Blow out the candle then smoke it. Michael Scherr created Higher Celebrations to help people enjoy special occasions with cannabis. His breakthrough product, Birthjay gained enormous media attention. He joins Dan Humiston to talk about his pipeline of products, raising capital and becoming the Hallmark of cannabis. Produced by PodConx MJBulls - https://podconx.com/podcasts/raising-cannabis-capital Dan Humiston - https://podconx.com/guests/dan-humiston Birthjays - https://www.birthjays.com/ Michael Scherr - https://www.linkedin.com/in/michael-scherr-0727b64/
Blow out the candle then smoke it.
Michael Scherr created Higher Celebrations to help people enjoy special occasions with cannabis. His breakthrough product, Birthjay gained enormous media attention. He joins Dan Humiston to talk about his pipeline of products, raising capital and becoming the Hallmark of cannabis.
MJBulls - https://podconx.com/podcasts/raising-cannabis-capital
Dan Humiston - https://podconx.com/guests/dan-humiston
Birthjays - https://www.birthjays.com/
Michael Scherr - https://www.linkedin.com/in/michael-scherr-0727b64/
MP Higher Celebrations
Dan Humiston: [00:00:00] Today and I'm J Polls. We are joined by Michael Sheer, the founder of Higher Celebrations, the maker of js. Michael, welcome back to the show.
Michael Scherr: Thank you for having me again. It's been a few years and it's, it's great to be back on, so thank you.
Dan Humiston: Well, it has been a few years. I, we spoke before we jumped on, but the last time you were here was in, it was in late January, early February of 2020, and a few things happened since we last spoke. Um, the good news is, birthdays and high celebrations continue to take celebrations to new heights right off your websites.
And for our listeners, that missed, missed you three years ago. I, I thought of a good place to start would be just explain to everybody what a is.
Michael Scherr: Perfect. Excellent. Yeah, so Higher Celebration is, is our parent company and the goal is to make novelty gifts for, uh, the adult cannabis market. and we launched the birthday, the Joint Fear Birthday as our flagship product because everybody has [00:01:00] a birthday and you know, working on the, the other products for your anniversary, for Thanksgiving, other holidays, things of that sort.
But in short, the birthday is a proprietary cone and crutch with a widget on top that has a candle, a real candle. You lay on fire and sing happy. Blow the candle out, you take the top off and then the actual cone sits in a little, , cup with a steak on it. So it goes into your cake. You don't get any frosting on the bottom or wax on the top.
And it's the, the birth J. I like to be punny. It may not be the smartest guy in a room, but often I'm the punt, so I'll take that as a, as I win.
Dan Humiston: I love it. I love it. , when we were here last. and what you just said was, it's, it's, it's, it's, it's just a cone. But that, but you've evolved from just the cone in the state of Massachusetts, for instance, if you want your birthday to come, ready to go.
, it's now legal. Explain how you pulled that off.
Michael Scherr: Awesome. Yeah. So I'd like to say, you know, the goal was to have your cake and smoke it too. And now we made it easier, so in, in Massachusetts, we're fortunate enough to sign an [00:02:00] exclusive agreement with Northeast Alternatives, and they're a, um, fully vertically integrated, producer, know, cultivator.
And, uh, they have, , a dispensary which sees over a thousand people a. But they also distribute their products, which are, you know, very versatile, innovative, to over 150 dispensaries in Massachusetts. So they came to us with a proposal and we decided, hey, you know what? We learned in the pandemic that the products can sell empty on Amazon and and head shops, but in order to see true recurring revenue, we need to fill it.
Because the reason there are billions of dollars of pre-rolls sold every year is because there are pre-rolled. They're easy, they're grab and go. And so by leveraging all the data that we have around birthdays and, and things of that sort, you can offer people a discounted birthday or, you know, get people while they're in line waiting.
Are you celebrating? This is a great way. Upsell someone 10 to $20, or even get 'em back in the store for an extra time per, per year. And so those are, those are kind of the opportunities that we saw with a filled birthday. And they can [00:03:00] just grab it, put on their cake, light it, and enjoy. So it's, we were very lucky and this is a, an amazing model that we've been trying to figure out the best way to do it.
And we are excited to scale this from state to state. So we're already in talks with a few other states to license this. I. , , for these other, , producers, MSOs, vertically integrated, you know, providers across the country to, uh, license our intellectual property, fill the birthday with their flower, and go from there.
