Jun 20 2016 . 15 min read
Elevating the Conversation with Mitchell Britten
Elevating the Conversation with Mitchell Britten
Mitchell Britten, founder and CEO of two THRIVE Cannabis Marketplace dispensaries in Southern Nevada, as well as a North Las Vegas growing facility, worked in Colorado’s cannabis industry from 2009-2014, making him a virtual veteran in the industry. When Britten started his cannabis journey in 2009 for a Colorado company, it had a single store, a 5,000-square-foot grow, and a staff of 30 people. By the time Britten left the company in 2014, he was managing 13 stores, 550 employees, and $40 million a year in sales. With regard to his experience in the space, Elevate was curious to find out how the cannabis industries differed between Colorado and Nevada.
It was a little bit of an accident, I was just finishing up school at Metro State University in Denver and I met somebody where I worked who owned a cannabis company and he recruited me to run one of his retail stores and the rest just kind of happened organically. I was studying Modern Philosophy and philosophy guys think outside of the box and this is definitely outside of the box. I am from a family of lawyers so I intended to go into law but the marijuana thing was just so hot and it was just beginning in Colorado, this was late 2008. I was a little uncertain as to whether I was going to do it or not but he was so persistent in trying to get me to come and work for him that I finally just bit the bullet and did it and it worked out. When I first started with the company we were a single store, a small grove of just over 5,000 square feet and the staff that goes along with that which is 25 or 30 people. By the time I left, we were 13 stores, 550 employees, a 3,600-flowering light grow and when I left the company I was Director of Operations. I kind of climbed all the way through the ranks and saw the business from its infancy to pretty much what it is now. That company represented $40 million a year in sales and about 35,000 lbs grown a year. It was serious business. It was my Ph.D. in marijuana. We did everything imaginable the wrong way; for me, learning from my mistakes is my biggest value-add. There are so many mistakes people repeatedly make in the industry. I always say I will make plenty of mistakes, I just won’t make the same ones again. From 2009 to 2013 in Colorado we made $20-million-plus dollars in mistakes -- whether it was improper design of HVAC system implementation in the cultivation facility or designing dispensaries, hiring or just methods or standard operating procedures -- that kind of give me a little bit of a leg up as far as my competition is concerned. My learning curve is just a little lower.
I was a retail store manager. I didn’t know anything about marijuana but I knew how to talk to people and sell products and manage cash. The similarities between medical marijuana and restaurants are huge. You have a product that in most cases can be looked at almost like a deli. You have got a product that starts going bad the minute you open the package and it loses moisture and it loses appeal. If you were to think of cannabis as deli meat, it sounds really funny, but the second you open that bag your product starts degrading. As for people who work in the restaurant industry, the servers and bartenders, the similarities and crossovers are huge.
When we were writing our applications, Vegas was kind of looked at as the holy grail of the cannabis industry. You just look at what the city is founded on -- the city lends itself very nicely to everything that’s going on in the marijuana industry. If it gets to the recreational model things will be very interesting here. This is the only place I have ever traveled to where people are okay spending $15 for a bottle of water at a pool or a $1,000 dollars for a bottle of vodka. If those kind of inflated prices carry over to this industry, I think Vegas could hold the highest gram price in the nation -- making it a really profitable place to compete in the marijuana space.
You can kind of compare all these markets against one another. But what you get with every new market and every new state that opens and writes thoughtful regulation is that they have all of the other previous markets to look back on and talk with regulators and figure out what worked and what didn’t work. I think Nevada did a really good job, better than anywhere else in my opinion, on really putting thoughtful regulations together. There are so many things that work in certain spaces and don’t work in others and I think that Nevada did a really good job of navigating it and coming up with their own version of what’s important like figuring who can and can’t operate in the space. I think if you compare Colorado to Nevada, Nevada just learned from all of Colorado’s mistakes. So the state definitely has got a leg up and the regulators in my opinion are far more advanced out here. They are used to dealing with complex industries, like gaming, nothing is more confusing than gaming, where they are finding an audit trail for cash and things like that. If anybody has the wherewithal to do it, it’s Nevada in my opinion.
No, we didn’t. Originally when I came into the space in Colorado lab testing wasn’t mandated. A lot of things weren’t known to the consumer like what they were putting on their product. As I was leaving Colorado that’s when lab testing was being mandated and they are just kind of wrapping their hands around it. I think I was the first store that came to market out here that we don’t price any of our products based on THC content. The Nevada consumers were trained early on that that’s how the market was going to go. To me, some of my favorite strains have historically tested at 13, 15, 17 percent THC. You can get very high prices for those in markets like Colorado and Los Angeles so I just don’t think it’s the right model to charge patients based on THC. I compare it to alcohol, you don’t always go and order EverClear just because it’s 180-proof. Most people like to have a glass of wine and will pay more for a glass of wine that’s 13 percent alcohol versus something like Everclear or vodka. I do think the entire industry will shift more towards exactly what the consumer wants, it won’t be driven by THC or CBD really. It will be the strains everyone is looking for. It’s not necessarily that this strain is 13 percent, it will be that this strain tastes good and makes me feel good and it was exactly what I was looking for. Not everybody in the market is out to get high and I think that is a really big misconception that everybody who smokes pot is looking to get high -- that just couldn’t be further from the truth.
