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Christopher Ratliff discusses getting down to the grass tax

What do cannabis businesses need to succeed?

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Christopher Ratliff discusses getting down to the grass tax

Christopher Ratliff, president at Victus Consulting Ventures, discusses business piracy in the cannabinoid sector.

Getting down to brass tacks is an idiom thought to have originated in boat building. So let us do just that – let us build this ship and get down to brass tacks. For the less creatively inspired, let it be known, the ship I am referencing is cannabis companies in new emerging markets. Although the cannabis industry is a scientific industry and nowhere near maritime operations, I have chosen this analogy to accentuate the point of business piracy that often takes place within the cannabinoid sector. 

One of the most important factors one should know about the cannabis industry is how many businesses pass around a model of; misused technical expertise to get the ship built to sail in the right direction. If specialised scientists and horticulturists are essential to properly build the “ship”, then recognising them positively will give them the courtesy to do the job. Unfortunately, many founders suffering from the Dunning–Kruger effect insist on marketing full-time roles, yet the intention is to use subject matter experts (SMEs) as contractors and eventually cut them loose. 

Read more: How legal cannabis companies keep their farms safe and secure

Oftentimes the board of directors will bring in a very unqualified team to steer the ship due to their experience in banking or maybe flying kites (it does not make sense to me either). For the sake of your investment and reputation, you need to consider the ramifications of this practice. It will sink your ship, destroy lives, and turn you into the topic of someone’s lawsuit.  

The times they are certainly changing like the wind that blows a sail and you do not want to blow your future sales. Any press is not good press anymore, and it probably never was.

Once the ship is built and the executive leadership team is in place, they set sail; confident in their experience to guide the ship’s direction. However, it usually sets sail about one-quarter of the way across the proverbial ocean before the experienced, technical builders are forced to walk the plank and get fed to the sharks. It is laughable to watch a group of people with a large learning curve go a portion of the way across the ocean of business development believing, “pull that rope over there, I saw them do it” will get them the rest of the way.

 The confidence quickly dwindles when they find they are effectively spinning round and round in the middle of the ocean until someone else comes along to commandeer the ship. Mutiny, reverse takeover, and the same processes occur on repeat and, unfortunately, there is no one with innovative thoughts left aboard to help the situation. The sharks the poor souls encounter while treading water looking for a new ship to board are the next round of employers who may be up to the same exact activity. The sharks will undoubtedly want to speak to the captain of the previous ship to verify their qualifications. But because technical experts can be strong-willed, they will absolutely swim back ashore and try again. 

However, due to the activities described, it becomes a never-ending cycle promoting distinct lies and more thought-out misrepresentation. This unfortunately leaves SMEs with genuine talent, specialised degrees, and a plethora of qualifications in a position to explain why they are no longer with the previous ship. Who in their right mind jumps off a perfectly good ship in the middle of the ocean to swim back ashore? No one unless you are Aquaman! Also, do you really believe the geniuses who pulled all the wrong ropes, read the wind incorrectly and burned the charts are willing to tell the next company your marvelous accolades of building every inch of their vessel? No of course not! A pseudo captain is not going to reveal that they are in reality… just a pirate. 

Now the metaphorical point has been made, let us disembark from all the creative ship talk. The real shame about the cannabis industry in the way that it exists at the moment is how criminal and rather pathetic some of the start-up practices appear to be. Along with fraudulent misrepresentation and equity flashing, there are many stoner scientists doing a chemist’s job, banking executives leading product development decisions and grill cooks converted to “master growers” overnight because the industry titles suggest that is what they are. It literally is that ridiculous! 

On the other hand, it is not every cannabis company and if you are not the target audience of this article, do not take offence. There are genuine people with great talents working at amazing companies holding the appropriate roles. It should not be a surprise that those companies and their staff members are sailing right into success within the sector.

What should start-up cannabis companies set out to do in accordance with healthy business practices? 

For starters, having a broad understanding of the deployment of funds just will not cut it anymore. You need to specifically invest seed funding and even pre-seed funding into the right value-adding activities. 

In my opinion, your most valuable assets are your team/staff, your equipment platform and your compliance infrastructure. Most often in the cannabis sector, you see investment going into marketing and branding, cultivar genetics and packaging. 

