MJBulls 0025 Diagnostic Labs Corp transcript
Dan Humiston: [00:00:00] Support for this show and the following message come from Trevett Hill, overseeing a cannabis investment can be time consuming and expensive. Travis Hill provides cannabis investors with an external turnaround team to help management reignite growth for a free confidential review. Go to Trevett Hill dot com.
Alan Hirsch: [00:00:20] It's exciting. Although the common person might not think that safety is so sexy but when you look at all these things onto the radar like food and meat and dairy and things that are regulated cannabis is becoming more regulated. It's very very sexy.
Dan Humiston: [00:00:40] From Buminit media it's the MJ bulls podcast a show about raising cannabis capital
Dan Humiston: [00:00:50] I'm Dan humiston and On today's show how the diagnostic lab corp is adding the Cannabis Vertical to their acquisitions to fuel their growth.
Dan Humiston: [00:01:06] Today we're joined by Alan Hirsch from the diagnostic lab corporation. Now thanks for being on the M.J.bulls podcast.
Alan Hirsch: [00:01:12] It's great to be here.
Dan Humiston: [00:01:13] Alan let's go back a bunch years like before cannabis was legal and in chances are the black market cannabis was probably pretty contaminated. I don't think people realize the plethora of different contaminations that probably existed back then. Can you tell us some of them.
Alan Hirsch: [00:01:29] Absolutely so when you can in safety when you get into the product is actually three parts there's physical chemical and microbial risk. The physical risk is something where something might be like a piece of glass or something gets in a brownie or an edible or something that would be their microbial would be something that's extremely dangerous and cause deaths like mold or salmonella or E. coli can a chemical risk could be the herbicides and pesticides chemicals will make you sick will kill you. But the mold and the E.coli and the microbial have a potential to kill you.
Dan Humiston: [00:02:01] Oh my gosh. And those were all there then. fast forward quite a few years ago states started passing medical marijuana laws and then the recreational laws started passing. So people are assuming that all the cannabis now it's not black market is all contamination free.
Alan Hirsch: [00:02:18] Well it's a great question and you actually got right to the chase which is that ostensibly it's medical marijuana. Now there have been very few cases where people have died but there are cases in California where there have been mold that's found. Now someone is let's say using this to fight cancer or the side effects of cancer medication then they're having that suppressed immune system. So it's very very important that we're ever someone using medical marijuana that it's not just following a state regulation but actually have much on certification testing requirements because you can get very very sick and possibly die from contaminated marijuana. Thousands of pounds of cannabis is recalled in Colorado every month really so it's definitely no problem.
Dan Humiston: [00:03:05] Tell us a little bit more about DLC and exactly how you crack this problem to.
Alan Hirsch: [00:03:10] DLC is really a food safety and agricultural safety company that not only cannabis but anything whether it's me dairy fish seafood or agriculture. We have clients that are in cannabis and not in cannabis. And what we do is we basically make sure that the supply chain and the entire food chain or agricultural chain is made safe. We followed in certain cases USDA or FDA when it comes to guidelines for cannabis. There's many different state and country regulations and what we do is we set up the whole planning and quality control systems and all of the standard operating procedures for growers manufacturers
Dan Humiston: [00:03:47] Are you going to actually go right into the grower manufacturers facility and help them set up their standard operating procedure.
Alan Hirsch: [00:03:54] Correct. And for cannabis brands which are now a hot topic this is what happens in food when you see organic labeling or you see other types of fair trade or vegan or non GMO. These are all food labels that are done through inspection that add value to the brands. So just like in food there is a premium in the market for what we call quality Kraft type of cannabis and that exists today. So our business model is actually run out of food safety.
Dan Humiston: [00:04:25] Okay. Tell us about it.
