Marijuana Business Magazine September 2019

Marijuana Business Magazine | September 2019 136 And Green Peak is further expanding its product line by moving into infused beverages. The company inked a licensing partnership with Shorts Brewing Co., a Michigan craft brewer. The infused beverages will be nonalcoholic and are expected to be available before the end of the year. Using Contacts to Move South In addition to expanding into retail, Green Peak is enlarging its geographic footprint. In June, the company agreed to acquire a licensed, vertically integrated Florida business, Tree King Tree Farm, for $48 million. The deal gives the company one of 22 vertical licenses in Florida, which is among the nation’s largest medical cannabis markets. “This allows us to expand our footprint and gives us a really solid position,” Radway said. “It’s a fantastic state for medical, and it will become a great one for recreational. Having the No. 2 and No. 3 states in the country fits our model. It effectively provides us with the runway for growth in 2021 and 2022, and Michigan is growth for us in 2019 and 2020. We have a very strong runway for the next four years.” Green Peak planned its Florida growth for years. It engaged a law firm and a lobbying firm there and began to develop relationships in the state and talked with current license holders to see who would be willing to sell. “We kept our ear close to the ground and built relationships with a law firm, lobbying firm and with licensees and business owners in the state so we’d have good connections and a good network,” Radway said. “We used a lobbying firm,” he added, “because cannabis is a heavily regulated industry and the ability to navigate highly complex structures is a must. Those regulatory environments are different by state. So using a top-tier lobbying firm to help us build political, regulatory and legislative relationships is a smart move, and it’s worked well for us.” Business Strategies | Cultivation The first half of Harvest Park, Green Peakʼs cultivation and processing facility, was completed earlier this year. Courtesy Photos Pax Partnership On top of its other business activities, Green Peak Innovations has its eye on the vaporizer market. The Michigan company recently signed an agreement with San Francisco vaporizer company Pax Labs, aiming to capitalize on the growing popularity of vape pens and cartridges. “We are an authorized Pax pod distributor and filler. We use our locally produced oil, we fill the Pax pods, and we distribute them to stores throughout Michigan,” Green Peak CEO Jeff Radway said. He said the company will carry Pax products in its Michigan and Florida retail outlets. In particular, Green Peak will build out Pax sections—stores within stores—“in all stores that have the space to tell the brand story and do it justice,” Radway explained. While flower remains the most popular form of cannabis purchased by consumers, its share of the market is shrinking. Vape pens and concentrates, meanwhile, have picked up the slack from falling flower sales. Vape pens, in particular, have grabbed an increasingly larger share of the market. Radway noted that “more consumers prefer to consume via vape or edibles, and Pax is a tremendous alternative. We sell other vape products, but Pax is the best in our view because they’re a closed-loop system.” The vape company, he added, “has technology that allows you to sync the vape pen with your phone and control, via Bluetooth, the heat setting at which you vape products. That changes the effect accordingly so the consumer can dial in a personalized effect. We feel Pax is a leader in the technology side.” Radway said Green Peak did its homework before approaching Pax. The company performed market research, and Pax “stood out so we were aware of them from the beginning and started conversations with them as early as late 2017.” This included both business meetings and creating personal relationships, he added. “You have to align objectives. And we felt we were best-in-class in this state and they were best-in-state in vaporizer technology,” he said. “So we thought it could work.” – Amanda Baltazar Jeff Radway. Courtesy Photo