I am not saying those activities do not also add value to building your company and consequently the brand, I am saying to clearly evaluate and prioritise investing in the interests that will generate the most effective ROI. Another point to reference is the overuse and misunderstanding of building an appropriate company culture. Most cannabis companies claim that company culture and the preservation of it is most important to the success of the business. 

I concur with this notion; however, toxicity in a workplace due to a culture built upon prejudice, hierarchy and the clique mentality will not cut it either. Best business practices are to build a company culture rooted in diverse backgrounds, collaboration, and human understanding. This type of company culture will drive innovation, inclusion, and excellence in any business. 

It will also drive revenue, production and promote an overall positive moral for all stakeholders. Until then there will be a lot of sinking ships and displaced sailors which is currently the “grass tax”.

Christopher Ratliff
President
Victus Consulting Ventures

Christopher Ratliff

Opinion

Opinion: former Juicy Fields CEO shares his thoughts on the case

“I might be off the mark, but I don’t think this was an intended Ponzi Scheme,” Willem van der Merwe.

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Opinion: former Juicy Fields CEO shares his thoughts on the case
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Home » Opinion » Christopher Ratliff discusses getting down to the grass tax

In this opinion article, the former CEO of Juicy Fields, Willem van der Merwe, shares his opinion on the Juicy Fields case so far, with a message to the founders and investors.

I might be off the mark, but I don’t think this was an intended Ponzi Scheme. I believe this was purely a case where a good business concept was mismanaged by inexperienced people, which are more equipped to develop IT solutions, not run businesses in a productive and transparent manner. 

There is a distinct difference between designing a race car, and eventually racing with it. This business took off way beyond anyone’s expectations, including those of the Juicy Fields founders. When they realised the size of the fish they caught, they tied to get help, but unfortunately seems to have recruited both good and a few wrong people to assist them.

Read more: Juicy Fields fraud controversy – company claims it will refund investors

I was informed by a reliable source that the owners/founding members indeed decided to suspend the Juicy Fields.io platform deliberately, once they became aware of one or two rogue people that lead them down the wrong path.

For these owners/founding members to restart up the JuicyFields.io platform will not be inconceivable or event too farfetched, but they will need to have a good and plausible explanation for/to the market for their initial actions taken, and going forward, to give the platform half a chance, will need not only a new platform offering that deals with issues such as proper KYC but be compliant with regulators. 

In addition, any new offering will require a new, revitalised marketing strategy to build up trust again. The issue is not the business offering itself, it became the way in which the business was promoted, perceived and disclosed to its members.

Personally, my first thoughts were that the brand is most certainly tarnished. Having had some time to think about it, I think the best way forward for owners/founding members of the JuicyFields.io platform is to almost “relaunch” it, with the proviso already mentioned. 

If they don’t at least try, a stigma will not only follow these owners/founding members but also the business of crowd growers in general.

Following the news release that was released by the owners/founding members on 27 July, it is apparent that Juicy Fields was duped into believing the BaFin regulatory issues should be dealt with by registering new Juicy Fields companies outside of Germany, where this all started. This, of course, is not correct, as the BaFin situation to my understanding, was simply a case of filing the requisite prospectus as required by German financial regulators, to clarify the grey area that Juicy Fields was operating in.

A person by the name of Von Luxburg presented himself as an attorney that could help the owners/founding members with the BaFin requirements, including writing a prospectus for the group as was suggested and required by BaFin at the time. 

It appears now from what we have all learned, that he clearly did not have the best interest at heart of the owners/ founding members of the Juicy Fields platform. When these inexperienced owners/ founding members realised this, they did what any person in their shoes probably would have done, and that was to shut down or suspend operations, to prevent losing all the investors’ funds. 

Their fears were actually credible, as I further understand that Von Luxburg had indeed sent people to at least one of the Juicy Fields banks, to try and take over signature control of this account.  

According to news that started flowing into the markets via social media since mid-July when the JuicyFields.io platform was suspended, both Von Luxburg and the owners/founding members started blaming each other publicly, another tragedy in this saga, and again in my opinion showing some inexperience by the owners’/ founding members in dealing with such situations. 

