MJBulls 0017 4Front Ventures Transcript
Dan Humiston: [00:00:00] Today's show and the following message are brought to you by Agri science labs the largest most established cannabis testing network in Colorado. To find out how you can get the most accurate and reliable test results visit Agri science dot com.
Kris Krane: [00:00:14] We've built this terrific operations platform we've built all of these operations protocols that are really built and designed to be scalable to be replicable. We've built a terrific operations team around it and we're doing all of it to help others build their businesses. We need to start doing some of this on our own.
Dan Humiston: [00:00:34] From Buminit media its the MJBulls podcast a show about raisin cannabis capital on today's show how forefront ventures is applying years of cannabis retail operation experience to Mission their nationwide chain of cannabis dispensaries.
Dan Humiston: [00:01:00] Hey kris how's it going.
Kris Krane: [00:01:02] It's going well. It's a nice day for cannabis conference.
Dan Humiston: [00:01:04] It is. We're here at the Cannabis World Congress Business Expo in Los Angeles with Kris Krane and Kris is the president of forefront ventures. I'm going to let Kris tell you this story but I met Kris a few years ago when he was in more advisory capacity but their company has morphed into so much more. Kris can you maybe bring us back to when you guys first started. And you know what got you to where you are right now.
Kris Krane: [00:01:26] Sure.
Kris Krane: [00:01:27] So I mean to take it back just a little bit farther I spend most of my career working on Cannabis Policy in Washington D.C. So I was one of the founding members of Students for Sensible Drug Policy. When I was in undergrad I was the associate director at normal for six years in D.C. and then the executive director of Students for Sensible Drug Policy so I've been in this for a long time. We started forefront in 2011 as four front advisers a consulting business where we brought in some really high level folks from outside the cannabis industry to create as sop's and operational best practices as well as some regulatory experts where we would help people win licenses and then help them set up their best practice operations particularly on the retail end.
Dan Humiston: [00:02:04] Well in 2011 there was not a lot of licenses out there were not.
Kris Krane: [00:02:08] That's right. We were involved in some of those early states and we won a lot of licenses for clients around the country and really built a robust operations model for people to run scalable replicable retail. And it was in about 2014 2015 that we started with our evolution from consultants into operators. And part of it was you know we started getting some access to capital and we kind of took a look at the landscape and said you know we've built this terrific operations platform we've built all of these operations protocols that are really built and designed to be scalable to be replicable. We've built a terrific operations team around it and we're doing all of it to help others build their businesses. We need to start doing some of this on our own. One of the differentiators between us and some of the other multi-state operators out there is that we spend a lot of time building the engine so building the sop's building the operations protocols building the manuals building a training program.
Dan Humiston: [00:03:00] Initially you're doing that for all the people that you're advising. That's correct. And you're perfecting it through working with them and all their different states. That's right. And now you say we have this model in place. Let's do it on our own.
Kris Krane: [00:03:12] We have the model we have the access to capital we've got the operating talent. We should start doing some of this on our own and so that sort of began this evolution from consulting into operating. Okay I think again what differentiates us from some of the other multi-state operators out there is that I think a lot of our competitors in the space some of them do a really nice job came from the business world and are an art and are really looking at this as a roll up strategy where they're going out and they're collecting licenses all around the country. But they may have a lot of disparate brands and are really spending more time on the roll up than they are on how you execute and operate a coherent brand strategy across multiple states.
Dan Humiston: [00:03:44] So there's a real eclectic group of companies that aren't really. There's no synergy because each one of the groups where is your specifically going in saying this is their brand. This is how we're going to do it and maybe not grow at that rate through acquisitions.
Kris Krane: [00:03:58] We're going to do it and we are doing some acquisitions were much more targeted we're trying to acquire companies that we think we can retrofit into our model. But we're really focused on execution and we spent a lot of time building the engine so to speak so that we can replicate not just operations but culture which I think is really important to you. We think you know ultimately if you're trying to build a brand particularly brand in the retail space which is where our primary focus is it's really important that if a customer goes into one store and they have a terrific experience if they go into another store in another part of the state or another part of the country even if it's a very different regulatory environment that they feel like they're walking into the exact same store.
Dan Humiston: [00:04:36] That the Starbucks Starbucks.
Kris Krane: [00:04:38] Or you think about any sort of chain where it's not just the aesthetic but it's the way that the staff interacts with people. Because if you have a good experience in one store and then you go into another story the experience is subpar it really reflects negatively on your entire brand different. It doesn't even have to be so different. Exactly. Exactly this way and you're giving it to me this way. It's not right. It's very different but it's extremely off putting to the customers is.
Dan Humiston: [00:05:00] I get frustrated with TSA at different airports. If they don't do it exactly the same way.
Kris Krane: [00:05:08] We've got two stores open today one on the South Side of Chicago and one in Allentown. OK we will have seven stores open by the end of this year. We'll be rolling out three stores in Maryland over the course of the next three months or first want to open in about a week and a half in Glenmont Maryland just outside of Silver Spring and then the next month in Boltt in the city of Baltimore and Hamdoon in the month after that. In Catonsville county all those stores are built out. And in fact we got our final final approval from the state today for Glenmont so we will absolutely be opening in a week and a half there and then we have a store in Worcester Massachusetts that will be opening. And also it looks like in November that store is about 95 percent built out at this point. And another big project in Massachusetts I can't give the details of yet but that's a pretty major acquisition for us. So that's a real fast growth.