And from there we other products that they can do as well. So right now it's that goal is, is getting people to, appreciate the birthday as, as a way to augment the experience of the customer and help them drive more revenue per, per.
Dan Humiston: It seems like a perfect, collaboration because you're filling some, a need that different state operators need and they're helping you because you, you know, you can't, for our, our listeners know this, but it doesn't re, it bears repeating, is that you can't ship the product from state to state. So , this helps [00:04:00] you.
And that, and that you don't have to have like satellites in every state. You can just send the empty cones, let them do the filling. Now , you probably can't talk about this, but it just seems like, wow, if it's squiring, this, well, in Massachusetts, you probably already teed up a bunch of other states and you don't have to say it.
If you do, you do, but I suspect that there will be opportunity , to partner up with other.
Michael Scherr: Yeah, correct. And, and, and we're in talks with a few of the players, and you can name the Nevada, you'll probably guess who it is, you or a couple of them in California. A few of the larger cultivators and brands do co-branded assets and things of that sort. So I can make custom cones because I'm direct to the factories.
I don't own a factory that makes cones, but I'm direct to, to the manufacturers overseas. and it's, it's an opportunity to. It's a scale and the goal is to have recurring revenue so we can raise a proper Series A so I can launch the other 2030 products I wanna launch and grow this like, like it should grow.
And the pandemic was tough cuz a lot of the head shops, tobacco stores we were selling and closed down. So that, [00:05:00] you know, took our revenue down substantially. Had to pivot and sell P P e glove, sanitizer and MASH to keep the lights on and pay my vendors employee. and it worked. I mean, it wasn't glorious.
It wasn't rolling in the dough like some of these folks were with massive PPE deals, and we weren't planned touching, so we were not considered essential, and now we are planned touching. So that is something that, , is what we learned during the pandemic and, and we're excited to grow that across the states.
, but yeah, no other states, if, you know, people want to connect with us, we're, we're not papered on any other states just yet. We have talks with other states for sure, but really excited to grow this model and, and. You know, depending on the size of the state, one, two, or three licenses or even exclusivity, if the, if the orders are big enough, the pos are large enough in each state for people to have a differentiated opportunity to, to offer something to, to their customers and patients.
Dan Humiston: it seems like a perfect way for you to launch new products too, if you have this network that you're working with. Of, of, of you say partners, [00:06:00] for lack of a better word, in different states throughout the country. , you said you have a pipeline of, of products that are just waiting to go if you already have , the shelve space with these different places.
that seems automatic, so, what, our whistle, what are some of the other products that might come out in the future
Michael Scherr: Well, yeah. So I'll be high level because some of them are, I'm waiting to file IP for a little bit. But essentially, you know, the idea of giftable cannabis, or I call it gift abus, we wanna have, whether it's empty or filled kiosks in every, every dispensary that can have.
The ancillary products or filled products ancillary, obviously you can then not have a two 80 e hit on, on your, your balance sheets or your books. So you can actually increase revenue without dealing with the two 80 e issues. Um, so that's one opportunity for an empty product. But obviously on the other side, just the idea of looking at, you know, anniversary Thanksgiving and all the holiday, other events.
I have so many product. For the holidays, for Christmas, Hanukkah, new Year's. Even our patent, we filed [00:07:00] covers sparklers. One of 'em covers in edible. So being able to, for folks don't wanna smoke, okay, we can still have a birthday or a novelty gift to this product that's non-combustible. And so the roadmap of innovation is, is fascinating.
We have things that. I've never seen them in dispensary. I've never seen, I've only dreamt them up and I have, I'm having some engineers kind of design them for our roadmap, for our, for our deck when we started. Go raise a Series A here soon. But yeah, the goal is, is, is kind of sell that hopium of what we can build based upon what we already have built.
And that's something that's pretty exciting for us. And, you know, finding those partners that we can trust and grow with. I don't, I don't wanna go find a, a partner for this product, a partner for that product. I'd love to have one or two or three or, you know, in each state that believes in, in what we're doing.
And I mean, I think the ultimate opportunity is, is twofold. One is you raise a bunch of money and you keep yourself growing. Or you find an MSO or a strategic that wants to roll you up, that wants to bring you in and say, Hey, we're gonna have you. Head of innovation or something down the road and, and, and buy the, you know, substantial chunk of my [00:08:00] company.
