Navigating Compliance in the Cannabis Industry Marion Mariathasan, the CEO and Co-founder of Simplifya, a regulatory and operational compliance software platform for the cannabis industry, joins Dan Humiston to discussed the importance of compliance for licensed operators. He explains how Simplifya helps to maintain a license to operate legally through cost-efficient and streamlined software. He also talks about the new product, Risk Mitigation Alliance, that they launched in collaboration with Canngen to mitigate risks for both operators and insurance carriers. Produced by PodConx MJBulls - https://podconx.com/podcasts/raising-cannabis-capital Dan Humiston - https://podconx.com/guests/dan-humiston Marion Mariathasan - https://www.linkedin.com/in/marionmariathasan/ Simplifya - https://www.simplifya.com/ Recorded on Squadcast - https://squadcast.fm/
Navigating Compliance in the Cannabis Industry
Marion Mariathasan, the CEO and Co-founder of Simplifya, a regulatory and operational compliance software platform for the cannabis industry, joins Dan Humiston to discussed the importance of compliance for licensed operators. He explains how Simplifya helps to maintain a license to operate legally through cost-efficient and streamlined software. He also talks about the new product, Risk Mitigation Alliance, that they launched in collaboration with Canngen to mitigate risks for both operators and insurance carriers.
MJBulls - https://podconx.com/podcasts/raising-cannabis-capital
Dan Humiston - https://podconx.com/guests/dan-humiston
Marion Mariathasan - https://www.linkedin.com/in/marionmariathasan/
Simplifya - https://www.simplifya.com/
Recorded on Squadcast - https://squadcast.fm/
[00:00:00]
Today on the MJ Bulls Raising Cannabis Capital Podcast, we are joined by Marion Mariah Hanson, the c e o and Co-founder of Simplify. Marion, welcome back to the show.
Thanks, Dan. Great to be here. Thanks for having me.
Hi. Well, I appreciate you being here again. It's great to have you back. Last time you were on, we were focusing more on investors during the Cannabis Investor series. This time we're gonna get an opportunity to actually talk about Simplify It, which is the industry's leading regulatory and operational compliance software platform.
And this subject is one of those subjects that most companies, they just don't wanna deal with. And. I laughed. I laughed cuz I, I said, it was to somebody the other day. I love regulations are three words that no business owner has ever said. But, but,
It's true.
But if you're in cannabis, you better take it seriously cuz getting [00:01:00] outta compliance could just kill your business.
And, and I thought maybe we'd kick it off by talking about like, what are the risk of falling outta compliance? Like what kind of penalties could companies face?
Yeah, so thanks Dan for asking that question. And, and, and you're right. Compliance is about as exciting as watching paint draw on the wall, I guess, and we, we joke internally that it's the least sexiest thing in the industry, but. I, I think from our perspective, and I think many people would agree that the most valuable asset of a licensed operator is that license to operate legally.
And why we exist is to help them maintain that license through a very cost efficient, streamlined method through our software. As regulations are changing constantly. There's, Quite a bit for whether it's a big m MSO or a small mom and pop to really digest and stay on top of. So simplify as a rec tech company, we, half of our team are lawyers and [00:02:00] policy folks, and the other half are engineers.
And so we, we ingest all those regulations, we simplify it down, create them into, understandable audit questions. We also extrapolate and create SOP standard operating procedures from those regulations. Then we have a cheat sheet through our smart cabinet that helps them understand all the different, applications there to f keep on top of and refile.
And so it's, it's a lot going on there. And so our goal, where we started off was to help streamline that and, for those people that don't follow kind of the rules and regulations and fall outta complaints, I mean, We saw this, I think in California late last year, 1.2 million fine.
Right? That's, it's not small amount of money and, and you have seen people lose their license because they are, not playing by the rules. And, and so I, I think, compliance is not just about the every single operator, but if we're gonna move this movement for [00:03:00] cannabis ahead, We really need to ensure that everyone is playing by the rules and good governance and compliance is a very key element to that, right?
To let the communities, the policy makers, everyone know that we're here and we're serious.
That's a really good point is that if the key to getting this to the, to where we want it is to move it from the. The shadows into the public and, and, and move it outta the legacy operations into, professional operators. And, one thing I, I think is really important and, and, and I've seen this happen before.
It's not just the company, there's ramifications for the employees making a mistake.
yes. Yes. And so that's, where these SOPs and even the way it simplifies design, whoever's doing that audit on whatever facility or location, they're going in there and, once they're done with that audit, they're actually, attesting to the fact that they, answered every question [00:04:00] truthfully.