Alan Hirsch: [00:04:26] We take care of food from farm to table as well as seed to sell. We're bringing these techniques that have been in existence for 100 years and food safety now into cannabis safety and whether it's making workers safe making the products safe or making the actual system that produces it's safe. It's not that sexy but let me tell you something. It is the underbelly and the most important part because all it takes is one lawsuit and it put somebody out of right now they can use it in their marketing materials and certain cases depending on which system we use they can use on the labeling like whether it was or estuary or has a. So either way it's up to the grower. And we also see a huge growth in point of sale systems very similar when you go into a wine shop and you see the ratings on wine. The safety rate when you look at anything it has a UL certificate or any type of rating. Everything right now including is very anecdotal. This is great stuff but no one has really created the whole safety system and that's what we've done over the last five years that we think is poised for being disruptive. Also one of our key products is that we work with many growers who've been successful on four licenses as the quality control and medical director and we bring our whole team of seven scientists and doctors to the table say a licensing needs to know that they need a great medical director and they need quality research and quality control and systems and as Opie's to make sure that processors say we've actually got specialized protocols that we use and we've done that successfully now enforce the.
Dan Humiston: [00:06:04] 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 .com and now back to the show.
Dan Humiston: [00:06:30] With all this growth how have you been doing it and how do you intend to do it moving forward.
Alan Hirsch: [00:06:35] So one of the great things that we've done is that we've embarked on a different strategy than most people in the cannabis world. We're building a great company that happens to have a can of this work culture we've embarked on an M&A an acquisition plan and a strategic plan to buy food safety companies. And add the Cannabis Vertical. So this year with all our acquisitions are together we're projecting out over 3 million in revenues with about a 1 million dollar adjusted ebitda if we continue on this path within 24 months. We're going to have close to 40 million of top line with about a 4 million dollar.
Dan Humiston: [00:07:07] Oh my gosh that's crazy right.
Alan Hirsch: [00:07:10] And that's different because most people go in and cannabis expect to lose money. But having a finance back when I realize that value always lasts longer if you have a bottom line and you're making money that's really all people care about. So that's what we're doing that's a lot different. We're trying to do it where we have an ancillary and then build a real business and then add that candidates for a while.
Dan Humiston: [00:07:32] I know you got a lot of people's attention as soon as she said you're even on your project ebitda numbers because we don't hear that a lot here. Well how did somebody get involved if they wanted to get involved.
Alan Hirsch: [00:07:42] So the good news is with DLC the risk is out of the deal money already. We are going public I have to make a formal announcement but that's happening and we have a pre IPO round. Or you could participate in the stock in a different way later on.
Dan Humiston: [00:07:57] When does the pre IPO round start.
Alan Hirsch: [00:08:00] It's right now is open right now.
Dan Humiston: [00:08:01] Good. And if somebody wants to learn more about that. How do they do it. I'll have my contact information get on line and we'll set a whole we have everything about diagnostics labs and all of Alan's e-mail on the MJ bulls dot com website.
Dan Humiston: [00:08:16] But yeah. Wow.alan you're moving fast moving fast.
Alan Hirsch: [00:08:22] Well we appreciate that look. The interesting thing about safety which is known is that when you look at the cannabis market and they say it's a 30 billion dollar by 2020 you know the market size when you look at food testing and agricultural safety in that whole market it's already 113 billion dollars. So we just have to have a modest amount of revenue and success to really get it out of the box and we feel very strongly that we're a first mover. Talk about our model and what we're trying to do. It is definitely unique it is proprietary and you know we just think it's exciting. Although the common person might not think that safety is so sexy but when you look at all these things onto the radar like food and meat and dairy and things that are regulated and cannabis is becoming more regulated it's very very sexy.
Dan Humiston: [00:09:09] I think you have something here that a lot of people are going to find maybe not sexy but they're going to find financially sexy. ALLEN It's been a pleasure talking to you today. Thank you so much for being on the show.
Alan Hirsch: [00:09:19] Thank you so much.
Dan Humiston: [00:09:20] And yeah I will speak to you soon. Good luck.
Dan Humiston: [00:09:25] Hey just a quick reminder that you can become an MJ bulls member for only four ninety nine a month and enjoy exclusive access to companies information like their pitch decks and investment opportunities. Sign up today at MJ bulls dot com
Dan Humiston: [00:09:42] Thanks for listening to the mjbulls podcast. to learn more about today's guest or to apply to be a guest. Visit our Web site at M.J. bulls 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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