Marijuana Business Magazine April 2020

Marijuana Business Magazine | April 2020 90 The company, founded in 2016, has developed processing technologies that address one of the biggest problems associated with using hemp proteins in food products—their bitter taste, or what founder Chad Rosen calls “sensory challenges.” The Carrollton, Kentucky- based firm expects to purchase 1 million acres of hemp by 2030. “Customers want fried chicken without the feathers, fish without the fins and burgers without the beef,” said Rosen. “So food manufacturers need some kind of plant substrate to make that happen. That’s where hemp protein fits in well, if it’s processed in a way that avoids incorporating those astringent tannins.” Hempé is sold in about 400 stores including Wegmans, Fairway Market and Whole Foods locations. Courtesy Photo Beyond Bootstrapping Despite all the hype surrounding plant-based products, many makers of hemp foods are still trying to bootstrap their way out of the cottage-industry food scene. Even Colorado-based Hemp Way Foods, one of the most- established players in its sector, has had difficulty attracting outside investors because of its relatively slow rate of growth. Founder Carla Boyd says the company earns a healthy profit margin of 30% to 40% on its products but has yet to generate more than $100,000 in yearly sales. That’s been a bitter pill for potential investors to swallow. Consequently, Boyd has come up with a different plan to kick- start growth. With the help of an outside consultant, she’s working to develop a franchise model that would essentially replicate her business (recipes and all) in other states, allowing franchisees to market themselves as local producers and potentially avoid supermarket slotting fees, among other benefits. As she ponders the next phase of growth, Boyd is also teaching a class through the Women’s Cannabis Chamber of Commerce on how to launch a hemp-based food business. She hopes to help aspiring entrepreneurs learn from her missteps and encourage them to seek help from experts. “It’s hard on a budget (to hire outside consulting help), but I would have saved hundreds of thousands of dollars—and a lot of heartache—if I had done that from the beginning,” she said. – Anna Robaton-Winthrop IMPOSSIBLE BEYOND Carla Boyd