Solstice has thrived by keeping a tight focus on cultivating high-quality, consistent cannabis
by Tony C. Dreibus
Entrepreneurs typically start companies for a handful of reasons. Many do it for the money, while others are primarily interested in building a legacy, working for themselves or following their passion. Alex Cooley formed his latest company, Solstice, in part for two other reasons: He had a crisis of conscience, and he wanted to specialize in one particular area of the marijuana industry.
Cooley previously co-owned a cultivation site and dispensary in Seattle, where he sold a mix of medical cannabis the company grew itself and MMJ it purchased on the wholesale market. Over time, however, he realized that he “wasn’t confident of the legitimacy of the supply chain” and didn’t know for sure if the cannabis he was selling actually helped the people seeking medication.
“I was standing across a counter from a woman telling her it was legitimate medicine to aid in the treatment of cancer, but I didn’t really know where the cannabis had come from,” he said. “I thought, ’this is not medicine, this is not how cancer drugs are made, this is not how pharmaceuticals are made.’”
Cooley also felt he was doing too much – instead of focusing strictly on production he split his time as a grower, buyer and dispenser.
So he decided to walk away from the company and linked up with a new business partner, Will Denman, to create a “legitimate supply chain for cannabis” as well as further the cause of medical marijuana in general. He and Denman both believed in the medical benefits of marijuana to treat a number of disorders, so they began researching which strains help with various ailments.
In 2011, armed with extensive knowledge about medical marijuana, the duo started Solstice. Cooley said the company links up with preferred business partners for extraction and product creation, and it’s those partnerships that help Solstice focus mainly on a single specialty: growing cannabis.
Focus, Focus, Focus
Focus is important in any industry, especially the marijuana space, Cooley said.
While some states force a single company to essentially grow, process and/or sell marijuana, Washington State does not. In areas where companies can work in multiple areas of the business, entrepreneurs should consider focusing on one area, Cooley said. Too often a business owner will start as a grower and then move into developing vaporizers or packaging or extraction, leaving the company spread too thin.
Cooley said he and Denman focus on producing and processing marijuana. They leave extraction and product creation to outside vendors as well, and they even farm out some of their production to trusted producers.
“There are so many opportunities in this industry that it’s easy to lose yourself. Do one thing better than anybody else and you’ll go far,” Cooley said. “Double down on focus.”
That doesn’t mean a company shouldn’t try to expand – quite the opposite. Rather than growing the business by getting into many different areas of the industry, Cooley suggests expanding geographically or boosting the number of strains you offer. Just try not to leave your expertise.
“If you’re going to grow cannabis, OK, you’re a grower,” he said. “You don’t need to be an extractor, too. Let an extraction company extract your material – they’re going to do a better job.”
Cannabis production might seem easy to outsiders on the surface, but it’s quite complex.
A big part of the equation involves maximizing yields – and therefore raising profits – by using data-based calculations involving the amount of light, water and fertilizer needed to grow consistent, high-quality cannabis efficiently. Cooley and his growers analyze every bit of data, which helps them make informed decisions.
To do that, Solstice has high-end processing systems that allow executives to mine data and make tweaks where necessary, saving valuable resources including time and money.
Writing out employee handbooks, establishing standard operating procedures and communicating clear expectations for each employee are also important with regards to improving efficiencies, he said.
“Do you think they open a McDonald’s and say, ’This is kind of how we do things – people order food and you cook things and then we sell it to them?’” Cooley said. “You could technically say that’s what McDonald’s does, but they have very clear standard operating procedures and employee handbooks and protocols and procedures, all of it. If you don’t have (these things), you’re missing the boat.”
Make Sustainability a Priority
Introducing efficiencies leads to improved profitability, which is what every business owner likes to see. But cultivators should also be focused on sustainability, Cooley said.
Growing marijuana has a lot of negative side effects on the environment, including leftover plant material and waste water. To ensure the industry remains viable and continues to gain acceptance, business owners need to be environmentally conscious. At the very least, it won’t hurt your business to become more sustainable, and it actually benefits most companies over time.
“We have a responsibility as businesses to be stewards of the environment,” Cooley said. “In the long term, it’s going to be cheaper to produce your product if you do it in a sustainable fashion. And it’s not like somebody is going to say, ’Oh, I’m not going to do business with that company because they’ve adopted sustainable practices.’”
Hire an All-Star Team and Delegate
As with any other industry, having the right people in the right positions sets companies up for success. Cooley said cultivation companies need to hire top performers if they want to be successful.
Too often owners are so engrained in the business they built from scratch that they want – or feel the need to – do everything. But getting lost in the minutiae can result in lost productivity and employees who feel like they’re not allowed to do their jobs effectively. Specialty employees are hired for a reason, and they really should be better at what they do than top executives.
“I see a lot of successful people getting to a point where they want to tap out because they’re still trying to do everything,” Cooley said. “Another part of that is being humble and understanding that you’re not the smartest person. I know I’m not the smartest person at Solstice, so I’m relying on people smarter than me to make decisions.”