speaker 1>the same. I can't fire rafts if we have a problem.

0:15:34.516 --> 0:15:39.116
<v Speaker 1>I can't fire him the same answer. I don't want

0:15:39.156 --> 0:15:41.236
<v Speaker 1>to presume that you guys smoke weed. But if you

0:15:41.316 --> 0:15:43.916
<v Speaker 1>do smoke weed, what's your favorite thing to do when

0:15:43.916 --> 0:15:45.956
<v Speaker 1>you smoke? I smoke before I go to bed. My

0:15:46.036 --> 0:15:50.676
<v Speaker 1>favorite thing to do is to sleep. I don't smoke.

0:15:50.716 --> 0:15:53.116
<v Speaker 1>I'll take some edibles, and then I like to do

0:15:53.156 --> 0:15:56.556
<v Speaker 1>design stuff, so, like, you know, some high level stuff

0:15:56.596 --> 0:15:58.716
<v Speaker 1>because it makes me super creative. So it might be

0:15:58.756 --> 0:16:01.236
<v Speaker 1>the website, might be some cool pictures, might be a

0:16:01.316 --> 0:16:04.956
<v Speaker 1>label design, might be some inspiration that type of thing.

0:16:05.396 --> 0:16:07.876
<v Speaker 1>So your answer is work joy your favorite thing to

0:16:07.876 --> 0:16:10.556
<v Speaker 1>do when you get highest work? Yeah, isn't that crazy?

0:16:10.916 --> 0:16:13.396
<v Speaker 1>It's okay, No, it's great. If you have just like

0:16:13.436 --> 0:16:15.436
<v Speaker 1>a ten minute break in the middle of the day,

0:16:15.476 --> 0:16:18.836
<v Speaker 1>what do you do to relax? I watch unintentional as

0:16:18.956 --> 0:16:23.716
<v Speaker 1>mr videos on YouTube, especially the medical variety. It's my favorite. Well,

0:16:23.716 --> 0:16:27.956
<v Speaker 1>like doctors just sort of like rustling little like plastic

0:16:28.036 --> 0:16:31.756
<v Speaker 1>rappers as they're doing a surgery or something. Yeah, oh,

0:16:31.796 --> 0:16:33.876
<v Speaker 1>you know, my favorite thing is the lymph node check.

0:16:34.036 --> 0:16:37.116
<v Speaker 1>I'll watch a compilation of that. Did they just like

0:16:37.156 --> 0:16:39.916
<v Speaker 1>gently touch your lymph nodes around your neck and clavical

0:16:40.076 --> 0:16:45.596
<v Speaker 1>do you, guys think you'll work on the farm forever? No,

0:16:45.996 --> 0:16:48.476
<v Speaker 1>probably not. How will you know when it's time to

0:16:48.516 --> 0:16:52.116
<v Speaker 1>go do something else? When I do not love going

0:16:52.796 --> 0:16:58.236
<v Speaker 1>to grow plants, there's still that like just pure amazement

0:16:58.636 --> 0:17:00.956
<v Speaker 1>at the growth a week over week where I'm just

0:17:01.236 --> 0:17:04.156
<v Speaker 1>I'm enthralled like a little kid. Great. Thanks so much

0:17:04.196 --> 0:17:05.796
<v Speaker 1>to both of you for your time, Thanks for talking

0:17:05.796 --> 0:17:07.756
<v Speaker 1>to me. Thank you guys so much for thinking of us.

0:17:07.756 --> 0:17:13.236
<v Speaker 1>Really yeah, it's great. Thank you, Thank you guys. Joy

0:17:13.316 --> 0:17:17.356
<v Speaker 1>and Ralph Hollingsworth run the Hollingsworth Cannabis Company phc CO.

0:17:18.356 --> 0:17:21.236
<v Speaker 1>Today's show was produced by Edith Russolo. It was edited

0:17:21.276 --> 0:17:24.876
<v Speaker 1>by Robert Smith and Kate Parkinson Morgan and engineered by

0:17:24.876 --> 0:17:27.996
<v Speaker 1>Amanda ka Wong. I'm Jacob Goldstein and I'll be back

0:17:28.036 --> 0:17:38.076
<v Speaker 1>next week with another episode of What's Your Problem.