I'm open to whatever, because, you know, if I were stuck in the mud zinc, I have to have this, then I would be, you know, potentially stagnating my opportunities. But if a, if a big MSO says, Hey, we see the value of having innovative products with IP that no one else can have, that's a really unique opportunity and that's a really great way to differentiate because a lot of these MSOs don't have the brand differentiation like a cookies has.
For example, if I would've mentioned some of these MSOs, you probably couldn't. individual brands they have underneath their umbrella. So being able to have something that can scale nationwide or even globally because it doesn't touch the plant at its roots, at its core, you are then having an opportunity to do something that most folks aren't doing.
Dan Humiston: I wanna jump ahead because I know we're gonna be cutting close on. , it seems like the key to this is a, a with the distribution, which I think you're tackling, and then b would be the next thing would be getting the word out. And I suspect that, that the combination of a national marketing campaign that's consistent , is an expensive proposition,
you mentioned that you're, you're gonna [00:09:00] be raising money at Series A. Can you tell us a little bit about.
Michael Scherr: I mean slightly premature, but I just know based upon what I needed and didn't realize I needed from a standpoint of marketing budget and also understanding next hires, I forecasted, okay, let's say I wanna raise a million on a 10 pre or something like that sort, or, or between seven to 10, which is why I want the recurring revenue.
And to have two or three states under our. I need to justify it. I'm not gonna go out and and try to say, Hey, we can do all these things, and the birth J again is one product. If that can open the door and be that kind of catalyst to showcase how the recurring revenue models can work as a filled product by licensing our IP out there.
Then not, are we an only an i p play? We're, you know, the branding product development package design play, which I think on the last call we, you know, talked about a few years ago, I, I cut my teeth in, in branding and, and product development, both getting my MBA and Babson for entrepreneurship, but then taking a job at a packaging company where I was hired to build their cannabis division now, and they had [00:10:00] done packaging for, you know, Vera Wang, Bloomingdale's, Macy's, and the, and and the like, and they didn't know about cannabis.
I got to learn through those two experiences of how to build brands and actually produce them, build a supply chain. So I bring that on top of the IP play and it's, I, I think those combined with some recurring revenue can really justify a larger raise at a higher evaluation.
Dan Humiston: Oh, and I think we talk about, I talk to a lot of investors and I ask 'em what are the things, some of the things that they're li looking for? And, , in addition, all the everything that you mentioned, they're always talking about. Brands, they're like, you know, we'd like, so we'd love to see strong brand.
And as you mentioned, there aren't a lot of strong brands and you've carved out your own little piece of the pie here. It's a strong brand, whether it's Bert J's or , all the, the, the thousand other puns that you're gonna come up with , they're, that's effective. And, and all, all underneath this one umbrella. [00:11:00] That's everything that they're looking for. So I, I'll have, make sure that I have your, the links. He js uh, higher celebrations, everything in the show notes. So, you know, if anybody's out there that's listening right now and says, Hey, that's a company I wanna invest in, or Hey, that's a company that I wouldn't mind partnering up with, , somebody from Michael's team will definitely be there.
, , , was there anything I left out that we needed to touch on? Any of your products that you wanna highlight , before we say.
Michael Scherr: I could talk for days. Obviously 10 minutes is a challenge. and it's funny because a couple years ago I couldn't market in certain ways. I couldn't get into, you know, hot topic, for example. They love the products, but like, we don't do ancillary cannabis stuff. We eats too much paraphernalia.
So I. Uh, took some of the IP and filed again, and I, I've created like a shot glass for celebrations. It's called the Hotshot, which is a really unique proprietary shot glass with a big candle on it and a top that, you know, stops from sloshing, , the alcohol or dripping wax in there. So the idea of, , innovation around a challenge that was brought to us creates opportunity [00:12:00] in somewhere else.
Now that's not cannabis obviously, but the idea is creating more products around adult, celebrations. , yeah, we're excited. I mean, the, the, the higher celebrations line is gonna keep growing and whether it's through innovation or through acquisition, you know, those, those are the two ways we can really grow the, the product line.
And so we're excited to see what happens the next, you know, six to 12 months around that and around the raise and around, the re recurring revenue that we're hoping we'll get from these state by state opportunities. And I appreciate you having me on.