Dan Humiston: [00:05:50] And then I suggest you have a cultivation facility and so we have a couple we have a cultivation facility that's operationally in Illinois.
Kris Krane: [00:05:58] Our first products are hitting the market this week in Illinois. We were one of the last to get up and running there and then we have a cultivation facility also in Worcester Massachusetts that will be opening within the next couple of months so that one is also about 90 percent built out and we're waiting on some final approvals from the state.
Kris Krane: [00:06:12] So we should have plants in the ground there by the end of the year.
Dan Humiston: [00:06:17] Just a quick thank you to one of our sponsors Bridge West LLC is one of the first accounting firms in the world to focus solely on the cannabis industry. It is your one stop provider for accounting audit tax and advisory service. They're offering a free 30 minute intro call to one of their leadership teams to all MJ Bull's listeners go to bridge west CPA dot com and now back to the show.
Dan Humiston: [00:06:42] Our listeners I'm sure are anxious to hear about this because there really is not a lot of national chain plans that we've heard. And so when we hear people that are talking about some sort of national chain or aspirations for a national chain it gets everybody's attention. Sure. Tell us how if there is an investor or somebody who's sitting there what has a little extra capital that wants them a chance in your company. Can they get involved.
Kris Krane: [00:07:06] Well it just so happens that we're in the midst of a capital raise as we speak. We're kind of on the tail end we should be closing it out by the end of next week maybe in the middle of next week. It's going very well but we can still bring some folks in if people are interested. Okay. So we're doing this is a 15 million dollar raise. We may very well go up to 20. We had about 10 million of that spoken for before we officially launched. So I think we'll probably get closer to the 20 million figure there. It's a priority a round so we are planning on getting publicly listed on the CSC in Canada later this year. So we'll be doing another round later on this year in coordination with us going public in 2008. That's the plant we're pushing really hard to get this done in November December. Now that's the we're closed at a priority around now. Most of the proceeds from this round are going to go to help us close the acquisition that I mentioned earlier we've got a very strategic and important acquisition that we're finalizing in Massachusetts currently talk about. I can't talk about it openly but it is very important and very strategic acquisition for us there. So a good chunk of this round will go to help us close out that acquisition as well as to both optimize one of the facilities that we're buying and to expand their cultivation capacity in that facility as well as to help finish up some of the other projects we have going on.
Kris Krane: [00:08:14] So dispensary as I mentioned those are all funded and built out. So this is going to help finalize our grow in Massachusetts as well as finalize this.
Dan Humiston: [00:08:21] So if this acquisition so if somebody is interested would they participate in the in either this round that you're doing right now or the next round. Who do they contact.
Kris Krane: [00:08:29] Sure so they can either go to our website which is forefront ventures dot com what's the numeral four. And then fronts ventures .COM. They can also send an email to info at 4 front ventures dot com and let them know that they're interested and interested in investing. That email will get read quickly and pass along to the right people when we come in with investment bankers and everything so yes yes yes because this is a priority a round we have and we actually have a formal investment bank up in Canada that we're working with a capital as our lead up there. But they can come in through us we'll get everyone under NDA and get the docs out quickly and we can be quite efficient and we'll have all of their information . You wanted to look at stuff.
Dan Humiston: [00:09:05] Chris this is really interesting. This is an exciting project. I mean I have a little experience in retail. I have a pretty good feel for what you're going through right now. It's exciting for you.
Kris Krane: [00:09:14] It is it's been a lot of work and like everything in this industry it's a real grind. But I think we've built the engine to pull this off. And you know there's a lot of talk about valuations and land grab and roll ups and all that and I think you know when the dust settles on all of this it really comes down to who can execute right the ability to execute well and execute a national strategy. And we may not have quite the footprint that some of our competitors have today we're close but we're much more strategic and focused in how we handle this and I think the majority of folks in the industry are really have spent a lot of time thinking about how you execute and how we execute on that. Really proud of what we've built and I feel good about where we are moving forward.
Dan Humiston: [00:09:51] Well Chris this has been a really pleasure to speak with you today and I wish you the best of luck. This will be exciting to watch.
Kris Krane: [00:09:57] Thank you very much. I appreciate you having me on and give me a chance to talk with you and your listeners. Thanks.
Dan Humiston: [00:10:01] Good luck. Thank you very much.
Dan Humiston: [00:10:07] Just a quick thank you to one of our sponsors Trevett Hill managing and supporting a cannabis investment as Time consuming and expensive Trevett Hill provides cannabis investors with an external team to help their investment reignite growth. To learn more go to Trevett Hill dot com.
Dan Humiston: [00:10:26] Thanks for listening to themjbulls podcast to learn more about today's guest or to apply to a guest. Visit our Web site at M.J.bulls.com and if you like our show give us a review on iTunes. Today's show was produced by buminit media. I'm Dan Humiston and you've been listening to MJbulls podcast.
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