They really should have simply obtained legal court orders, but I reckon they were overwhelmed by the mess that was created. Again, these are my observations from the outside.

My message to investors will be to be patient. Logic tells me that nobody can steal this type of money and get away with it. Rather, engage with the company or its lawyers and see if a refund can be arranged. I’m sure the owners/ founding members will be eager to deal with the threats and accusations accordingly. 
 
To the owners, I would say be transparent and in constant communication with the eGrower clients. Also, do your best to get everything operational again, but in a way that will increase security for all involved, and with the future blessing of the authorities such as BaFin. 

This situation will not be resolved overnight as the financial institutions have apparently frozen all the Juicy Fields accounts. Not because the authorities requested it, but because the owners/founding members did. The financial institutions are highly regulated and I’m almost certain they, in turn, would have to have reported these events to their local Financial Intelligence Units (FIUs). 

Regarding my earlier comments that I doubt that this was a Ponzi scheme or money laundering – there is simply too much at stake for any bank, never mind the owners/founding members to even try and engage in this type of business.

The current status and situation of the Juicy Fields business, unless amicably resolved in the very near future, will most certainly be investigated by the regulatory bodies to determine the reasons for any such account activities nor part of a bigger investigation. The owners/ founding members can either decide to wrap up the business, refund whoever is owed money and wind down the business or refund everyone and then start fresh with a new approach to market.

May logic and good sense ultimately prevail and the investors be made whole again, and the cause of this whole situation be dealt with properly and adequately.

Willem van der Merwe
Former Juicy Fields CEO

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Despite US federal court ruling Delta-8-THC remains in legal limbo – what’s next?

Despite the cannabinoid receiving federal legal status in the US, more than 20 individual states have sought to restrict Delta-8.

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Delta-8-THC

Scott Mazza, co-founder and COO of Buffalo’s Vitality CBD, discusses the future of Delta-8-THC, the first psychoactive cannabinoid to achieve nationwide legal approval in the US.

Delta-8-THC is in the crosshairs of regulators in the United States. Despite the cannabinoid receiving federal legal status, more than 20 individual states have sought to restrict Delta-8.

The controversy arises from the fact that Delta-8, unlike cannabidiol (CBD), produces psychoactive effects. Though less intense than Delta-9-THC, the cannabinoid reportedly creates more of an ‘in-your-body’ sensation and physical relaxation. Here, however, lies the problem. Some regulators aren’t happy that Delta-8 is the first psychoactive cannabinoid to achieve nationwide legal approval thanks to a perceived loophole in 2018’s Farm Bill.

It begs the question: what’s next?

The history behind Delta-8-THC

Delta-8 tetrahydrocannabinol, also known as delta-8-THC, is a psychoactive substance found in the cannabis sativa plant, of which marijuana and hemp are two varieties. Delta-8 is one of more than 100 cannabinoids produced naturally by the cannabis plant though it’s not found in significant amounts. Its chemical structure is similar to Delta-9-THC, which is regarded as the main psychoactive element found in marijuana. That said, Delta-8 counts smoother effects than Delta-9, making it appealing to many THC consumers.

It bears repeating that Delta-8-THC is only naturally found in small traces, which is why it’s typically synthesised from legal, hemp-derived CBD. This is possible thanks to the similar molecular structure of cannabinoids and a process called isomerisation. This method sees CBD dissolved in glacial acetic acid to convert it to Delta-9 THC. After three days, half of the material becomes Delta-8-THC. Of course, for quality control, an experienced chemist should oversee the entire process and a third party must test the final products.

The result reportedly produces a clear high without the anxiety often associated with Delta-9. A survey of 500 Delta-8 users largely reported relaxation, pain relief and euphoria, with most participants reporting they could perform their normal daily activities without experiencing the adverse side effects associated with cannabis use, like paranoia, anxiety or the ‘munchies’. Great, right? Well, the answer depends on who you ask.

A cannabinoid in legal limbo

Critics of the cannabinoid claim that it should not be legal in the first place. This is because 2018’s Farm Bill legalised hemp across the country. Since the legislation made no mention of Delta-8, it also became legal to sell. Since then, the industry boomed, especially in prohibitionist states due to the relative lack of specific, restrictive policies.

