Cannabis delivered right to your door Prior to legalization, cannabis delivery was an important component of the illicit business model. California is one of the few legal cannabis states that allow cannabis to be delivered by licensed companies. Zachary Pitts CEO and Founder of Ganja Goddess joins Dan Humiston to talk about his expansion strategy which includes preparing for Amazon and Uber as potential competitors. Produce by PodCONX https://podconx.com/guests/zachary-pitts https://goddessdelivers.com/
Cannabis delivered right to your door
Prior to legalization, cannabis delivery was an important component of the illicit business model. California is one of the few legal cannabis states that allow cannabis to be delivered by licensed companies. Zachary Pitts CEO and Founder of Ganja Goddess joins Dan Humiston to talk about his expansion strategy which includes preparing for Amazon and Uber as potential competitors.
Ganja Goddess Investment information
https://podconx.com/guests/zachary-pitts
[00:00:00] Dan Humiston: Today in raising cannabis capital. We are joined by Zach pits, the CEO and founding partner of ganja goddess, Zach, welcome to the show.
Zach Pitts: Thank you for having me. I appreciate you having me.
Dan Humiston: I'm really excited to have you on the show today, you are in a cannabis sector that we don't have an opportunity to talk about very often because cannabis delivery services aren't available in all states. I thought to get things started. You could give us kind of a brief overview of how the cannabis delivery service works in California.
Zach Pitts: Sure. The traditionally in the illicit market cannabis and delivery, they're very closely tied. It's how a lot of people are used to getting their weed, getting it delivered. And so I think there's a long history of it. But it's definitely made regulators a little bit uncomfortable with it at the beginning.
But in California, luckily, we worked really hard to introduce the concept of legal cannabis being delivered. And so in California.
They've created a licensing system [00:01:00] where the state licenses. Delivery only as well as storefronts that do their own delivery.
Dan Humiston: I see you mentioned that the county, or the jurisdiction that you're in, provides a license, does that limit your expansion ability throughout the state or are you free to move into other jurisdictions?
Zach Pitts: Over the half of the state's population just doesn't have access , to retail cannabis locally. And I think something like 40 to 60% of municipalities aren't even licensing at all.
But as a delivery service, We are allowed to deliver to anyone the part of the prop 64 that legalized cannabis says that if you're over 21, anyone can buy cannabis. We're able to deliver anywhere in California right now.
And we do a schedule delivery and it doesn't matter if there's not a local storefront where you live, you can get it delivered.
Dan Humiston: That's huge. That's huge. Now, do you use like gig workers to deliver that or do you have your own [00:02:00] team of people that do the deliveries?
Zach Pitts: have our own team of people that does it, and that's actually required by the law and the regulations.
Dan Humiston: I'm assuming that the person that's getting the delivery needs to be present when the package is delivered so that you verify that. Okay. All right.
Zach Pitts: Yeah, delivery is actually one of the safer way. To retail cannabis because they're calling you or they're placing an order to a specific location.
They're sharing their ID. So they have to go through a lot of steps if they want to try to steal somethingthe drivers they're in unmarked cars, so , they're not going to be crimes of opportunity. And, there's a specific location That you can send the police to if someone tries to steal from you.
Also because of the pandemic, they've actually eased the restrictions . Now the regulatory authority, the BCC has allowed us to drop off the package at the door and from a distance verify that it's the person who ordered
Dan Humiston: Oh, that's okay. That makes
Zach Pitts: yeah.
[00:03:00] Dan Humiston: Now, like one more logistical question. Do you actually have to take ownership of the products and then store them? Or can you pick up the products from the dispensary and just deliver them?
Zach Pitts: Yeah.
, as a license holder, we have to have our own facility that has the products that we buy from distributors. And the distributors are basically taking it from the growers and the manufacturers, and then bringing it to them.
Dan Humiston: You briefly touched on the pandemic and I know you recently released a report on a poll that you conducted during the pandemic. How has cannabis consumer purchasing chain.
Zach Pitts: This is going to get into kind of some, high level discussion, that the entire economy has been moving over to e-commerce. Amazon has obviously decimated the big box stores but it starting to happen for smaller businesses as well, and it's happening across the board.
And so there's a movement to just. Of the convenience of the ease of the cheaper nature of [00:04:00] e-commerce to want to do it in everything. And it works in pretty much everything. And I think with smaller businesses and I think with cannabis as well, and I, to not to toot my own horn too much, but I think this is what we've really done is that people are still looking for that curation.
People are still looking for a lifestyle brand. And that can still work online and that can still work in narrow categories as opposed to broad categories like the Amazons and Walmarts. And the pandemic just pushed everyone where we were going anyway on a much faster schedule.