It didn’t really change anything. My core values are growing affordable and incredibly safe medical cannabis so the lab testing to me is not a barrier of entry. It’s more of an accountability practice where patients can hold these companies accountable to safe and sustainable cultivation methods. For people who aren’t willing to go the extra mile to have good product, you aren’t going to compete in the space.
The first thing I am bringing to Nevada is changing the pricing model that everybody is accustomed to paying for THC. If you look at my location in North Las Vegas, for instance, you look at the menu and something that’s priced on our top shelf is a much lower THC or could be priced much lower than something that has high THC and I think that’s going to be my number one difference. Plus, having done this in Colorado and the scale to which we did it, I will probably be able to bring some of the cheapest product to market. So it’s really cost of goods. From a scalability aspect, having grown and processed 35,000 lbs. a year, the methods that we are cultivating are sound and very scalable.
I think Nevada has already learned everything there is to learn from Colorado. The way everybody looks at Nevada is kind of as the next frontier. With that being the case, the cultivators and operators out here have decided to come to Nevada to operate. That’s a really cool and unique opportunity for all of us because it’s the one place where the best cultivators and the best operators from across the United States are coming to operate so it makes it a little bit more of a competitive environment and it makes it more fun for me.
In my opinion, we bring one other thing -- when Nevada issued the licenses, somewhere near 200 for cultivation facilities and mid-60s for dispensaries -- I wanted to build a model that was not my dispensary. Branding our stores as cannabis marketplaces was really important to me. This way we can position ourselves to be the storefront for the cultivators who didn’t get storefronts. I came here to be a one-stop shop and that doesn’t include just selling my product. My product will probably only meet about 30 to 40 percent of our customers’ demands so I am looking for that other 70 percent of product so patients know they are coming into THRIVE and they can get the top cultivators and products and they don’t have to go anyplace else. It’s something different, being that storefront for those who don’t have one is important for building relationships and it’s important for making sure the patients have really easy access to the medication that they need. I am a creature of habit so stepping outside of my comfort zone of being vertically integrated was difficult, but it just made sense with the way these licenses were awarded. If you didn’t, in my opinion, you are not doing it properly.
I have been hearing about that one topic since I started in the industry. That’s what everybody wanted to have happen. It would be great, I think it would bring in a new set of challenges that aren’t necessarily good or bad. I think there are upsides and downsides to the possibility of rescheduling. I will believe it when I see it. I would encourage it. I think that comes up to this whole idea of when the industry started out of the backwoods of California and with a lot of illicit black market products. A lot of people who don’t want to jump through the regulatory loops are not going to be in favor of adding to the compliance load but the way that I look at my job in this industry is that it has very little to do with marijuana and it has everything to do with compliance. And so people who share that same viewpoint will succeed if it is rescheduled because it’s a necessity to our industry and people who are willing to get on board will do a great job and those that don’t want to deal with all of the red tape won’t do so well.
I think reciprocity is incredible. It has never really been done before. I think it has its sets of challenges and issues but I do think it’s a really interesting thing that they decided to do. There‘s a lot of medical patients who come to visit Vegas and flying on an airplane with your medicine that is federally illegal is an interesting issue. It doesn’t have a right or wrong answer. You hear from a lot of people who travel with theirs all the time but, to me, I wouldn’t take that risk. But a lot of people do and Vegas gives you that opportunity to not take that unnecessary risk of traveling with your illicit medicine.
It’s shaped up to be a lot more emotional of an industry than I thought it was going to be. Sometimes you are dealing with people who are using it for chronic pain and of those chronic pain users some of them choose to go down that avenue as a way to get licensed and smoke cannabis for recreational purposes and be protected under medical laws. But then there are the other people, the 10 or 15 percent of the chronic pain users, who are using if for awful withdrawals from drugs or helping them stimulate their appetite from chemo. Some of those stories get really emotional. You get attached to cancer patients who come in daily and when they stop coming in it’s usually because they have passed away. I have been invited to more funerals in this industry than anybody probably gets invited to in a lifetime. It’s all because these families see you as this support system that’s been helping their loved ones. But usually by the time they turn to cannabis, oftentimes it’s too late, so it’s less about a cure and more about end-of-life comfort. That to me has been the most surprising thing. I didn’t anticipate getting attached to people and watching them fight for their life.