Despite protests from certain sectors, this ruling continues to stand the test of time. In May, a California federal appeals court ruled that Delta-8 and other cannabinoids derived from hemp are legal even if the substances have psychoactive properties. Further, the Drug Enforcement Administration (DEA) has conceded that Delta-8-THC is generally unregulated because the current statute only bans cannabis products with more than 0.3 percent Delta-9 THC by dry weight.

Federally, there remain no restrictions against hemp-derived Delta-8. However, the story is different at a state level. Today, more than 20 states have sought to restrict Delta-8. Meanwhile, The Food and Drug Administration (FDA) has issued warnings to companies that are marketing products with Delta-8 and making what the agency says are “unsanctioned claims” about their therapeutic potential.

What’s next for Delta-8?

The legal limbo between federal approval and state prohibition is creating a patchwork of standards across the country. Unfortunately, fewer and fewer consumers can access the cannabinoid as a result. It remains to be seen what will happen next in this saga but, interestingly, the judges in May’s case noted that “it is for Congress to fix its mistake” if Delta-8’s legalisation was an unintended consequence of the Farm Bill.

In my view, it should be Congress that clarifies this issue. Currently, we’re seeing the discrepancy between legalising low THC cannabis plants yet criminalising high-THC varieties. In an ideal world, Congress will step in and put an end to prohibition once and for all.

With more research, we can hope that rigorous academic studies confirm the anecdotal benefits of the cannabinoid, giving more reason for consumer availability. For now, it’s encouraging to see that Delta-8 remains legal at a federal level, perhaps opening the door for larger legislative change regarding psychoactive cannabinoids going forward.

This article is by Scott Mazza, co-founder and COO of Buffalo’s Vitality CBD. Hailing from a background in finance, Scott is well-versed in the benefits of hemp and passionate about providing people with a natural alternative to the pharmaceutical industry.

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Opinion

Brains Bioceutical: building a cannabis dream team 

CEO of Brains Bio, Rick Brar, discusses his philosophy that a CEO is only as good as the team they lead.

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Brains Bioceutical: building a cannabis dream team 
Home » Opinion » Christopher Ratliff discusses getting down to the grass tax

In this article, CEO of Brains Bioceutical, Rick Brar, discusses how building an expert team makes for a successful cannabis business. 

I have always subscribed to the mantra that you are only as good as your team. As an entrepreneur and CEO, my relative success has always been the result of the high-performing teams that I have had the privilege of working with over the years. They have been instrumental in creating positive synergies, bringing innovative ideas to the forefront and helping to bring the company vision to life.

When I founded Brains Bioceutical, a global manufacturer of naturally-sourced active pharmaceutical ingredients (APIs), I knew the company would be embarking on a new frontier in the research and development of cannabinoids for the health and wellness sectors. 

Read more: Brains Bioceuticals announce FSA validation for its CBD as a novel food

This ambitious undertaking would require the top minds across a number of industries, from pharmaceutical to cannabis and everything in between. Our team is strategically positioned to cover a diversified approach to pharmaceutical cannabinoids – with operations across the pharmaceutical, nutraceutical and medical markets.

With that in mind, I went in search of the infrastructure and the people I would need to help fulfil my vision of creating a company that specialised in the development of natural, plant-based cannabinoid APIs, backed by evidence-based research.

My team of advisors tracked down an API manufacturing facility in the United Kingdom that was EU-GMP certified. Not only did the facility (BSPG Laboratories) check all of the boxes, it was run by Dean Billington, an accomplished scientific professional with decades of experience in the pharmaceutical industry. 

Dean is one of the most knowledgeable people in the industry when it comes to the CBD molecule and what it takes to navigate the complex global regulatory environments associated with cannabinoid APIs. He has a proven track record of commercial and business development success with major pharmaceutical companies including Caligor RX Ltd., Bilcare GCS Europe Limited, Fisher Clinical Services and Pharmalytic Limited. 

He has also provided independent consulting services to a wider range of pharmaceutical companies at various stages of growth, providing expertise on all aspects of the drug development cycle including clinical trials, analytical chemistry and quality assurance.