But then with cannabis as well, it was the perfect kind of thing to have delivered during the pandemic because, if you're anxious, if you're having trouble sleeping, if you're hanging out at home and bored and you can't go out to a bar, cannabis is perfect for that.
Dan Humiston: I didn't even think about this earlier, but man, that pandemic. It hurts so many people, but there are businesses like yours that, that, you're in the right place at the right time. , you [00:05:00] mentioned something earlier about Amazon and I guess as an investor, I'd have to ask you about the elephant in the room.
If the big boys like Uber and Amazon get into the cannabis delivery system, how do you compete?
I think
Zach Pitts: right now cannabis has thousands of small businesses and in any market there's going to be mergers and acquisitions. There's going to be consolidation into larger and larger players. And that doesn't mean there isn't still space, and you still have small liquor stores. For instance, you still have small groceries.
But those huge companies are going to come in. The question is how do you position yourself to either continue to survive in that world? Or how do you position yourself to be the introduction to that world for those huge companies? So , we want to be there in a year or two or three or four when federal legalization happens that we're perfectly oriented for [00:06:00] whena company with billions and billions of dollars comes in and is I want to figure out how to do this.
Let's get you. You can go.
Yeah. Yeah.
So you have to have an exit strategy. And sometimes that exit strategy is taking advantage of the big businesses coming in. But some of it is also, recognizing, there's a lot of hullabaloo over Uber's CEO talking about. Yeah.
We could, cannabis is something we could deliver, but that's just someone talking.
That's just someone not recognizing, the entire model of. Isn't allowed under any regulatory framework, so sure they could come in and they could have to completely redefine how they do delivery because they, you can't do gig. It's not allowed in any state to do gig workers on delivery.
Dan Humiston: Yeah. A lot of very successful people from other industries have learned quickly how unsuccessful they are in the cannabis industry, because it's, everything is different.
That's a funny that you mentioned that because a lot of [00:07:00] the early investment in a lot of the early startups in cannabis in California, they treated the companies like tech companies.
And that was their first mistake where cannabis, you have a physical product in the, at the end of the day, it's a logistical business. It's not a software business, in a tech company, you can spend lots of money, build the software, and then you don't have a lot of costs. To sell that software or that service or whatever with cannabis it's not the opposite, you have a product that you physically have to make or sell.
Zach Pitts: And so you can't burn through the capital in the same way.
Yeah. , like I said, a lot of , very successful people got their lunch handed to them in the cannabis industry already. And they continue to, you mentioned that you're raising capitalare you using the capital for expansion? Can you tell us a little bit more about your current race?
Sure. We're able to deliver everywhere in California and we don't compete on speed of delivery. We do scheduled next day deliveries. But we cover the entirety of California, including all those areas that don't have.
[00:08:00] Retail access or, the suburbs that might have a lot of people interested in cannabis, maybe they only have one shop and they don't really like that shop that much. And then we're a lifestyle brand and this is really where my partner comes in is she's in an older woman and she's not part of the traditional . Pop bro lifestyle. . She wants to see, cannabis represented as part of being healthy and part of being happy of having fun , she wants to see it appeal to her as a woman, not a 20 year old man. We really tried to capture that and create a platform that is familiar to people who are used to normal econ that, really takes those consumers who are interested, but not as Experience in cannabis and bring them into the market because right now, it ranges between like 15 to 20% of the population in legal states uses cannabis and it can be a lot bigger.
And I think the rest of the people, they just need that introduction. And once they get that instruction, they're very loyal. And I've been speaking a lot. I'm sorry, [00:09:00] without quite answering your question.
. All of our growth has been largely through some basic SEO and word of mouth. And we've had tremendous growth that way, but we've spent maybe two or 3% of revenue on advertising and so we want to expand the people that we're reaching.
We want to do like actual advertising campaigns. We want to expand to other states. We know that our model works here in California and we know to work in other states. And so we've had those preliminary discussions and we could do all of these things on our own, but we know with investment, we can do it faster.
We can be grow that much faster and be that much more ready when federal legalization happens. And when that larger push of burden and acquisitions happen.
I think that's a good strategy. I think that's a good strategy. Yeah. And for investors we will have all of Zach's information and ganja goddess information in the show notes. And if you're a [00:10:00] consumer and you want to have your cannabis delivered to your door next day you can just click the link and place your order directly .
Dan Humiston: Zach, I appreciate you being on the show today. This was a lot of fun, good stuff,
Zach Pitts: it was a good conversation. Thank you.