And, cuz end of the day there's not only ramification for that employee, but if they, didn't do it correctly or, took shortcuts or wherever the case may be. Now they're putting that business in jeopardy as well. Right. So it, it really is something, and, and you're seeing, I think we saw late last year again, the mayor of New York talking about how they're gonna, step up enforcement and I think that's gonna happen across the country and it's already kind of started and, and I think it's just, it's just good practice, right?
, it's a highly regulated industry and if you wanna. Be a successful business that helps promote this movement, then play by the rules.
Yeah. Last thing we need is a bunch of bad headlines from operators that didn't play by the rules. So you're right. I understand you recently teamed up with Cangen to launch a new product. Can you tell us a little bit more about risk mitigation Alliance?
Yeah, would love to. So, about two years ago the, Charles from Cangen and we started having some conversations around, [00:05:00] insurance itself is a, is a risk averse industry. We're a risk mitigation company. And, and they're like, they really wanna bring the best products and services for the industry.
But like, hey, how do we help mitigate that risk, not only the, to the operator, but to us as carriers and insurance companies. And that conversation kind of, started snowballing and. Almost two years later we've got the, the leading not only carriers, but brokers from Cangen to Safe Verb to Quad Score to Hub, to Imma, all these guys that came together and said, look, let's do something that can really help benefit the industry.
We understand it's struggling, right? Everyone right now is a, cash is a, is is an issue. And so for those players that are using Simplify and, and are mitigating their own risk by doing that, these insurance partners are willing to subsidize 70% of simplifier, that's a big undertaking.
And I, and I think most people in any industry view insurance companies as like the bad guys. [00:06:00] Right. And here, this is their way of saying like, look, we're actually here to help. So not only will they subsidize 70% of Simplifier, Dan, but they're also gonna start giving preferred pricing and discounts.
Were applicable, based on the risk profile of a company, if they're using a tool like Simplifier. So we think it's a very exciting initiative for the industry, especially giving kind of the downturn and, and, and the cash issues. And
Let's just call it out though. I mean, it's in their best interest to make sure that the, their insurers are following the rules, so yeah. It makes a lot of sense , that they would want to work with only cannabis companies that are.
In the simplify a stable of of companies that, they, they, they know that are following the rules. It, it lowers their risk probably, and I'm sure long term, it may encourage some of the bigger insurance companies to enter our space because they have that assurance.[00:07:00]
So it's already happening. Since we launched rma we've had, big, big non-cannabis insurance companies already reach out to us asking how they could kind of join this initiative. And I think a lot of these bigger guys have just been reluctant because of the risk factors that come along with cannabis.
But I think with Simplify and now having paired up with these current leading cannabis companies they realize that the risk aspect of it is reduced when someone is using simplifier. Right? End of the day, it, it works out great for us cuz this was what we wanted the industry to have as a risk mitigation tool.
But when others are coming in, it, it certainly starts to confirm that we're doing something right.
Well, I definitely can tell you're doing something right, and, , you said it's the least sexy thing in the industry, but I'll tell you what, I bet you a lot of people would love to be an investor in your company because this is one of those things that is essential.
And once people. [00:08:00] You realize how important it is to protect their license. You're gonna, you have tons of business because of that. And it's not just like today, they're gonna need you for a long term. So as far as an investor goes, is there any possibility at any point that you might be raising capital where some investors may have an opportunity to be part of your team?
Well, Dan, we, we've been very fortunate. We've, we've got some great family offices and, and Merit Capital have been an early investor and so at this point we don't really have any plans to raise. But you know, we're looking at opportunities internationally and potentially even, potentially acquiring companies.
So, you never say no. And so, simplifies, it's here for the long run. We've been here a little over six years now. In cannabis years, that's quite some time. We've learned a lot. And so, and we are expanding products, right? So we started off with products for the operator.
Now we have products for banks. We have products for law firms. We have products for insurance. And so we will continue [00:09:00] to expand our products and then be innovative. And, and so, yeah, so that's a long answer, long way of saying that one.
Or hey, it's better. At least it was a, not a no, at least at some point. And, and I'm sure , when that day comes, if that day ever comes, we will definitely want you back on the show. So we can have, so we can, give every, give all of our listeners an opportunity to To, to, to learn more about that.
But for now, we will have, I'll simplify as information in the show notes. So maybe you might be able to just reach out to Mary and say, Hey, I got an idea. , can we talk to you about some, some partnership here? Or if you want to learn more about protecting your most precious assets I'm sure somebody from their team would love to speak to you about that.
Mary, it's always pleasure to have you on the show. I look forward to having you on. Again. Thanks for doing this today.
Thanks Dan. This is always great to, come chat with you. Good questions as always.