Read more: Former GSK director joins cannabis company

Once Dean accepted the position as global chief operating officer for Brains Bioceutical, I knew this company was going to be well-positioned for hyper growth in the CBD health and wellness industries.

Following Dean’s hiring, I was in search of candidates that could lead our vertical markets – ingredient, wellness and pharmaceutical development. Terry O’Regan, who had a demonstrable track record of high performance in the pharma and biotech sectors, was my primary target. Having worked in a number of senior executive roles with pharmaceutical giant Biogen, I knew Terry could provide the expertise when it comes to the development and launches of new products and drive sustainable growth strategies. 

With Biogen, Terry developed a comprehensive portfolio strategy that maximised the potential of Biogen’s MS brands, ensuring the company had the top three most prescribed MS drugs in the United Kingdom. He also made significant strides as chairman of the American Pharmaceutical Industry group, influencing government policy within the life science sector by identifying opportunities for further collaboration between the UK Government and the industry.

But it wasn’t just Terry’s track record in product innovation, business development or policy reforms that made him the ideal candidate for President of Brains Bio. It is his passion for creating a company culture where employees feel valued and respected; where everyone is an equal part of something extraordinary. Terry is a man that does his homework and before accepting the role as President, he consulted with a number of neurologists, oncologists, patients and conducted a thorough literature review of the potential that cannabinoids could have on the future of healthcare and patient outcomes. Convinced that our natural, plant-based cannabinoid API could be used to treat various chronic diseases facing the world, Terry graciously agreed to lead our team.

Thankfully for us, Terry had deep connections with prominent people in the pharmaceutical industry, including Bill Purves, who is now our chief commercial officer. Bill is a veteran in both the pharmaceutical and cannabis industries, ideally suited to lead Brains Bioceutical’s business development strategy, exploring new revenue streams and solidifying relationships with existing and prospective customers. 

He started his pharmaceutical career with GlaxoSmithKline, where he stayed for over 10 years leading the company’s international business development unit. His entrepreneurial ventures began shortly thereafter with Iroko Pharmaceuticals, where Purves helped establish the company’s global sales and distribution networks for branded generic and specialty prescription products. In 2018, he entered the cannabis space, serving as CCO and CFO for Jacana, a Jamaican cannabis company. In these roles, Purves helped transform the startup into a fully vertically integrated cannabis company with business arms that included research and development, cultivation, production and extraction.

As CCO of Brains Bioceutical, Purves is able to combine his passion and experience in the pharmaceutical industry with his background in working with a cannabis startup.

And last but not least, what is a company without a tactical political strategist, public policy expert and master communicator? Barinder Bhullar, our senior vice president of corporate affairs, serves as the crucial link between the company and its customers, investors, employees and government, responsible for overseeing Brains Bioceutical’s overall communications strategy and providing direction on the company’s image, reputation and general performance. 

Barinder has held multiple senior level positions within the BC government, with a proven track record in establishing and maintaining relations with domestic and international governments and stakeholders. He also served as vice-president of international affairs for The Supreme Cannabis Company, a leading Health Canada licensed cannabis producer. In this role, Barinder worked with governments in the United Kingdom and Brussels to provide input on Europe’s medical cannabis policy. More importantly, Barinder demonstrates incredible leadership and passion and is eager to lead the Brains Bio team in unlocking transformative health and wellness solutions for patients and consumers.

Collectively, we have an incredible mission ahead of us. The strength of our combined team brings over 100 years of relationships with large pharmaceutical and research institutions. This combined with an exclusive partnership with one of the world’s largest human nutrition companies, will allow us to rapidly expand our global sales footprint. Using our industry leading hemp-based cannabinoid API, we are pioneering a new frontier in medicinal and wellness solutions across the world. 

Our leadership team possesses unparalleled expertise and institutional knowledge in biotechnology, pharmaceuticals and cannabinoid-based product development. Now that we have the people, the infrastructure, the licensing and the research and development well underway, I am proud to say that Brains Bio is strategically positioned to be a trailblazer in healthcare innovation across the world.

Rick Brar
CEO
Brains Bioceutical

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